Tesla's Musk says no plans to relinquish chairman, CEO roles: NYT

(Reuters) – Elon Musk has no plans to relinquish his dual role as chairman and chief executive officer of Tesla Inc (TSLA.O), he said in an interview with the New York Times on Thursday.

FILE PHOTO: Elon Musk, founder, CEO and lead designer at SpaceX and co-founder of Tesla, speaks at the International Space Station Research and Development Conference in Washington, U.S., July 19, 2017. REUTERS/Aaron P. Bernstein

Musk, who is under intense scrutiny by the U.S. Securities and Exchange Commission and is facing lawsuits over his tweets last week about taking Tesla private, said he saw the tweet as an attempt at transparency, according to the paper.

The 47-year-old billionaire also said no one had seen or reviewed it before he posted it, according to the NYT. nyti.ms/2vOkgeM

The SEC has sent subpoenas to Tesla regarding Musk’s plan to take the company private and his statement that funding was “secured”.

Musk said in a blog on Tesla’s website on Monday he was in discussions with Saudi Arabia’s sovereign wealth fund over Tesla take-private deal and other potential backers but that financing was not yet nailed down.

Another possibility under consideration is that SpaceX, Musk’s space transportation company, will help bankroll the Tesla privatization and will take an ownership stake in the carmaker, the NYT said, citing unnamed people familiar with the matter.

Reporting by Rama Venkat Raman in Bengaluru; Editing by Gopakumar Warrier

SEC scrutiny of Tesla grows as Goldman hints at adviser role

WASHINGTON (Reuters) – The U.S. Securities and Exchange Commission has sent subpoenas to Tesla Inc (TSLA.O) regarding Chief Executive Elon Musk’s plan to take the company private and his statement that funding was “secured,” Fox Business Network reported on Wednesday, citing sources.

The electric carmaker’s shares fell as much as 4 percent but cut their losses after Goldman Sachs Group Inc (GS.N) said it was dropping equity coverage of Tesla because it is acting as a financial adviser on a matter related to the automaker.

Investors viewed the Goldman statement as confirming a tweet from Elon Musk on Monday about working with Goldman, even as the reported subpoenas indicated the SEC has opened a formal investigation into a matter.

The latest news extended the roller-coaster ride for Tesla investors in recent days, adding to uncertainty about the future course of the company and whether a deal can be done amid growing regulatory complications.

Tesla and the SEC declined to comment.

Musk stunned investors and sent Tesla’s shares soaring 11 percent when he tweeted early last week that he was considering taking Tesla private at $420 per share and that he had secured funding for the potential deal.

FILE PHOTO: A Tesla sales and service center is shown in Costa Mesa, California, U.S., June 28, 2018. REUTERS/Mike Blake/File Photo

The shares fell 2.6 percent to $338.69 on Wednesday, below $341.99, their closing price the day before Musk tweeted his plan to take Tesla private.

The Tesla CEO provided no details of his funding until Monday, when he said in a blog on Tesla’s website that he was in discussions with Saudi Arabia’s sovereign wealth fund and other potential backers but that financing was not yet nailed down.

Musk also tweeted late Monday night he was working with Goldman Sachs and private equity firm Silver Lake as financial advisers. However, as of Tuesday, Goldman was still negotiating its terms of engagement with Musk, according to a person familiar with the matter.

The 47-year old billionaire’s tweet about secured funding may have violated U.S. securities law if he misled investors. On Monday, lawyers told Reuters Musk’s statement indicated he had good reason to believe he had funding but seemed to have overstated its status by saying it was secured.

The SEC has opened an inquiry into Musk’s tweets, according to one person with direct knowledge of the matter. Reuters was not immediately able to ascertain if this had escalated into a full-blown investigation on Wednesday.

This source said Tesla’s independent board members had hired law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP to help handle the SEC inquiry and other fiduciary duties with respect to a potential deal.

The Wall Street Journal said the SEC was seeking information from each Tesla director.

Reporting by Sonam Rai, Michelle Price and Supantha Mukherjee; Editing by Anil D’Silva, Nick Zieminski and Cynthia Osterman

High-Quality Hidden Gems (Continued)

As previously discussed, to achieve superior returns, investors may want to look for stocks that are way under-covered. We continue our search for hidden gems, this time in the US market. US stocks are generally more liquid, receiving more exposures, which makes it harder for us to land on high-quality hidden gems. Be aware that liquidity is a positive factor and analyst coverage is a negative factor in my proprietary stock quality ranker. Additionally, US market is overvalued probably by all metrics, including this Warren Buffett Indicator. Therefore, we loosen the screening/filtering criteria a bit as followed:

  1. Return on assets: no less than 10% for the past 10 years;
  2. Return on equity: no less than 12% for the past 10 years;
  3. Return on invested capital: no less than 12% for the past 10 years;
  4. Net margin: no less than 5% for the past 10 years;
  5. Gross margin: no less than 30% for the past 10 years;
  6. Operating margin: no less than 10% for the past 10 years;
  7. Free cash flow margin: no less than 5% for the past 10 years;

Again, I put the screening result into my stock ranker which further takes into consideration factors, such as growth/momentum, industry/sector, shareholder friendliness, financial strength. Overall, my combination of screener and ranker gives high weights to managements’ capital allocation skills, profitability, and cash flow. Below are the top-ranked ones with limited coverages here in the Seeking Alpha community. We include their respective valuation analysis in the end.

Federated Investors (FII)

Since 1955, Federated Investors has been a leading provider of investment management products and related financial services and is now one of the largest investment managers in the U.S. with $397.6 billion in assets under management (AUM) at the end of 2017.

Source: Federated Investors Annual Report 2017.

The majority (more than 60%) of the AUM is held through money market strategies and/or products at Federated. The heavy emphasis on money market assets lends to a stable AUM revenue stream regardless of market volatility. Actually, the money market portion of the business is a hedge on stock market volatility as any sell-off in the stock market may contribute to money market investments as the safe haven. Moreover, the rising interest rate would benefit Federated’s money market funds due to less likelihood of the fee waiver program, which cost losses to the company for many years during the low-rate period.

Federated Investors employs a super capital-light business model, consistently generating high returns on capital over the past decade (see below) and currently earning 1195.8% return on tangible equity. The business produces strong free cash flow (around 28% FCF margin) for its owners and spends less than 1% CAPEX on sales.

Source: Morningstar; data as of 8/5/2018.

The dividend is safe regardless of the current high yield (4.5%), thanks to its strong balance sheet (i.e., 3.6x current ratio, 0.22 Debt/Equity).

There is limited coverage on FII here in the Seeking Alpha community, with only three articles on the stock for the past year and no article for the past two months. The share is currently trading at a discount if compared to its historical levels in terms of P/E, P/B, P/S, P/CF and dividend yield (see below). Hence, FII is a strong buy on our hidden gems list.

Source: Morningstar; data as of 8/5/2018.

NIC Inc. (EGOV)

NIC Inc. is the leading provider of digital government services that help governments use technology to provide a higher level of service to businesses and citizens and increase efficiencies. It was founded in 1992 and is now headquartered in Kansas with 950+ employees nationwide and partnerships with 6,000 federal, state, and local government agencies in the US.

Source: Investor Presentation 2018.

NIC takes a flexible approach to funding digital government solutions. While most enterprise partnerships are funded through a transaction-based funding model, others are funded through fixed fees or a hybrid of fixed fees and transaction-based funding. The transaction-based model saves taxpayers’ money on upfront development cost and generates recurring revenue whenever users enjoy the efficiency through digital/online services provided by NIC. It is a win-win solution for all parties (i.e., governments, taxpayers, NIC), benefiting from user population growth, government promotion, and service monopoly.

The long-term contract, high switch cost, B2G (business-to-government) relationship and niche market play get NIC a wide moat to it economic castle with high profitability and returns on capital (shown below).

Source: Morningstar; data as of 8/5/2018.

The company’s balance sheet is another reason investors should be comfortable with the stock: over 2x current ratio with no debt.

There are only four articles on EGOV stock in the Seeking Alpha community during the past year and only five analysts covering the stock according to WSJ.com. Like FII, the share is quietly trading at a discount if compared to its historical levels in terms of P/E, P/B, P/S and P/CF (see below). Hence, EGOV is another buy on our hidden gems list.

Source: Morningstar; data as of 8/5/2018.

Atrion Corporation (ATRI)

Atrion is a leading supplier of medical devices and components to niche markets in the global healthcare and medical industry. While it is a comparatively small company in the sector, Atrion is the leading U.S. manufacturer of products in several market niches, including soft contact lens disinfection cases, clamps for IV sets, vacuum relief valves, surgical loops used in minimally invasive surgery, and check valves.

The company has been and will be benefiting from the industry tailwind as the growth of health care spending is consistently exceeding the overall GDP growth (see below) due to the aging population.

Source: Statista.

The management team has done an exceptional job allocating capitals efficiently, indicated by a stable and high margin and return on capital (shown below). The business also maintained its typical profitability and growth during the 08/09 great recession, thanks to the recession-proof nature of the industry. The niche market play and sufficient R&D spending have been giving Atrion the durable competitive advantage.

Source: Atrion Corporation Annual Report 2017.

The stock (as shown below) has consistently outperformed the market benchmark and the sector benchmark. It has its track record of raising dividends consecutively for 15 years now, with a super clean balance (i.e., no debt, plenty of cash, and a current ratio of over 9x).

For the past 12 months, there has been only one article on ATRI in the Seeking Alpha community and no Wall Street analyst following the stock according to WSJ.com. Nonetheless, the valuation appears to be a bit rich if we compare the price multiples to their historical averages (see below P/E, P/B, P/S and P/CF). Therefore, we would like to put Atrion on our watch list for now.

Source: Morningstar; data as of 8/5/2018.

Summary

Warren Buffett once mentioned that he has confidence in getting as high as 50% returns on a small amount of money to invest in stocks. Likewise, we believe it is not hard to beat most investment funds with large scales or financial professionals. To achieve so, investors (especially those individual ones with a relatively small amount of investable fund) should take advantage of small caps with little popularity and coverage. Thankfully, size is not an advantage in the investment world and being popular or not has no correlation with investment results.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Soros Fund Management adds popular tech names, BlackRock in second-quarter

NEW YORK (Reuters) – Soros Fund Management LLC added Facebook Inc (FB.O), Apple Inc (AAPL.O) and Twitter Inc (TWTR.N), but trimmed stakes in Alphabet Inc (GOOGL.O) and Amazon.com Inc (AMZN.O) in the quarter through June, according to a regulatory filing on Tuesday.

Billionaire hedge fund manager George Soros speaks during a discussion at the Clinton Global Initiative’s annual meeting in New York, September 27, 2015. REUTERS/Brendan McDermid/File Photo

The family office of billionaire George Soros also bought stakes in AT&T Inc (T.N), Chevron Corp (CVX.N) and T-Mobile US Inc (TMUS.O) and divested stakes in eBay Inc (EBAY.O), Nvidia Corp (NVDA.O), Snap Inc (SNAP.N) and Paypal Holdings Inc (PYPL.O).

Soros Fund Management also dramatically boosted its shares in BlackRock Inc (BLK.N) – the world’s largest asset management firm, overseeing $6 trillion – by nearly 60 percent to 12,983 total shares in the second quarter.

Other notable adjustments included paring stakes in Netflix Inc (NFLX.O), Citigroup Inc (C.N) and Wells Fargo & Co (WFC.N), but raising its shares of Pandora Media Inc (P.N) and Salesforce.com Inc (CRM.N).

Soros Fund Management took share stakes in Facebook of 159,200 class A shares during the second quarter and 54,500 shares in Apple.

A number of prominent fund managers sharply cut their holdings in Apple only weeks before it became the first publicly-traded U.S. company to be worth more than $1 trillion.

Einhorn’s Greenlight Capital slashed its stake by 77 percent, while Philippe Laffont’s Coatue Management unloaded 95 percent. Advisory firm Diamond Hill Capital Management cut its stake by 27 percent.

Other big holders, including Sanders Capital and Adage Capital Partners, only trimmed small amounts in the second quarter.

Soros also rejigged his energy holdings, raising stakes in Devon Energy Corp (DVN.N) and Kinder Morgan Inc (KMI.N), while dissolving his stake in the VanEck Vectors Oil Services ETF (OIH.P) and cutting exposure to Canadian Natural Resources Ltd (CNQ.TO) and Williams Companies Inc (WMB.N).

Quarterly disclosures of hedge fund managers’ stock holdings, in what are known as 13F filings with the U.S. Securities and Exchange Commission, are one of the few public ways of learning what the managers are selling and buying.

But relying on the filings to develop an investment strategy comes with some risk because the disclosures come 45 days after the end of each quarter and may not reflect current positions. Still, the filings offer a glimpse into what hedge fund managers saw as opportunities to make money on the long side.

The filings do not disclose short positions, or bets that a stock will fall in price. As a result, the public filings do not always present a complete picture of a management firm’s equities holdings.

Reporting by Jennifer Ablan; additional reporting by Trevor Hunnicutt, editing by G Crosse

Craigslist Founder Matches $1 Million in Donations for Teachers’ STEM Projects

Craig Newmark, the founder of the Craigslist classifieds site, has set up a matching donation of up to $1 million for STEM projects proposed by teachers at DonorsChoose, a fundraising site designed to help classrooms at a time of tight school budgets.

The matching offer is tailored to provide a focused impact. The largest chunk, $850,000, matches donations to hands-on projects with a goal of under $1,000 that focuses on STEM (a catchall for science, technology, engineering, and math) at schools that draw at least half their students from low-income households.

Another $100,000 is earmarked for matching STEM projects involving girls, in which the project has fallen short of its financial target. The final $50,000 will be unlocked through projects proposed through a hashtag, #STEMStories, on Twitter that provokes a conversation. (No target number of tweets was set.)

The particular focus on STEM came from teachers, after Newmark asked DonorsChoose to ask what approach would have the greatest impact on classrooms.

DonorsChoose lets teachers propose projects against which they fundraise. The site handles the details. It has over 65,000 campaigns currently active, double its total in late March, when a single donor dropped $29 million to fund all the money required to reach the goal for the 35,000 projects then outstanding.

Last year, Newmark donated $1 million in matching funds towards projects that involved students in military families. That effort helped 1,800 teachers with 318,000 students.

Earlier this year, Newmark’s philanthropic organization donated $20 million to the City University of New York’s graduate journalism school, which named itself after Newmark. The journalism program pursues ways to install more trust in journalism and turn journalists into effective entrepreneurs.

Nvidia rolls out new chip technology for filmmakers

(Reuters) – Nvidia Corp (NVDA.O) on Monday released a new generation of chips aimed at helping expand its business among movie makers and other graphics professionals.

The logo of technology company Nvidia is seen at its headquarters in Santa Clara, California February 11, 2015. REUTERS/Robert Galbraith/File Photo

At a gathering of graphics professionals on Monday, Nvidia rolled out its newest generation of chip technology, called Turing after the legendary British computer scientist Alan Turing.

The biggest selling point of the chips is an improvement in so-called “ray tracing,” or the ability for the chip to simulate how light rays will bounce around in a visual scene.

That task takes so much computing power that designers have to wait while a chip churns through the data to see the results of their work. Nvidia says the new generation of chips will let designers make those changes in real time, which could speed up the creative process – and which Nvidia hopes customers will pay a premium for.

“Turing is Nvidia’s most important innovation in computer graphics in more than a decade,” Jensen Huang, founder and CEO of Nvidia, said in a statement.

The Santa Clara, California-based company’s shares have risen more than 50 percent over the past year, backed by data center chip sales that more than doubled to $1.9 billion its last fiscal year. Nvidia’s data center chips power artificial intelligence tasks training computers to recognize images and are increasingly eating away Intel Corp’s (INTC.O) growth opportunities.

And Nvidia’s biggest business, its consumer chips that let video gamers play with improved graphics, grew 35 percent to $5.5 billion in its most recent fiscal year. That growth came from hot gaming titles such Epic Games’ Fortnite and the fact that the chips were adopted by homespun cryptocurrency enthusiasts.

But Nvidia’s middle line of chips, aimed at graphics and design professionals who make films and other digital content, has not fared nearly as well, growing only 11.8 percent last year to $934 million.

Patrick Moorhead, an analyst with Moor Insights and Strategy and a former chip executive, said Nvidia is likely looking to stave off competition from rival Advanced Micro Devices Inc (AMD.O), which is likely to target the same group of professional users with its new graphics chips next year. Nvidia’s existing strength in the data center market and the high-end gaming market have left it most open to attack in the middle of the market.

“Where Nvidia gets the biggest bump right now (from a new chip generation) is in the workstation market, which makes it all that more competitive,” Moorhead said.

Reporting by Stephen Nellis; Editing by Cynthia Osterman

How to Watch Sunday Night’s Perseid Meteor Shower—Online or In Person

Late Sunday night to early Monday morning will mark the peak of the annual Perseid meteor shower, arguably the most popular and dramatic meteor shower around. An average 60 meteors per hour are expected to streak across the sky, a spectacle that will be enhanced this year by a darkened crescent moon. NASA says the best time to see the shower is between 2 a.m. and dawn local time—but the shower will be visible as early as 9 p.m.

The Perseid shower occurs when the Earth passes through the tail of the Swift-Tuttle comet. Small particles of comet dust burn up when entering Earth’s atmosphere, creating the bright streaks (mistakenly) known as “shooting stars.”

Watching the shower doesn’t require any special equipment, but viewers should stay find a spot away from artificial light, and NASA recommends allowing about 30 minutes without light—including your smartphone!—for your eyes to adjust to the dark.

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Clear skies will also make viewing more enjoyable. Space.com has a shower-viewing forecast, currently indicating that cloud cover and smoke from summer wildfires will obscure the view for those in the Western U.S. By contrast, conditions in the central U.S. are expected to be particularly good.

If clouds obscure the sky where you are, there are several options for watching the shower online. NASA will be streaming a view from Huntsville, Ala. live on its MeteorWatch Facebook page. Starting at 5 p.m. ET Sunday, the astronomy site Slooh will also host a stream of the shower, complete with commentary and Q + A from astronomers.

Fax Machines Are Still Everywhere, and Wildly Insecure

It’s tempting to think of fax machines as a relic, every bit as relevant as an eight-track tape. But fields like health care and government still rely on faxes every day. Even your all-in-one printer probably has a fax component. And new research shows that vulnerabilities in that very old tech could expose entire corporate networks to attack.

In fact, the surprising ubiquity of fax machines is what inspired Check Point researchers Yaniv Balmas and Eyal Itkin to analyze the tech’s present-day security posture. Vulnerable network printers are a classic target, and the researchers found that they could similarly exploit bugs in faxes to get inside private networks.

“Fax is an ancient technology, the protocols we use today haven’t been changed for the past 30 years,” Balmas says. “But everybody is still using fax and nobody really looks at it as a valid attack vector. So we thought, what if we could exploit a printer just by sending a malicious fax? In an all-in-one printer, one side is connected to the phone line and the other side is connected to the network. So if we could take over the device, we could then move into the internal network.”

Hackers have targeted fax machines for decades, and the technology is still insecure in basic ways. For example, fax data is sent with no cryptographic protections; anyone who can tap a phone line can instantly intercept all data transmitted across it. “Fax is perceived as a secure method of data transmission,” says Balmas. “That’s a huge misconception—it’s absolutely not secure.”

In addition to the lack of encryption, researchers say that the fax protocol—the industry standard description of how the technology should be incorporated into products—is documented in a very confusing way. As a result, they suspected that it was likely implemented improperly in many devices. When the researchers analyzed the Officejet line of fax-capable all-in-one printers from industry giant Hewlett-Packard, the found exactly the type of issue they had suspected.

The problem they discovered was a common issue known as a “stack overflow,” in which the structure that stores information about a running software program overloads, causing it to crash. Attackers can initiate stack overflows strategically to gain more access or privileges on a system. So the researchers crafted a malicious fax with data in it that would exploit the bug when sent to a vulnerable machine.

“The attack scenario is actually pretty simple,” Check Point’s Itkin says. “A malicious attacker wants to infiltrate a covert network, let’s say a bank. And the fax number for this bank is public, so he can get that number. On the bank side, if the printer that receives the fax is also connected to the internal network, then all the attacker needs to do is send a malicious fax to this phone number and automatically he will be inside the internal network of this bank. It’s crazily dangerous.”

An attacker could also embed an additional exploit into the malicious fax, so once the first phase of taking over the all-in-one printer is complete they can bore deeper into a company’s network from there. In a demo, the researchers show that they’ve taken over an HP Officejet printer by displaying a sinister image on its screen. Then they use the infamous Eternal Blue Windows exploit as an example of a hacking tool an attacker could deploy from there to gain deeper remote network access. The researchers say it currently takes less than one minute to transmit a fax with all of this code hidden inside it, and that they could potentially reduce the transmission time even more.

Balmas and Itkin disclosed the issue, which affects all Officejet printers regardless of model or version, to HP. And the company has released a patch that adds standard protections against stack overflows. “HP was made aware of a vulnerability in certain printers by a third party researcher,” HP spokesperson Luke Cuell told WIRED. “HP has updates available to mitigate risks and have published a security bulletin with more information. … We encourage customers to keep their systems updated to protect against vulnerabilities.” Many HP printers automatically download updates, but printer update adoption rates are often slow.

IT administrators have increasingly added authentication checks to network printers so that only authorized users can initiate printing—a safeguard that cuts down on the potential that a remote attacker could send a malicious print job. But the researchers say that the fax protocol doesn’t allow for such a mechanism. “There are absolutely no protections over fax,” Balmas says. “Even if you really wanted to do that there is no way. Fax is always sent unauthenticated, it’s a design thing, so no matter what you do I will still be able to send you this fax.”

For institutions and individuals the researchers say that the crucial safeguard comes from a conceptual understanding that plugging a printer into a phone line opens up an additional avenue for potential attack.

“The real solution would be to stop using fax,” Itkin says. “But if you can’t do that then probably the solution for organizations or home users would be to segregate the printers, put them in a separate network, so even if someone takes over the printer they won’t easily be able to propagate into the main network.”

You probably haven’t thought about fax machines—or used one—in forever. But some tech never dies; it just gets less and less secure.


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4 Things To Know Before You Move Your Business To The Cloud

Expensive technology used to be a significant advantage for big companies. Large enterprises had the resources to hire consultants, invest in sophisticated systems and collect masses of data to analyze. That gave them better visibility into market trends, helped them automate processes and make better decisions.

The cloud disrupted all that because it meant that world-class technology no longer needed a significant capital investment upfront. Today, anyone with an idea can sit at their kitchen table and access the world’s best technology with little more than a broadband connection. That’s been a real game changer.

It has also meant larger organizations have had to adapt. Cloud computing is not only much cheaper than legacy systems, it is also more flexible, adaptable and much easier to integrate with new capabilities like artificial intelligence, The Internet of Things and Blockchain. Yet moving your business to the cloud can also be a major challenge. Here’s what you need to know to get it right.

1. Be Clear About What You Expect to Achieve

Moving your enterprise to the cloud is more than a just a technology decision, it is a business decision. “In the early days cloud was mostly driven by cost, but the cloud today is about going faster and adding more capabilities and functionality.” Jason McGee, VP and CTO of  IBM Cloud Platform told me. So it’s critical to know going in how you expect it to change your business.

In fact, Deepak Patil, a Senior Vice President at Virtustream, a cloud application management platform lists seven distinct motivations for moving to the cloud, from increasing reliability and scalability to making your workforce more productive. “You have to be crystal clear about your motivations to move to the cloud so that you can verify that your goals are being met.”

That’s why it is imperative that you don’t approach the cloud the way you would, say, a new CRM system. It’s something that, if done right, has the potential to transform your entire business, but can also lead you into a technological quagmire. So you need to involve more than just the technology department, you need to get input from the who team.

The best way to start is by asking yourself business related questions, such as “How could better serve our customers through faster, more flexible technology?” or “How could artificial intelligence transform our business?” Once you understand your business goals, you can work your way back to the technology decisions.

2. Choose Technology That Fits Your Needs

One common mistake firms make with the cloud is to approach it as a monolith when, in fact, it is actually a myriad of technologies, including, hardware, software and capabilities that need to be integrated to achieve positive business outcomes. Because every enterprise is, in one way or another, unique, every organization needs to have its own approach to the cloud.

“One common mistake is to try to do everything with one provider,” says Patil of Virtustream. “Different cloud providers have different strengths. So a best practice is to use multiple providers and that takes a considerable amount of due diligence to understand those strengths and ensure that the providers you choose can be integrated seamlessly.”

It is the potential to integrate capabilities that makes cloud technology so exciting. It’s what allows us to, say, take a wealth of customer data stored in servers, analyze it using the latest artificial intelligence software and use those insights to improve decision making in a CRM application. Yet none of that just happens by itself.

“You have to ask yourself, ‘Does this cloud play nice with other clouds?'” says Darren Hoch of Stone Door Group, a company that helps Fortune 1000 companies move to the cloud. He also stresses that a successful initiative requires smart planning, especially for applications that are more than five years old and were not originally set up to work on the cloud.

3. Shift Not Only Your Technology, But Your Business Model

While moving to the cloud can help streamline existing operations, there is vastly more potential in leveraging it to create new business models and open up new possibilities. For example, Experian found that cloud technologies helped it solve a problem that had existed for decades at its credit bureau.

Think about what happens when you apply for credit when you go to buy a car. You sit at a desk at the dealership, fill out some paperwork and expect to get approved within minutes. Yet because traditional computing architectures lack the speed and flexibility of the cloud, the reality is that the data used to make those decisions could be as much as 30-60 days old.

That’s a serious problem, because the real world is always changing. Factories close and people lose their jobs. Other businesses open up and create new levels of prosperity. With a potential 30-60 day lag, credit approval decisions could be lag behind the business cycle. However, after the move to the cloud, Experian was able to create Ascend, a “data on demand” platform that allows its customers to make credit decisions based on near real time data.

Vijay Mehta, SVP of Experian’s Advanced Technology Group told me what’s key to unlocking the possibilities of the cloud is leveraging its flexibility to experiment more. “What we found was that we could test new technologies and innovate our business practices much more quickly than we ever thought possible,” he said.” “By moving our data out of legacy systems and onto the cloud we were able to liberate it.”

4. Moving to the Cloud Isn’t Just About Technology, But People Too

Perhaps the most important thing to understand about the cloud is that the transformation is about much more than technology. “Don’t think you’re going to go to cloud, organize your people the same way and see all the benefits of cloud. You going to have to change how you operate” says IBM’s Jason McGee.

Mehta of Experian agrees. “One of the business benefits of moving to the cloud has been what we can do with our staff resources,” he told me. Moving to the cloud enabled us to repurpose our people from things like maintaining infrastructure to solving business problems for our customers. That not only creates more value, it’s also much more interesting and satisfying work.”

Every significant technology not only creates value, it also shifts value from one place to another and the cloud is no different. It’s involves much more than simply moving data and software from your own servers to a remote resource. You need to think clearly about how you can leverage its possibilities to create more value for your customers, partners and employees.

That’s what makes the cloud one of the most disruptive technologies ever. It’s not about changing how you manage your data, but transforming how you manage your business.

Disclosure: In the past, Experian has paid for my travel to speak to its executives and appear at its annual conference.

The Dead Stocks Are Coming Back – Cramer's Mad Money (8/9/18)

Stocks discussed on the in-depth session of Jim Cramer’s Mad Money TV Program, Thursday, August 9.

There are lot of ways to win in the stock market, and looking at stocks that were left for dead is one sure-shot way of winning. Thursday was one of those days where stocks that were ignored by the Street for long soared.

Viacom (NYSE:VIA) reported a great quarter after it saw a good turnaround, which was started in December 2016 by CEO Bob Bakish. Viacom, which owns film and television properties, including MTV, Nickelodeon, Comedy Central, BET, VH1 and Paramount Pictures, has been put through cost-cutting and has boosted its intellectual property wares. The company is also refurbishing the company’s balance sheet and driving sales with low-budget hits. “You know what’s the most amazing thing about this turn? So few people know that it’s happening – most people aren’t even aware that Viacom even owns this stuff,” said Cramer.

“After today, I wouldn’t be so sure CBS is the better business. However, I’d certainly rather own Viacom here than CBS. Everyone’s given up on Viacom, which means it’s got much more opportunity for upside than a stock everyone fawns over, like CBS,” added Cramer.

Century Link (NYSE:CTL) also surprised the Street with a good quarter, rising guidance, which led to the stock rallying 13%. The company had merged with Level 3 Communications, and its turnaround has been incredible.

Talking about turnarounds after being left for dead, how can Yelp (NYSE:YELP) be left behind? The company reported good earnings and beat on all counts, which led to the stock rallying 26%. It’s back in the spotlight. DowDuPont (NYSE:DWDP) also went up after its CEO, Ed Breen, purchased $2 million worth of stock.

Other stocks that were left for dead but are coming back into the spotlight are Michael Kors (NYSE:KORS), Spotify (NYSE:SPOT) and Roku (NASDAQ:ROKU).

CEO interview – Magna International (NYSE:MGA)

The stock of Magna International is down 5% for the year after the company missed in its recent quarter and cut guidance. Cramer interviewed CEO Don Walker to find out more about the quarter.

Walker said that the company had a record quarter in terms of revenue. Though it missed consensus, there were headwinds in the form of tariffs and the China joint venture. “If the tariffs stay the way they are – and who knows if anything more gets ratcheted up in China – it’s about a $60M a year hit,” he added.

There is no clarity on how much of the increased costs will be passed on to customers. “But I also think, at some point in time, NAFTA does get re-negotiated and the tariffs within NAFTA go away, because it’s bad for all three countries,” said Walker.

The company has entered into JVs with Lyft (LYFT) and Beijing Automotive Group, and it sees brighter times ahead. “I think the industry is the highest-tech industry in the world. We have lots of technology, we’re spending a lot in R&D, so I think there’s huge opportunities globally in the automotive industry,” he concluded.

World Wrestling Entertainment (NYSE:WWE)

The stock of WWE is up 250% since Cramer first recommended it in March 2017. “When you’ve got a triple, you need to take something off the table. That’s common sense. It’s portfolio management,” he said. Is it too late for investors to buy in? Cramer digs deeper to find out.

In the past few years, WWE has transformed itself from a traditional television and pay-per-view play to a direct-to-consumer colossus. Its digital properties are driving growth, and the company’s online streaming platform has made it the most followed sports brand in the world on social media.

Despite digital subscriber growth, the company has not overlooked its traditional TV roots. It extended its long-time deal with NBCUniversal subsidiary to air Monday Night Raw, and it agreed to air WWE Smackdown on Fox Sports (FOX, FOXA). “The really amazing thing with this story, though, is that WWE has both a thriving online subscription business, where people pay them directly for premium content, and they can negotiate better deals with their traditional TV partners,” added Cramer.

The company not only produces content for paid television, but also different content for YouTube and Facebook. “On the 2020 numbers, WWE’s trading at less than 25 times earnings, which seems a lot more reasonable, doesn’t it, when you’ve got a 37% long-term growth rate? WWE has caught fire here, so if you already own it from when I first recommended it, book partial profits,” Cramer concluded.

For those who do not own the stock, wait for a pullback before buying some.

CEO interview – CyberArk Software (NASDAQ:CYBR)

CyberArk reported good earnings and the stock rallied. Cramer interviewed chairman and CEO Udi Mokady to find out what lies ahead.

Mokady said the company had a good quarter in all three geographies. The new regulations in EU gave it momentum, government spending on cybersecurity in the US has increased and companies are taking cybersecurity seriously to protect their sensitive assets.

Mokady adds that cybersecurity is getting important which each day as threats from North Korea and Iran still loom. With the upcoming elections, the interference remains a top focus.

Viewer calls taken by Cramer

Mylan (NASDAQ:MYL): Cramer doesn’t like the company because it doesn’t have good margins and it did not have a good quarter either.

Boot Barn Holdings (NASDAQ:BOOT): The sales momentum and rising same-store sales are impressive.

AMC Entertainment Holdings (NYSE:AMC): Cramer did not opine on the stock, as the viewer knew more about it than he did. He said he needs to work more on the stock.

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Twitter CEO Jack Dorsey: We Haven’t Banned Alex Jones Because He Hasn’t Violated Our Rules

YouTube, Facebook, Spotify, Apple be damned: Twitter will not be following suit.

The social network announced Tuesday that it would not ban Alex Jones or InfoWars from the site, noting that neither are currently in violation of its rules.

But in case the service’s position was not entirely clear, Twitter founder and CEO Jack Dorsey further shed light on its stance via a series of tweets late Tuesday.

Noting that he knows it’s “hard for many” that Twitter hasn’t suspended Alex Jones or InfoWars, Dorsey explained that “the reason is simple: he hasn’t violated our rules.” Nevertheless, he said that Twitter will “enforce if he does” and will “continue to promote a healthy conversational environment by ensuring that tweets aren’t artificially amplified.”

Dorsey noted that the site will “hold Jones to the same standard we hold to every account, not taking one-off actions to make us feel good in the short term, and adding fuel to new conspiracy theories.” He highlighted the need to adhere to Twitter’s own rules rather than “succumbing” and “reacting” to outside pressure, as that would lead Twitter to becoming a service that’s “constructed by our personal views that can swing in any direction.”

While the social network has already been the recipient of criticism for choosing not to suspend Jones, Dorsey’s last tweet in particular drew additional ire. Dorsey suggested that although “accounts like Jones’ can often sensationalize issues and spread unsubstantiated rumors,” it is the responsibility of journalists to validate his claims “so people can form their own opinions.”

“This is what serves the public conversation best,” he added.

To which New York Times technology reporter Cecilia Kang replied, “What is it that you think journalists do? Spend all day combing Twitter to fact check Alex Jones? That’s good for Twitter but not for democracy. There’s a bigger world out there, @Jack”

Twitter has repeatedly come under fire for failing to stop bullying and abuse among its users and refusing to ban some users while seemingly unfairly blocking others.

Facebook Apologizes for Algorithm Mishap That Threw Balloons and Confetti on Indonesia Earthquake Posts

Facebook’s algorithm that triggers balloons and confetti when users write the word “congratulations” on the site is usually just a festive add-on.

But it took an inadvertent turn in Indonesia following a deadly, 6.9 magnitude earthquake on the island of Lombok on Sunday. Users took to Facebook to express concern for those affected by the earthquake, employing the Indonesian word “selamat”—which can mean safe or unhurt, but can also mean congratulations depending on the context.

The word was misinterpreted by Facebook’s algorithm, accidentally prompting the celebratory animation.

Facebook quickly apologized for the mishap, noting that the feature is “widely available” on the site globally, but expressed regret “that it appeared in this unfortunate context.” Lisa Stratton, a Facebook spokesperson further explained to Motherboard that they have since turned off the feature locally, and said that their “hearts go out to the people affected by the earthquake.”

Herman Saksono, an Indonesian PhD student in human-computer interaction, expressed surprise that Facebook hadn’t accounted for the double meaning of “selamat,” telling Motherboard that “People use the word interchangeably.”

“Researchers spend a lot of time before launching a function like this to make sure it truly fits the culture and practices in languages in which it will be used,” he said. “I would expect Facebook to do the same, given all the resources they have. I guess [they] missed this one.”

How health care should take advantage of the cloud

The cloud has come to the health care sector, and it’s having an impact by saving some money. However, that’s not the real value of cloud computing for this sector, a sector that affects us personally at some point in our lives.

Black Book Research found that 93 percent of hospital CIOs are actively acquiring the staff to configure, manage, and support a HIPAA-compliant cloud infrastructure. Also, 91 percent of CIOs in the Black Book survey report that cloud computing provides more agility and better patient care with the proliferation of health care data.

But there is a huge innovation gap when it comes to health care and cloud computing between what’s possible versus what is actually being done. Take patient data, for example. Most health care organizations, providers, and payers don’t make many moves toward better and more proactive management of patient data unless regulations move them along.

This isn’t about operational and billing data, or electronic health records (EHRs). If health care systems abstracted information in certain ways, both the doctor and patient would have better insights into the patients’ health, preventive care, and treatment.

The cloud services that support these innovative functions are now dirt-cheap. As hospitals become cloud-enabled, it’s time to start moving faster toward the complete automation of care, treatments, and analyses of patient health. Let’s move from a system that’s largely reactive to a system that’s completely proactive.

Of course, there are islands of innovation in the health care sector. But it’s still mostly on the R&D side of things and has yet to trickle down to direct patient care. The potential here is greater than in any other sector I’ve seen. Just consider the telemetry information gathered from smart watches and cellphones and the ability to funnel all data though deep learning-enabled systems that cost pennies an hour to run on the cloud.

Now that we have the tools, there is little excuse not to innovate beyond what’s been done already. We’re better than this. 

Going cloud-native costs more than you think

There is a bit of sticker shock out there. No, it’s not the big IaaS public cloud bill that will make you gasp, it’s the price of changing applications to take advantage of cloud-native features as they move to the cloud.

There are three basic ways to deal with application migration to the cloud:

  • Lift and shift, or just putting the applications on a public cloud unmodified and hoping for the best.
  • Partial refactoring, which means modifying parts of the applications to take advantage of some cloud-native features.
  • Complete refactoring, or redoing most of the application to take advantage of cloud native features.

Of course, lift and shift is the cheapest way to go, and thus the way that many enterprises have directed their cloud migrations. The downside is not taking advantage of the cloud platform where the application resides, leads to higher bills, slower applications, and just not making the application be all that it can be on the public cloud platform.

The refactoring approaches, to take advantage of cloud-native features, result in lower cloud bills and higher performance, but it adds costs and risk. Moreover, the worse the state of your applications, the higher the refactoring cost and the risk.

Enterprises are doing the right thing in trying to refactor applications moving to the cloud, including running the cost metrics of the work that would need to be done. This refactoring effort not only includes the rewriting itself, but testing, deployment, and perhaps using new devops organizations and tool chains.

The problem is the cost. I see them ending up triple what enterprises initially expected. This is due largely to the fact that the applications were much worse than originally assumed, and major (unexpected) gutting was needed to get them first to a good architectural state and then to a cloud-native state. It’s like when you go to the auto mechanic to find out what is making those ticking sounds, only to find that a pushrod is bad and needs a major expensive overall.

So, will enterprises pay the extra cost? Some will, for most of their critical applications. But budgets are budgets. So, enterprises will end up not refactoring as many applications as originally thought, perhaps putting them off for 2020 or 2021. This may end up costing more money in the long run. If that’s acceptable to you, fine. My advice is fix it now, rather than later, and absorb the costs you’ll end up paying later anyhow. After all, that pushrod can come right through the block.

Google Roundup: Five New Features And Enhancements For Google's Apps

What’s new for Google’s apps and devices.Credit: Alexas Photos/Pixabay

Google is always modifying its apps and devices with upgrades and new features. The pace of change is so relentless that trying to keep track can be overwhelming. In case you missed them, here are some of the best new features Google introduced this week.

Google’s Clock app teams up with Spotify

You can now wake up to a selection of music from Spotify if you use Google’s Clock app as your morning alarm. Your choices are limited to one of 26 Spotify curated playlists or one of the last 10 things you played yourself. Pray a prankster doesn’t get ahold of your phone and ruin your day with a death metal playlist instead of Spotify’s “Have a Great Day!” that normally wakes you up.

Home adds room-specific controls.Credit: Google

Home adds room-specific controls

Home now lets you control devices in individual rooms which can be very useful for actions like voice controlling lights. Previously, if you said “turn on/off the lights”, the Assistant carried out the action on all the smart lights in the house. Now if you assign lights (or anything else) to rooms and say “turn on the living room lights”, only the lights in the living room come on.

The Assistant responds differently to “Turn on/off the lights” (without a room mentioned) depending on where you are when you issue the command. If you’re in a room that has lights assigned to it, the assistant will only turn on the lights in that room. If you’re in a room with no assigned lights, all the lights in the house will come on.

You can assign smart devices to rooms in the “Control your home” section of the Home app.

The Assistant’s routines can be scheduled

Routines are a useful way to carry out a series of commands that usually follow one another. For example, “Turn on the lights”, “Who won yesterday’s Nationals game?”, “What’s the weather?” and “Play NPR” can be combined in a routine that’s triggered by “Good morning”.  Previously, you had to trigger the command with a spoken phrase. Now you can set it to run automatically on a timed schedule.

To set up a scheduled routine, tap the menu icon (three vertical lines) in the upper left corner of the Home app. Tap More settings > Routines and create a new routine. You can set the days of the week and time of day you want the routine to run, the speaker you want to use if the routine involves audio, and whether you want phone notification when the routine executes. You should be able to include the new room-specific controls in a scheduled routine although I haven’t tested it myself.

Table data now appears in Search results.Credit: Google

Google Search returns examples of tabled data

A well-designed table is a clear and concise way to present certain types of information and many news organizations concerned with countering the flood of purposeful misinformation use them to make reliable data available to readers. Previously, the existence of data tables in an article was hidden from Google Search results. Users had to click through to the article to discover a table. Now, Search results can include an example to alert users that a data table appears in an article.

Enhanced information about events in Search

Search can not only help you become better informed with the inclusion of table data, it can help you have more fun with newly enhanced information about events.  A search string like “events near me” returns a list of local events as it has in the past. Now if you tap one of the events, it opens a page with helpful details about the event such as time, location and ticketing information. You can tap through to a ticket provider, to the event’s website for more info, or to Google Maps for directions. There’s also a share button to make coordinating with friends easier. A “For You” tab organizes events into the categories that Google thinks will interest you along with events that are trending where you live.

If you’re interested in Google, here are some other articles you might enjoy.

Meet Serverless Inc. – The Startup That Aims To Accelerate Serverless Computing

Serverless computing is no more a buzzword. It has become a first-class citizen of the cloud alongside virtual machines and containers. Serverless Inc., a Bay Area-based startup realized the potential of serverless computing back in 2015 when the only prominent serverless platform was AWS Lambda.

Serverless PlatformSource: Serverless Inc.

Last week, Serverless Inc. announced that it had raised $10 million in Series A funding from Lightspeed Ventures. Including the seed round, the company has raised a total of $13 million.

Austen Collins, CEO and Founder of Serverless Inc., saw the opportunity in creating an open source tool to simplify application development targeting AWS Lambda. What started as an abstraction to Lambda transformed into a cloud-agnostic serverless platform supporting all major serverless environments.

Serverless developer community loves the framework and tools shipped by Austen’s team. Apart from getting featured on the home page of Hacker News several times, this open source project on Github gathered about 25000 stars which a remarkable feat for an independent open source project.

Within a short span of time, Austen’s framework has become an unofficial standard for serverless tooling. Every major serverless platform debuts with support for Serverless Framework. From Google Cloud Functions and more recent Kubeless, almost all the major environments are supported by this framework.

So, what excites developers about Serverless Framework? It’s the simplified approach to building modern applications based on integrated tooling.

Unlike other application development and deployment patterns, serverless platforms are highly distributed. For building a simple web or mobile app, developers will have to assemble a variety of resources ranging from an API Gateway to object storage to an event-driven messaging service. They have to connect the dots across a variety of cloud services making deployment and debugging very complicated. Serverless Framework is one of the first toolkits that aims to simplify the lifecycle of microservices targeting serverless environments.

Recently, Serverless Inc. announced an end-to-end platform that comprises of the framework, a visual dashboard and a cloud-agnostic event gateway. At the core of the platform is the popular Serverless Framework that provides a declarative mechanism to deploy and manage functions. The Dashboard enables developers and operators to monitor, collaborate and secure serverless applications. The Event Gateway offers integration infrastructure by connecting serverless applications and functions to existing workloads and cloud services.

Serverless Platform attempts two things – plugging the gaps existing within mainstream serverless environments and delivering a consistent workflow. This approach minimizes the risk of adopting serverless environments for enterprises. I feel the uniqueness of Serverless Platform lies in its platform-independent approach. In its current form, it supports AWS, Azure, IBM Cloud, GCP and Kubeless among other environments. Developers follow the same workflow to manage the application lifecycle irrespective of the deployment target.

Serverless Inc., boasts of impressive clientele. EA Sports, Coca-Cola, Nordstrom, Expedia and Reuters are some of the big brands using the framework. The company has set an example for other startups aspiring to build an open source platform that enjoys the attention of the developer community while being highly relevant to enterprise customers.

Serverless computing and Functions as a Service (FaaS) are in their infancy. The market is extremely fragmented with dozens of services and tools. The industry has no standard for eventing, messaging, function declaration, versioning, deployment, monitoring and logging.

The container world is equally excited about the convergence of Kubernetes and FaaS. Multiple projects claim to deliver serverless capabilities on Kubernetes.

CNCF, the custodian of Kubernetes and related projects, is working on standardizing some of the building blocks of the serverless platform. The serverless working group at CNCF recently proposed a standard called CloudEvents for exchanging messages across functions. But, it has a long way to go before the vendors accept it as a standard.

With the fragmentation and complexity revolving around serverless computing, companies such as Serverless Inc., have a massive opportunity in building tools that aim to make developers productive in building modern applications.

China's market regulator says Pinduoduo to step up product vetting

BEIJING (Reuters) – China’s market regulator said on Friday that after a meeting with online discounter Pinduoduo Inc the company agreed to step up vetting of the products listed on its platform amid reports of counterfeiting.

FILE PHOTO: The logo of Chinese online group discounter Pinduoduo is seen next to its mobile phone app in this illustration picture taken July 17, 2018. REUTERS/Florence Lo/File Photo

In a statement on its website, the State Administration for Market Regulation said Pinduoduo should “strengthen platform management, regulate business activities of third-party vendors, stick to law and maintain a healthy, fast and sustainable development.”

Huang Zheng, Pinduoduo’s chief executive officer, vowed to “thoroughly rectify and reform,” and cooperate with regulators’ investigation, according to the statement. The company is backed by Chinese video and internet company Tencent Holdings Ltd and was valued at $23.8 billion last week in an initial public offering (IPO) in New York.

Authorities said earlier this week they were investigating the company after reports that the platform was selling counterfeit and shoddy goods to its over 300 million users. Shanghai-based Pinduoduo described reports as “attacks” on the company.

Pinduoduo’s share price has slumped below its IPO price this week following the investigation. Its shares had jumped 44 percent on its trading debut.

The firm is also being taken to a federal court in the United States by a diaper maker, which claimed that Pinduoduo knowingly allowed the sale of counterfeit products bearing the company’s name on its site.

After the IPO, Pinduoduo became the subject of media reports and online jokes centered on goods on its marketplace resembling products from firms such as Coca-Cola Co, Apple Inc and Samsung Electronics Co Ltd.

Many jokes described the goods using the phrase “shanzai”, a term often used to refer to look-alike products featuring purposely misspelled names of big brands.

Reporting by Pei Li and Brenda Goh; Editing by Christian Schmollinger

Google plans censored version of search engine in China: sources

BEIJING/SAN FRANCISCO (Reuters) – Alphabet Inc’s (GOOGL.O) Google plans to launch a version of its search engine in China that will block some websites and search terms, two sources said, in a move that could mark its return to a market it abandoned eight years ago on censorship concerns.

FILE PHOTO: A security guard keeps watch as he walks past a logo of Google in Shanghai, China, April 21, 2016. REUTERS/Aly Song/File Photo

The plan comes even as China has stepped up scrutiny into business dealings involving U.S. tech firms including Facebook Inc (FB.O), Apple Inc (AAPL.O) and Qualcomm Inc (QCOM.O) amid intensifying trade tensions between Beijing and Washington.

Google, which quit China’s search engine market in 2010, has been actively seeking ways to re-enter China where many of its products are blocked by regulators.

The Intercept earlier reported Google’s China plans on Wednesday, citing internal Google documents and people familiar with the plans.

The project is code named “Dragonfly” and has been underway since the spring of 2017, the news website said.

Progress on the project picked up after a December meeting between Google’s Chief Executive Sundar Pichai and a top Chinese government official, it added.

Search terms about human rights, democracy, religion and peaceful protests will be among the words blacklisted in the search engine app, which The Intercept said had already been demonstrated to the Chinese government.

The finalised version could be launched in the next six to nine months, pending approval from Chinese officials, it added.

Chinese state-owned Securities Times, however, said reports of the return of Google’s search engine to China were not true, citing information from “relevant departments”.

But a Google employee familiar with the censored version of the search engine confirmed to Reuters that the project was alive and genuine.

On an internal message board, the employee wrote: “In my opinion, it is just as bad as the leak article mentions.”

The worker, who declined to be named, said that he had seen slides on the effort and that many executives at the vice president level were aware of it. He said he had transferred out of his unit to avoid being involved.

Separately, a Chinese official with knowledge of the plans said that Google has been in contact with authorities at the Cyberspace Administration of China (CAC) about a modified search program.

The official, who declined to be named, said the project does not currently have approval from authorities and that it is “very unlikely” such a project would be made available this year.

Google declined to comment on the accounts and the CAC did not immediately respond to requests for comment from Reuters on Thursday.

A day earlier, the search giant also declined to comment on specifics mentioned in The Intercept report, but noted that it has launched a number of mobile apps in China and works with local developers as part of maintaining its domestic presence.

But the report pummeled shares of U.S.-listed Baidu (BIDU.O), which dominates China’s search engine market. Baidu shares fell 7.7 percent on Wednesday, despite posting better than expected quarterly results.

Google’s main search platform is blocked in China along with its video platform YouTube, but it has been attempting to make new inroads into China.

In January, the search engine joined an investment in Chinese live-stream mobile game platform Chushou, and earlier this month, launched an artificial intelligence (AI) game on Tencent Holdings Ltd’s (0700.HK) social media app WeChat.

Reports of its possible re-entry spurred a strong reaction on Chinese social media outlets on Wednesday evening, including debates over the merits of a censored search engine versus accessing the U.S. version through illegal virtual private networks.

“Let’s carry on jumping the Firewall,” said one anonymous poster. “I’d rather not have it than use a castrated version.”

Reporting by Brenda Goh and Cate Cadell, Editing by Sherry Jacob-Phillips and Muralikumar Anantharaman

3D-Printed Gun Downloads Halted by U.S. District Judge

Downloads of data to produce untraceable plastic gun parts on a 3D printer have been halted by a federal judge in Seattle this afternoon. U.S. District Judge Robert Lasnik agreed to issue a temporary restraining order against Defense Distributed, which resumed downloads over the weekend following the settlement in late June with the federal government of a 2015 lawsuit.

Eight states and the District of Columbia filed suit yesterday, led by Washington State’s Attorney General Bob Ferguson, on the basis that the settlement violated both a required procedure for issuing a waiver for gun manufacture and the Tenth Amendment.

Also today, President Donald Trump weighed in, stating on Twitter, “I am looking into 3-D Plastic Guns being sold to the public. Already spoke to NRA, doesn’t seem to make much sense!”

Senators added their voices later in the day, urging the president to reverse the settlement decision. Lisa Murkowski, an Alaskan Republican, tweeted that “Even as a strong supporter of the Second Amendment — this is not right.”

Connecticut Sen. Richard Blumenthal, a Democrat, stated of Trump and the settlement, “It’s his doing, it’s his responsibility and the blood is going to be on his hands.” Fellow Democrat Edward Markey of Massachusetts said, “Donald Trump will be totally responsible for every downloadable plastic AR-15 that will be roaming the streets of our country if he does not act today.”

The settlement, which came without notice on June 29, included paying some court costs to Defense Distributed’s founder, Cody Wilson, and dismissing the suit that alleged the downloads violated the Arms Export Control Act.

Uber Puts the Brakes on Self-Driving Truck Program That Spurred Lawsuit

A promising program to put Uber in the driver’s seat for freight has hit the brakes: the company has stopped development on Otto, its self-driving truck project. The news, first reported by TechCrunch, was confirmed in a statement by Eric Meyhofer, Head of Uber Advanced Technologies Group. Otto garnered early attention by completing a 120-mile autonomous delivery in October 2016.

Uber said that it was shifting resources within its Advanced Technologies Group, which handles research on autonomous vehicles, to focus entirely on cars. Following a fatality in Arizona in March this year, after which the company stopped all its street-based driving tests, the company only last week returned to the road, starting in Pittsburgh.

The truck project was acquired from Otto, which operated in San Francisco, while Uber’s car development occurs in Pittsburgh, where the company has hired away a big portion of the local Carnegie Mellon University’s robotics group in 2015. Employees will be reassigned or offered severance, according to the company.

Uber’s entrance into self-driving trucks came with big headaches. Otto was co-founded by Anthony Levandowski, who had left Google’s autonomous car project, later spun off under the Alphabet parent company as Waymo. Uber put Levandowski in charge of its self-driving car program, but Waymo sued, claiming Levandowski had taken trade secrets about Waymo’s LIDAR system for use at Otto and Uber. (LIDAR technology provides continuous depth scans of the area around a vehicle, and complements conventional camera inputs.)

The case never reached trial. Uber fired Levandowski early this year, and under the leadership of new CEO Dara Khosrowshahi, who tried to defuse many outstanding conflicts, settled with Waymo by providing $244.8 million in equity in Uber. Uber also agreed not to incorporate Waymo’s confidential information into their hardware and software, although Khosrowshahi didn’t agree that trade secrets made their way into Uber. The other three Otto founders left by April 2018.

This business change doesn’t affect Uber Freight, which has nothing to do with driving. That company division, available throughout the continental U.S., is a booking service for truck drivers that Uber has checked out and let into the system to find loads to book. Uber said Freight’s load volume has doubled every quarter, and its tripled the size of its staff over the last 15 months. An analyst report today indicated Uber Freight targets a $15 to $20 billion logistics market, but it’s unclear how big a piece the company could claim.

This also isn’t necessarily the end of Uber’s truck efforts. Rather, the company said it’s maintaining its relationship with truck manufacturers and could return to this industry segment in the future.

Agile Is Not Just Another Management Fad

Senior executives increasingly recognize that “Agile Is Eating The World”. In fact, surveys by both Deloitte and McKinsey show that over 90% of senior executives want to be agile, while less than 10% currently see their own firm as “highly agile.” There are now major efforts under way with “Agile transformations” being planned or implemented in many large organizations, both public and private. Yet in the ensuing scramble to “be agile,” the risk of Agile being dumbed down to become just another a set of efficiency tools aimed at reducing head-count is significant. For instance:

  • Agile as cost reduction: At a recent meeting in a large global corporation concerning the implementation of Agile management, a presentation was being made about the potential benefits of Agile. The presentation dwelt on the acceleration of innovation, the improved quality of products and services, the higher customer satisfaction and the improved staff morale. The senior management didn’t appear to be paying much attention until they saw a slide suggesting that Agile would also enable a reduction in the company’s head-count. Head-count reduction was an immediate turn-on. Although the overall thrust of the presentation was about improved innovation, quality and staff commitment, it was clear where the senior executives’ interest lay.

Shutterstock

  • Agile as scientific management: In another global firm in the midst of a major Agile implementation effort, it was decided at one point to stop using the term “agile” and in its place use the slogan, “better, faster, cheaper.” The reasoning was that the new slogan would win support from late-adopters and avoid the baggage that had become attached to the term, “agile.” The shift in terminology ran the risk that the slogan might become the very goal of the Agile transformation, leading back in effect to Frederick Taylor’s idea of management as cost reduction methodology. (Eventually, the firm changed the slogan to: “Better Value Sooner Safer Happier.”)
  • Agile as a patch: In yet another case, a global firm carefully deployed Agile processes and ceremonies such as small teams, short iterations, daily standups and retrospectives, but the work continued essentially as it had before. The teams were supposed implementing Scrum, but their Scrum practice consisted of mini-waterfalls that rarely completed the sprint’s target. The Agile mindset was missing. There were, unsurprisingly, few if any benefits. Agile was in effect no more than a patch on the existing management practices.
  • Agile as a sweatshop: In some cases, firms have used Agile with their top talent, but in other parts of the firm, they have continued sweat-shop conditions that are antithetical to Agile management. The tension between the two dynamics in different parts of the organization makes one wonder whether both can co-exist over the long haul. The promotion of Agile management as a tool to promote efficiency is also implicit in the subtitle of Jeff Sutherland’s otherwise excellent book, Scrum: The Art of Doing Twice the Work in Half the Time. A focus on doing “more work in less time” runs the risk of missing the point that Agile is essentially not about doing more work. It’s about generating “more value from less work.
  • Agile as a scaling framework: In some cases, a scaling framework, such as SAFe, has been deployed across the organization, but without significant change in work practices where the work is carried out. Here again, as one might expect, no benefits have ensued.
  • Agile as a sham: In another case, a firm was proceeding profitably and making great progress in its Agile implementation when an edict came down from the very top of the firm that costs had to be cut by a significant amount, because of a perceived need of top management to boost quarterly profits and ultimately the share price. In making the cuts, the managers did their best to preserve the gains being made from the Agile implementation and to minimize the collateral damage from the cuts. But the impact in terms of lost trust was significant. The staff had seen that, when push came to shove, the management talk about the primacy of adding value to customers was ultimately subject to short-term shareholder-value concerns.

The Sad History of Business Process Reengineering

We have seen this movie before. Take, for instance, the sad history of business process reengineering (BPR). In the early 1990s, BPR went through a rapid boom-and-bust cycle. At the outset, it was presented as a transformational business management strategy. It focused on the analysis and design of workflows within an organization, working backwards from the customer. BPR was intended to help firms fundamentally rethink how they did their work in order to dramatically improve customer service, cut operational costs, and become world-class competitors. If BPR had been implemented in this spirit, it could have led to deep organizational change.

Manager directingPhoto iStock

Initially, there was huge enthusiasm. It was the management fashion of the day. However, it soon became apparent that most companies were not using BPR as its founders had intended. Instead they were using BPR as a pretext to reduce head count. BPR quickly earned a reputation for being synonymous with downsizing and layoffs. Despite the underlying good idea of “working back from the customer” it ran flat smack into the emerging hyper-priority of cost cutting and maximizing shareholder value as reflected in the stock price. As a result, BPR fell into disrepute, much to the chagrin of its founders.

“When I wrote about business process redesign in 1990,” wrote Tom Davenport, an early BPR advocate, “I explicitly said that using it for cost reduction alone was not a sensible goal. And consultants Michael Hammer and James Champy, the two names most closely associated with reengineering, have insisted all along that layoffs shouldn’t be the point. But the fact is, once out of the bottle, the reengineering genie quickly turned ugly.”

Similarly, Michael Hammer said: “I wasn’t smart enough about that. I was reflecting my engineering background and was insufficiently appreciative of the human dimension. I’ve learned that’s critical.”

A similar fate awaited other management reform movements, such as Quality Circles, Total Quality Management (TQM) and Knowledge Management (KM). These management ideas started out as legitimate alternatives or adjustments to the prevailing bureaucratic management paradigm, but in due course they were subverted and turned into subsets of the bureaucracy. BPR, TQM and KM programs still exist. What remains of them now are the almost-lifeless remains of once-bold thinking.

Will Agile’s Fate Be Different?

There are at least three differences between Agile on the one hand and these failed management fads.

One is that Agile entails an explicit paradigm shift in management. Rather than trying to work within the existing management paradigm, Agile recognizes that its dynamic is fundamentally at odds with cost-cutting bureaucracy. The earlier fads had practically nothing to say about the purpose of a firm. So in due course, they were coopted and ultimately undermined by the notion that the purpose of a firm is to maximize shareholder value as reflected in the stock price, a philosophy in which value enhancement inevitably takes a back seat to systematic cost-reduction.

By contrast, Agile management explicitly gives primacy to adding value to customers. Hence it is more threatening to the status quo, but it is also more honest as to what’s at stake. This is both an advantage and challenge. It raises the stakes. It poses an explicit threat to the status quo and is more likely to be stomped on. There are many aspects of Agile that make managers anxious. But by being honest about the nature of the change under way, it gives its advocates explicit guidance as to what’s at stake.

Second, Agile is a more comprehensive and coherent set of ideas than any of these earlier fads. There was never any serious effort to define BPR budgeting, or KM HR, or TQM strategy, in the way that there are serious efforts under way to define and implement Agile budgeting, Agile HR and Agile strategy.

Finally, Agile is deeply rooted in the human dimension of how work actually gets done. It emphasizes what’s involved in generating value for customers and creating workplaces that are genuinely stimulating and frequently inspiring. As a result, it is much more difficult to ignore the human dimension of Agile, or pass off cost-cutting Agile as the genuine article. Fake Agile is much easier to spot than “fake BPR” or “fake KM”, because the human dimension of those movements was much less explicit than in Agile.

Nevertheless, there are continuing risks, particularly as big consulting firms with no particular background in or aptitude for Agile thinking, are engaged to lead large-scale Agile transformations. The risk is that Agile will be turned into a caricature of its essence. The caricature will then be used as a basis for maintaining the status quo or shoehorning Agile into traditional management as just another set of tools and processes for reducing headcount.

What is needed for all of those implementing Agile is to be on the watch for “fake Agile” as well as efforts to turn Agile into a caricature of its innovation-based value-creating principles.

And read also:

Why Agile Is Eating The World

Six Lessons That Society Must Learn About Agile

Ten Agile Axioms That Make Managers Anxious

Why Do Managers Hate Agile

Explaining Agile

JetBlue's Response to Dumped Bridesmaid's Viral Tweet Is a Perfect Lesson in Emotional Intelligence

You can’t make this stuff up.  A woman named Courtney Duffy was all set to fly across the country to be a bridesmaid in her friend Alex’s wedding. Duffy is getting an MBA at Dartmouth and then moving on to an MPA (Masters in Public Administration) at Harvard, so it’s safe to say she’s very busy with schoolwork. That being the case, she booked a flight on JetBlue that would get her to her destination in time to take part in the wedding ceremony, and then fly back on Sunday evening, presumably in time for summer classes or a summer job on Monday.

None of that was good enough for Alex, who sent her a lengthy and regretful email explaining that she had really wanted Duffy to also be on hand for a bridesmaid trip, and throughout the weekend, and not to fly home before Monday. The shorter trip “just won’t work with the duties as a party member.” And so, Alex wrote, she must ask Duffy to relinquish her duties as bridesmaid. “This is one of the hardest things I’ve ever had to ask anyone,” she wrote. But a couple of sentences later, she also asked Duffy to mail her the jumpsuit (jumpsuit??) so that a replacement bridesmaid could wear it instead.

Revenge is sweet, and sweetest on social media, so Duffy posted a screenshot of the entire email to Twitter, as part of a plea to @JetBlue.

The whole situation resonated with the Twitterverse. Duffy’s tweet has been retweeted more than 1,000 times. Many responded that they’d had similar experiences of being fired as bridesmaids. Most advised Duffy to burn the jumpsuit (or go swimming in the ocean and then send it along), forget the friendship, and count herself fortunate not to participate in a wedding where a jumpsuit was required. 

Four hours later, the airline responded. JetBlue did indeed refund Duffy’s airfare, and took it a step further:

Reasonable people can disagree over whether it was justified or not for Alex to fire Duffy as a bridesmaid. On one hand, traditional bridesmaid duties stretch over weeks or months before the wedding and include planning and participating in a bridal shower and possibly a bridesmaids’ trip. On the other hand, if you’re inviting someone from thousands of miles away, and you have expectations that go beyond the wedding itself, that’s something you should discuss up front. Had Alex done that, Duffy could have made the decision to either plan a longer trip or decline the bridesmaid role.

Whatever her reasoning, if Alex had to ask Duffy to step down, it should have been via phone or video chat, not an email or text message. Not only would that have been a better way to preserve the relationship–assuming she cares about that as her email says over and over that she does–it would have saved her a lot of social media embarrassment. 

But. As Duffy herself noted in a follow-up tweet, weddings tend to bring out the worst in people. JetBlue is able to see the big picture–that in six months or a year the two might be able to laugh about this and enjoy a girls’ weekend together. Or maybe not, and Duffy will wind up using her gift airfare with a different friend.

Either way, it’s a win for JetBlue. Not only did the airline do something nice for someone who was upset, it wisely saw the opportunity to get a lot of excellent publicity for the relatively small investment of a couple of free tickets. Even more important, it did it quickly, before Twitter users’ famously fickle attention had wandered somewhere else.

American Airlines Blames Customers Finding Out the Truth For Having to Make Fares More Attractive

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

Over the last few weeks, many airlines have been crowing about how well they’re doing.

And then there’s American Airlines.

It suddenly encountered difficulties, despite being huge and enjoying an extended network in a buoyant economy.

One of the areas in which it suffered is its Sub-Cattle Class.

Often known as Basic Economy, these are the (allegedly) cheapest tickets that don’t let you change your seat, force you to board last, give you the worst seat at the last minute and, in American’s case, don’t let you use the overhead bins.

I mentioned earlier this week that American had decided to change the carry-on requirements, as its Basic Economy offering wasn’t doing so well and was even angering its own employees.

Gate Agents and Flight Attendants were forced into being the Bag Police, which is tiresome in the extreme.

On the airline’s earnings call last week, American CEO Doug Parker offered another factor that contributed to the airline’s poor Basic Economy performance.

“There are now filters on things like Google search that ask you if you want to bring a carry-on, and if you say yes, the American flights don’t show up nearly as high as they did before because it adds $20 to our fare,” he said.

The truth can be a pesky beast. It can reveal that your Basic Economy fare only exists to make passengers despise it so much that they’re prepared to pay more for the Economy Class that used to cost less.

Parker insisted there was “nothing wrong” with passengers learning the truth. 

“When you get yourself in a position in this business where price-sensitive customers find themselves with lower fares on truly competitive airlines like that, we have to take that into consideration,” he said.

Many passengers may chuckle at the notion that American might not be a truly competitive airline.

There’s another aspect to all this, however.

The major airlines — American included — have, for quite some time now, been pressuring the government to stop Google and comparison sites like Kayak from revealing the true cost of flights.

Or, rather, they want to force them to reveal the same information as the airlines do — such as flight delays — without actually having access to that information.

The big airlines want customers to go to the airline’s own site, where they can be fooled into thinking that fares are very low, until they see — just before pressing the Buy button — just how much all the extras cost.

So when Parker says there’s nothing wrong with customers accessing Google, I fear he may mean that there’s everything annoying about it.

YouTube plans original programing in India, Japan and other markets

BEVERLY HILLS, Calif. (Reuters) – Alphabet Inc’s YouTube is creating scripted series and other original programing for international markets including France, Germany, Japan, Mexico and India to try to draw new customers to its paid subscription service, a senior executive said on Friday.

FILE PHOTO: Susanne, Daniels Global Head, Original Content, YouTube, speaks at the Milken Institute 21st Global Conference in Beverly Hills, California, U.S., May 1, 2018. REUTERS/Mike Blake/File Photo

The programing will come in the form of multiple genres such as music documentaries, reality series, talk shows and scripted series, Susanne Daniels, YouTube’s global head of original programing, said in an interview. It will be produced in local languages and subtitled or dubbed for other markets.

Some of the programing will appear on YouTube Premium, the monthly subscription service formerly called YouTube Red. Other content will be available on YouTube’s free service with advertising.

“We are targeting markets where we believe we have a tremendous upside in potential subscribers,” Daniels said.

YouTube already has released a handful of original shows in South Korea and one in India, a talk show in Hindi about cricket. Called “UnCricket,” the show has performed “beyond expectations,” Daniels said.

Daniels also said a reality show starring South Korean pop band Big Bang had boosted subscriptions, and that 50 percent of the new customers came from outside of Korea.

More details about the new international slate will be released in the coming weeks, she said.

YouTube will be competing with companies including Netflix Inc and Amazon.com Inc that are investing in local language programing for online audiences around the world.

The first original shows from YouTube debuted on its premium service in 2016, starting with series from some of the platform’s most popular video creators. It added programing from Hollywood stars and also released a batch of children’s shows including Emmy-winning “Fruit Ninja Frenzy Force.”

There are no current plans for more original children’s programing, Daniels said. The YouTube Kids app serves that younger audience, she said, and the company does not believe children’s content will drive subscriptions to YouTube Premium at this time.

Reporting by Lisa Richwine; Editing by Will Dunham

Game publisher EA's revenue forecast misses estimates

(Reuters) – Electronic Arts Inc forecast tepid second-quarter revenue growth on Thursday, overshadowing quarterly results that topped analysts’ estimates and sending its shares down 7 percent in extended trading.

FILE PHOTO: An Electronic Arts (EA) video game logo is seen at the Electronic Entertainment Expo, or E3, in Los Angeles, California, United States, June 17, 2015. REUTERS/Lucy Nicholson/File Photo

The company said it expected adjusted revenue of $1.16 billion for the current quarter, down slightly from a year earlier, when sales were driven by “Battlefield 1”.

The timing of the recognition of bookings in Asia as well as foreign exchange weighed on the company’s forecast, EA added.

Analysts on average had expected revenue of $1.23 billion, according to Thomson Reuters I/B/E/S.

“Expectations may have been higher for second-quarter guidance and the Street may have expected an increase in annual guidance but we understand EA is conservative early in the year,” Consumer Edge Research analyst Raymond Stochel said. 

The rise in popularity of games from the “battle royale” genre such as “Fortnite” is posing challenges to established game publishers, including EA, and rivals Activision Blizzard Inc and Take Two Interactive Software Inc.

EA said it expected the launch of new games, including “Madden NFL” and “Battlefield V”, in the coming months to take on some of those challenges.

For the first quarter, the company said “The Sims 4” player base grew 35 percent and the “FIFA World Cup” update had over 15 million unique players.

Chief Financial Officer Blake Jorgensen told Reuters that though EA had only two weeks of the World Cup in its first quarter, user engagement with FIFA was “extremely” high and that should help “FIFA 19” when it is launched in September.

EA reported revenue of $749 million on an adjusted basis for the latest quarter ended June 30, beating analysts’ average estimate of $742.42 million.

Net income fell to $293 million, or 95 cents per share, from $644 million, or $2.06 per share, a year earlier.

Excluding items, the company earned 13 cents per share, according to Reuters’ calculation, topping analysts’ estimate of 6 cents per share.

Shares of the company have risen nearly 40 percent this year.

Reporting by Pushkala Aripaka in Bengaluru; Editing by Shounak Dasgupta and Anil D’Silva

Federal Class Action Lawsuits Against ICOs Are Set To Double

Federal Building SEC

Federal Building SECASSOCIATED PRESS

It’s been a record year for federal lawsuits related to initial coin offerings, the new fundraising method that lets entrepreneurs raise capital by selling tokens on a blockchain.

While 2017 saw the first five U.S. class action lawsuits related to the technology, according to a report released today by the Stanford Law School Securities Class Action Clearinghouse and Cornerstone Research, the first six months of 2018 alone had an additional seven filings.

But the rise in class action lawsuits around ICOs coincides with a larger, “historic” incidence of class action securities lawsuits since 2016, with more than 750 federal securities class actions having been filed since halfway through that year. That’s the most prolific 24-month period since the Private Securities Litigation Reform Act of 1995 was enacted, according the the report.

Report coauthor Joseph Grundfest, a Stanford Law School professor who is a former commissioner of the U.S. Securities and Exchange Commission, described the findings in a statement:

“Class action securities fraud litigation continues to affect a large percentage of publicly traded firms.”

While ICOs aren’t typically tied to public firms, they have nevertheless raised $19.4 billion since 2014, according to CoinDesk data, with the total amount raised in 2018 surpassing all of 2017 earlier this year. Six of the seven class actions filed this year are still active, according to data from the Stanford Law School Clearinghouse.

Notable ongoing lawsuits include one filed in June against San Francisco-based Ripple Labs alleging that the defendants raised “hundreds of millions of dollars” through the unregistered sale of XRP to retail investors. Another suit, against U.K.-based Bitconnect, alleges that the company “failed to disclose material facts” that caused its value to drop.

Further ongoing cases filed this year are against Paragon Coin, Latium Network, DRIP and Cloud With Me. A seventh case, against cryptocurrency mining operation Mining Max, was dismissed in June.

Capture

CaptureCornerstone Research

In total, 12 ICO class actions are documented in the report, all of which occurred in the past two years. Two of these ICOs have parallel action in California state courts.

The new fundraising mechanism has been the target of frequent accusations of abuse due to their perceived lack of accountability and an early disregard for securities law. As a result, the SEC earlier this year named the head of its distributed ledger technology working group, Valerie Szczepanik, as the first senior adviser for digital assets, tasked in part to look into the issue. 

However, the Cornerstone report is interesting in that it also highlights existing problems related to more traditional securities issuances. While the total number of ICOs is on pace to more than double in 2018, they represent just a tiny fraction of the total class action lawsuits being filed.

Grundfest concluded:

“If the trends observed in the first half of the year continue to year-end, approximately 8.5 percent of all companies listed on the NYSE and NASDAQ markets will have been sued in these cases.”

AMC Looks to Tap into Facebook's Black User Base in New Deal

Guests walk into an AMC Entertainment Inc. movie theater in West Chester, Ohio, U.S., on Saturday, July 30, 2016. AMC Entertainment is scheduled to release earnings figures on August 1. Photographer: Luke Sharrett/Bloomberg

</div> </div> <p><span style="font-weight: 400;"><span class="tweet_quote"> <a href="https://twitter.com/intent/tweet?url=http%3A%2F%2Fwww.forbes.com%2Fsites%2Fkorihale%2F2018%2F07%2F25%2Famc-looks-to-tap-into-facebooks-black-user-base-in-new-deal%2F&amp;text=AMC%20wants%20to%20tap%20into%20Facebook%E2%80%99s%20largest%20user%20group%20to%20sell%20more%20movie%20tickets." target="_blank" data-ga-track="ExternalLink:https://twitter.com/intent/tweet?url=http%3A%2F%2Fwww.forbes.com%2Fsites%2Fkorihale%2F2018%2F07%2F25%2Famc-looks-to-tap-into-facebooks-black-user-base-in-new-deal%2F&amp;text=AMC%20wants%20to%20tap%20into%20Facebook%E2%80%99s%20largest%20user%20group%20to%20sell%20more%20movie%20tickets." rel="nofollow">AMC wants to tap into Facebook’s largest user group to sell more movie tickets.<span data-ga-track="ExternalLink:https://twitter.com/intent/tweet?url=http%3A%2F%2Fwww.forbes.com%2Fsites%2Fkorihale%2F2018%2F07%2F25%2Famc-looks-to-tap-into-facebooks-black-user-base-in-new-deal%2F&amp;text=AMC%20wants%20to%20tap%20into%20Facebook%E2%80%99s%20largest%20user%20group%20to%20sell%20more%20movie%20tickets."></span></a></span> The deal will allow users to purchase their tickets directly through the social media site. Due to the recent popularity of movies with black storylines or a black main lead, could this AMC-Facebook partnership help keep the movie chain afloat?</span></p> <p><b>The Breakdown You Need to Know</b></p> <p><span style="font-weight: 400;">AMC shares have taken a beating, down </span><span style="font-weight: 400;">20% in a year, </span><span style="font-weight: 400;">due to a lackluster summer in 2017 and they are in need of a new strategy. </span><a href="https://www.culturebanx.com/" target="_blank" data-ga-track="ExternalLink:https://www.culturebanx.com/" rel="nofollow"><span style="font-weight: 400;" data-ga-track="ExternalLink:https://www.culturebanx.com/">CultureBanx</span></a><span style="font-weight: 400;"> notes that with considerable disruption in the movie theater industry thanks to companies like MoviePass and the overall decline in attendance, creating a social media partnership could be the key to a turn around for the company. Especially because black people are the most prolific group of social media users and tend to lead the patterns and trends shaping the landscape. Pew research found 70% of black adults use Facebook far outpacing any other ethnic groups.</span></p> <p><span style="font-weight: 400;">The social media platform already has agreements with e-ticketing services Fandango and Atom Tickets. However, for Facebook this is the first time the company is directly partnering with a movie theater chain. AMC stated all payments through Facebook will be processed by AMC, Fandango or Atom Tickets. In the AMC- Facebook deal, users who purchase tickets via the platform will have their online ticketing fees waived.</span></p> <p> </p> <p><span style="font-weight: 400;">So for AMC the proof is already in the pudding with this new deal, if we look at Atom’s e-ticket sales for Black Panther they reported a company record. The movie chain wants to see similar success with its online sales. More than 150 AMC locations, nearly 23% of the chain’s U.S. locations, set new admissions revenue records for a single title on opening weekend for Black Panther, according to deadline. “We know people already use Facebook to find movies to see in theaters, and purchase tickets to them,” said Swapna Joshi, Facebook’s product manager for movie ticketing in a statement. </span></p> <p><span style="font-weight: 400;">During the latest quarter, ticket revenues at AMC were up seven percent to $875 million, a number it wants to increase during the second half of the year. AMC which is owned by China’s Dalian Wanda Group shares have risen 10.1% this year, while Facebook shares have gained 17.9%. Currently AMC operates 660 theater across the U.S. and &nbsp;is also the world’s largest movie exhibitor.</span></p>

<p><b>Movie Ticket Mindfulness</b></p> <p><span style="font-weight: 400;">Large format movie chain Imax is also having a record setting year due in part to Black Panther. The company made more than, $40M from the film. It will be interesting to see if AMC competitors Imax and Cinemark attempt to cut a similar deal with Facebook in efforts to boosts their e-ticket sales.</span></p>” readability=”52.2968803565″>

Guests walk into an AMC Entertainment Inc. movie theater in West Chester, Ohio, U.S., on Saturday, July 30, 2016. AMC Entertainment is scheduled to release earnings figures on August 1. Photographer: Luke Sharrett/Bloomberg

AMC wants to tap into Facebook’s largest user group to sell more movie tickets. The deal will allow users to purchase their tickets directly through the social media site. Due to the recent popularity of movies with black storylines or a black main lead, could this AMC-Facebook partnership help keep the movie chain afloat?

The Breakdown You Need to Know

AMC shares have taken a beating, down 20% in a year, due to a lackluster summer in 2017 and they are in need of a new strategy. CultureBanx notes that with considerable disruption in the movie theater industry thanks to companies like MoviePass and the overall decline in attendance, creating a social media partnership could be the key to a turn around for the company. Especially because black people are the most prolific group of social media users and tend to lead the patterns and trends shaping the landscape. Pew research found 70% of black adults use Facebook far outpacing any other ethnic groups.

The social media platform already has agreements with e-ticketing services Fandango and Atom Tickets. However, for Facebook this is the first time the company is directly partnering with a movie theater chain. AMC stated all payments through Facebook will be processed by AMC, Fandango or Atom Tickets. In the AMC- Facebook deal, users who purchase tickets via the platform will have their online ticketing fees waived.

So for AMC the proof is already in the pudding with this new deal, if we look at Atom’s e-ticket sales for Black Panther they reported a company record. The movie chain wants to see similar success with its online sales. More than 150 AMC locations, nearly 23% of the chain’s U.S. locations, set new admissions revenue records for a single title on opening weekend for Black Panther, according to deadline. “We know people already use Facebook to find movies to see in theaters, and purchase tickets to them,” said Swapna Joshi, Facebook’s product manager for movie ticketing in a statement.

During the latest quarter, ticket revenues at AMC were up seven percent to $875 million, a number it wants to increase during the second half of the year. AMC which is owned by China’s Dalian Wanda Group shares have risen 10.1% this year, while Facebook shares have gained 17.9%. Currently AMC operates 660 theater across the U.S. and  is also the world’s largest movie exhibitor.

Movie Ticket Mindfulness

Large format movie chain Imax is also having a record setting year due in part to Black Panther. The company made more than, $40M from the film. It will be interesting to see if AMC competitors Imax and Cinemark attempt to cut a similar deal with Facebook in efforts to boosts their e-ticket sales.

BBC's 1.6m World Cup And Wimbledon 4K UHD Stream Requests Are Major Milestone

The BBC has been testing Ultra-High Definition (UHD) technology for some time, but this summer has seen its biggest trials to date, with both the soccer World Cup and Wimbledon playing host to 4K transmissions.

All 29 live World Cup matches shown on BBC One were available in UHD, while every match played on Centre Court was also given the special treatment.

While Eurosport, BT Sport and Sky Sports have also broadcast several events, including Premier League football, Formula 1 and French Open tennis in 4K, all of these have required a subscription to watch as well as standardized hardware such as a Sky Q box.

England manager Gareth Southgate is seen during the 2018 FIFA World Cup Russia Quarter Final match between Sweden and England at Samara Arena on July 7, 2018 in Samara, Russia. (Photo by Ian MacNicol/Getty Images)

FTA trials

The BBC’s trials were the first ‘free-to-air’ (FTA) ones in the U.K., while the broadcaster also trialled new colour technologies such as Hybrid Log-Gamma (HLG) and High Dynamic Range (HDR). In total, it received 1.6 million requests for its 4K streams in what it is calling a significant milestone for FTA UHD transmissions.

The majority of the content was available on BBC iPlayer, with some Wimbledon programming available on the Sky Q platform. The single most popular day was Saturday 7 July, when a peak of 60,300 people tuned in for the Sweden v England World Cup Quarter Final and Day 6 of Wimbledon.

“The trial is an important step forward, showing for the first time that Ultra HD and High Dynamic Range (HDR) can be delivered live and “free-to-air” over the Internet,” said Phil Layon, head of broadcast and connected systems at the BBC. “It’s part of the BBC’s mission to ensure that future audiences can enjoy the benefits of improved picture quality, and this trial follows on from our work ensuring viewers were not left behind by the move to HDTV, albeit with different technologies.

“We wanted to demonstrate live end-to-end Ultra HD, but we have always felt that Ultra HD needed to be more than just extra pixels. So we also wanted to demonstrate a wide colour gamut and the HLG that the BBC and NHK have standardized. This is essential for improving the visual experience irrespective of the viewer’s screen size.  Finally, we wanted to do this FTA, streamed to BBC iPlayer, at a scale never seen before in the U.K.”

Live vs On Demand

The BBC’s lack of commitment to a 4K trial for the World Cup led many to believe it wouldn’t happen, despite the fact it held closed tests for the 2014 FIFA World Cup in Brazil. It has also offered some 4K content on the iPlayer, most notably Planet Earth.

However, the corporation has insisted that providing a live stream is a different challenge to producing content on-demand. Using industry standard compression techniques, it generally takes 20 hours to create 1 hour of content that can be viewed with an 18-23Mbps transmission rate.

Obviously, this is impractical for a live stream, so the BBC had to use multiple encoding techniques paired with GPU-accelerated software. This made the 4K feed possible but also increased the required bit rate to 36Mbps.

“For these reasons it is very hard to draw comparisons between on-demand Ultra HD content from the likes of Netflix, Amazon, or our Blue Planet II trial last year,” added Layton. “The demands are much greater for live because all the processing needs to be done in real-time, and requires users to have a much higher speed connection to the Internet, as the live bit rates are significantly higher.  Additionally, all viewing is co-timed so downstream systems have to scale to much greater capacity than for on-demand.”

BBC iPlayer UHD streamBBC

First come first served

The tests also sought to determine how such a high-bandwidth feed would impact the BBC’s other online services. It tried to predict demand using sales figures for UHD-compatible television sets in the U.K., but it was impossible to estimate how many people would be interested and how many TVs were connected to superfast broadband.

To solve this issue, the BBC put a cap on the number of viewers who could access the 4K feed, although it only had to enforce that on one occasion. The use of multicast technology, which sees multiple devices uses the same stream, should reduce the demands placed on the BBC’s infrastructure in the future.

But the main issues were issues with colour, a lack of 5.1 audio, and latency. Many viewers complained on social media that their feed was delayed when compared to the Digital Terrestrial Television (DTT), satellite and standard online broadcasts.

“There was a great deal of variability reported for the same event, “explained Layton. “One viewer would report perfect viewing, another with the same TV would report constant buffering.  Sometimes this could be traced to the use of Wi-Fi or an insufficiently fast ISP connection.  But there is more going on and we think that some devices are very sensitive to the overall network conditions.

“My own experience reflected this and sometimes one device would work fine, other times it would buffer, yet another device would then work fine and I could see no obvious local network issues.  We have captured some network traces and now need to better understand exactly what is happening and then work with the [Consumer Electronic manufacturers] on their implementations.”

It’s likely we’ll see more and more sporting events produced in 4K as broadcasters seek to either differentiate their services or ensure they don’t get left behind by the competition.  However, this will mostly be on a subscription basis or via satellite, cable or dedicated IPTV hardware.

It’s possible that 4K might even be delivered over DTT in the future, but until then, the BBC’s online tests are incredibly important in getting UHD sport to as many people as possible.

Intelligent Drones Push The Boundaries Of Oil And Gas Inspection

Drone hoovers over oil and gas facilityCape

Drones are not new to industry or the oil and gas sector. They have been used by companies that are offering full-service video, or to capture survey photographs for some time.  However, Renner Vaughn, director of oil and gas at commercial drone operator, Cape, believes that there is a major gap between what companies are hoping for and achieving in the use of drones.

“What we’ve done at Cape, is bring the user drones together with aerial telepresence, our technology, to give experts that visibility they need in real time,” Vaughn said. “Instead of hiring a company to go out and perform the survey for you, I’m trying to coach them on what to see and what’s important in terms of the asset inspection. How about let the experts take over and do it themselves in real time? That’s what we are bringing to the industry in a very early stage of drone usage.”

Manual inspection

Aerial view from droneCape

In this age of heavy focus on operational efficiency, companies are losing a lot of time and money on manual inspection tasks and responding to incidents and alarms that have come in through the DCS or the SCADA system. It takes time to get out to the field and investigate the issue and then they may not have the expertise to diagnose the issue quickly. “What if they could put a drone in the air and quickly get the expert to the site virtually over a live video feed connection?” Vaughn added.

Drones can be utilised right through the oil and gas value chain from inspecting pipelines, storage tanks and offshore platforms. “We can fly over storage tanks in shale fields with high-definition cameras, even thermal cameras,” Vaughn explained. “We’re also adding intelligence to the payload of the drone in addition to being able just to see what’s happening.

“In the onshore world, the major thing that we’re doing with drones is cutting down on time spent behind the wheel of the vehicle traveling out to the site to simply place eyes on the facility. If we could do that much more quickly and in many more sites at the same time using drone technology, then we’re giving these companies an unprecedented level of visibility that they previously would have struggled to achieve at the same rate with the same ease.”

 

Commodity items

Aerial drone footageCape

As the technology continues to mature, drones are becoming a commodity item that can be purchased at most electronic stores and be up and running with a number of high-quality features. “It is about the software that we have built to make the drone easy to use,” Vaughn added. “We’re opening the potential of the drone by allowing people to get that first-person viewpoint that the drone provides.

“It is essentially taking an off-the-shelf drone and allowing a company to get the maximum use with the minimum amount of hassle. “

What Cape has done is build a platform that allows any novice user to be able to log in from his or her office and pilot the drone and go out and conduct an inspection themselves without any training on how to run a drone. “We’ve created a very safe, automated environment around which the drone can operate that includes crash-proof geofences or virtual boxes in the air which the drone cannot go outside.

“It feels much more like you’re operating a flying camera rather than piloting a drone and worried about where the aircraft is. You’re focused on the piece of equipment or the facility assets that you’re trying to inspect instead.”

 These are relatively small, battery-powered drones so the technician in the field would simply need to be within a few miles of the asset they need to inspect. The size of the battery and size of the aircraft determines how long it can fly from its base, but the usual average would be seven kilometres, which allows a field of 196Km2 to be covered.

Early adopters

With this technology Cape is seeing early adopters from shale fields in Texas, Oklahoma, and North Dakota, which are arranged in such a way that the facilities, although they cover a very large area, they’re quite close together. “A drone can take care of dozens of facilities and accomplish the inspection task while a technician is able to be on the ground working on a piece of equipment,” Vaughn added. “A maintenance technician can be flying on multiple sites at once and accomplishing this in a much faster time frame.”

Looking to the future of drones in the oil and gas sector Vaughn calls that the fun part. “That’s where we start putting more sensors on the drones,” he said. “I’m envisioning some integration with SCADA systems, for example, being able to fly over a facility and wirelessly harvest the data or retrieve the data from a meter or a small computer. We could even interact with a PLC based upon visual inspection of the site, adjusting parameters.”

Sensors would put an additional dimension, beyond the current video, into the data stream that drones are helping to collect. “What we’re working on already that we’ll be introducing within the next year is applying machine learning to the drones,” Vaughn continued. “Teaching the drones to be able to recognize visual cues in its camera feed and then allow the user to make adjustments or automatically change certain aspects of a system based upon those inputs.”

With this ability a technician in the field could log into the drone, tell it to go fly the normal route. It will do so unless there is an issue. In which case, it will learn to alert the system. If it is integrated with SCADA, then the whole operations team would get alarms. “I’m picturing the drone as just another critical tool in the field to make an operator’s day much more productive,” Vaughn concluded.

Certainly, with the marriage of unmanned platforms, sensors and artificial intelligence, drones have a bright and profitable future in the oil and gas sector.