American Airlines Has Changed Something Very Basic About Its Service. It Just Hasn't Told Passengers Yet

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

Airlines are run with very little room for maneuver.

Once the system breaks down in a single place, it can have a terrible knock-on effect. 

And, of course, every new decision taken at the top has little consequences lower down.

It can all add up.

Have you noticed, for example, that the boarding time on your American Airlines boarding pass doesn’t always correspond with when the plane actually boards?

Yes, sometimes it’s delayed. Because delays are an integral part of flying enjoyment.

Sometimes, though, flights are boarding early. 

After all, there’s only one aisle and scores of fraying tempers.

There’s also the pressure all American employees feel to get the planes out on time.

Still, it can be annoying to turn up at the gate on time for boarding and discover that, oh, it’s already begun.

Cue the involuntary spasms caused by wondering whether there’ll still be overhead bin space.

Why, though, doesn’t American have the correct boarding time on its boarding passes?

View From The Wing’s Gary Leff offers darkly: “This is a known issue at American, and one they’ve chosen not to spend on the IT to fix.”

I asked American the inside story.

An airline spokesperson offered: 

It is not that we don’t want to update our IT. We have many projects we are working on, and we expect the fix will be in place in November.

In essence, then, the airline simply hasn’t got around to it.

Can’t you see that it’s busy?

Actually, I’m sure it is. Management puts all sorts of pressure on employees to deliver on a whole range of new parameters, as the big airlines fight for marginally more business and try to squeeze additional revenue from passengers.

Someone has to implement all that. That’s not always easy.

And have you seen how often airline IT systems break down? Why, American’s last vast issue was only in June.

Honestly, dear passenger, you can be so annoyingly inconsiderate sometimes.

Just wait in line, would you?

Retirement: How To Earn High Income Without The High Risk

Generally, a vast majority of folks, especially retirees, associate the Closed-End Funds [CEFs] with high risk, high leverage, and high fees. Many consider them unsafe and unsuitable for long-term holdings. Some others would argue that they have no place in a conservative or a retirement portfolio. Though it is easy to understand why, we tend to have a different opinion. There is no doubt that at times, their market prices can be volatile, more than the broader market-indexes or dividend stocks. It is also difficult to separate the good funds from the bad ones. We believe that in spite of their obvious risks if used with the appropriate diversification and right proportions, they can provide high-income, moderate risk in line with the broader market and at the same time provide market-matching or market-beating returns. It is not about all in or nothing; it is about the right proportions. How much is appropriate? The right amount of exposure to a specific type of investment usually depends on several factors including an individual’s goals, risk tolerance, and personal situation.

We will go over both the benefits and the risks of investing in this kind of portfolio strategy. However, we believe that there are more positives than the downsides and that’s why it deserves a place in your overall strategy. At the same time, they are not for everyone. First, if your investment pool is large and your income needs are less than 3-4% of your investment pool, there may not be a need at all to go for a higher income portfolio. Second, if you cannot tolerate slightly higher volatility (than S&P500), even while you are receiving the high income, you should probably stay away. Lastly, if you do not care about income, but just the total return, obviously these investments are not for you.

We will run several back-testing examples to provide the readers a glimpse of benefits versus risks in comparison to the broader market indexes. In fact, if used in the right proportions in terms of allocation, a CEF portfolio may provide higher income, lower risk, and the longevity of an income-focused portfolio.

In the end, we will provide some updates on our 4-year-old model portfolio, “The 8% Income CEF Portfolio”, which we have maintained here on SA and provided regular updates/reviews. Incidentally, this portfolio is also part of our Marketplace HIDIY service.

Back-Test # 1: (10-CEF Portfolio – Investment over 10 years)

CEFs selection and strategy:

We selected 10 CEFs that were introduced in 1994 or earlier. Selecting CEFs with such a long history is a tough call since a lot of popular CEFs today did not exist prior to 2004 or 2005. Another important criterion for CEFs selection was that we wanted each CEF to belong to a different asset class, and would avoid duplicity as much as possible.

By selecting 1995 as the beginning year, we would be making purchases at increasingly higher prices, especially in 1997-1999. But the subsequent bear market from 2001 to 2003 would even out our cost basis. By selecting the period from 1995 to 2017, we are able to include two full-blown bear markets and two bull-market periods.

We fully understand and appreciate the fact that this process would introduce some element of selection bias. The first factor is that a fund with such a long history would (more than likely) be a successful one. But that may not be entirely true, as there would be others with mediocre performance. However, a selection strategy of picking the best fund among its respective asset class can avoid the pitfalls. Secondly, there may be the beginning year bias. To remove the beginning-year bias, we have included an additional back-testing model (please see the model#3), which should help remove any doubts on that front.

Here is the list of 10-CEFs that we selected going back to 1994-1995:

CEF Name

Symbol

Asset-type

1

John Hancock Financial Opportunities Fund

(BTO)

Equity Securities – U.S. Banks, Regional Banks, Thrifts/Finance holding cos.

2

Tekla Healthcare Investors

(HQH)

Healthcare and Medical Technology

3

Alliance World Dollar Government Fund I

(AWF)

High Yield Government and Corporate Fixed Income Securities

4

Cohen & Steers Total Return Realty Fund

(RFI)

Real-Estate – Equities and Debt Securities

5

PIMCO Commercial Mortgage Securities

(PCM)

Mortgage-backed Securities, Non-Investment Grade Securities

6

New America High Income Fund

(HYB)

Corp High Yield Bonds

7

Morgan Stanley Emerging Markets Fund

(MSF)

Emerging markets Equity Securities

8

Liberty All-Star Equity Fund

(USA)

Equity Securities – US Companies

9

John Hancock Premium Dividend Fund

(PDT)

Preferred Stocks and Dividend Equity Securities

10

Blackrock Muni-Yield Fund

(MYD)

Municipal Bonds – Investment Grade (Tax Exempt)

## Blackrock Muni-Yield Fund (NYSE: MYD) is a Tax-Free Municipal Fund. It may not be suitable inside a 401(k) or IRA account. However, one can choose a taxable municipal fund.

Assumptions:

  • We invested $10,000 every year from 1995 to 2004 (first trading day, every January). Over 10 years, total original investment amounted to $100,000.
  • We would withdraw 6% income from this portfolio (on a yearly basis at the year-end) on the invested capital and take an increase of 2.5% per year for inflation adjustment.
  • Income withdrawals would start right from the first year.
  • The begin- date for the back-test is January 1st, 1995. End-date is December 31st, 2017.

10-CEF Portfolio Return & Income Calculations: – 6% (with inflation) Income Withdrawn:

S&P 500 Return & Income Calculations:– 6% (with inflation) Income Withdrawn:

Performance comparison of the 10-CEF portfolio with S&P 500:

10-CEF Portfolio

(From 1995-2017)

**S&P500

(From 1995-2017)

Total Original Investment

(Contributions made for first 10 years)

$100,000

$100,000

Total Income Withdrawn

$130,011

$130,011

Net Portfolio Value (after income)

$230,801

$116,721

Compounded Annualized Return (in addition to income)

4.76%

0.86%

Net Portfolio Value (No income withdrawn)

$592,483

$432,383

Compounded Annualized Return (when no income is withdrawn)

10.39%

8.47%

*Annualized returns were calculated on the basis of 18 years (not 23 years) since investments were made over 10 years.

**Performance of S&P500 has been taken from the Vanguard 500 Index Fund.

As you could see, for nearly 24 years, the 10-CEF portfolio has performed very well. It provided inflation adjusted 6% income every year and still provided nearly 5% compounded return in terms of capital appreciation. However, if you had put the same amount in S&P 500, after taking inflation-adjusted 6% income every year, S&P 500 did not perform nearly as well and ended up providing very little appreciation (0.86%) in the capital.

Back-Test # 2: (10-CEF Portfolio – Investment over 20 years)

Assumptions:

  • We invested $10,000 every year for 20 years from 1995 to 2014 (first trading day, every January). Over 10 years, total original investment amounted to $200,000.
  • We would withdraw 6% income from this portfolio (on a yearly basis at the year-end) on the invested capital and take an increase of 2.5% per year for inflation adjustment.
  • Income withdrawals would start right from the first year.
  • The begin-date for the back-test is January 1st, 1995. End-date is December 31st, 2017.

Performance of CEF Portfolio – 6% (with inflation) Income Withdrawn:

Performance of S&P500 – 6% (with inflation) Income Withdrawn:

Performance comparison of the 10-CEF portfolio (contributions for 20 years) with S&P 500:

10-CEF Portfolio

(From 1995-2017)

**S&P500

(From 1995-2017)

Total Original Investment

(Contributions made for first 20 years)

$200,000

$200,000

Total Income Withdrawn

$210,084

$210,084

Net Portfolio Value (after income)

$381,290

$252,115

Compounded Annualized Return (in addition to income)

5.09%

1.80%

Net Portfolio Value (when no income withdrawn)

$848,773

$682,218

Compounded Annualized Return (when no income is withdrawn)

11.76%

9.90%

*Annualized returns were calculated on the basis of 13 years (not 23 years) since investments were made over 20 years.

**Performance of S&P500 has been taken from the Vanguard 500 Index Fund.

As you can see, when we do not draw any income, CEF Portfolio performs better than S&P500 leaving a larger balance in the end. However, performance improvement becomes more prominent and significant when we are drawing a constant 6% income (with annual 2.5% increments for inflation).

Back-Test # 3: (10-CEF Portfolio – Multiple Beginning Years)

We wanted to remove the beginning-year bias if there was any, so we decided to include another back-testing model. We would perform the same test (Back-test#1) for our 10-CEF portfolio and S&P 500 with commencement year to move by a year each time (from 1995-2016).

Assumptions:

  • We invested $10,000 every year for 10 years from 1995 to 2014 (first trading day, every January). Over 10 years, total original investment amounted to $100,000.
  • We would withdraw 6% income from this portfolio (on a yearly basis at the year-end) on the invested capital and take an increase of 2.5% per year for inflation adjustment.
  • Income withdrawals would start right from the first year.
  • We conduct a series of tests, each time we change the commencement date. We start with 1995, then with 1996, 1997, 1998 and so on until the year 2016.
  • For each back-test series, the End-date is December 31st, 2017.

Here are the results, in a graphical form. The results favored the 10-CEF portfolio strongly until the year 2008. Only after the year 2009, S&P 500 started outperforming the 10-CEF portfolio slightly.

Note: In the graph, starting years from 2009 to 2016, the investment was less than 100,000 (10K per year). However, they were normalized to a base of 100,000.

Up until the year 2008-2009, the 10-CEF portfolio beat S&P 500 almost every time, irrespective of the year you may have started this portfolio. After 2009, however, both have performed more or less even, but S&P500 has taken a small but clear lead due to the very strong bull market of the last 10 years. The chart also shows that if you were a buy-and-hold income investor, investing in the S&P 500 index during 1995-2001 was not such a good idea.

Backtesting Summary/Remarks:

Even with these three extensive back-testing models, we do agree that some element of selection bias could remain as to the kind of CEFs we picked. One possibility could be that since we were looking for CEFs that had 25+ years of history, a majority of them probably had a better-than-average track record, and the ones with bad track records did not survive for this long, so never made to our list.

In our view, the success of 10-CEF portfolio boils down to the following factors:

  • Wide diversification among varied asset classes; some of them have low correlation with the stocks.
  • Investment over long periods (in a staggered manner), in this case over 10 years. By doing so, even though we bought at the very peak prices during 1996-1999, but we also bought at the bottom during the recession of 2001-2003 at the bottom.
  • Selection of CEFs that have a good track record of maintaining their NAVs (Net Asset Values). We need to be careful to be selective about which CEFs we buy into. Not all are equal in terms of quality.
  • Selected CEFs should have yields in excess of 6-8% and possibly have positive UNII (Undistributed Net Investment Income). This may not apply to some categories of CEFs.

Risks to CEFs Investing:

Obviously, there are some risks to CEF investing, especially when the entire portfolio is based on CEFs. There are several well-known risks.

  • A vast majority of CEFs use high leverage, generally in the range of 20-35%. Some use even higher. This leverage helps them earn higher investment income which then supports a high level of distribution rates. However, leverage works both ways. It does wonders in good times, but during recessionary times it can really hurt their bottom lines.
  • CEFs are generally known for high fees. Normally a part of these fees covers the interest on the leverage being used. However, NAVs are reflected net of fees, and there are no separate fees that the investor has to pay.
  • CEFs provide high distributions, ranging from 6-10%. However, many times, the high distribution may consist of ROC (return of capital). The ROC is not always bad, but it is difficult to separate the good ROC from a bad one.
  • Their market prices normally differ from their NAVs, and this difference is known as discount or premium. To an investor, a discount is obviously better as you would be buying it less than what it is worth. But sometimes, a CEF may be trading at a large discount for a valid reason, for example, its UNII is consistently negative and is not sufficient to support the distribution and a distribution cut may be imminent. When a distribution cut happens, not only the income will reduce, but the market price will fall as well. Another reason could be its track record in terms of NAV has been less than desirable.

In our view, the track record of a fund matter, especially with regards to its NAV. Of course, the comparison should be made within the asset class that the CEF invests in. For example, we know that all energy-related CEFs had performed poorly during 2015-2017 energy prices bust, but still, there will be some who have performed better than others within their class. Also, when we talk about performance, it is better to compare NAV performance rather than the market price.

Our Current “8% Income CEF Portfolio”

We started this model portfolio in October of 2014, and since then, we have published several periodic updates on SA. At the outset, this portfolio had two simple goals; first, to provide 8% income (by way of dividends and distributions); and secondly, provide some capital appreciation over the long term. For income-seeking investors, 8% income will allow a withdrawal rate of up to 6% and leave 2% for growth.

Author’s Note: This model portfolio is part of our “High Income DIY Portfolios” SA Marketplace service. For more details, please see at the top of the article, just below our logo.

In this model portfolio, we allocated $100,000 initially, and another $100,000 was allocated in the next 12 months ($8,333 in 12 installments). Thus the total cost basis for the portfolio stands at $200,000 (excluding the reinvested dividends).

Cash added/contributed:

Initial Investment 10/17/2014:

$100,000

From Nov. 1st, 2014 until Oct 1st, 2015

$100,000

12 installments of $8333. 33

TOTAL Contribution (Cost basis)

$200,000

In this income-centric portfolio, we utilized a diversified group of CEFs. Initially, we selected 12 funds and added a few more in the subsequent years. This approach has provided us a broad diversification, high distributions, and exposure to different types of assets such as Equity, Bonds/Credit Securities, Utility, Infrastructure, Energy MLPs, Preferred Income, Floating-Rate Income, Healthcare, etc. Currently, we have three individual company stocks, one ETF, one ETN, and 11 CEFs.

Here is the current portfolio consisting of 16 securities:

Fund/Stock Name

SYMBOL

Fund’s composition

1

DNP Select Income (NYSE: DNP)

DNP

Utility (80%)

2

Kayne Anderson MLP (NYSE: KYN)

KYN

(MLP – Master Limited Partnership)

3

Guggenheim Strategic Opp Fund (NYSE: GOF)

GOF

Equity CEF fund

4

Columbia Seligman Premium Tech Growth (NYSE: STK)

STK

Equity CEF fund

5

Nuveen Muni High Inc Opp (NYSEMKT: NMZ)

NMZ

Muni Tax-Free ( Tax-free yield)

6

PIMCO Dynamic Credit Income (NYSE: PCI)

PCI

Global Income, including corporate debt, mortgage-related and other asset-backed securities

7

PIMCO DYNAMIC INCOME FD (NYSE: PDI)

PDI

Debt obligations and other income-producing securities

8

ISHARES US PREFERRED STOCK ** ETF **

(NYSEARCA: PFF)

PFF

Preferreds 90% (This is an ETF, not CEF)

9

COHEN & STEERS TOTAL RETURN REALITY Fund (NYSE: RFI)

RFI

REIT (Real Estate) CEF

10

COHEN & STEERS REIT & Preferred Income Fund (NYSE: RNP)

RNP

Preferred is 48%, 50% REIT

11

Cohen & Steers Infrastructure (NYSE: UTF)

UTF

Utility+Infrastructure (50% is International)

12

UBS ETRACS Monthly Pay 2xLeveraged ETN (NYSEARCA: CEFL)

CEFL

Exchange Traded Note (based on the index of CEFs)

13

Tekla Healthcare Investors ( HQH)

HQH

Healthcare/Biotechnology

14

Annaly Capital Management, Inc (NYSE: NLY)

NLY

mREIT

15

Main Street Capital Corp (NYSE: MAIN)

MAIN

BDC (Business Development Co)

16

Ares Capital Corp ( ARCC)

ARCC

BDC

Dividends:

Total dividends earned since portfolio inception: $59,263*

(*this includes $1,382 from securities already sold)

For the year 2018, the projected yield is in the range of $17,000, which will be 8.5% yield on cost.

1

Dividends collected until 09/17/2018

$59,263

3

Cost basis excluding dividends (09/17/2017)

$200,000

4

Portfolio balance (09/17/2018)

$269,843

5

Net profit/Loss (incl. dividends) (09/17/2018)

$69,843

6

Return on total contributed capital, including un-deployed funds

34.9%

Here is the portfolio as of 09/17/2018. The gains/losses shown below are without counting dividends, as they are not re-invested into original securities, but get deposited as cash.

Performance

The table below shows the funds in the portfolio in the order of performance (from best to worst) as of Sept. 17, 2018. The performance has been calculated and sorted after including the dividends.

Comparison with 60:40 Stock-Bond Portfolio:

Here is the performance comparison with a typical Stock-Bond portfolio.

Our Stock-Bond portfolio allocates in the ratio of 60:40 to stocks and bonds. The Stock/Bond portfolio mirrors the invested amounts with 8% CEF Portfolio (at different times). The hypothetical stock/bond portfolio has a 40/20/40 allocation to Vanguard Total Stock Market ETF (NYSEARCA: VTI), iShares MSCI EAFE – International (NYSEARCA: EFA), and (Vanguard Total Bond Market ETF (NASDAQ: BND). So far, the 8% Income Portfolio has beaten the Stock/Bond (60/40) portfolio on both total return and income for the majority of the time.

As of 09/17/2018

Total value

Dividends (since inception)

8% Income portfolio

$269,843

$57,187

60:40 Stock/Bond portfolio

$248506

$15,439

Closing Remarks:

We believe an all CEF portfolio presents a viable alternative to an all-stock or a balanced stock-bond portfolio, however, as part of a broader strategy and allocation model. Obviously, the primary benefit of this portfolio is the constant stream of cash income that it generates, and one does not need to sell shares to withdraw income. It appears that in good times (bull market), this portfolio, after including the dividends, should at least match the broader market performance. However, more importantly, during tougher times, the cash dividends would help protect the downside considerably, as is evident from back-testing models. The constant stream of income will also help the investor to resist the temptation to sell at the worst time.

With the help of several backtesting models and from the past four-year performance from our current model portfolio, in our opinion, we feel this 8% model will likely perform better than a broader market index fund, especially if we need to withdraw high levels of income on a consistent basis. So, we believe this portfolio would have a special appeal to income-seeking investors.

It is important to point out that this portfolio will not protect the investor from a broader market crash or correction. To avoid getting caught in a situation like 2008, we always recommend that one should invest gradually over a period of time, adding equal sums of money every time, which would hopefully smoothen the ride.

Disclaimer: The information presented in this article is for informational purposes only and in no way should be construed as financial advice or recommendation to buy or sell any stock. Please always do further research and do your own due diligence before making any investments. Every effort has been made to present the data/information accurately; however, the author does not claim 100% accuracy. Any stock portfolio or strategy presented here is only for demonstration purposes.

Disclosure: I am/we are long ABT, ABBV, JNJ, PFE, NVS, NVO, CL, CLX, GIS, UL, NSRGY, PG, KHC, ADM, MO, PM, BUD, KO, PEP, D, DEA, DEO, ENB, MCD, WMT, WBA, CVS, LOW, CSCO, MSFT, INTC, T, VZ, VOD, CVX, XOM, VLO, ABB, ITW, MMM, HCP, HTA, O, OHI, VTR, NNN, STAG, WPC, MAIN, NLY, ARCC, DNP, GOF, PCI, PDI, PFF, RFI, RNP, STK, UTF, EVT, FFC, HQH, KYN, NMZ, NBB, JPS, JPC, JRI, TLT.

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.

7 Things Introverts Wish Extraverts Knew

As I pointed out a few columns ago, introverts tend to be more creative, more reliable, more trustworthy and to work harder than extraverts. Not surprisingly the great inventors and innovators of history have been markedly introverted: Einstein, Bill Gates, Mark Zuckerberg, Elon Musk, Isaac Newton, Nikola Tesla, Archimedes, and Charles Darwin.

Insanely, though, contemporary business culture values extraversion.  They hire people based upon first impressions (extraverts are good at that), goal them on “collaborating” (which extraverts love) and then spending billions of dollars creating open plan playgrounds perfectly suited for extraverts.

As I said, insane. Or maybe “inane” is the mot juste.  

Anyway, because of the egregious management boneheadedness, most workplaces are dominated by extraverts… to the great detriment of both productivity and innovation. However, since, alas that’s not likely to change any time soon, introverts and extraverts will need to learn how to get along.

Unfortunately, while introverts can see right through extraverts, extraverts simply don’t seem to grok introverts at all. So, since I’m off-the-scale introverted, I’ll take in on myself to speak for my fellow introverts to tell the extraverts what we wish they already knew. Here goes:

1. You’re talking too much.

Introverts are good listeners but the fact that we’re listening to you and not saying anything doesn’t mean that we’re enthralled by everything you’re saying. Quite the contrary. If you’ve been talking for more than a couple of minutes without pause, we’ve mentally proceeded from “What a bore!” to “OMG, will he never stop talking!?” to “For God’s sake, STFU!!” We’re not going to say anything, though, because if we did, we would never hear the end of it.

2. We don’t want to change.

Even though it’s abundantly clear that society (in general) and workplaces (in particular) tend to value outgoing “people-people,” we introverts don’t want to, nor feel the need to, change to fit other people’s ideas of how we ought to act and feel. We’re perfectly fine the way we are, thank you very much. What’s more, we’d greatly appreciate it if you stopped assuming we envy you. We don’t. Believe me. We don’t want to be like you.

3. Give us private offices or let us work-from-home.

Today’s open plan offices are productivity toilets and health hazards for everyone. For introverts, though, they’re particularly hellish because there’s no way to get away from other people. Forcing an introvert to work in an open plan office is like forcing an extravert to spend all day in solitary confinement. We need privacy. Please have the common sense and common decency to give it to us.

4. We resent doing more than our share.

Because extraverts spend so much time collaborating, sharing, and gossiping, the burden of actually getting real work accomplished falls to the introverts. After a while–no, scratch that–from day one, we resent that you waste time and money socializing while we’re working our asses off. And we really resent it when you pipe up to steal the credit.

5. Leave us alone to recharge.

Introverts feel physically, emotionally, mentally and spiritually drained after being forced to interact with other people. The only way that we can recharge is by disconnecting and being by ourselves. Yes, we know that you draw energy from other people. Like a vampire. But we’re the opposite. So when you see us sitting by ourselves, don’t think you’re doing us a favor by pestering us. You’re not.

6. We are not shy loners.

Quite the contrary. Introverts are often talented at public speaking. We often have a small circle of close friends and family with whom we enjoy spending time. We’re not bashful about our accomplishments; we just don’t feel the need to toot our own horns. We don’t talk about ourselves because we’d rather talk about something more interesting than stuff we already know.

7. Go away, please.

Eventbrite’s IPO Is a Hot Ticket as Stock Surges 59% in First Day of Trading

Shares of online-ticketing company Eventbrite rose 59% in their first day of trading as investors clamored for what looks to be a dwindling supply of brand-name tech IPOs in the final months of 2018.

Eventbrite’s stock, which listed on the New York Stock Exchange under the ticker EB, rose as much as 71% to $39.30 a share on Thursday before closing at $36.50. The company initially priced its offering from $19 to $21 a share, but high demand raised the final offering price to $23.

At that price, Eventbrite’s IPO raised $230 million.

Eventbrite created its online service for live-event ticketing 12 years ago. According to a letter from Eventbrite’s founders in the IPO prospectus, the idea behind the site was not only to make it easier for people to organize and distribute tickets for free and paid live events, but also to address a need for face-to-face connections in an era in which people increasingly connect through social networks and other digital platforms.

Last year, Eventbrite created tickets for 3 million events in 170 countries. Its revenue grew 51% to $202 million in 2017 while its net loss declined to $1.98 a share from $2.48 a share. In the first six months of 2018, revenue growth accelerated to 61%, while its net loss increased to 73 cents a share from 44 cents a share a year earlier.

Part of the popularity of Eventbrite’s offering may come from the successful tech IPOs in the last 12 months, including streaming-TV device maker Roku, online-storage provider Dropbox, wireless-speaker manufacturer Sonos, as well as the direct listing of streaming-music giant Spotify. For the remainder of the year, however, there are few well-known tech startups that have signaled plans to go public in coming months.

After Eventbrite, online-survey software company SurveyMonkey is the best-known tech-IPO candidate.

This has been the strongest year for IPOs in several years since 2014 and one of the busiest periods in 24 years. According to Dealogic, 120 companies have staged IPOs in the first half of 2018, raising an aggregate of $35 billion.

Tech company offerings have been among the most successful IPOs.

Everything Amazon Announced: Echo Plus, Alexa Microwave, Echo Sub

Amazon announced more than a dozen new hardware products today, along with several software updates, all aimed at bringing its voice assistant Alexa to more devices in your home—and even to your car.

Some of the products were updates to existing Echo devices; others were brand new, like a new Echo Sub speaker, or a Fire TV device that acts as a DVR for local TV broadcasts. And, as rumored, there was a new home appliance in the mix too: An Amazon Basics microwave that works with Alexa and will sell for the low price of $60.

There were few dramatic flourishes at the media event in Seattle, Washington as senior vice president of devices and services Dave Limp rattled off the new products. The event was held on the top floor of Amazon’s Spheres, a biodome located directly next to the company’s corporate offices. Limp began the event by saying 70 new products would be announced within just an hour’s time, software updates included. There were no glossy product videos, or detailed descriptions of the materials used in the new hardware. The whole event underscored Amazon’s strategy of selling high-volume, low-cost hardware in an effort to get customers to use more of its services. And, of course, it was a good reminder that Amazon wants to be absolutely everywhere.

More Echos Than You’ll Know What to Do With

Amazon updated its Echo Dot, Echo Plus, and Echo Show speakers today, keeping the same pricing as earlier models while adding small tweaks that make them sound better and look better.

The new Dot

Amazon

The new Plus

Amazon

The new Echo Dot is bigger than the previous Dot, and it’s now covered with fabric on the sides. It looks like a little pouf on your coffee table or nightstand. It now has a 1.6-inch driver, Limp said, updated from the old model’s 1.1-inch driver, and is 70 percent louder. It connects to other speakers either over Bluetooth or via an audio-out cable. It ships next month for $50, the same price as the old Dot.

The Echo Plus speaker, a squatter version of the tubular Echo, looks similar to last year’s Echo Plus. And it still doubles as a smart home hub. But it now has something called “Smart Home Local Voice Control,” which means it runs certain commands for smart-home devices locally. “So when the internet goes down, you can still say, ‘Alexa, turn on the lights,’ or ‘Alexa, turn on the plug,'” Limp explained. It ships next month for $150.

The Echo Show offers some practical utility that other Echos don’t: It’s an Echo speaker with a display. The new Echo Show ($230) has an updated exterior: a fabric back cover, and a 10-inch HD display that offers much more screen space than last year’s 7-inch display. Like the Echo Plus, it doubles as a smart home hub. Like the Dot, the sound is supposed to be improved with “real-time Dolby sound processing,” according to Limp.

And the Echo Show now has a web browser. That not only gives it a way to, say, display recipe instructions from your Amazon Meal Kit, but also a way for Amazon to show you YouTube videos without having a YouTube app running natively on the device. (Google pulled YouTube from Amazon devices late last year, and Amazon doesn’t sell Google hardware on its website.)

A Smarter Car

Amazon

There was another new Echo added to the mix as well: the Echo Auto, a tiny device that goes on the dashboard of your car and gives you Alexa capabilities while you’re driving. It talks to the Alexa web service through your phone, which it connects to using Bluetooth. Alexa, add avocados, almond milk, and millennial guilt to my shopping list. Alexa, give me directions to my local conflict-free coffee shop. Alexa, will this keep me from getting distracted in the car? And so on.

Echo Auto has a catch—it’s not technically ready, and it’s only available by invitation. It’s not the first time Amazon has done a limited launch of a hardware product—several Echo products have seen limited availability at first. Also, this may be one product that the company wants to test with a small user group before it has all of us shouting at Alexa from behind the wheel. It will cost $50 when it eventually ships, but if you’re lucky enough to get an invite before the end of this year, it will cost you $25.

Sound Companions

Five other products were released today under the moniker, “Echo Companions.” This is a class of products that connect to existing Echo speakers, or add Alexa functionality to other non-Amazon products in your home that you already own. Most intriguing are the audio products: Echo Link, Echo Link Amp, Echo Sub, and Echo Input.

Amazon

Echo Input

Amazon

The Echo Link is a $200 box with a big dial on it that you plug into a stereo, turning your legacy sound system into an Alexa-powered music station. The $300 Link Amp is the same thing, but with a 60-watt stereo amplifier inside—just hook up a pair of speakers, and you’re in business.

The Input is a simple, flat puck that connects to a speaker of your choice. It has microphones on it, but no speaker of its own. It essentially turns any regular speaker into a smart speaker. It’s actually quite a bit like Google’s Chromecast Audio device, with one difference: the Echo Input has mics and can accept voice commands on the device, whereas the Chromecast does not, and can only accept voice commands through a phone or a Google Home speaker. The Input will cost $35 when it becomes available in the near future.

How low can you go, Echo Sub?

Amazon

Rounding out the home audio “Companions” is the Echo Sub. It’s exactly what you think it is: a $130 subwoofer that pairs with one or two Echos in your home.

Probably the biggest audio news to emerge from today’s event has little to do with hardware. Amazon is adding support to Alexa for multiroom music playback. This update lets those with multiple speakers group them together to play the same tracks in unison in multiple locations around the home. The enhancement that brings Amazon’s smart speaker multiroom capabilities roughly up to par with Google’s and Apple’s.

The last Companion is a $30 Wall Clock which connects to an existing Echo speaker to give you visual indications for timers and reminders that you set with your voice. It’s not out yet, but coming soon.

Today I Learned You Can Microwave a Potato

Amazon

Amazon’s new Alexa-enabled microwave doesn’t have Alexa built directly into the appliance. Instead, it wirelessly connects to another Alexa device in your kitchen and takes commands that way. But the new Amazon Basics countertop microwave is the first appliance in the Amazon Basics line to technically work with Alexa.

Amazon seemed thrilled to show reporters today that you can ask Alexa to microwave a potato. And it also works with Amazon’s Dash Replenishment service, which means the microwave knows when you’re running low on popcorn and orders your more. Plus the $60 price tag undercuts most of the countertop microwaves selling on BestBuy.com right now. Amazon does as Amazon does.

One other smart-home device to talk about (oh, you’re not the only one who’s exhausted here) is the $25 Amazon Smart Plug. Insert it into an electrical conduit, plug in an appliance like a light, space heater, or coffee maker, and you can now turn that device on or off with your voice. Neat!

Fire TV Now Means Actual TV

Amazon

No new Amazon Fire TV box or stick was announced today—Amazon just released a new cube-shaped streamer in June—but there was a new piece of hardware that’s compatible with Fire TV. It’s called the Fire TV Recast, and it’s a DVR device that works with either a Fire TV box or stick or an Echo Show to cast and record live TV streams.

We’re talking about good ol’ over-the-air local TV, not streaming video or cable shows. You can also access all of these TV streams and DVR’ed content on iOS or Android.

“We realized that the average person in the US has access to several dozen channels coming into their home over the air,” Marc Whitten, vice president and general manager of Fire TV, said in an interview. “And it’s not a very convenient or integrated experience as it exists today. So we saw this as a way to go after that particular problem.” The Fire TV Recast will ship sometime before the holidays, Amazon says, and will cost $230 for a version with two tuners, and a 500GB DVR; and $280 for a Recast with four tuners and 1 terabyte of storage.

Sticky Fingered Intruders

Ring

In February, Amazon acquired the home security company Ring for a reported $1 billion. Today, two new Ring security cameras were unveiled, although they’re still selling under the Ring brand, rather than with Amazon or Echo badging.

Called the Stick Up Cam, as were previous versions of Ring cameras, these are indoor/outdoor cameras that sell for $180 and stream live video feeds in 1080p HD, include motion detection features, and offer two-way talk functionality. One version, the Ring Stick Up Cam Wired, is powered either by an Ethernet cable or a micro-USB power supply, while the battery-powered version lasts for six to 12 months, depending on usage. In the future, Limp said, Ring’s Stick Up Cams will also work with Alexa.

Things We Didn’t Hear About (Like Privacy)

Amazon made no mention of some of the other Echo-branded products it’s released in the past year, including the Echo Look, a camera that judges your outfits; or the Echo Spot, a touchscreen alarm clock. Amazon did tell WIRED, however, that it is still producing these products. There was also no mention of Kindle hardware, although that’s not entirely surprising, since Amazon just updated the Kindle Oasis this year, and Kindles don’t have built-in voice control like nearly everything else that was shown off today.

But another glaring omission on Amazon’s part was any kind of deep dive into how the company plans to keep your voice commands, your location, and your purchasing history private. Amazon has faced criticism over the past couple years for unclear privacy policies or outright missteps, including an incident back in May where a woman reported that Alexa had recorded and shared a private conversation she was having with her husband.

At the launch of the Echo Look, the aforementioned smart camera that gives you style advice, WIRED’s Brian Barrett reported that it had no separate privacy policy, citing a policy expert who noted that “Amazon doesn’t say anywhere in any kind of clear language what the risks are.”

Personally, I find last year’s Echo Show to be an incredibly useful product in my kitchen. And the updated Show might be, too. But I keep a piece tape over the camera on my Show, and I’ll stick a strip of tape over the camera on the new one too. Other “smart displays” that have been introduced, like Lenovo’s Google-powered screen, have a physical tab that acts as a shutter over the camera lens.

As Amazon makes more and more connected devices, and as Alexa gets that much smarter, Amazon’s press events might be well spent addressing that particular elephant in the room.


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This Ridiculous Video for United Airlines 'Explains' the New Boarding Process

Some explanations are better left to a simple card or even a text message.

A new video on YouTube, created by United Airlines, tries to explain the new boarding process, which went into effect this week.

Sadly, it makes it seem like an intricate maze.

Before we get into the video and what makes it so confusing, know this: There’s hope. United Airlines did simplify how it all works to board a plane now, trimming the lines down to just two options, green or blue. At first glance, you might wonder if things would be far simpler if there was one lane, but that might also be an indication that you have only flown with really polite people. One lane means way more crowding. People bud in line. Multiple lanes beyond two means more confusion. So I do understand why this two lane approach is much easier.

Then, there’s the video. Here it is:

[embedded content]

That’s right. Text pops up in the video in a chaotic fashion, a guy gives you all of the boarding pass advice, a cheesy music tracks plays in the background, and there are blue and green colors flashing at you like crazy. By about halfway in or maybe two-thirds, it starts to feel like someone went overboard with the two primary colors. It’s not a terrible video, but it also doesn’t help explain a simple process. And it probably shouldn’t exist.

The problem with visual communication, of course, is that it can go way too far. The video is two minutes and 21 seconds long when it should have been about 30 seconds. A voiceover saying “there are now only two lanes, and you’ll split into two groups depending on which zone you’re in” would have been just about right. Text me that, then snap–done.

There’s something to be said for “you’ll figure it out” after giving a teaser or a hint of what’s going to happen when you board. A sign is sometimes better than a video.

It would be like trying to explain the airport kiosks. You know, they are super simple. Insert your ID or a credit card, punch a few buttons, grab your boarding pass.

If a video tried to explain things like multiple layovers, what to do if your ID doesn’t work, or just about any other scenario that would make it seem complicated would…make it seem complicated. Very few people get confused by kiosks. It’s actually better to skip a video altogether. I always notice someone hovering around the kiosks anyway. And, if you don’t watch the United Airlines video explaining the new process, you’ll figure it out. It speaks for itself. And there are screens everywhere. And gate agents are readily available.

It’s a bit ironic, actually.

By making an explainer video, it makes passengers more stressed instead of less stressed. The video itself tells you ot to be stressed, which is a sure sign that you might want to be stressed. What would be far less stressful? No video at all.

And, this is where things get interesting, by the way. For anyone trying to communicate about a slightly complex topic, the first question to ask is: Should this even be a video? Or is it better to include a few directional indicators at the point where someone needs to know a new process? Think about something as simple as placing an order for products and services. Sometimes, not explaining something makes it all seem easier.

My best example of this has to do with McDonald’s kiosks.

They are not as common in the U.S., but I started using them on a trip to Austria recently. I can’t imagine how anyone could improve them. They have huge icons, you click things to order. That’s it. Making the process itself easier–which United Airlines has done–is the big win. Trying to explain why something is easier–which is the mistake United Airlines made in the video–is a sure way to create even more confusion.

Eventbrite Raises IPO Pricing Range, Now Hopes to Raise as Much as $230 Million

Eventbrite, an online platform for live-event ticketing, raised the proposed price of its planned IPO to a range of $21 a share to $23 a share from its previous range of $19 a share to $21 a share.

When IPO candidates increase the price of their offerings, it can signal a strong demand among institutional investors. Eventbrite is planning to sell 10 million shares later this week, listing its shares on the New York Stock Exchange under the ticker EB. At the high end of the new range, Eventbrite’s proceeds from the IPO would total $230 million.

The company was founded in 2006 as a way to make it easier for people to organize and distribute tickets for free and paid live events. Last year, Eventbrite created tickets for 3 million events in 170 countries. Its revenue grew 51% to $202 million in 2017 while its net loss declined to $1.98 a share from $2.48 a share.

In the first six months of 2018, revenue growth accelerated to 61%, while its net loss increased to 73 cents a share from 44 cents a share a year earlier.

Despite the higher net loss so far this year, demand for Eventbrite shares was enough to prompt a higher price. Part of that popularity may come from the successful tech IPOs in the last 12 months, including Roku, Dropbox, Sonos, as well as the direct listing of Spotify. Outside of Eventbrite and SurveyMonkey, there aren’t a lot of well-known tech startups heading through the IPO pipeline later this year.

2018 has been the strongest year for IPOs in several years. According to Dealogic, 120 companies have staged IPOs in the first half of 2018, raising an aggregate of of $35 billion. It’s the best first half for U.S. IPOs since 2014 and one of the busiest periods in the 24 years that Dealogic has been tracking IPO data. Tech offerings have been among the most successful IPOs.

The 1 Thing You Need to Make Your Content Go Viral

During this process, I’ve learned a lot about what it takes for content to go viral. And if there’s one central takeaway, it’s this: virality isn’t an accident. There’s a method to going viral, and while it’s not exact, it can be learned, engineered, and applied. The secret?

You have to apply the science of growth hacking and analytics to the art of engaging, impactful writing.

Viral Doesn’t Care About Your Feelings

First thing’s first. There’s a harsh truth you have to accept if you want to reliably engineer viral content:

Success has nothing to do with how you feel about your writing.

I’ve written posts from the depths of my soul about some of the most difficult experiences in my life. I was sure they would resonate with my audience and achieve massive engagement. But after I hit the publish button, they bombed so hard I had to take them down. On the flip side, I’ve had posts I cranked out in five minutes without thinking turn into some of my biggest hits.

The point here is that you can’t always trust your intuition when crafting viral content. There are patterns that you can learn and apply to your writing, but ultimately, it doesn’t matter what you think of the piece. The only thing that matters is the data.

This is why I test my content relentlessly. On my two main social profiles, LinkedIn and Instagram (@igbenlee), I’m constantly adjusting variables and looking for patterns. I’ve learned how to use the roughly 140 character-preview of a LinkedIn story to maximize views. I’ve learned the fine balance of too many vs. not enough emojis for engagement on Instagram.

It’s not an exact science. Sometimes a post will buck the trend, and you still need to write from the heart with real emotion. But there are reliable patterns for every platform and every audience. The only way to learn them is to test every possible variable and look to the data for guidance. Sometimes, that means throwing your intuition out the window.

Recycling: Good for the Planet, Good for Your Brand

Another cardinal rule I’ve learned is that while there are platform-specific formulas, generally if something works, it works. And if you have a piece of content go viral, that’s now a proven asset that you can use again and again.

Take a look at this status:

This post ended up getting 6 million views on LinkedIn and was one of my most viral pieces, bringing in serious revenue for my business. So why not leverage it elsewhere? I knew it had gained traction on LinkedIn, so I had a hunch it would do the same on Quora – the audiences are similar enough to resonate to the same style and format.

Here’s the same story, with slight modifications to fit the medium, on Quora:

Sure enough, it hit the Quora Digest and became one of my highest-performing answers.

The lesson? Be shameless in recycling your content.  

Too many creators fear that people will remember their content and call them out for reusing it.

“Oh, I mentioned that on Twitter, I can’t use it again.”

It’s bull****.

The Internet moves too fast now, and there’s simply too much content. Trust me when I say that no one remembers your stories, and if they do, they don’t care. In the content economy of 2018, you have to be smarter and more efficient. That means reusing the stuff that works.

Now, if my agency wants to do a campaign for an info product or a landing page, we lead with something that’s worked in the past. I keep a spreadsheet going with links to all of my high-performing content. If I need quick engaging copy, I can pull directly from that and make a few modifications instead of starting from scratch — and I know it’s good, because it’s worked in the past.

Find What Works and Use It

The content playing field on social networks is crowded, but there’s still plenty of opportunity. If you can define a niche that provides value to an audience, then test relentlessly to find out what works and what doesn’t, it’s possible to build a massive inbound funnel of traffic and leads — no matter what you’re trying to sell.

Just remember to test, find what works, and leverage it to the full extent possible.

What Alibaba's Success Reveals About the Value of Automating Strategy

With the speed of change and volume of market feedback today, as well as the advances in machine learning, Amazon, Alibaba, and others have proven the value of software driven strategy decisions.

For example, most e-commerce platforms today offer millions of products, with a changing mix daily and a changing market, such that it’s virtually impossible to manually predict a strategy for mapping customer demographics to products displayed online.

Only smart software can plow through the volume of live data, recognizing trends, customers, and match offerings to reality.

Alibaba, today the counterpart in China to Amazon, Ebay, and Google here, has demonstrated leadership in this area, and provides guidance for all of us to learn from in a new book, Smart Business, by Ming Zeng.

Zeng is the former chief of staff and strategy advisor to co-founder Jack Ma for over a decade, and outlines five key steps for automating decisions today as follows:

1. Log and use consumer behavior and product transaction data.

In my work with small businesses and startups, I routinely find owners who rely on guessing at key customer drivers, and let their passion drive product focus, rather than data. They think they are saving costs by not using the latest technology to capture data, and minimizing storage.

In China, even tiny bike sharing companies now have to digitally track every bike through GPS, and every mobile interaction between a bike and a rider to compete. No human or paper tracking systems are a competitive alternative.

The days of manual reservations and receipts are behind us, whether it be with rides, clothing, meals, or entertainment.

2. Configure every decision step into real-time software.

Businesses must capture every business decision activity, including customer relations, in digital software so that decisions affecting the activities can be automated and optimized through machine learning. This is a new class of software that can adapt in real time to market changes.

In the bike rental business, all operations and rental decisions are made completely by software, with no human intervention. The efficiency gain is tremendous.

The software directs humans and trucks to balance the tide of idle bicycles to other areas of a city where the demand is higher at the moment, rather than humans directing software.

3. Get data flowing, and machines talking to each other.

With today’s technology, data flow and coordination are readily achieved through common Internet protocols and application programming interfaces (APIs). These allow applications to communicate automatically and almost instantly, even over long distances, to mobile and IoT devices.

Way back in 2002, Jeff Bezos at Amazon issued an ultimatum to completely institute internal APIs within the company, and later to their millions of suppliers.

Through this focus, Amazon has become one of the first trillion dollar companies, and continues to expand its reach beyond books, e-commerce, and now into groceries with Whole Foods.

4. Record live data in full for all internal business elements.

The opposite of live data is static data that is sampled or profiled for analysis at a later date. Live data also requires metrics and infrastructure that can interpret and evaluate the data, and smart businesses must develop these in the algorithms they use in their data-intelligence engines.

5. Apply machine-learning for real-time software decisions.

Intelligent real-time software decisions are quickly replacing after-the-fact analytics. Only with full live data, built-in metrics, and artificial intelligence to iteratively improve the decision process, can your business keep up with the pace of change, and unique markets around the world.

Uber’s algorithms match car and driver, minimizing wait times and making mapping calculations in ways that no human dispatcher could match. Google search rankings are updated many times a second, based on new info and your profile changes. If your business is not powered by an algorithm, you don’t have a competitive business today.

These steps lead to what Zeng defines as a customer-to-business (C2B) model, where every direct interaction with customers sets into motion a striking reorientation of all business activities, and builds a feedback loop from customers. This allows businesses to automate all decisions productively, to scale and compete effectively, in tune with trends and new marketplaces.

Evacuating for Florence, Tesla's Security Flaw, and More in This Week in Cars

Sure, we’re a little biased around here. But when storms bear down on this country’s coasts—scary ones, like Hurricane Florence (since downgraded to a tropical storm), threatening floods and high winds—our minds zero in on the transportation aspects. Some people need to leave their homes, but how? Some need to get to shelters, but when, and how quickly? And then, after the storm is over, someone needs to get in and assess it all. And then the residents need to come back. This week, WIRED Transpo spent some time thinking about these thorny questions, from the perspective of residents, government emergency planners, logistics-obsessed officials, even drone pilots.

Elsewhere in transportation world, we talked to people who had solved other intimidating issues: How to stop someone hacking your Tesla, how to get around flying cars’ battery problems, and how to help someone ride a bike at 168 mph. It’s been a week—let’s get you caught up.

Headlines

  • Tesla owners, remember to turn on your dashboard display PIN. WIRED security writer Andy Greenberg tells the tale of KU Leuven researchers who discovered that anyone with a bit of savvy and $600 in radio and computing equipment should be able to wirelessly read and decrypt Tesla key fobs, allowing them to swipe cars without a trace. Tesla rolled out its new antitheft PIN feature two weeks ago, and says no Model S units sold after June are vulnerable to the hack.
  • Don’t call it a concept car. Mercedes-Benz’s Vision Urbanetic is a “mobility concept,” a body-swappable hybrid that can haul people or packages, depending on its fancy. The concept is an excuse for the Germans to start thinking (and messaging) about new forms of moving stuff—without adding to cities’ already oppressive traffic issues.
  • Another pack of Germans, another mobility concept. Transportation editor Alex Davies meets BMW’s Vision iNEXT, an electric, autonomous, baby SUV that BMW hopes points to the future of driving. Or not driving, as it were.
  • Led by Los Angeles, 30 cities teamed up this week to create an online portal for collectively bargaining with electric car, street sweeper, garbage truck and bus manufacturers over the price of their products. Together, these cities will need to replace 115,000 vehicles valuing about $10 billion, senior writer Jack Stewart reports. And going electric is a lot easier when you can get a good deal.
  • As Hurricane Florence continues to batter the East Coast, it’s important to remember: When governors and mayors declare mandatory evacuations, they’re the products of years of planning and thought.
  • But some have more planning and thought than others. A disaster and urban planning expert tells me that some places just don’t have the resources for robust hurricane plans—and that the vulnerable, and especially those without cars, suffer for it.
  • As the rains continue to fall, Jack Stewart catches up with the professional drone pilots prepping to help out in the recovery effort—beef jerky, pretzels, and all.
  • Waze and tech company SpotHero install specialized beacons in Chicago’s labyrinthine tunnels, where no functioning GPS dare go. Just one problem: Locals love their shortcut tunnel secrets.
  • Lyft adds public transit data to its app in Santa Monica—meaning Californians might open it every time they travel, no matter the mode.
  • What’s better than a flying car? A flying car with all of its complex electric battery issues solved, because it’s in fact tethered to a power line for much of every trip. Eric Adams speaks to the (quixotic?) inventors behind the Karman Electric concept.
  • Meet Denise Mueller-Korenek, a bicyclist who hopes to beat the world motor-paced bicycle land speed record—a mere 167 mph—this weekend at Utah’s Bonneville Salt Flats. “Accelerating past the takeoff speed of a Boeing 757 on a bike seems impossible,” writes contributor Joe Lindsey, but when you’ve got a drag racer blocking the wind for you, it just might be possible.

Elon Musk Street Art of the Week

It’s been 11 days since Tesla CEO Elon Musk sat down for a 2.5-hour, wide-ranging interview with comedian and podcaster Joe Rogan. And it’s been about eight days, if the internet is to be believed, since someone in Melbourne, Australia, immortalized the interview with a mural of the [CEO himself taking a quick hit of a blunt.

Required Reading

News from elsewhere on the internet

In the Rearview

Essential stories from WIRED’s past

A look back at 2016 finds the top reason startups fail: Running a hardware business is super hard.

President Trump's Tweets Top This Week's Internet News Roundup

In the past seven days New York decided it didn’t want Cynthia Nixon as its governor, Amazon’s owner elected to get into the education business, and a series of gas-line explosions hit north of Boston. But on the plus side, we also had Mark Wahlberg’s schedule to look at and a new Dolly Patron/Sia collaboration to listen to, so I guess it’s not entirely a hellscape out here? Maybe? While we ponder that idea together, let’s look at what else has been dominating the online conversation over the last week.

Is There Such a Thing as a Solemn Fist Pump?

What Happened: President Trump probably could’ve handled the anniversary of 9/11 better than he did.

What Really Happened: The anniversary of the September 11 attacks in 2001 is a solemn occasion, and one in which the United States turns to its president to see empathetic, strong leadership that comforts everyone and embraces the country’s greatest strengths during a troubled time. President Trump’s behavior on 9/11 this year was, well, maybe not that.

He did, to be fair, address the topic people wanted him to.

Funny thing about the image in that last tweet…

There was also this:

Oh, and this:

What could be more presidential?

As the media dazedly recounted Trump’s behavior during the day, others found a memetic outlet for those appalled by what was happening.

There. Doesn’t that feel almost cathartic? There’s nothing that can’t become content, if we try hard enough.

The Takeaway: To be fair, it could have been worse. No, really.

Bad Tweets, Part 2

What Happened: Apparently, when you’re prone to paranoid thinking, it’s very easy to become a truther for all kinds of things.

What Really Happened: Actually, speaking of things that could’ve been worse, let’s take a brief moment to discuss what might be the worst thing President Trump has done on Twitter yet. First off, please remember that an independent study by the Milken Institute School of Public Health at George Washington University found that the death toll in Puerto Rico after Hurricane Maria stands at 2,975 (and rising. Now, with that number in mind, consider that as recently as this past week President Trump was calling the government’s response to Maria “incredibly successful,” and complaining that the work was “an unappreciated good job.” OK, now that you know all of that, think about this:

Yes, that really was Trump outright denying the deaths of thousands of people, and claiming it was a lie motivated by politics. Just let that sink in for a second.

Of course, this was news because how could it not be? The president is outright being a hurricane impact denier, which is genuinely staggering.

Still, at least his Republican counterparts stood up against him. Right? Well, OK, Orrin Hatch and House Majority Leader Kevin McCarthy claimed they hadn’t seen the tweets, Lindsey Graham also questioned the death toll, and Marco Rubio tried to straddle a non-existent line.

Studies in leadership, all. (FYI, a couple of Republicans did eventually push back.)

The Takeaway: If this was, as some believed, an attempt to distract attention away from other subjects, it certainly worked well. Maybe a little too well.

All Those Witches, Lined Up and Offering Confessions

What Happened: The ongoing so-called “witch hunt” against those surrounding President Trump claimed another victim last week, as Paul Manafort pled guilty in court on Friday.

What Really Happened: On Friday, the one thing that political watchers had simultaneously been expecting and convinced was unlikely to happen—let’s call it the Schrödinger’s cat of the current political moment—finally happened: Former Trump campaign chairman Paul Manafort agreed to plead guilty to avoid a second trial.

The news resurrected a piece of Trump-related ephemera in at least one person’s mind.

Of course, people are already wondering how this impacts the big picture.

At the time of this writing, Trump’s Twitter feed is filled with Hurricane Florence-related retweets, but it’s genuinely only a matter of time before he responds to this news and revisits his previous statements about Manafort.

Still, at least the White House has its angle, as utterly unbelievable as it is.

Once again, Paul Manafort was the chair of the Trump campaign, and the man who chose the vice president. It’s more than a little disingenuous to claim that this has nothing to do with the campaign. But tell that to those around the president.

The Takeaway: There’s really only one way to end this, isn’t there?

Ringo Starr Would Be Appalled

What Happened: Just in case you thought that Thomas and Friends was a jolly series about happy trains and overweight controllers, the National Rifle Association has a shocking piece of information for you. Yes, the National Rifle Association.

What Really Happened: Everyone knows that, sometimes, there’s something in combining two flavors together to create a fun and exciting taste combination that will thrill the masses. Chocolate and peanut butter? It’s a game changer! The NRA and Thomas and Friends? Maybe a little less so, as it turns out.

Yes, you read that right. A show on the National Rifle Association’s streaming service dressed characters—you know, trains—from Thomas and Friends in KKK hoods. This is actually a thing that really happened, somehow.

It’s quite breathtaking that this was real—so real, in fact, that it became a story in its own right, because sure, why not? But at least Twitter was totally cool with it. Oh, no. Wait.

But how did Dana Loesch, who hosted the segment, feel about the whole kerfuffle?

The Takeaway: There really is just one way to wrap this one up. George Takei, do you have the pun-o-matic ready?

Emergency Services

What Happened: There’s one organization that even the federal government turns to in times of natural disaster, and with a hurricane headed towards the East Coast, last week seemed like the time to shine a spotlight on it.

What Really Happened: Late last week, Hurricane Florence made landfall on America’s East Coast, leading to a very difficult number of days for everyone whose homes, family, and loved ones in its path. But even before it hit, Florence was very much being considered a big deal.

With mandatory evacuations underway, people watched as the storm grew stronger, then seemingly weakened before getting stronger again. Was it going to slow down and linger in certain areas? It was hard to tell. Even NASA got involved. That mixture of surreal expectation and fear kept building throughout the week as the hurricane continued to approach.

But how serious were storm preparations on the ground? I mean, a state of emergency is one thing, but is there another way to measure these things? Turns out, the answer is yes, and in the most amazing way.

It’ll come as little comfort for those affected directly by Florence, but for everyone else, there’s some strange joy to be had in watching the Waffle House Index go mainstream. The world can still offer unexpected delights, it turns out.

The Takeaway: Stay safe, everyone.


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Cryptocurrency project Tezos to launch main network next week: document

NEW YORK/ZURICH (Reuters) – The Tezos cryptocurrency project is preparing to launch the long-awaited main version of its network that underpins a new virtual token on Monday, according to a message seen by Reuters from Ryan Jesperson, the president of a Swiss foundation that promotes the initiative.

FILE PHOTO – Tezos co-founder Kathleen Breitman speaks during the Crypto + ICO Summit cryptocurrency conference in Duebendorf, Switzerland March 28, 2018. REUTERS/Arnd Wiegmann

The Tezos Foundation raised $232 million in July 2017 to build the network and issue a new type of cryptocurrency to its backers in one of the largest-ever initial coin offerings, and launched an initial version of the network one year later after months of delays.

The Tezos Foundation plans to transition the network to a mainnet, or a more complete version, on Monday, according to Jesperson’s message. A foundation representative did not provide comment in time for publication.

That launch would mark an achievement in a project hobbled by internal infighting and delays. Tezos still faces litigation in the United States and the threat of increased regulatory scrutiny of the nascent cryptocurrency sector.

A high-profile feud between project founders Arthur and Kathleen Breitman and former foundation president Johann Gevers was followed by Gevers stepping down in February. He was replaced by Jesperson, one of the project’s contributors.

Since Tezos’s problems were first detailed by Reuters in October, several class-action lawsuits have been filed in the United States against the project’s organizers alleging the fundraiser violated federal securities laws and defrauded investors.

    In February, the U.S. Securities and Exchange Commission denied a public information request from David Silver, a lawyer representing some of the class-action plaintiffs, seeking information on Tezos, saying doing so could interfere with an investigation or enforcement activities.

The Tezos fundraiser was structured as a donation, though some contributors say they believed it was an investment. If deemed a securities offering, the new cryptocurrency might fall under the remit of the SEC.

The Reuters investigation published in October also found that Arthur Breitman, a French citizen registered with the Financial Industry Regulatory Authority (FINRA) in the United States, had not reported any outside business activity while working at Morgan Stanley in 2014 and 2015 when he was developing and pitching Tezos.

In April, FINRA suspended Breitman from associating with broker-dealers for two years, part of a settlement to resolve allegations that he made false statements about his side venture while working at Morgan Stanley.

Reporting by Anna Irrera and Brenna Hughes Neghaiwi; Editing by Meredith Mazzilli

Trump's antitrust enforcer considers shifting up a gear

WASHINGTON (Reuters) – The chairman of the Federal Trade Commission, which stops mergers it believes will push up prices, signaled Thursday he was willing to consider tougher enforcement, a move that could affect high profile big tech companies but also energy producers, drug makers and a big swath of the U.S. economy.

The Federal Trade Commission building is seen in Washington on March 4, 2012. REUTERS/Gary Cameron (UNITED STATES)

Joseph Simons, who was nominated by President Donald Trump to head the FTC in October 2017 and began work in May, noted in a brief speech that during two previous stints at the FTC, most recently as head of the Bureau of Competition, there had been a tendency to take a relatively hands off approach to antitrust enforcement.

“But now at the beginning of my third stint at the commission, things have shifted. The broad antitrust consensus that has existed within the antitrust community in a relatively stable form for about 25 years is being challenged,” he said at a conference organized by the FTC.

“First, some recent economic literature concludes that the U.S. economy has grown more concentrated and less competitive over the last 20 to 30 years, which happens to correlate with the timing of a change to a less enforcement-minded antitrust policy, beginning in the 1980s,” he said. “These concerns merit serious attention.”

Simons also noted calls for antitrust to address issues of income inequality and lagging wages, and said that this would also be discussed.

“We do this with the goal of understanding if our current enforcement policies are on the right track or on the wrong track, and if they are on the wrong track, what shall we do to improve them?” he said, noting that he was keeping “a very open mind.”

Rebecca Slaughter, a Democrat on the five-member commission, noted in a tweet a Roosevelt Institute study showing relatively few big companies dominate markets ranging from airlines to pharmaceuticals, saying “@FTC is listening.”

Trump has pushed for tough enforcement of antitrust law but muddied the waters by singling out AT&T’s purchase of Time Warner, owner of CNN, which Trump has frequently criticized. The Justice Department sued in court to stop that deal but lost. It has appealed.

Big tech companies such as Alphabet Inc’s Google, Facebook Inc, Amazon.com Inc and others have faced criticism from Republicans and Democrats for everything from widespread collection of users’ information to being used by Russia to meddle in the 2016 U.S. election to being unfair in how they use their dominance to compete with smaller rivals.

The FTC conducted an investigation of Google that ended in 2013 with a slap on the wrist for the search and advertising company. Yelp Inc has pushed for the agency to re-open that probe.

In a congressional hearing in June, Simons noted the clout of the few, powerful big tech companies but also said he would not support attacking companies “because they’re big and successful.”

The FTC does much more than review big tech mergers. It also reviews mergers in the energy sector, such as a deal to combine industrial gases companies Praxair Inc and Linde, as well as mergers across health care, from hospitals deals to pharmaceutical mergers.

The FTC, which is currently made up of three Republicans and two Democrats, shares the work of enforcing antitrust law with the Justice Department.

Reporting by Diane Bartz; Editing by Susan Thomas

How Borrowing and Sharing Might Save Retail

Human beings have been bartering since the dawn of their existence. Before currency was created, around 600BC, cattle, sheep, vegetables, and grains were popular items for trading. Fast-forward to today, it seems we are experiencing a reconnection with our bartering roots. Americans especially, have spent the past few decades priding themselves on ownership, often displaying their consumerism habits in the form of their larger-than-life vehicles, their homes, and any other material item that could accelerate their status in this sort of consumerist competition.

Millennials, who lived in the big houses, and went to soccer practice in the big cars, aren’t buying it; any of it. Ownership is fading out, as our societies are shifting towards this idea of not being tied down, something called the access economy. But that doesn’t mean we aren’t still consumers… we are just learning to be more responsible about how we consume. With this shift, retail will also have to shift, as we can begin to see exactly how people will “buy” in the future and what they will expect from their sellers.

It Isn’t Just About Houses and Cars

The truth is that we all have (at least once) bought something we would consider a high-ticket item, that we used a handful of times and then put in a closet. According to Philip and Melissa Niu of Parachut, Americans spend $1.2 trillion annually on nonessential goods – in other words, items they do not need. Here’s a few other statistics the Parachut team wants you to know:

  • There are 300,000 items in the average American home. 80% of those items actually go unused.
  • In America, there are four times as many self-storage facilities than Starbucks, McDonalds, and Subway combined.

These statistics point us in the direction of why this access economy is growing in popularity. The idea of having access to the items we need, when we need them, for the amount of time we want to use them, really hits the top two consumer concerns on the head; convenience, and price. Parachut, starting with photography, audio and video equipment first, has the potential to be the Amazon platform of this growing access economy.

Major Pain Points Could Be Eliminated

I had to record audio for a convention I spoke at, and borrowed a device from a family member to get the job done. I had planned to buy this device when I got back in the states, but my experience with the device ended up swaying my decision in the opposite direction. Once I used the recording device, I realized it really wasn’t what I wanted (or needed) at all, and therein lies a huge lesson when it comes to retail. 

Retail Doesn’t Allow Us to (Easily) Try Before We Buy

This is especially true when it comes to electronics and high-ticket items, which often makes these types of purchases stressful given the major long-term commitment buyers are forced to make.This access approach will allow retailers to peel back one of the biggest pain points of shopping. This could be a better and more profitable solution than waiting until consumers force stores into showrooms.

Renting… Only Better

For some reason, no matter how many times Blockbuster dies, I just cannot not think of their model of renting when I hear the word. Renting, in it’s olden, black-and white days (as my children would say) came with stiff timelines and financial consequences. Renting in the new access economy is shaping up to be much more free with boundaries that are capable of flexing. This new idea of renting without time limits, is great. But there’s another element to freedom I want to point out also.

If retail can get this approach to access right, we can avoid the smaller “community options” that often leave us meeting in a dark parking lot to exchange (or buy discounted) goods from a seller in a blue Toyota at the back of the lot. Retail has the opportunity to cash in on a billions-rich growth plan, and to participate in something more mature, private, and clean, than the parking lot meetups.

Recurring Revenue for Retailers

Could this new economy approach be the win-win we are all seeking? The burden of ownership doesn’t stop with the individual, and if retailers can shed some of that ownership burden too, we will begin to see the creative opportunities grow. This will be the reward for our consumerism responsibility, better options to borrow, more access, more convenience,and all at prices we are happy to pay. Welcome to the potential future of retail.

Meet the Transhumanists Turning Themselves Into Cyborgs

A woman tries on a virtual reality headset at a neuroscience lab in Geneva, Switzerland.

This exoskeleton can be used to treat physical handicaps or to augment the wearer’s motor skills. The Defense Advanced Research Projects Agency (DARPa) is working on a similar prototype that would could turn soldiers into war machines.

Neil Harbisson, who is color blind, implanted a prosthesis into his skull that converts colors into sound waves. He considers himself a cyborg.

The dietary supplement Elysium contains nicotinamide riboside, which has been shown to promote cell regeneration in mice. The drug’s long-term effect on humans is unknown.

Julien Deceroi implanted a magnet into his middle finger. He’s an example of a “grinder,” biohackers who operate on their own bodies.

The size of a grain of rice, the NFC/RFID microchip can be implanted under the skin by a tattoo artist. The chip can be used to store data or interface with electronic devices.

This anti-aging light therapy mask is meant to be worn for five minutes a day and promises to make the user look younger.

The Mailpan—an implant filled with stem cells that secrete insulin—is an artificial pancreas that could potentially transform the lives of diabetics.

Marie-Claude Baillif has suffered from myopathy since adolescence. Without her respirator, she would have died thirty years ago.

“Nootropics,” aka smart drugs, are a class of substances supposed to improve cognitive function, memory, creativity, or motivation.

The body modification artist Lukas Zpira is the author of the “Body Hacktivism Manifesto,” which advocates “taking control of our destinies by perpetually reinventing the self.”

Professor Grégoire Courtine of the École Polytechnique Fédérale de Lausanne implants electrodes into a paralyzed rat’s spinal cord to help it learn to walk again.

Photographer Matthieu Gafsou says transhumanism encompasses a wide array of techniques and philosophies.

One of the biggest misconceptions about transhumanism is the belief that it’s a new phenomenon. “We have been intimately involved with technology for a very long time,” Gafsou says.

In many ways, all of us are transhumanists based on our extensive use of technologies like the smartphone, the artificial hip, and the pacemaker.

Tesla: Shorts Are Now In Charge

Despite finally dipping my toe into Tesla (TSLA) on the short side earlier this year, I’ve largely stayed out of the debate on Seeking Alpha. Actually, making this bet is a change of pace for me. I’ve often fielded questions, as a long/short investor focused on cash flows, on why I did not short this company from 2014-2017. The problem with shorting Tesla – and something numbers-focused short sellers have repeatedly glossed over – has been Elon Musk. Savvy investors realize that. Cash burn just did not matter so as long as Elon Musk could continue to convince institutional investors to cough up billions of dollars to fund his vision.

This is changing. The situation in 2018, particularly in recent months, has called his ability to do that into question. With significant pressure on his company, recent well-publicized news items (“Funding Secured”, senior management turnover, Joe Rogan interview) have begun to weigh on many investors, large and small. While many have wondered why the Board of Directors has not taken action, I think the answer to that is obvious. They simply cannot kick Elon Musk to the curb; the Board knows that without Musk there is no Tesla and the debt-funded growth story folds in on itself. Longs have to think long and hard on whether raising capital will be as easy as it has been in recent years, especially as the 2018 and 2019 Convertible Senior notes now look like they will have to be rolled over with cash instead of stock. The short side, years early on betting against the firm, finally will have its time in the sun. While calls for bankruptcy are way too early, in my opinion, there is still money to be made betting on lower equity pricing.

Laying Out The Framework, Broad Short Case Review

Tesla has had absolutely no problem raising nearly $3,000mm from secondary stock offerings since 2015. The company raised billions more in hybrid debt alongside that on very attractive terms. However, perhaps nothing is more indicative of Tesla’s access to capital than their recent pure bond offering. In my opinion, the $1,800mm raised by the 5.3% Senior Notes due 2025 was a watershed moment that highlighted Elon Musk’s continued ability to sell the future. Any impartial bond analyst that looked at the financials and lack of bond protections took a very cautious outlook. This pessimism was something that could be seen in Moody’s initial bond rating of B3, well into junk territory. These analysts took a very bleak outlook on Tesla’s future, its execution risk, and its cash needs.

As a result of the rapid ramp up in Model 3 production and the significant increase in capital expenditures required under the production plan, we expect that Tesla will remain free cash flow negative into 2019. Given this negative free cash flow outlook, the uncertainties associated with the launch of the Model 3, and the potential cash requirements necessary to cover the maturities of its convertible debt, Tesla will face large cash requirements through 2018.

This does not even factor in the usual protections built into debt rated this far into junk. As a reminder, the sole guarantor on these notes is Solar City. The Gigafactory, a core component of the Tesla story, is not collateral and can be levered up itself. There are none of the usual covenant restrictions on further debt issuance, selling assets, or on capital spending. Nonetheless, Goldman managed to find buyers at a 5.3% coupon – a rate 200bps below where typical bonds of this credit quality would be priced. After the recent downgrade to Caa1, it is easy to forget that Tesla is in the company of distressed stories like Windstream (WIN) and Revlon Consumer Products. These issuers are seeing double-digit yields to maturity on their debt. Even after the recent collapse in the Tesla 2025 bonds (now worth 84 cents on the dollar), the yield to maturity is still 8.3%. That is lofty, all things considered.

However, can Tesla roll over the debt at attractive terms going forward? Remember what is coming due shortly:

  • $920mm in 0.25% Convertible Senior Notes (March 2019)
  • $230mm in 2.75% Convertible Senior Notes Due 2018 (November 2018)
  • $185mm on the Term Loan (December 2018)

With shares now down meaningfully from the $420.00/share Privatization Rally, rolling over into fresh Converts becomes more and more dilutive to shareholders with every passing day. The downturn in the 2025 Senior Notes shows that demanded interest rates will be in the high single digits. I think it is clear that this time next year, Tesla will, at the minimum, be dealing with $100mm+ in additional annual interest expense or shareholders will be facing significantly more dilution down the line.

*Did he inhale or not inhale? “420” per share indeed.

All of this will weigh heavily on the mind of Elon Musk and Tesla management heading into Q3 and Q4. Cash burn, which in the past did not matter, now does. Big institutional investors and lenders, which Tesla has relied on to finance its capital structure, are going to focus heavily on reported results. Tesla is going to have to borrow more capital to boost production at some point; investors will want to see a somewhat sustainable business model while operating under that 5k/week Model 3 run rate. While there have been many “make or break” calls on Tesla over the past several years, I believe that the second half of 2018 is where this will finally be true. Remember this statement from the most recent conference call:

I feel comfortable achieving a GAAP income positive and cash flow positive quarter every quarter from here on out.

There is little margin for error. Despite the share price collapse, analyst estimates for Q3 and Q4 have come up meaningfully over the past weeks and months. If Tesla reports continued cash burn heading into this major refinancing activity, there is substantial downside potential for the common equity. This will be pivotal. Fasten your seatbelts.

Disclosure: I am/we are short TSLA.

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.

Hackers Can Steal a Tesla Model S in Seconds by Cloning Its Key Fob

Tesla has taken plenty of innovative steps to protect the driving systems of its kitted-out cars against digital attacks. It’s hired top-notch security engineers, pushed over-the-internet software updates, and added code integrity checks. But one team of academic hackers has now found that Tesla left its Model S cars open to a far more straightforward form of hacking: stealthily cloning the car’s key fob in seconds, opening the car door, and driving away.

A team of researchers at the KU Leuven university in Belgium on Monday plan to present a paper at the Cryptographic Hardware and Embedded Systems conference in Amsterdam, revealing a technique for defeating the encryption used in the wireless key fobs of Tesla’s Model S luxury sedans. With about $600 in radio and computing equipment, they can wirelessly read signals from a nearby Tesla owner’s fob. Less than two seconds of computation yields the fob’s cryptographic key, allowing them to steal the associated car without a trace. “Today it’s very easy for us to clone these key fobs in a matter of seconds,” says Lennert Wouters, one of the KU Leuven researchers. “We can completely impersonate the key fob and open and drive the vehicle.”

Just two weeks ago, Tesla rolled out new antitheft features for the Model S that include the ability to set a PIN code that someone must enter on the dashboard display to drive the car. Tesla also says that Model S units sold after June of this year aren’t vulnerable to the attack, due to upgraded key fob encryption that it implemented in response to the KU Leuven research. But if owners of a Model S manufactured before then don’t turn on that PIN—or don’t pay to replace their key fob with the more strongly encrypted version—the researchers say they’re still vulnerable to their key-cloning method.

Keys to the Kingdom

Like most automotive keyless entry systems, Tesla Model S key fobs send an encrypted code, based on a secret cryptographic key, to a car’s radios to trigger it to unlock and disable its immobilizer, allowing the car’s engine to start. After nine months of on-and-off reverse engineering work, the KU Leuven team discovered in the summer of 2017 that the Tesla Model S keyless entry system, built by a manufacturer called Pektron, used only a weak 40-bit cipher to encrypt those key fob codes.

The researchers found that once they gained two codes from any given key fob, they could simply try every possible cryptographic key until they found the one that unlocked the car. They then computed all the possible keys for any combination of code pairs to create a massive, 6-terabyte table of pre-computed keys. With that table and those two codes, the hackers say they can look up the correct cryptographic key to spoof any key fob in just 1.6 seconds.

In their proof-of-concept attack, which they show in the video below, the researchers demonstrate their keyless-entry-system hacking technique with a hardware kit comprising just a Yard Stick One radio, a Proxmark radio, a Raspberry Pi minicomputer, their pre-computed table of keys on a portable hard drive, and some batteries.

First, they use the Proxmark radio to pick up the radio ID of a target Tesla’s locking system, which the car broadcasts at all times. Then the hacker swipes that radio within about 3 feet of a victim’s key fob, using the car’s ID to spoof a “challenge” to the fob. They do this twice in rapid succession, tricking the key fob into answering with response codes that the researchers then record. They can then run that pair of codes through their hard drive’s table to find the underlying secret key—which lets them spoof a radio signal that unlocks the car, then starts the engine.

[embedded content]

That whole attack chain, the researchers say, is possible thanks to the Pektron key fob system’s relatively weak encryption. “It was a very foolish decision,” says KU Leuven researcher Tomer Ashur. “Someone screwed up. Epically.”

The KU Leuven researchers say they told Tesla about their findings in August 2017. Tesla acknowledged their research, thanked them, and paid them a $10,000 “bug bounty” for their work, the researchers say, but it didn’t fix the encryption issue until its June encryption upgrade and more recent PIN code addition.

In a statement to WIRED, Tesla said those fixes were rolled out as quickly as possible given the time needed to confirm the researchers’ work, test a fix, and integrate it into their manufacturing processes. “Due to the growing number of methods that can be used to steal many kinds of cars with passive entry systems, not just Teslas, we’ve rolled out a number of security enhancements to help our customers decrease the likelihood of unauthorized use of their vehicles,” a Tesla spokesperson wrote to WIRED. “Based on the research presented by this group, we worked with our supplier to make our key fobs more secure by introducing more robust cryptography for Model S in June 2018. A corresponding software update for all Model S vehicles allows customers with cars built prior to June to switch to the new key fobs if they wish.” The company also noted that you can trace a Tesla on your phone, which should make it relatively easy to locate a stolen vehicle.

The researchers believe their attack might also work against cars sold by McLaren and Karma and motorcycles sold by Triumph, which also use Pektron’s key fob system. But they weren’t able to get their hands on those vehicles to test them. Neither Karma nor Triumph responded to WIRED’s request for comment, nor did Pektron itself. McLaren says it’s still investigating the issue but is alerting its customers to the potential theft risk and offering them free “signal-blocking pouches” that block radio communications to their key fobs when they’re not in use. “While this potential method has not been proven to affect our cars and is considered to be a low risk, plus we have no knowledge of any McLaren vehicle being stolen by this or the previously reported ‘relay attack’ method, nevertheless we take the security of our vehicles and the concerns of our customers extremely seriously,” a McLaren spokesperson writes.

If those other manufacturers are indeed affected, beyond putting keys in those “signal-blocking pouches”—Faraday bags that block radio communications—just how all of them might definitively fix the problem is far from clear. The researchers say that the companies would likely have to replace every vulnerable key fob, as well as push out a software update to affected vehicles. Unlike Tesla, whose cars receive over-the-air updates, that might not be possible for other manufacturers’ vehicles.

Warning Sign

Despite the questions surrounding how to prevent the attack, KU Leuven’s Ashur argues that revealing the vulnerability is necessary to pressure Tesla and other carmakers to protect their customers from theft. Now that Tesla has added a PIN feature, it also serves as a warning that Tesla owners should turn on that feature to protect against a surprisingly easy method of grand theft auto. Aside from that PIN, Tesla also allows Model S owners to disable “passive entry” for its key fobs, and instead require them to push a button on the fob to unlock the car, a setting that would also stymie the KU Leuven attack. “This attack is out there and we’re not the only people in the world capable of coming up with it,” Ashur says.

For years, hackers have demonstrated it’s possible to perform so-called relay attacks against keyless entry systems, spoofing a car’s radio signals to elicit a response from its key fob and then replaying that signal in realtime to the car’s locking system. In some cases, hackers have pulled off those attacks by amplifying the key’s radio signal, or by bridging the distance between the car and the victim’s key fob by holding one radio device close to each. Those relay attacks have been used to pull off very real car thefts, though it’s never been clear how many, given the lack of evidence left behind. Relay attack thefts are no doubt part of Tesla’s motivation for adding its PIN precaution, regardless of the KU Leuven research.

But even those relay attacks still only allow a car thief to spoof a victim’s key once. Even if they manage to drive the car away, they’re unable to unlock or start it again. The KU Leuven attack, by contrast, allows a thief to permanently clone the victim’s key, so that they can unlock and drive the car in perpetuity. “Basically, we can do everything a relay attack can do and more,” says Wouters.

With that dangerous key cloning method now in the open, vulnerable Model S owners would be wise to turn on Tesla’s newly added PIN feature or disable passive entry. Punching four numbers into the car’s dash or a button on its key fob before starting it up may be an annoyance. But it beats returning to a empty parking spot.


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5 Money-Saving Tips From Some of the World's Wealthiest People

Dolly Parton freezes leftovers. Sarah Jessica Parker dresses her kids in hand-me-downs. And Warren Buffett, one of the wealthiest humans walking the planet, pays for McDonald’s food with coupons.

Are these just the quirky habits of the rich and famous? Not at all. They represent the way these millionaires and billionaires acquired and retain their wealth: by managing money effectively, efficiently, and prudently.

If you want to travel in elite circles with billionaires like Oprah or “just” millionaires such as David Bach, author of 11 bestselling financial books, [[added descriptor]] be ready to tighten your purse strings — even if you have plenty of extra coinage at your disposal.

From the very beginning of my career, I focused on experiences, not material things. When I ran Coplex Ventures, my first company, I routinely paid myself last. It didn’t hurt to cut luxuries like eating out; I knew I was setting myself up for a better future.

What I didn’t realize is my penchant for penny-pinching wasn’t unusual. In fact, many rich people who grew up in dire straits never lost their ability to stretch a dollar or seek out bargains. Though it may sound silly to think of J.K. Rowling worrying about money, she’s on record as saying that she had trouble getting comfortable with the sudden influx of cash after her Harry Potter books became bestsellers.

Truly, many of the one-percenters among us aren’t living as lavishly as we might assume. Humble beginnings or not, we can all learn their secrets to sitting on cash instead of spending voraciously. Anyone can wield their wealth wisdom, including the following tips, to make smarter choices when it comes to spending, saving, and investing.

1. Live below your means.

Buffett moved into his current home in the late 1950s. After purchasing it for a little more than $30,000 he settled down and never moved again, according to Business Insider. Could he afford several vacation properties or a large mansion? You bet. Yet he’s not interested in moving.

Mexican business magnate Carlos Slim Helú follows the same principle of living frugally. He hasn’t switched residences for four decades. Again, his choice not to bounce around or amass personal real estate has earned him a billionaire status. Even if you never hit that top 10 list, you’ll do well to lower your living costs.

2. Buy in bulk.

I’m a Costco habitue and an Amazon fan because I appreciate being able to purchase frequently used items in larger quantities. As long as they won’t sit on a shelf for eons or go bad, the decision to buy in bulk makes perfect sense.

Mark Cuban apparently agrees. In a Vanity Fair video, he advised buying two years’ worth of toothpaste or other household item whenever you see it on sale. Sure, he could afford to grab a single tube of toothpaste whenever the old tube runs empty, but that’s not the smart move. Although you pay more up front, you save on the back end.

3. Invest in a reasonable vehicle.

Don’t expect to see Mark Zuckerberg speeding around in a Ferrari. According the Business Insider, the frugal Facebook founder prefers to get from point to point in his Volkswagen GTI, a far cry from a cherry red sports car packing 800 horsepower under the hood.

Evaluate the pragmatism of your own transportation method. According to Carfax, vehicles can depreciate up to 25 percent annually. Go easy on the up-front cost and try to keep your wheels on the road for as long as you can. That way, you’ll get the most money mileage out of your ride.

4. Fly economy class.

Business and first class may tempt you beyond belief, but unless you can save up travel points and hack the system, always fly economy. Even Ingvar Kamprad, the late Ikea founder, flew frugally.

His belief was that just because he could do something didn’t mean he should, and that included wasting dollars on luxury plane travel. It’s a truth many travelers have come to realize: First class comes with perks, no doubt, but you get to your destination just as quickly if you choose the cheap seats.

5. Clip coupons.

You probably don’t have time to go full Extreme Couponing. Don’t let that stop you from occasionally clipping coupons or checking out discount payment apps like CrayPay that pay a certain percentage of your purchase.

Feeling a little weirded out at the thought of carrying coupons? Hey, if Kristen Bell and other stars use coupons to stretch their income, anyone can — and should. Never think a coupon makes you look poor: It’s a common way for well-off people to spend their dollars wisely.

Financial success involves more than just getting a raise or hitting the big time with an up-and-coming stock. The road to becoming and staying much more than solvent involves making smarter day-to-day decisions, including whether you want to add a sundae to that cheeseburger meal deal.

An American Airlines Captain Just Did Something Resourceful and Kind for Every Single Passenger on His Flight. His Stunning Story Went Viral

Wichita Falls is a city of about 100,000 people in northeast Texas. It looks like there’s a lot of stunning natural beauty nearby.

But what the airport at Wichita Falls doesn’t have, apparently, is a place to get a nice meal near the airport, especially if 100 or more people unexpectedly show up all at once.

This became relevant last week, when American Airlines flight 2354 from Los Angeles to Dallas-Fort Worth was diverted there due to extreme thunderstorms. Passengers were looking at the likelihood of having to scramble to find a place to stay overnight, to say nothing of finding a bite to eat.

And the captain on their flight came up with a very simple solution.

In short, he called up the local Papa John’s and ordered 40 pizzas for his 159 passengers. As far as we know, he fronted the entire bill, $500 or more, himself. And his simple gesture went viral.

The captain’s name: Jeff Raines, according to CNN. His actions–in fact the moments when he found himself running back and forth from the terminal to the Papa John’s delivery car–was all captured on video by an airport worker named Josh Raines (no indication they’re related).

As Josh explained later in his Twitter feed, the passengers were going to travel the rest of the way to Dallas via bus. But Wichita Falls Municipal Airport is actually a mostly military airport, attached to Sheppard Air Force Base. It’s just not equipped for a sudden, unexpected influx of passengers.

Jeff Raines (the captain) apparently followed the whole thing up with an explanation on Facebook:

Thanks for the compliments however this was a “TEAM” effort. My First Officer was on the telephone with crew tracking / hotel desk arranging for our release and hotels for the entire crew.

The Flight Attendants manned a galley cart from the aircraft serving waters, juice, and sodas to all the passengers in the terminal. All while the Envoy SPS Personnel were arranging for a bus, re-booking flights, and answering a flurry of questions from these passengers.

Thanks to everyone for your help – there is no “I” in TEAM.

It’s unclear whether the passengers continued to Dallas via bus, as both Josh Raines and Jeff Raines seem to have suggested, or if they flew there the next morning, as American corporate P.R. says. I suspect it’s possible some passengers might have continued on to Dallas via bus; others waited for the flight the next day.

But the real point here is an airline employee taking it upon himself to do something that’s clearly not listed in the American Airlines handbook, but that has a lot of potential to increase passengers’ affinity for the airline.

We’ve seen this repeatedly lately, for example with the Southwest Airlines captain who rerouted a flight to enable a passenger to get an amazing photo of the Great American Eclipse in 2017, and the Southwest flight attendant who worked to allow a passenger who has Down syndrome to fulfill her dream, at least for a day, of working as a flight attendant.

These little actions help any business’s reputation, and they often pay big dividends. For its pilot’s $500 pizza outlay, American clearly got a lot more than $500 worth of brand equity or marketing.

It doesn’t even really matter if the passengers like pizza. Simply by making the effort, the captain bought goodwill.

“We are always proud of our crew members who take great care of our customers who fly on American Airlines,” American said in an email. “We are fortunate that our crew members are the best in the business.”

These Southwest Airlines Passengers Just Got a Really Disturbing Letter. Here's the Big Problem and the Reason Why

Southwest Airlines passengers on four flights last month got a disturbing letter recently, saying that they could have come into contact with a fellow passenger who has measles. 

And while Southwest seems to have acted as soon as it found out and consulted with the Centers for Disease Control, there’s a special circumstance about Southwest that makes this a potentially bigger deal than it might have been on other airlines.

First, the flights:

  • August 21: Flight #5, Dallas (Love Field) to Houston (Hobby)
  • August 21: Flight #9, Houston (Hobby) to Harlingen
  • August 22: Flight #665, Harlingen to Houston (Hobby)
  • August 22: Flight #44, Houston (Hobby) to Dallas (Love Field)

In an emailed statement, the airline told me that it reached out to every single passenger who was on any of the flights–more than 500 people, going by the average capacity of a Southwest 737. 

And that’s what actually makes this a bigger deal than if it were on another airline. Because one of the defining features of flying on Southwest Airlines is that there is no assigned seating. 

In fact, that feature contributed to it being ranked the #1 carrier for families: if you’re traveling with children under 6, passengers can board in the second group (after “A” but before “B”),  which means it’s almost always pretty easy to make sure that families can sit together.

But in a situation like this one, rare though it might be, that policy works against Southwest. 

Because not only does Southwest almost certainly not know what seats the passenger who has measles was sitting in; it doesn’t have any idea which passengers were sitting in which other seats.

This matters because the CDC would normally mandate that an airline notify everyone who sat within two rows of an infected passenger. But without assigned seating, the airline had to notify literally everyone who took any of the four flights, even though the vast majority of people likely didn’t actually come into contact with the infected passenger.

So, all 500-plus total passengers from those flights are being warned to watch for fevers, colds, and rashes. 

“The rash begins on the face as flat, red spots and spreads down the neck and trunk to the rest of the body,” as The Dallas Morning News summarized, and “other symptoms include a fever over 101 degrees, cough, runny nose and red, watery eyes.”

Since the incubation period runs 21 days, as Dallas County health officials put it in a letter to one passenger: “It is very important for you to watch for symptoms of measles through Sept. 11, 2018.”

That passenger, who shared the letter with a Dallas-area television station, said sure enough, she has a rash.    

“Mostly, like I said, rash appeared on my legs. I did speak to the health department and explained my symptoms, so their advice was to go to the doctor. They didn’t think that it may or may not be measles but they advised me to visit my physician,” the woman, Monica Nicholas, told NBC 5 Investigates.

Here’s Southwest’s statement about the whole thing:

Our Safety & Security groups worked with the CDC to support the agency’s work in reaching our Customers who traveled onboard four intra-Texas flights last week (details below) with a passenger later diagnosed with Measles. We’ve shared awareness of the situation and protocols with our Employees who also were onboard these aircraft. Our entire fleet is subject to rigorous and regular cleaning programs and every aircraft utilizes hospital-quality HEPA filtration that improves overall quality of the air in the passenger cabin.
 

Robinhood, the Zero-Fee Stock and Crypto Trading App, Is Planning to Go Public

Robinhood—the fintech startup that offers stock, option, and cryptocurrency trades with zero fees—is taking steps to go public, starting with the hiring of a chief financial officer.

Robinhood co-founder Baiju Bhatt, speaking at the TechCrunch Disrupt conference Thursday, confirmed the company’s plans for an IPO and CFO hire. Both tasks will need to be handled with care. Bhatt said that Robinhood’s business model has subjected it to constant audits from the SEC and other financial regulators.

In the past couple of years, Robinhood has grown from a quixotic idea—no fees to trade stocks—to one of the more intruiging startups in the fintech space. Robinhood raised $110 million at a $1.3 billion valuation in April 2017. It’s now valued at $5.6 billion.

But Robinhood, like many tech startups planning to go public these days, is still losing money. And it’s branching out into areas like stock options and cryptocurrencies that will incur losses as Robinhood pushes for market share. “We don’t intend to make very much money on it at all for the foreseeable future,” Robinhood co-founder Vlad Tenev told Fortune in June.

The thing is, investors in IPOs are willing to tolerate losses as long as they will be turned soon enough into growing profits. And they’ve learned to distrust CEOs who talk cavalierly about losing money. Witness the downfall of Groupon after its manic growth failed to deliver profits, or Uber, which has had to retool its expensive global ambitions.

But given that few fintech startups have matured into companies that traditional Wall Street investors are comfortable sinking their assets into, Robinhood’s approach to the public stock market will be closely watched. In May, Robinhood’s active user accounts reached 4 million, surpassing E*Trade, a trading platform long beloved by daytraders.

Robinhood’s push into cryptocurrencies has helped it sign up more users. The company is not only helping small investors in a market that sometimes seems stacked against them, it’s looking like the most disruptive financial startup since E*Trade shook things up in the 1990s with low commissions and real-time stock quotes. Whether its expensive business model will be welcomed by IPO investors remains to be seen.

​Hollywood goes open source

Out of 200 of the most popular movies of all time, the top 137 were either visual-effects driven or animated. What did many of these blockbusters have in common? They were made with open-source software.

That was the message David Morin, chairman of the Joint Technology Committee on Virtual Production, brought to The Linux Foundation‘s Open Source Summit in Vancouver, Canada. To help movie makers bring rhyme and reason to open-source film-making, The Linux Foundation had joined forces with The Academy of Motion Picture Arts and Sciences to form the Academy Software Foundation.

The academy is meant to be a neutral forum for open-source developers both in the motion picture and broader media industries to share resources and collaborate on technologies for image creation, visual effects, animation, and sound. The founding members include Blue Sky Studios, Cisco, DreamWorks Animation, Epic Games, Google Cloud, Intel, Walt Disney Studios, and Weta Digital. It’s a true marriage of technology and media-driven businesses.

You know those names. You probably don’t know the name of the open-source, special-effects programs, such as Alembic, OpenColorIO, or Ptex, but Morin said, “they’re very instrumental in the making of movies”.

And they’re more important than you think. “The last Fast and the Furious movie, for instance, while it looks like a live-action movie, when you know how it was made, it’s really by-and-large a computer generated movie,” Morin said. “When Paul Walker passed away in the middle of production, he had to be recreated for the duration of the movie.”

The Academy of Motion Picture Arts and Sciences, which you know best from the Oscars, started looking into organizing the use of open-source in the movies in 2016. The group did so because while open-source software was being used more and more, it came with problems. These included:

  • Versionist: As more libraries were being used it became harder to coordinate software components. A production pipeline, which had been perfected for a 2016 movie, was likely to have out-of-date components for a 2017 film.
  • Organization: While volunteers tried to track these changes, they didn’t have the funding or resources needed to go beyond recording changes.
  • Funding: Many open-source programs had lost their maintainers due to getting jobs elsewhere or for lack of funding.
  • Licensing: As all open-source developers know, sooner or later licensing becomes an issue. That’s especially true in the motion-picture industry, which is hyper aware of copyright and other intellectual property (IP) issues.

So, the overall mission is to increase the quality and quantity of open-source contributions by developing a governance model, legal framework, and community infrastructure that makes it easier to both develop and use open-source software.

In more detail, the goals are:

  • Provide a neutral forum to coordinate cross-project efforts, establish best practices, and share resources across the motion picture and broader media industries.
  • Develop an open continuous integration (CI) and build infrastructure to enable reference builds from the community and alleviate issues caused by siloed development.
  • Provide individuals and organizations with a clear path for participation and code contribution.
  • Streamline development for build and runtime environments through the sharing of open-source build configurations, scripts, and recipes.
  • Provide better, more consistent licensing through a shared licensing template.

Developers interested in learning more or contributing can join Academy Software Foundation mailing list.

Morin added, “In the last 25 years, software engineers have played an increasing role in the most successful movies of our time. The Academy Software Foundation is set to provide funding, structure, and infrastructure for the open-source community, so that engineers can continue to collaborate and accelerate software development for movie making and other media for the next 25 years.”

Rob Bredow, SVP, executive creative director, and head of Industrial Light & Magic, said, “Developers and engineers across the industry are constantly working to find new ways to bring images to life, and open source enables them to start with a solid foundation while focusing on solving unique, creative challenges rather than reinventing the wheel.”

If you’d like to get into the movie business, now’s your chance. “We’re welcoming all the help we can get to set up the foundation,” Morin concluded. “Writing code today is perhaps the most powerful activity that you can do to make movies. If you’re interested, don’t hesitate to join us.”

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JD.com CEO was arrested on allegation of rape: police report

MINNEAPOLIS/SHANGHAI (Reuters) – The founder and chief executive of Chinese retailer JD.com Inc, Richard Liu, was arrested in Minneapolis last week following an allegation of rape, according to a public information report released by police on Tuesday.

FILE PHOTO: Richard Liu, CEO and founder of China’s e-commerce company JD.com, attends a France-Chinese forum on the applications of artificial intelligence at SOHO 3Q in Beijing, China January 9, 2018. REUTERS/Jason Lee/File Photo

Liu, identified in the report by his Chinese name Liu Qiangdong, was released from custody on Saturday without being charged, and he returned to China.

Earl Gray, a Minnesota-based lawyer for Liu, said on Monday that the Chinese businessman has denied any wrongdoing and that he did not expect his client to be charged.

On Tuesday, defense attorney Joseph Friedberg said, “They are not going to charge in this case. There’s no credible complaint.”

Minneapolis Police Department spokesman John Elder said on Tuesday that if there were any charges against Liu they would not be filed until completion of a criminal investigation that would not occur before Friday.

The police report shed a bit more light on the nature of the accusation, which authorities had previously left vague. It said the alleged offense was “criminal sexual contact – rape,” and said domestic violence was not involved.

It gave no further details, but Elder said the alleged attack reportedly occurred at 1 a.m. local time on Friday, and that Liu was taken into custody later that evening.

Elder declined to disclose whether any accuser was cooperating with police. “I wouldn’t address that. That goes to the investigation,” he said.

JD.com Inc’s stock fell as much as 7 percent on Tuesday, hitting an 18-month low, reflecting investor uncertainty. Shares in China’s second largest e-commerce company closed down 6 percent at $29.43 on Tuesday on the Nasdaq and were steady after hours.

JD.com’s rules require Liu, who holds nearly 80 percent of the company’s voting rights, to be present at board meetings for the board to make decisions, although it was not clear if he has to be physically present or could participate by teleconference.

The company counts Walmart Inc, Alphabet Inc’s Google and China’s Tencent Holdings as investors. It faces stiff competition from rival Alibaba Group Holding Ltd at home.

“If this spirals as a media focus, negative attention could offset some of the positives associated with endorsement by Walmart and Google,” analyst Rob Sanderson of MKM Partners said.

“Negative publicity could also compromise JD.com’s ability to attract international brands to its marketplace, which has been a top focus of the CEO over the past two years or so,” Sanderson said.

Liu lost a court battle in Australia in July to keep his name out of a sexual assault trial. Liu was not accused of any wrongdoing in that case, according to a court document.

The case involved a person who had been a guest at a party hosted by Liu at his home in Sydney 2015 who accused another guest of sexually assaulting her at a hotel. The defendant was found guilty of seven offenses.

Reporting by Adam Jourdan and Todd Melby; Additional reporting by Arjun Panchadar; Writing by Frank McGurty; Editing by Toni Reinhold and Edwina Gibbs

China lures chip talent from Taiwan with fat salaries, perks

TAIPEI (Reuters) – A huge pay rise, eight free trips home a year and a heavily subsidized apartment. It was a dream job offer that a Taiwanese engineer simply could not refuse.

A leaflet that asks employees to protect company confidentiality is seen at a reception in a chip company, in Hsinchu, Taiwan August 31, 2018. REUTERS/Tyrone Siu

A veteran of Taiwan’s top-tier chipmakers, including United Microelectronics Corp (UMC)(2303.TW), the engineer took up the offer from a Chinese state-backed chipmaker last year and now oversees a small team at a wafer foundry in eastern China.

The engineer joined a growing band of senior Taiwan professionals working in China’s booming and fast-developing semiconductor industry.

Attracting such talent from Taiwan has become a key part of an effort by China to put the industry into overdrive and reduce the country’s dependence on overseas firms for the prized chips that power everything from smartphones to military satellites.

That drive, which started in 2014, intensified this year as U.S.-China trade tensions escalated, according to recruiters and industry insiders, exposing what China feels is an over-reliance on foreign-made chips.

China imported $260 billion worth of semiconductors in 2017, more than its imports of crude oil. Home-made chips made up less than 20 percent of domestic demand in the same year, according to China Semiconductor Industry Association.

More than 300 senior engineers from Taiwan have moved to Chinese chipmakers so far this year, joining nearly 1,000 others who have relocated since Beijing set up a $22 billion fund to develop the chip industry in 2014, according to estimates from H&L Management Consultants, a Taipei-based recruitment firm.

The battle for skilled engineers has raised concerns in Taiwan that the island could lose a key economic engine to its political foe, China. Analysts say China is still years behind Taiwan in terms of chip design and manufacturing, however, even as it moves ahead in terms of the production of lower-end chips.

China’s semiconductor plans accelerated this year after the United States banned sales of chips to the Chinese phone vendor ZTE (0763.HK), senior Chinese officials familiar with the matter told Reuters in April.

Tariffs imposed by Washington on $16 billion worth of China’s imports have hit Chinese semiconductors, which are now subject to tariff rates of 25 percent.

That will make Chinese chips less competitive compared to those from Taiwan and South Korea, and could disrupt China’s semiconductor ambitions. Beijing’s aim is to have local chips comprise at least 40 percent of China’s semiconductor needs by 2025.

Underscoring the talent crunch, two state-run institutions said in August that about 400,000 professionals were working in China’s integrated circuit sector at the end of 2017, far short of the estimated 720,000 workers needed by 2020.

While China has also targeted engineers from South Korea and Japan to address that shortage, it has had the most success in Taiwan thanks to a common language and culture, recruiters say.

Lin Yu-Hsuan, a manager at the recruitment firm H&L, said engineers from Taiwan were lured by high pay, perks and more senior positions at Chinese chipmakers like Semiconductor Manufacturing International Corp (SMIC) (0981.HK) that are flush with cash from China’s multi-billion chip fund.

“Many of them said: ‘the money I will earn in China in three years is equivalent to what I could get in Taiwan in 10 years. I could retire earlier’,” Lin said.

Steve Wang, the vice chairman and president of Novatek Microelectronics (3034.TW), a Taiwanese integrated chip designer, said a small percentage of its employees had left for China over the past two years, and acknowledged that it would be difficult to match offers from Chinese rivals.

The engineer at the wafer foundry, who declined to be named as the details of his contract were not public, said his Chinese employer offered him a new three-bedroom apartment with a 40 percent discount on the condition that he worked for the company for more than five years, in addition to a 50 percent pay rise. He declined to give the exact figure.

“China dares to burn money, whereas Taiwan companies have limited resources,” he said.

COUNTER-OFFER

A senior executive at a newly-established chipmaker in northeastern China, SiEn (QingDao) Integrated Circuits Company Ltd, said about one-third of its recently recruited 120 engineers were from Taiwan.

“There is not a lack of money. What we need is talent,” said the person, who declined to be named as he was not authorized to speak to the media.

He said the company, led by Richard Chang, the founder of SMIC, China’s leading chipmaker, offers new hires discounted property and attractive subsidies for bilingual schools in the port city of Qingdao.

“Taiwanese engineers are most experienced and could help us cultivate local talents,” the executive said. “The movement will continue to escalate.”

Industry watchers said Taiwan’s widely respected chip design houses and foundries have been among the hardest hit by the outflow of engineers, and have been forced to ramp up spending to lure workers.

The island’s leading integrated circuit designers and chipmakers have seen a 35 percent jump in labor costs, including salary and benefits from two years ago, compared with a 21 percent hike in revenue, according to Reuters calculations based on corporate filings from Taiwan’s 10 largest listed companies by market value.

TRADE SECRET

Taiwan has been watching the Chinese recruitment efforts with growing anxiety.

It has long barred chipmakers like Taiwan Semiconductor Manufacturing Co Ltd (2330.TW), a key supplier to Apple Inc (AAPL.O), from moving their most advanced technology to manufacturing operations in China to keep it from falling into the hands of Chinese rivals.

Many in Taiwan are also concerned that the rapid development of China’s chip industry could lead to the sort of oversupply and plunging prices that came with Chinese efforts to develop other key industries like solar panels and liquid crystal displays.

China’s integrated circuit design firms have already surpassed their Taiwan rivals in terms of revenue, with $31 billion in 2017, compared with Taiwan’s $22 billion, according to Mark Li, an analyst at Bernstein.

The fears are that the battle for talent will widen that gap further.

In a move to retain top talent, Taiwan’s cabinet in July pledged to relax tax regulations on employee stock ownership.

“The Chinese Communist Party has been poaching our talent,” said Chen Mei-ling, minister of Taiwan’s policy-planning National Development Council. “The government has amended regulations to help companies keep talent.”

Ho Chan-cheng, legal affairs director at Taiwan’s Intellectual Property Office, said “inappropriate poaching” could lead to the leaking of trade secrets and that the government was working to protect the island’s core technology – namely the capacity to increase chip yield per wafer.

Taiwan companies are also trying to offer their own incentives.

Antonio Yu, spokesman for the Taiwan-based chip design house Phison Electronics Corp (8299.TWO), said that while the company “does not have the capital to play such a money game,” it has tried to create a “reassuring environment” for its employees.

He cited long-standing cash bonuses and programs such as free legal counseling, as well as a monthly town hall meeting with Phison’s chairman, Khein-Seng Pua.

“We treat our employees like family,” he said.

Despite such efforts, Taiwanese engineers are finding incentives from China hard to resist.

Tommy Huang, a 37-year-old Taiwanese chip engineer who in 2016 joined United Semiconductor in southern China – a joint venture between Taiwan’s UMC and Chinese state-backed partners – said Taiwanese efforts to retain talent did not work for him.

“You don’t have any chance if you stay in Taiwan,” said Huang, whose Chinese employer offered him an annual school subsidy of up to 60,000 yuan ($8,689) for his five-year-old child and a salary more than double what he earned in Taiwan.

“We are buying hope by coming to China.”

Reporting By Yimou Lee; Additional reporting by Cate Cadell in BEIJING and Ju-min Park in SEOUL; Editing by Anne Marie Roantree and Philip McClellan

In India, Google races to parry the rise of Facebook

SAN FRANCISCO/MUMBAI (Reuters) – Google retains only a slight lead over Facebook in the competition for digital ad dollars in the crucial India market, sources familiar with the figures say, even though the search giant has been in the country far longer and has avoided the controversies that have dogged its rival.

A woman walks past the logo of Google during an event in New Delhi, India, August 28, 2018. REUTERS/Adnan Abidi

Facebook’s success has shaken Alphabet Inc’s Google, led by an Indian-born CEO, Sundar Pichai, who has made developing markets a priority.

Google officials in India earlier this year were alarmed to learn that Facebook Inc was likely to generate about $980 million in revenue in the country in 2018, according to one of the sources. Google’s India revenues reached $1 billion only last year.

Facebook and Google declined to comment on Indian revenue figures or the competition between the two companies.

Google is now pushing back, attempting to lure customers with better ad-buying tools and more localized services. The revamped strategy mirrors initiatives that have succeeded in boosting the time Indian consumers spend with Google services.

The battle in India reflects an epic challenge for Google in developing markets around the world that are crucial to the company’s long-term growth – many consumers in those country’s are gravitating to Facebook and it’s siblings, Instagram and WhatsApp, at the expense of Google search and YouTube, and advertising dollars are quick to follow.

“Facebook is a far more user-friendly platform even though they haven’t created features specifically for Indian advertisers,” said Vikas Chawla, who runs a small ad-buying agency in India.

Facebook ads, compared with those on Google search or YouTube, tend to transcend language barriers more easily because they rely more on visual elements, said Narayan Murthy Ivaturi, vice president at FreakOut Pte Ltd, a Singapore-headquartered digital marketing firm. Pinpointing younger consumers and rural populations is easier with Facebook and its Instagram app, he and other ad buyers said.

And Facebook is succeeding in India, which boasts the fastest-growing digital ad market of any major economy, despite internal turmoil and political controversy. It has been without a country head for the last year, and has faced a series of incidents in which rumors circulating on Facebook and WhatsApp have prompted mob violence.

Facebook and Google between them took 68 percent of India’s digital ad market last year, according to advertising buyer Magna. Media agency GroupM estimates digital advertising spending will grow 30 percent in India this year.

The Facebook phenomenon is evident close to home for Google. During a recent lunch period, six out of 10 people who walked out of Google’s Bangalore offices while looking at their phones told Reuters they were checking WhatsApp. All 10 said they regularly used Whatsapp.

Eight Indian ad buyers interviewed by Reuters were divided on whether Facebook would overtake Google in Indian ad revenue. That such a question would even be debated explains why Pichai, Google’s chief executive, has pressed to flip the company’s approach to emerging markets.

“India is the most important market for the ‘Next Billion Users’ initiative,” Caesar Sengupta, the head of the effort, told Reuters on the sidelines of the annual “Google for India” event in New Delhi last week.

A man walks past a Google hashtag during an event in New Delhi, India, August 28, 2018. REUTERS/Adnan Abidi

NEW TACTICS

For many years Google designed its services for early adopters of new technology, who tended to be in Silicon Valley, said Nelson Mattos, who oversaw Google’s Europe and Africa operations for several years. Great products would then find a broad global audience.

“Over time, as you saw the growth of Facebook, the importance of WhatsApp and other tools in these new markets, and not the same adoption of Google, the company started to realize that maybe they had to change that approach,” Mattos said.

Shortly after taking the helm three years ago, Pichai mapped a new strategy for places such as India: More services tailored to locals; more marketing on radio, billboards and TV; more local staff and start-up investment.

Google’s India workforce has more than doubled since to more than 4,000 employees, or about eight times Facebook’s presence, according to a tally of LinkedIn profiles and company statements.

Its products evolved too, becoming easier to use with low data plans. Smartphone apps such as Files Go and Tez – rebranded last week as Google Pay – were aimed at Indians.

“There’s definitely a sea change,” said Asif Baki, a user researcher at Google who oversees two-week “immersion trips” in developing markets for senior executives and staff.

The efforts are bearing fruit. Indian users during the first half of this year spent more time on Google services than on Facebook services, according to estimates from audience measurement firm Comscore. Over a similar period a year ago, Facebook came out on top.

Extending those gains to the ad business is a work in progress. A handful of Google executives, including leaders for display ads and small business advertisers, traveled to India earlier this year in a previously unreported trip to better understand the needs of Indian clients.

The visit spurred them to consider ideas such as enabling advertisers to reach users only in a particular Indian state, since language and literacy vary greatly around the country, according to a person familiar with the discussions.

At the New Delhi event, Google unveiled a plan to bring Indian newspaper content online, to increase the supply of search results – and ads – available in regional languages. 

Google still has to reckon with other issues. Small businesses in emerging markets are less likely to have websites, a foundation for Google ad campaigns but unnecessary for Facebook.

Executives met with one Indian merchant who recorded product videos on YouTube then messaged the links to potential customers on WhatsApp, said Kim Spalding, the company’s general manager and product lead for small business ads. 

    Facebook, meanwhile, is already on to commercializing such behavior. Just weeks ago, it began charging for text-based marketing features on WhatsApp, with video ads expected to launch next year.

Reporting by Paresh Dave and Sankalp Phartiyal; Additional reporting by Arjun Panchadar in Bangalore; Editing by Jonathan Weber and Alex Richardson

17 Great Motivational Quotes About Organized Labor

Not everybody realizes Labor Day was originally create to honor organized labor (i.e. labor unions). Few people also realize that labor unions were responsible for many of the workplace rights that created the American middle class.

Over the past fifty years, though, most of those hard-won rights have been under attack from billionaires and their political pawns. With that in mind, here are 17 of those hard-won rights and an “motivational” quote. (I’ll tell you at the end why the quotes are motivational)

  1. Unions won us weekends.  “Approximately 70% [of Americans] worked at least one weekend a month, with 63% saying that their employer expected them to put in time on an average Saturday and Sunday.” – Forbes.
  2. Unions won us paid time off. “A total of more than 30 days of vacation time allotted to workers in France, Germany, Spain and the United Kingdom stands in stark contrast to the 10 public holidays in the U.S., which are not guaranteed to come with pay.” — CNBC
  3. Unions won us sick leave. “While the majority of large US corporations offer paid sick leave, data from the US Bureau of Labor Statistics show that 36% of workers don’t have such protections.” – Fortune
  4. Unions won us social security. “The tax cuts enacted by Republicans and signed into law by Trump in December also will have a negative effect on Social Security in the near term, chiefly by reducing the program’s income from the taxation of benefits.” – Los Angeles Times
  5. Unions won us a minimum Wage. “Adjusted for inflation, the federal minimum wage peaked in 1968 at $8.68 (in 2016 dollars). Since it was last raised in 2009, to the current $7.25 per hour, the federal minimum has lost about 9.6% of its purchasing power to inflation.” Pew Research
  6. Unions won us (theoretically) equal pay. “U.S. women working full-time earned just $0.80 for every dollar earned by a man in 2016. The wage gap widens even more when broken down by race. Black women make $0.63 for every dollar, while Latina women earn $0.54 cents.” — CNBC 
  7. Unions won us anti-discrimination laws. “Companies are more than twice as likely to call minority applicants for interviews if they submit whitened resumes than candidates who reveal their race–and this discriminatory practice is just as strong for businesses that claim to value diversity as those that don’t.” — Harvard Business School
  8. Unions won us the eight hour workday. “A survey, which was conducted via Slack over a span of roughly three minutes on Monday afternoon, found that 97 out of 97 respondents have at some point in the recent past checked their work email addresses on their cellphones or non-work-related computers.” — The Atlantic 
  9. Unions won us overtime pay. “A paltry 7% of salaried workers received overtime pay.” — US Department of Labor 
  10. Unions won us child labor laws. “Republican governors and state lawmakers, who succeeded this year in curbing union powers, are pushing to revise their child-labor laws to help companies such as groceries get workers. Wisconsin will let employers treat teenagers as adults in pay and hours, and Maine lawmakers want to let companies keep teens working longer hours.” — San Francisco Chronicle
  11. Unions won us the 40 hour work week. “In a Gallup survey of 1,200 adults, 21% work between 50 and 59 hours a week, 18% work more than 60 hours, and 11% work between 41 and 49 hours. That means that 50% of the adults surveyed work more than 40 hours a week.” — Gallup
  12. Unions won us employee pensions. — “The Pension Benefit Guaranty Corporation, the agency set up 40 years ago to guarantee those pensions, made clear in its annual report released last month that one group of pension funds would most likely run out of money within a few years. Absent new legislation, the already modest pensions of some retired workers will be eliminated.” — New York Times
  13. Unions won us collective bargaining rights. “The lack of collective worker power helps explain why workers’ wages have been stagnant for the past 40 years, and why working people are so frustrated — as they have not reaped any of the gains of an improving economy.” — Economic Policy Institute
  14. Unions won us age discrimination laws. “Tech workers of all ages think older engineers are highly qualified, have good experience, and can share wisdom. But many older engineers are worried about losing their jobs as the tech workforce skews heavily towards Millennials.” — IEEE
  15. Unions won us whistleblower protection. “22 percent of corporate employees who reported misconduct faced retaliation, up from 12 percent in 2007. Most alarming, increases in the incidence of retaliation are outpacing the overall rate of increases in whistleblowing disclosures.” — Ethics Resource Center
  16. Unions won us privacy rights. “The battle for workplace privacy is over; privacy lost. Despite repeated language in judicial opinions regarding the need to balance the competing rights of employers and employees, no balancing occurs.” — American Bar Association
  17. Unions won us parental leave. “The United States remains the only country in the developed world that does not mandate employers offer paid leave for new mothers, according to the Organization for Economic Cooperation and Development.” — The Washington Post

Maybe you found those quotes alarming rather motivational? Well, I think they should motivate you to VOTE

Published on: Sep 2, 2018

​Linus Torvalds talks frankly about Intel security bugs

Meltdown-Spectre

At The Linux Foundation‘s Open Source Summit North America in Vancouver, Linus Torvalds, Linux’s creator, and Dirk Hohndel, VMware VP and chief open source officer, had a wide-ranging conversation about Linux security, open-source developer, and quantum computing.

Torvalds would really like his work to get back to being boring. It hasn’t been lately because of Intel’s CPU Meltdown and Spectre security bugs. The root cause behind these security holes was speculative execution.

In speculative execution, when a program does a calculation, which might go several ways, the processor assumes several results and works on them. If it’s wrong, it goes back to the beginning and restarts with the correct data. Because CPUs are so fast these days, it’s much quicker to do this than to have the hardware sit idle waiting for data.

Torvalds “loves speculative execution. CPUs must do this.” But, Torvalds is annoyed that “people didn’t think about the problems of taking shortcuts with speculative execution. We knew speculative work that wasn’t used had to be thrown away.” It wasn’t. That problem is now baked in most modern processors. The long-term fix is a new generation of Intel CPUs.

This ticked Torvalds off. Linux, programmers and the other operating system developers, had to scramble to fix the hardware vendors’ problems. Torvalds said, “It’s not fair. When we screw up, it’s fair, we have to fix it. But it feels less fair when we have to fix someone’s else’s problems.”

Earlier at the conference, Greg Kroah-Hartman, the stable Linux kernel maintainer, went into more detail about why fixing the first Spectre class bugs was such a problem for Linux developers in particular.

The problems were know about in July of 2017, Kroah-Hartman explained, but “it wasn’t until October 25 of last year that the kernel community heard rumors of the flaw. That’s a long time, and we only heard rumors because another very large operating system vendor told Intel to get off their tails and tell us about it.”

Then, Kroah-Hartman continued, “When we get a kernel security bug, it goes to the Linux kernel security team, we drag in the right people, we work with the distributions getting everyone on the same page and push out patches” Not this time. “Intel siloed SUSE, they siloed Red Hat, they siloed Canonical. They never told Oracle, and they wouldn’t let us talk to each other.”

Torvalds added that with the “security issues kept under wraps, we couldn’t do our usual open methods. This made fixing the bugs much more painful than it should be.” “It really wasn’t working,” continued Kroah-Hartman, so we “yelled at [Intel] and pleaded, and we finally got them to allow us to talk to each other the last week of December. All of our Christmas vacations were ruined. Intel messed up.”

Worse still, Kroah-Hartman said, “Debian wasn’t allowed to be part of the disclosure, so most of the world was caught with their pants down, and that’s not good.”

Since then, Torvalds said, “Intel has gotten much better.” But, even now, “I don’t know what the hardware bug schedule is.”

Still, when the next Spectre variant showed up, Foreshadow, the Linux kernel developers were notified ahead of time. Because of this, the Linux community could use their battle-tested open methods to patch this bug promptly.

Also, added Torvalds “The good news is the bugs have become more esoteric. They impact fewer and fewer cases. Intel and other hardware vendors are really getting down to the dregs of the hardware security bugs.”

For the rest of 2018, Torvalds said, “Every three months hardware bugs would show up. There have been eight serious bugs this year. There were only two or three in all the years before.”

Even now though the Spectre problems still haunt the Linux development process. The “Linux 4.19 merge window was not good. Usually it’s not a big deal. It’s just two weeks of me sitting in front of my computer. But the new security issue popped up in early in the merge window, which just added the usual frustration due to having patches that weren’t public. This made it particularly stressful.”

For all the pain this has caused, there’s also been one good, unexpected result. Kroah-Hartman explained that Linux and Windows programmers are working together on CPU security bugs.

“We now have this wonderful back channel. We’re talking to each other and we’re fixing bugs for each other,” he said. Who would have thought even five years ago we’d see this?

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Why Is the Founder of Craigslist Suddenly Giving Away Millions? Here's His Highly Unusual Story

Let’s talk about billionaires–especially unusual, bootstrapped, secretive philanthropic-minded billionaires who describe themselves consistently as nerds.

It’s a small group. Its leader: the Craigslist founder Craig Newmark.

He’s been in the news recently after donating $1 million to the progressive magazine Mother Jones. That’s in addition to $20 million to the journalism program at CUNY earlier this summer, and millions for other journalism, veterans, and election protection organizations. 

I first met Newmark in 2011 when I was writing for the military newspaper Stars & Stripes, and he was putting up serious money for veteran causes. But I didn’t realize then just how financially successful he’d been until I saw these recent reports on his philanthropy activity.

That’s partly because Newmark, now 65, is scrupulous about not saying anything about his personal finances. (One published estimate, based on a bit of forensic analysis in Forbes last month, puts him at well over $1 billion.)

It’s likely that most of his stake is still in Craigslist, which is just as reclusive, but which analysts think pulls in about $1 billion a year, with a 75 to 85 percent profit margin. That means it’s an extraodrinary cash cow. 

And to put it all in perspective, and appreciate just how different Newmark is compared to all of the other billionaire tech entrepreneurs floating around Silicon Valley and the Bay Area, you need remember two points:

First, the fact that Craigslist is basically bootstrapped, and that it wasn’t originally supposed to be a company.

It grew originally from a single email that Newmark sent to to 10 or 12 people, as he told Inc.’s Jon Fine in 2016. He was 42 at the time, and had been working as an engineer at Charles Schwab (after 17 years at–wait for it–IBM).

And second, what life was like in 1995, when that first email went out:

  • Jeff Bezos had just moved to Seattle. He hadn’t launched Amazon yet.
  • Mark Zuckerberg was in 5th grade. Monica Lewinsky hadn’t even become a White House intern.
  • The #1 song in America was “Gangsta’s Paradise” by Coolio.
  • There was no PayPal. If you won an auction on eBay, you had to mail a check.

Newmark had literally no idea that the site could ever be so successful at first. And why would he?

He says its spare, old-fashioned design was mainly a result of his own limitations as a designer back when the whole thing launched. (“I didn’t know how to do fancy,” he told Fine.)

Perhaps most amazing is that when he did start to see the potential, he took an honest personal inventory and decided that he wasn’t the best person to lead the company he’d created.

He recruited and hired Jim Buckmaster in 2000, and let him take over as CEO.

“I was able, to some extent, to divorce my ego from my CEO role. And I’d had a lot of lessons,” Newmark said in his Inc.com interview. “I’d seen micromanagement be a big problem in the tech industry. I just saw lots of situations where people screwed up by interfering with people who could do the job.”

That’s really the story. No capital raises, no talk about disruption, no rush to find an exit.

Just a simple idea, the prescience to get in very early, the confidence to keep doing the same thing, and the self-awareness to get out. It was simple, really–and sometimes,  simple really does lead to success.
 

JetBlue is Raising the Price to Check Bags–Here's Why United Airlines and Others Are Following Suit

JetBlue’s cost to check a bag has increased $5, going from $25 to $30 for your first bag, and $40 for your second (also a $5 increase). United Airlines has followed suit as well– charging a similar $30 for the first bag, and $40 for the second–their change went into effect August 31

Surely a company like JetBlue, which quite clearly has capable leadership–capable enough to keep the airline highest in customer satisfaction for 12 straight years (Southwest has now unseated them, but JetBlue hangs tight to 2nd place)–wouldn’t do something like this lightly. 

The cause? Fuel prices are spiking. 

You would imagine that they’ve run every possible scenario through various algorithms and concluded that raising baggage prices was the most logical option. And yes, something had to be done, because rising fuel prices over the last year have cut heavily into airline profits. 

As such, airlines are trying to rapidly figure out how to increase revenue while cutting expenses. 

Doug Mcgraw, Vice President, Corporate Communications at JetBlue, said, “We routinely review and adjust our ancillary pricing to ensure a healthy business so we can continue offering the best customer experience of any U.S. airline.” 

This definitely bodes problematic for those like Southwest and their infamous ‘bags fly free’ tagline. However, that isn’t stopping them from trying to find creative, ancillary techniques to drive top-line increases and recently announced that they are increasing the price of their EarlyBird boarding fee as much as $10 (depending on your route). 

Is there a hidden genius here, or is it just a last resort?

Maybe they’re banking on the price increases being offset by their faithful frequent fliers– JetBlue also has the highest-rated loyalty program among U.S. airlines.

Still, this seems like a risky tactic. Once upon a time, we liked to say that ‘any press is good press’. But that just doesn’t ring true anymore. 

No matter what amount of positive reputation JetBlue has garnered in the past, it doesn’t make them invincible to the power of bad headlines, especially when you’re a first mover of something that has to do with price hikes. And if you want to know how to get those, vaulting yourself to the top of a price list for something nobody actually likes paying for is certainly one way–even if United, WestJet, and Air Canada have all raised their prices as well.

The truth is, it’s very rare that you’d want to have the highest price for anything, especially when your biggest competitor is offering the exact same thing for free

A move like this shows that JetBlue has been painted into a corner and, and instead of waiting it out, they’re tracking through the wet stuff and making a media mess. Guess we’ll see what it looks like when it dries.

Apple self-driving car rear ended during road testing

(Reuters) – An Apple Inc (AAPL.O) self-driving car was rear-ended while merging onto an expressway near the company’s Silicon Valley headquarters this month, the company said in an accident report posted on Friday that confirmed the iPhone maker is still in the race to build autonomous vehicles.

FILE PHOTO: The company’s logo is seen outside Austria’s first Apple store, which opens on February 24, during a media preview in Vienna, Austria, February 22, 2018. REUTERS/Heinz-Peter Bader/File Photo

Apple executives have never publicly spoken about the company’s self-driving car program, but filings in a criminal court case last month confirmed that the company had at least 5,000 employees working on the project and that it was working on circuit boards and a “proprietary chip” related to self-driving cars.

Apple is entering a crowded field where rivals such as Alphabet Inc’s (GOOGL.O) Waymo unit and traditional carmakers such as General Motors Co’s (GM.N) Cruise Automation, as well as startups such as Silicon Valley’s Zoox, are pouring billions of dollars into cars that can drive themselves.

On Aug. 24, one of Apple’s Lexus RX 450h self-driving test vehicles in “autonomous mode” was merging south on the Lawrence Expressway in Sunnyvale, California at less than 1 mile per hour when it was rear-ended by a 2016 Nissan Leaf going about 15 miles per hour, according to the report posted on the California Department of Motor Vehicles website.

The accident happened at about 3 p.m. as the Apple vehicle had slowed and was waiting for a safe gap in traffic to complete the merge, the report said.

Both vehicles sustained damage but there were no injuries, the report said. Under a safety plan filed with California regulators, a human driver must be able to take control of Apple’s self-driving test cars.

An Apple spokesman confirmed that the company had filed the report but did not comment further. He declined to respond to questions about whether the trailing car could have been at fault.

Apple’s efforts remained shrouded in secrecy until years after its rivals like Google had begun testing on public roads. The iPhone maker’s first public acknowledgement of interest in the field came in a letter to U.S. transportation regulators in late 2016 urging them not to restrict testing of the vehicles.

Last year, Apple secured a permit to test autonomous vehicles in California. It has been testing cars on the road since last year and now has permits for more than 60 vehicles. Apple researchers also last year published their first public research on cars, a software system that could help spot pedestrians more readily.

The safety of self-driving cars has become a source of concern for U.S. transportation regulators this year after one of Uber Technologies Inc’s [UBER.UL] vehicles struck and killed a woman in March in Arizona, prompting the company to shut down its testing efforts for a time. Uber has said it plans to have self-driving cars back on the road by the end of the year.

The California DMV said it has received it has received 95 autonomous vehicle collision reports as of Aug. 31. Dozens of companies have received permits to test self-driving vehicles on California roads, but those permits require the presence of a human safety driver.

Reporting by Laharee Chatterjee and Nivedita Bhattacharjee in Bengaluru and Stephen Nellis in San Francisco; Editing by Richard Chang and Cynthia Osterman