The Geek’s Reading List – Week of April 8th 2016
I have been part of the technology industry for a third of a century now. For 13 years I was an electronics designer and software developer: I designed early generation PCs, mobile phones (including cell phones) and a number of embedded systems which are still in use today. I then became a sell-side research analyst for the next 20 years, where I was ranked the #1 tech analyst in Canada for six consecutive years, named one of the best in the world, and won a number of awards for stock-picking and estimating.
I started writing the Geek’s Reading List about 12 years ago. In addition to the company specific research notes I was publishing almost every day, it was a weekly list of articles I found interesting – usually provocative, new, and counter-consensus. The sorts of things I wasn’t seeing being written anywhere else.
They were not intended, at the time, to be taken as investment advice, nor should they today. That being said, investors need to understand crucial trends and developments in the industries in which they invest. Therefore, I believe these comments may actually help investors with a longer time horizon. Not to mention they might come in handy for consumers, CEOs, IT managers … or just about anybody, come to think of it. Technology isn’t just a niche area of interest to geeks these days: it impacts almost every part of our economy. I guess, in a way, we are all geeks now. Or at least need to act like it some of the time!
Please feel free to pass this newsletter on. Of course, if you find any articles you think should be included please send them on to me. Or feel free to email me to discuss any of these topics in more depth: the sentence or two I write before each topic is usually only a fraction of my highly opinionated views on the subject!
This edition of the Geeks List, and all back issues, can be found at www.thegeeksreadinglist.com.
ps: It being April Fool’s day, there was a lot of noise in articles. I have done my best to eliminate pranks but nowadays it’s getting hard to tell them from real stories.
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1) How Machines Destroy (And Create!) Jobs, In 4 Graphs
Just as we frequently read about killer robots (see Item 2) or massive job loss associated with presumably relatively benign robots. Although automation has led to a massive improvement in living standards a common view is that “smart” robots will result in dialing back the progress of the last couple centuries. This article does a good job at looking at how employment in various sectors has shifted over the years.
“For hundreds of years, people have been talking about machines taking jobs from people. Less often discussed: machines creating new jobs. In the first part of the 20th century, agricultural technology — the tractor, chemical fertilizers — meant a single farmer could suddenly grow much more food. So we didn’t need as many farmers. Technology destroyed a huge number of farming jobs.”
2) Dispelling the Killer AI Myth
This is a refreshing article but I doubt it will get much coverage: an actual AI expert discussing the absurdity of non-expert and media concerns over “killer AI”. Unfortunately for actual AI researchers it is much easier to write an article about the existential threat of AI than to bother to actually learn about what it is and is not.
“As a data science practitioner who uses machine learning as the basis of many client projects, I’m increasingly finding myself on the front line of the so-called “Killer AI” debate that keeps sprouting up around the web and mainstream press. Just recently I engaged in a discussion on Quora where a couple of people considered my dismissal of this “threat to humanity” as a serious oversight for what could become mankind’s downfall. The main argument in support of the Killer AI notion is the handful of very high-profile individuals who believe in it – physicist Stephen Hawking, entrepreneur Elon Musk, as well as commercial software giants Bill Gates and Bill Joy. Notice that NONE of these people, while brilliant in their own fields, have any direct experience with machine learning, AI or robotics.”
3) Tesla Model 3 reservations tops 325,000
Nobody ever went broke underestimating the intelligence of the consumers. What baffles me is this: Tesla has essentially done a $325M issue of unsecured, no covenant, no interest, debt without filing a prospectus. How is that legal?
“A week ago, we started taking reservations for Model 3, and the excitement has been incredible. We’ve now received more than 325,000 reservations, which corresponds to about $14 billion in implied future sales, making this the single biggest one-week launch of any product ever. This interest has spread completely organically. Unlike other major product launches, we haven’t advertised or paid for any endorsements. Instead, this has been a true grassroots effort driven by the passion of the Tesla team that’s worked so hard to get to this point and our current and future customers who believe so strongly in what we are trying to achieve. Most importantly, we are all taking a huge step towards a better future by accelerating the transition to sustainable transportation.”
4) The time that Tony Fadell sold me a container of hummus.
I’ve warned a number of times that Internet of Things devices, most of which connect to a proprietary server somewhere, that they are pretty much junk once that server is shut off. We have a perfect example in what happened to users of Resolv. To be fair, most likely the company would have winked out of existence eventually if it had not be acquired by Nest because that is the fate of most IoT companies. The fact that Nest/Google felt it wasn’t worth their money to maintain the system is typical of the thinking Philips or Samsung would apply: if it doesn’t make money, pull the plug. So remember if you wave a refrigerator or TV with IoT function understand that function will last as long as the vendor decides its worth their while. Thanks to my son Ali and my friend Allan Brown for links related to this item.
“On May 15th a critical Nest product will go dark. I’m shocked this isn’t bigger news. I don’t mean that the Nest product will reach end-of-life for support and updates. No, I mean that on May 15th they will actually turn off the device and disable your ability to use the hardware that you paid for. Google/Nest’s decision raises an interesting question. When software and hardware are intertwined, does a warranty mean you stop supporting the hardware or does it mean that the manufacturer can intentionally disable it without consequence? Tony Fadell seems to believe the latter. Tony believes he has the right to reach into your home and pull the plug on your Nest products.”
5) A fleet of trucks just drove themselves across Europe
Heavy trucks are more likely to be early adopters of Autonomous Vehicle (AV) technology than consumer automobiles for several reasons: the cost of AV technology is likely to be relatively lower since trucks are so expensive; fuel savings can justify the investment; and since trucks are almost constantly in use improved productivity will be a selling feature. Of course, professional drivers are more likely to use the technology safely whereas consumers are more likely to test the functional boundaries of the AVs systems, resulting in crashes.
“About a dozen trucks from major manufacturers like Volvo and Daimler just completed a week of largely autonomous driving across Europe, the first such major exercise on the continent. The trucks set off from their bases in three European countries and completed their journeys in Rotterdam in the Netherlands today (Apr. 6). One set of trucks, made by the Volkswagen subsidiary Scania, traveled more than 2,000 km and crossed four borders to get there.”
6) 3 Ways Self-Driving Cars Will Change Transportation
Unfortunately this is more of a fantasy discussion of electric vehicles than about self-driving, or Autonomous Vehicles (AVs). The sad reality of EVs is that battery technology is a major limiting factor an neither pricing nor functionality is improving at a significant rate. As for EV taxis, well, if they go 40 to 70,000 miles per year they would be more or less fully discharged at least once or twice a day, meaning they would last less than 2 years – optimistically.
“Self-driving cars could mean profound reduction in pollution and usage of valuable resources. Fully electric self-driving cars would also equate to much lower production and maintenance costs, prompting a drop in public transport costs for consumers. Lastly, if cars are no longer defined by the parts under the hood, public transportation might take on a new form entirely.”
7) Microsoft, Google make their pitches to unseat Amazon in the cloud
The article focuses on Microsoft and Google’s competitive response to Amazon but the story is somewhat deeper than that. There is a Swahili proverb “When elephants jostle, what gets hurt is the grass”, which portends what will happen to cloud services companies which lack the resources to compete with any of this three. The frantic effort by AWS, Microsoft, and Google, to establish share in this market will crush lesser players.
“But AWS still looms large over this market. Almost everything that Microsoft and Google spoke about at their conferences AWS also has a product line in. Machine Learning? Check. IoT? Yes. NoSQL databases? Sure thing. Amazon may not be the leader in each of these categories but it shows how tight the race is among these vendors. The consensus is that neither Microsoft nor Google did anything over the past two weeks to unseat AWS, but it’s clear the cloud wars are as hot as ever.”
8) CNET VR Day turns admirers into true believers
VR is very topical and it will be interesting to see how the market develops. A big issue will be the content (i.e. software or movies) and whether what is produced is good enough and diverse enough to appeal to a broader market. This sort of demonstration and feedback process has its limitations: people who are interested in VR currently may be a small minority and not reflective of the broader market so their reaction would only be remarkable if it were disappointing.
“So we decided to give our readers a chance to strap on these new devices, along with Gear VR, and see for themselves if the experience matches the excitement. Within three hours of putting out the invite for CNET VR Day, we had more than 1,000 readers sign up. After waiting a max of 40 minutes in line Wednesday, they spent about 10 minutes inside our San Francisco headquarters trying out each device. They viewed games, animation and a clip from Disney’s upcoming movie, “The Jungle Book.” Most visitors were impressed. “You’re just transported to another world,” said Yves, 41, a software developer who works at a startup across San Francisco Bay, in Alameda, after playing with the Oculus Rift. “You feel isolated. The thing completely encloses you. You are fooled into thinking you are operating in a completely different environment. It’s gonna be great to feel transported to other planets, other parts of the world or whatever. From that perspective, VR really achieves its goal.””
9) Departing FTC Commissioner Pans Digital Ad Industry’s Privacy Program
Online advertisers are quick to cry foul when users block their ads. The fact the ads consume an increasing amount of bandwidth, are often fraudulent or include malware seems to be irrelevant to them. They could reform their behavior but as this interview suggests the most basic efforts of self-policing fail. I suggest everybody install Privacy Badger in addition to uBlock or any other adblock software. Privacy Badger blocks the tracking advertisers refuse to block themselves.
“Today, digital advertisers are battling a rise in the use of ad blockers that’s fueled by consumer concerns including privacy. The breakdown in 2013 of an effort to establish a standard Do Not Track mechanism is partly to blame, she suggested. “We’ve seen an incredible rise in consumers taking matters into their own hands, which is precisely what I said would happen back then,” Ms. Brill said. “In some ways I think that effort fizzled because the multi-stakeholder process broke down,” said Ms. Brill. “There were entities involved that weren’t supporting the direction the group was heading and withdrew from the effort. It would have helped industry and consumers to have some rules of the road in online tracking.””
10) Newspapers to Brave browser: Don’t mess with our ads — or else
The Brave browser business model is to insert ads and split the payment between the user, the browser company, and the website. This may sound nice in theory for the user except this sort of thing has been tried before and users end up with virtually no payment unless they are human bots operating in a sweatshop in Asia somewhere. Interestingly, the decision to substitute adds may indeed make the effort illegal as a form of copyright violation.
“The Brave browser loads pages faster by stripping out not just ads but also website software that tracks users. The company eventually will insert ads that target your behavior but promises to keep your behavioral data on your computer and never gather the information itself. It’s not clear yet how many people use the browser, which launched in February, but Brave offers versions for personal computers powered by Windows, OS X and Linux and for phones and tablets powered by Google’s Android and Apple’s iOS. Brave’s financial strategy is to share 55 percent of its ad revenue with publishers — 70 percent when users don’t specifically carve off 15 percent for themselves. Brave itself keeps 15 percent and sends 15 percent to ad technology business partners. The newspapers refuse to participate.”
11) On cybersecurity, execs are burying their heads in the sand
As noted in Item 12 some “cyber” hacks are just signs of a badly run business, but there does seem to be another problem: namely that despite frequent headlines of hacks, some of which cost CEOs their jobs, executives don’t seem to think the problem is their concern. All this means, of course, if that company boards are themselves failing on their responsibilities to ensure the issue is dealt with at the highest level.
“Despite increased spending on cybersecurity, most executives are unprepared, even willfully ignorant, of the threats that could damage their businesses. A survey of 1,530 C-level executives across of range of industries found a widespread feeling that cybersecurity is an “IT problem,” even as CEOs personally shoulder the consequences for breaches: “The Target breach was one of the more significant ones: Executives can be held accountable,” says David Damato, chief security officer at Tanium, which co-sponsored the report with NASDAQ and the University of London. “But there’s still that disconnect. Executives still struggle with: ‘What should I be looking for?'””
12) Cyber fraudsters reap $2.3 billion through email wire-transfer scams
The interesting thing with this type of scam is that it is not a cyber security problem but a problem of abysmal financial controls. There is simply no way a well-run company could allow a check to be written on the basis of an email, memo, or verbal directive. Checks get written against invoices, invoices should have to be matched to purchase orders and waybills, and so on. Approvals should be required every step of the way. If a scammer can get a check written absent basic book keeping “cyber” has nothing to do with it.
“Businesses have lost billions of dollars to fast-growing scams where fraudsters impersonate company executives in emails that order staff to transfer to accounts controlled by criminals, according to the U.S. Federal Bureau of Investigation. Losses from these scams, which are known as “business email compromise,” totaled more than $2.3 billion from October 2013 through February of this year, the FBI said in an alert issued this week, citing reports to law enforcement agencies around the globe. The cases involved some 17,642 businesses of all sizes scattered across at least 79 countries, according to the FBI alert posted on the website of the agency’s Phoenix bureau.”
13) Outdated and Vulnerable WordPress and Drupal Versions May Have Contributed to the Panama Papers Breach
The “Panama Papers” were released a few days ago. Essentially these are a data dump of a couple of terabytes of the scams and money laundering schemes of the rich and famous. Although there has been some political fallout from the dump, past revelations regarding money laundering by major Swiss (UBS, Credit Suisse, and others) and UK (HSBC) banks only led to token fines and no significant sanctions to speak of. Regardless, some of the dictators, drug dealers, etc., who were clients of Mossack Fonseca are probably miffed at the revelations and it would be surprising if there were not a series of “suicides” and unfortunate “accidents” of people associated with the firm.
“Authorities have not yet identified the hacker behind the Panama Papers breach, nor have they isolated the exact attack vector. It is clear that Mossack Fonseca, the Panamanian law firm that protected the assets of the rich and powerful by setting up shell companies, had employed a dangerously loose policy towards web security and communications. The firm ran its unencrypted emails through an outdated (2009) version of Microsoft’s Outlook Web Access. Outdated open source software running the frontend of the firm’s websites is also now suspected to have provided a vector for the compromise.”
14) Sweep Is a $250 LIDAR With Range of 40 Meters That Works Outdoors
A price of $250 would be the high end of an acceptable price for LIDAR for an Autonomous Vehicle, however the modest range of this system means it can’t be used for that purpose. To be fair, the developers are targeting robots and drones, but it will be a breakthrough when low cost long range LIDAR is available. This is a Kickstarter so beware: the batting average of Kickstarter projects is pretty unimpressive.
“The “relatively low cost” bit is the problem: LIDARs are pricey, and an “affordable” 2D unit, with a range of 10 meters or less, can cost you over US $1,000. This is an enormous problem for both hobbyists and cost-conscious commercial robotics developers (i.e. every single commercial robotics developer). A San Leandro, Calif.-based startup called Scanse has developed a 2D LIDAR system that promises to be simultaneosly much cheaper and much better than what’s out there. For $250, you get a spinning LIDAR sensor with a range of 40 meters, even outdoors. We featured Sweep on Video Friday a while back, but we wanted follow up with a more detailed article, with some additional info from the Scanse team.”
15) Cable cord-cutting numbers soar in Canada thanks to Netflix, high prices, says report
“Cord cutting” is simply a shift away from the traditional cable/broadcast distribution system to streaming. Streaming allows you to watch what you want to watch (provided your streaming provider is licensed) when you want to watch it. When legal it is essentially a legal alternative to file sharing and is particularly important to younger demographics that of course eventually become older demographics. Some streaming is enabled by piracy but piracy is more reflective of pricing and licensing (beloved shows not being available in a particular country) than a chronic disdain for paying for media. Eventually cable providers will be dragged kicking and screaming into the 21st century and offer pricing to compete.
“According to the Convergence Consulting Group, 190,000 Canadians ended their ties with traditional TV in 2015. That’s an 80 per cent increase from the previous year when 105,000 people cut the cord. “It’s almost a doubling of a loss,” comments Brahm Eiley, president of the Toronto-based market research company. He says the jump is statistically significant because it’s such a radical shift compared with just two years ago. According to his numbers, only 13,000 Canadians cut the cord in 2013, while in 2012 there was actually a gain of 32,000 TV subscribers. Eiley expects the big drop in 2015 to be “the new normal.” His company forecasts that 2016 will see a decline of 191,000 TV subscribers in Canada.”
16) The TSA Randomizer iPad App Cost $1.4 Million
There is some discussion as to whether the TSA was taken for $1.4 million or a lesser amount depending on things like whether iPads were paid for, etc.. The lowest figure I’ve seen is around $120K for the “left or right arrow” app. I am sure a high school student could have done it cheaper, but you can’t blame IBM for taking the taxpayers’ money. Actually I could have designed the same function with $2 of semiconductors and a couple of LEDs and no iPad. Oh well – it’s not like it is real money, right?
“You may have seen the TSA Randomizer on your last flight. A TSA agent holds an iPad. The agent taps the iPad, a large arrow points right or left, and you follow it into a given lane. How much does the TSA pay for an app that a beginner could build in a day? It turns out the TSA paid IBM $1.4 million dollars for it.”
17) Google makes building apps easier with Android Studio 2.0
App development is a bit of a mystery to me but the fact there are millions of apps suggests there are plenty of people for whom it is not. This product release by google seems to make the development of apps even easier. I thought the cloud based test lab was a brilliant idea, especially since one of the issues with developing an app for Android phones (of which there are hundreds of models) vs iPhone (of which there are about 12) is testing on various platforms.
“The Android device emulator now takes advantage of multi-core CPUs, making it three times faster than before. “In most situations, developing on the official Android Emulator is faster than a real device, and new features like Instant Run will work best with the new Android emulator,” Google says. The brand new interface will help you fine tune an app by letting you rotate the screen, drag-and drop to install apps and use multi-touch controls like pinch to zoom. Once the app is ready, you can use Google’s Cloud Test Lab to put it “through a collection of tests against a portfolio of physical devices hosted in Google’s data centers,” according to the company. That works both with your own tests or basic ones supplied by Google, helping to eliminate conflicts and other bugs.”
18) Facebook Wants You to Post More About Yourself
I have to confess: social media baffles me. Why would I give a massive corporation all my personal data and why should I care about what people had for lunch? That’s another reason I’m not a billionaire. The interesting thing with Facebook is that, while its user base continues to grow, almost all of its revenue comes out of North America. You’d think the value of that revenue base would plateau but it shows no sign of doing so. Nevertheless, linking to external content would seem to have less value to advertisers than posting your shoe size or hair color. Oh well.
“Facebook Inc. is working to combat a decline in people sharing original, personal content, the fuel that helps power the money machine at the heart of its social network, according to people familiar with the matter. Overall sharing has remained “strong,” according to Facebook. However, people have been less willing to post updates about their lives as their lists of friends grow, the people said. Instead, Facebook’s 1.6 billion users are posting more news and information from other websites. As Facebook ages, users may have more than a decade’s worth of acquaintances added as friends. People may not always feel comfortable checking into a local bar or sharing an anecdote from their lives, knowing these updates may not be relevant to all their connections.”
19) First Look at Samsung’s 48L 3D V-NAND Flash
This is a pretty technical engineering report on a recently released Samsung flash component. Capacity is increasingly associated with “stacking” die rather than simply getting more bits per square millimeter, which is why these are called “3D”. There is probably a limit on layer stacking due to factor like power dissipation, but I can’t guess at what that limit is.
“Figure 3 is a package cross section showing the 16 dies stacked one on top of the other and connected using conventional wire bonding technology. The dies are an outstandingly 40 µm thin, perhaps the thinnest dies that we have seen in a package. By comparison, the dies in Samsung’s 32L V-NAND that we examined in 2014 were about 110 µm thick and stacked 4 dies high in their package.”
20) All The 3D Print That’s Fit to Pitt: New Additive Technology Center Opens Near Steel Town
GE’s approach makes sense, especially for a company of its size: a service center allows a sharing of expensive 3D printers and a sort of pooling of expertise. The article covers a wide range of 3D printing technologies and a careful reading would show that printing things is a whole lot more difficult than people can expect from a home printer.
“GE Aviation, for example, is already printing parts for jet engines, and GE Oil & Gas is using printers to make valves. The idea behind CATA, which is funded by each of the various GE businesses, is to bring additive into the mainstream for all of them. “Our mission is to ensure additive technology becomes a standard part of the tool kit for each business,” Cipolla says. “By having a shared facility, they can share the cost burden and we can advance the technology across the entire company much more rapidly than if they were to invest individually.””