The Geek’s Reading List – Week of May 27th 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.
1) Google beats Oracle—Android makes “fair use” of Java APIs
A victory by Oracle would have caused pandemonium in the software industry since APIs are basically how every software interacts with every other software and have not traditionally been considered copyrightable until recently. Of course, Oracle will appeal the case, and even though appeals are usually not successful they befuddled an appeals court before and they can do it again. Any developer considering working with any Oracle related code such as Java or MySQL should consider full GPL alternatives just in case Oracle continues in this desperate effort to appear relevant in the modern world.
“Following a two-week trial, a federal jury concluded Thursday that Google’s Android operating system does not infringe Oracle-owned copyrights because its re-implementation of 37 Java APIs is protected by “fair use.” The verdict was reached after three days of deliberations.”
2) Tesla Model S Autonomously Crashes on Highway
I like the quote from Tesla that “all systems worked as expected”. It’s a bit like “other than that, Mrs. Lincoln, how was the play?” It’s also a non-response because essentially it says that it is to be expected that a Tesla equipped with auto-brake can be expected to accelerate into a stationary vehicle. The legalese cited in the article is a particular hoot because it essentially says the system works until it doesn’t and then, well, you are on your own. I wonder if Volvo or other major auto vendors true and hide behind that sort of thing to explain away deficiencies. Eventually this ad-hoc system is going to kill somebody.
“A Tesla Model S crashed into a van while on Autopilot on the highway in Switzerland, and the driver caught the incident on video. Chris Thomann was driving his Model S with Tesla’s Adaptive Cruise Control (TACC) engaged. As you can see in the GIF below (Thomann set his YouTube video to private), the Model S seems to have recognized the car leaving the lane ahead, but did not spot the stopped van. The result was the Model S actually accelerating slightly into the van. According to Thomann, none of the safety systems worked properly.”
3) Will Apple iPhone 7 Sell, With Bigger Upgrade Coming Next Year?
Sorry, www.investors.com is a garbage website will all manner of ads (it doesn’t work if you have an adblocker), annoying popups, etc.. However I saw this article cited at a different website and at least wanted to be sure the quote was correct, because, well, funny story, US carriers no longer subsidize phones and no longer have 2 year contracts. They’ll happily let you finance the phone with 0% interest if you have good credit, but you pay full retail. This is a profoundly significant shift in the smartphone market and it is quite remarkable the long term ramifications of price discovery and the end of contracts are not well understood by investors.
“Wells Fargo Securities analyst Maynard Um said in a research report Monday that he doesn’t believe next year’s iPhone will hold back upgrades during the iPhone 7 cycle. “While it is reasonable to assume Apple may introduce an iconic iPhone in 2017, we believe it is not a foregone conclusion that the consumers will skip the iPhone 7 upgrade in 2016,” Um said. “The core of our premise revolves around continued competition for subscribers as two-year contracts come up for renewal.” If wireless carriers continue to run aggressive promotions to reduce subscriber churn and to attract new customers coming off two-year contracts, there may be strong incentives for people to upgrade, Um said.”
4) Hands on: ZTE Axon 7 review
This is another data point as to the health of the smartphone market. ZTE doesn’t have much of a market share in North America but the review suggests its new flagship phone has excellent features and performance and comes in at a 40% discount to Apple’s flagship. The article takes a dig at Apple’s 16GB device and rightly so. Smartphone pricing is falling off a cliff.
“You’ll have to buy this phone unlocked on Amazon or another retailer at full price. It won’t be sold at US carriers like AT&T, T-Mobile, Verizon or Sprint. And while it has enough bands to support all US phone networks, it’ll work with AT&T and T-Mobile SIM cards for now. Verizon and Sprint compatibility is due “possibly later in the year.” The good news here is that it’s packed with 64GB of internal storage and will cost $449 (about £340, AU$691). You won’t have to deal with a pesky two-year (or any) contract for that price. All of this contrasts with the 32GB Samsung Galaxy S7 at $650 and 32GB iPhone 6S at $750. That 16GB iPhone is no longer acceptable for a comparison when the Axon 7 comes with 64GB as standard.”
5) Xiaomi Revenues Were Flat in 2015
Xiaomi burst onto the scene a few years ago as it offered reasonably priced well featured smartphones. The company keeps to developing markets, probably due to intellectual property concerns. Unfortunately, there isn’t enough information in the article to establish whether the challenges are company specific (as implied by issues with some models), China specific (2.5% growth ain’t much), or related to my belief the smartphone market is shrinking globally. I can imagine that selling super premium priced iPhones into China is probably a lot harder in 2016 than it was in 2012.
“Flat sales growth represents a dramatic change of fortune for Xiaomi, which until recently appeared to be enjoying the momentum befitting China’s hottest startup. It was coming off sales growth of 135% in 2014, and in early 2015 founder Lei Jun said at a press conference that Xiaomi’s new smartphone was even better than Apple’s iPhone. However the phone, the Mi Note, amassed early user complaints about hot temperatures and didn’t become the mega-seller the company might have hoped. Later in the year Xiaomi suffered from the dramatic slowdown in China’s overall smartphone market, where shipments grew just 2.5% last year.”
6) Pas de problème … Quebec just passed a website blocking law
Wow. So we can add Quebec to the list including Turkey, China, and North Korea as places where the government decides what website you can look at. Of course, the aim is to protect the domestic financial interests (just as why China blocks Facebook) but it is great to see they are in such elite company.
“Canada’s second largest province, Quebec, has passed a law that obliges ISPs to block gambling websites. Bill 74 has passed almost without notice (the casino industry being the notable exception) and will see the government agency in charge of lotteries in the province, Loto-Québec, draw up a list of online gambling sites that they will then send to ISPs. ISPs will be required to block access to those sites within 30 days or face a $100,000 fine. The legislation doesn’t go into how ISPs should block the sites and although it is now law, it is extremely likely that they will put forward a legal challenge to it. Incredibly, the ban does not apply to all gambling sites – just those that Loto-Québec doesn’t like – and legislators were quite open about the fact that a goal of the law is to increase revenue to the local, officially approved gambling service Espacejeux.”
7) Tesla Model X owner files for Lemon Law protection claiming unfixable defects
There is a growing chorus of complaints about the quality of the Tesla Model X and its various “features” but this is the first “lemon law” suit related to the vehicle. I don’t think I’ll like to have my leg caught in a closing car door and I’ve read enough to assume that “autopilot” is Teslaspeak for “works most of the time under ideal conditions”. The comments at the end of the article show the problem: Tesla has become a cult. If the vehicle in question had come from a real manufacturer like Toyota or Ford the comments would be supportive of the owner rather than attacking him.
“Model X owner Barrett Lyon filed suit at Placer County Court in Roseville, CA claiming that the vehicle’s electronically actuated doors have slammed shut on his leg as well as damaged property as a result of its behavior. According to the Courthouse News Service (CNS), Lyon said “The doors do some weird, wicked things. If you get in and slide sideways and accidentally tap the brake, the driver’s side door slams shut on your leg. That’s not a very nice thing to have happen to you.” … Among other issues being cited in the Lemon Law suit are (quoting Lyon via CNS): “Auto Pilot in the rain is extremely dangerous, it causes the car to swerve into different lanes; Powered front doors are opening into cars and other obstacles; The power door slams are a feature of the Model X, and cannot be disabled; The touch screen freezes repeatedly, the second row seat causes driver’s seat to fold forward, and the auto park feature does not work 90 percent of the time,”
8) Why Oculus’s bitter DRM arms race exacerbates the Rift’s disappointing launch
I am somewhat skeptical as to the market potential for VR, at least outside of gaming. The gaming market is split between consoles and PCs, and console vendors will only support their own or licensed hardware. Facebook is going after the PC market, which will provide it with further rich streams of personal data (which is another reason I wouldn’t touch any hardware from Facebook). Understandably, they want to keep “their” stuff for themselves, hence the DRM. The thing is, VR headset are not that complicated so, unless Facebook can somehow attract PC gamers which are already Facebook users they are slicing the market pretty thin while opening the rest of the market up to other vendors – of which there will be many.
“There’s a program called Revive. It allows you to (for the most part) play Oculus Rift games on the HTC Vive. And why not? The two headsets are, at their core, pretty damn similar. If anything, the Vive has more functionality than the current Rift, meaning it should be easier to go Rift-to-Vive than vice versa. The problem: Oculus paid (a lot of, I assume) money for a handful of exclusive titles—Lucky’s Tale, EVE Valkyrie, Chronos—to convince people to buy a Rift. If people can wrap them to run on the Vive, it’s like Oculus paid for nothing! So Oculus patched in new DRM and Revive stopped working. Then over the weekend Revive cracked the new DRM. Such is life.”
9) Is Facebook eavesdropping on your phone conversations?
I’m not sure the article established as fact that they do, but if they don’t I wouldn’t be surprised if they stated. A few years ago in Batman: The Dark Knight, Batman uses a system which, back in 2008, was considered an egregious invasion of rights. Now it is just business and buried in a terms of service agreement. Man – people will do just about anything if you ask them to. What I have to wonder is, is it legal for your phone to record my words without my explicit permission? Sounds like a potential class action suit, if not criminal prosecution.
“Kelli enabled the microphone feature and talked about her desire to go on safari, right down to her mode of transportation. “I’m really interested in going on an African safari. I think it’d be wonderful to ride in one of those jeeps,” she said aloud, phone in hand. Less than 60 seconds later, the first post on her Facebook feed was a safari story that seemed to pop up out of nowhere. Turns out, it was a story that had been posted three hours earlier. And, after mentioning a jeep, a car ad also appeared on her page. “That is kind of weird,” she laughed. “I’m still not so sure this isn’t just coincidence. I don’t think Facebook is really listening to our conversations.””
10) Facebook begins tracking non-users around the internet
Facebooks sure seems to be in the news a lot this week. As is often the case the story is about their running roughshod over people’s privacy, including that of non-users. The antidote is the use of Privacy Badger, which blocked 11 trackers from this website and uBlock which blocked 22 requests from ad networks. There is little reason not to use these browser extensions unless you like the idea of a company stealing your information.
11) Fitbit Trackers Are ‘Highly Inaccurate,’ Study Finds
This is probably more serious than it sound because people actually rely on pulse rate tracking for their exercise routines and they may be misled into believe they are in better shape than they really are. Of course, chances are Fitbit disavows any responsibility for the accuracy of the data they produce in their terms of service which nobody reads or understands.
“Comparative results from rest and exercise — including jump rope, treadmills, outdoor jogging and stair climbing — showed that the Fitbit devices miscalculated heart rates by up to 20 beats per minute on average during more intensive workouts. “The PurePulse Trackers do not accurately measure a user’s heart rate, particularly during moderate to high intensity exercise, and cannot be used to provide a meaningful estimate of a user’s heart rate,” the study stated.”
12) Robot ranchers monitor animals on giant Australian farms
The article is not clear as to how “autonomous” the robots are, or what happens when they get stuck, run out of power, etc.. The video of various agricultural robots is kind of cool, though factors like cost, reliability, and so on are pretty important. As a guy who lives on a farm I can tell you that agricultural equipment is made heavy duty for a reason.
“A two-year trial, which starts next month, will train a “farmbot” to herd livestock, keep an eye on their health, and check they have enough pasture to graze on. Sick and injured animals will be identified using thermal and vision sensors that detect changes in body temperature and walking gait, says Salah Sukkarieh of the University of Sydney, who will carry out the trial on several farms in central New South Wales. “You’ve also got colour, texture and shape sensors looking down at the ground to check pasture quality,” he says. The robot, which has not yet been named, is a more sophisticated version of an earlier model, Shrimp, which was designed to herd groups of 20 to 150 dairy cows.”
13) Skimmers Found at Walmart: A Closer Look
There are two interesting points about this article: the first is how sophisticated “skimmers” have become as they are now almost invisible overlays, and the second is how far behind the US is with respect to basic credit/ATM card security. Skimmers are of little use if the cards are smartcards, and yet US financial institutions and retailers have dragged their heels with respect to the use of modern (i.e. decades old) anti-fraud technology.
“The Mercator Advisory Group notes that only 60 percent of all credit cards in the United States have been updated with chip cards, with debit cards lagging further behind. Even so, only 20 percent of card terminals in the U.S. have been activated for chip use as of April 2016, Mercator found. The United States is the last of the G20 nations to move to chip-based cards — much to the delight of fraudsters and organized cybercrime gangs that have siphoned tens of millions of credit and debit cards in major data breaches at retailers these past few years. Financial industry consultant Aite Group predicts that credit card fraud stemming from hacking will reach a record level in 2016 — $4 billion. Aite Group says fraudsters are busy milking this cash cow for all it’s worth as U.S. merchants start to pivot toward chip-card transactions.”
14) 3D printed titanium suffers from porosity that can cause breakage, CMU study reveals
You rarely read a negative article about 3D printing so this one really stood out. I’ve carried lots of articles about printing with titanium (it is used in aerospace and medical) but this is the first one I’ve seen which highlights shortcomings. I suspect this is more significant to aerospace where strength is important, rather than medical where biocompatibility is important.
“Titanium alloys can be found everywhere nowadays. Being extremely strong, lightweight and resistant to corrosion and high temperatures, its used in everything from military equipment to commercial jets and tennis rackets. What’s more, thanks to 3D printing the costly material can be used more effectively and on a smaller scale. But a new study by researchers from the Carnegie Mellon University (CMU) suggests that 3D printing inserts several flaws into the material, which can decrease the material’s resistance to fatigue and lead to breakage. The solution might be in the powder’s production process.”
15) 5 Myths About 5G
This is a very good article which covers the points made by an industry veteran regarding 5G wireless. I found the fact that 5G will not likely impact spectrum or capital spending to be particularly significant as I can almost predict a series of predictions about the opposite coming out of the industry analysts.
“One of the boldest statements in Onoe’s speech was that deploying 5G will not require a ton of investment. … But rather than requiring a complete overhaul of existing networks as some imagine, Onoe believes 5G will be deployed largely on existing infrastructure. Better service, he insists, does not always correlate with greater capital expenditures. NTT DOCOMO’s 600 billion yen in capital expenditures last year marked a 15-year low, even as the data traffic across its networks grew 6300 percent since 2000. In fact, Onoe actually expects capital expenditures for NTT DOCOMO to drop throughout 5G deployment, which he says would keep with trends for earlier wireless generations. To illustrate his point, Onoe opened a chart of the company’s capital expenditures over the past 20 years and asked the audience to guess when the company rolled out 3G and 4G LTE service. It’s impossible to tell based on expenditures alone. “For LTE, there was no increase in CapEx before the LTE launch,” he says. “That’s a fact””
16) Fearing forced Windows 10 upgrades, users are disabling critical updates instead
I’m a big fan of Windows 10 but Microsoft recently crossed the line into malware territory when it used deceptive techniques to get people to upgrade. The natural response to malware is to remove it and, unsurprisingly, some people have elected to fully disable Windows updates. I suspect that it not what Microsoft intended.
“Microsoft stepped on the gas in its quest to drive Windows 7 and 8 users to Windows 10 over the past couple of weeks, rolling the upgrade out as a Recommended update. Watch out! The only behavior that could deny the Windows 10 upgrade before—closing the pop-up by pressing the X in the upper-right corner—now counts as consent for the upgrade, and worse, the upgrade installation can automatically begin even if you take no action whatsoever. It’s nasty business, and it’s tricking legions of happy Windows 7 and 8 users into Windows 10. Over the past week, I’ve received more contact from readers about this issue than I have about everything else I’ve written over the rest of my career combined. But beyond merely burning bridges with consumers, these forced, non-consensual upgrades could have more insidious consequences.”
17) Crowdfunding tech can serve backers poorly, even when the thing gets made
This is a lengthy discussion of the weaknesses and failings of crowdfunding, which is a largely unregulated financial market. It’s worth noting the asymmetrical risk/return profile with crowdfunding: if you put in $100 and everything goes well you end up with a $100 product. If it doesn’t go well you lose your $100. So why not wait until the product is on the market – especially since most gadgets drop in price pretty quickly.
“Just last August, our sister site TechHive wrote “The FitNatic Nourish, and other cautionary crowdfunding tales,” in part to explain why TechHive had backed off further from covering crowdfunding campaigns. The article lists several major electronics projects that had failed to deliver, most in the $100,000s, and one in the neighborhood of $1.5 million. Since then—less than a year—projects totalling nearly $50 million, about half raised at Kickstarter, have had creating firms go bankrupt, teeter on the edge of partial failure, or have seen a significant delay. And that’s just a tally of some of the highest-profile ones, not a comprehensive look at the entire field.”
18) Google Steps Up Pressure on Partners Tardy in Updating Android
One of the great things about Android is that it is open source. Unfortunately that also means there are lots of small vendors who lack the resources to deliver updated software for their devices in the market. What this article shows is that, strangely enough, carriers are a major roadblock to software updates, which give you another reason to own an unlocked phone since you get those updates directly from the manufacturer.
“Getting phone makers and carriers to update to the latest version of Android has been one of the thorniest challenges facing Google as it tries to widen the use of its mobile software and generate more sales from its apps and web services. Now, Google is getting serious about remedying what ails Android, and it’s using both carrots and sticks to get partners to keep the world’s most popular mobile operating system more up to date. The issue — a mishmash of different smartphones running outdated software lacking the latest security and features — has plagued Android since its debut in 2007. But Google has stepped up its efforts recently, accelerating security updates, rolling out technology workarounds and reducing phone testing requirements. The Alphabet Inc. unit is also getting tougher, drawing up rankings that could shame some phone makers into better behavior, according to people familiar with the situation.”
19) The future of ultra-low-powered displays is finally in living color
Displays are becoming more common in advertising but they are quite power hungry. E Ink only consumes power when the display is changed, and, since the response time is very slow, they aren’t going to be showing video. So, as the article suggests, a small solar array and a battery is all you’d need to have an advertisement which changes every few minutes or so.
“The new display, which E Ink will publicly demonstrate for the first time, is a 20-inch, 2500 x 1600 resolution display that actually shares monochrome E Ink’s impressive power capabilities. Mancini told Mashable that it’s equally power-efficient. He explained that it could be used in bus stop signage. “Bus stops are powered with solar cells, you could power this with solar cells,” he said.”
20) Norway consumer body stages live app terms reading
This is a funny, but meaningful exercise showing the pointless legal gobbledygook associated with all many of technology nowadays. If the Terms and Conditions for 33 apps are longer than the New Testament they are probably even more opaque, meaning few lawyers, let along consumers could hope to understand them. This is particularly interesting given that Tesla now offers up disclaimers as sufficient justification for unsafe technology (see item 2).
“The average Norwegian has 33 apps, the Norwegian Consumer Council says, whose terms and conditions together run longer than the New Testament. To prove the “absurd” length, the council got Norwegians to read each of them out in real time on their website. The reading finished on Wednesday, clocking in at 31:49:11.”