The Geek’s Reading List – Week of March 17 2017
Welcome to the Geek’s Reading List. These articles and the commentary are not intended 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.
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!
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1) Hospital Stumbles in Bid to Teach a Computer to Treat Cancer
Remember all the hoopla about IBM’s Watson computing being applied to medical diagnosis? Ever wonder what happened? Well it turns out things haven’t gone as well as expected. The article seems to try and distance Watson from the program’s failure but, seriously, if the technology worked nearly as well as people thought it would do you really think they would have thrown in the towel?
“In 2012, the University of Texas MD Anderson Cancer Center launched an ambitious project with International Business Machines Corp.’s Watson program that promised to transform cancer care with the help of artificial intelligence. Almost five years and more than $62 million later, the sprawling Houston-based public institution has little to show for it, according to a special review conducted by the University of Texas System Audit Office that details a number of stumbles in the progress and management of the project. The audit doesn’t evaluate IBM Watson’s scientific capabilities or whether the technology works for this purpose. But instead, the report details the management and technology challenges at MD Anderson that make it hard to integrate artificial-intelligence software into complicated health-care settings. The Watson-based program isn’t in clinical use, according to the audit. The plan for a pilot focused on leukemia was “suspended mid-project” and the focus shifted to lung cancer to try to speed up progress, according to audit documents. Clinical trial and drug-protocol data in the system are outdated, and the pilot program doesn’t work with the hospital’s current electronic health records, according to the audit.”
2) Sony’s new wireless charging patent could let you borrow juice from other devices
This article generated a fair bit of online interest this week even though what is being described in the article is essentially “radio”. There is no chance whatsoever any significant amount of power could be transmitted wirelessly between two smartphones, even if they were a few millimeters apart. I’m sure Sony engineers get a bonus for patent applications but it’s rather hard to believe any patent clerk would accept such a thing. Overall it’s a pity so few people paid attention in physics class.
“This isn’t the first time we’ve seen patents and patent fillings related to new wireless charging techniques. Even Apple joined the fray by filing a patent for an inductive wireless charging technology. The company is now rumored to be working with Energous, a wireless charging company that has built tech that can charge wirelessly from a distance — so if you’re at home, your device can be charging no matter where you are in the house. There’s no question that the ultimate goal is for charging to be completely hassle free, and these companies all seem to be working toward that. Sony’s tech could be a piece in that puzzle — or it could just help you keep charged in an emergency, if it ever sees the light of day.”
3) Why laptops won’t come with larger SSDs this year
The SSD is going to kill the Hard Disk Drive (HDD) industry but it may take a bit longer than I expected. It turns out they are so much in demand that suppliers can’t keep up, which means prices are dropping as they should. HDD stocks have bounced back as though investors seem to think the hazard has passed but it hasn’t: this is the ultimate head fake – massive flash (and therefore SSD) capacity will come online within 12 to 18 months and SSD pricing will drop precipitously. That will result in a veritable implosion of demand for HDDs.
“A dearth in NAND flash chip supply will cause the prices of mainstream solid-state drives (SSDs) to leap by as much as 16% this quarter over the previous quarter, meaning laptop makers won’t likely offer consumers higher capacity SSDs in their new systems, according to a report from market research firm DRAMeXchange. On average, contract prices for multi-level cell (MLC) SSDs supplied to the PC manufacturing industry are projected to go up by 12% to 16% compared with the final quarter of 2016; prices of triple-level cell (TLC) SSDs are expected to rise by 10% to 16% sequentially, according to DRAMeXchange. In the second quarter of 2017, the average prices of mainstream client-grade SSDs will keep climbing, but at a more moderate rate. … The SSD adoption rate in the global notebook market is estimated to reach 45% this year, according to DRAMeXchange. The uptick in SSD adoption will be greater in the consumer-class notebook segment than the business-class segment.”
4) The Uber Bombshell About to Drop
I have no issue with Uber as a service but I figure anybody who believes it is worth over $60B is delusional: it is a car service, not a tech company. Nevertheless, like so many “unicorns” Uber has to keep stoking excitement in order to keep raising money in order to continue existing. Its self-driving car project is an example of this: AVs will not be commercially available for at least 10 year years and a car service is not going to be the company leading the charge. In any event, if this article is to be believed, their technology is “borrowed” and they might have to give it back.
“In the last few weeks Alphabet filed a lawsuit against Uber. Alphabet and Waymo (Alphabet’s self-driving car company) allege that Anthony Levandowski, an ex-Waymo manager, stole confidential and proprietary information from Waymo, then used it in his own self-driving truck startup, Otto. Uber acquired Otto in August 2016, so the suit was filed against Uber, not Otto. This alone is a fairly explosive claim, but the subtext of Alphabet’s filing is an even bigger bombshell. Reading between the lines, (in my opinion) Alphabet is implying that Mr Levandowski arranged with Uber to: 1) Steal LiDAR and other self-driving component designs from Waymo; 2) Start Otto as a plausible corporate vehicle for developing the self-driving technology; and 3) Acquire Otto for $680 million. Below, I’ll present the timeline of events, my interpretation, and some speculation on a possible (bad) outcome for Uber. The timeline references section numbers from Waymo’s amended filing, so you can read the full context yourself.”
5) Uber’s autonomous cars drove 20,354 miles and had to be taken over at every mile, according to documents
Uber may or may not have taken Google’s self-driving car technology but it sure doesn’t look like they took the good stuff. It turns out their vehicles don’t go very far before a human has to wrestle control back from them. It’s just a matter of time before they kill somebody.
“For example: During the week ending March 8, the 43 active cars on the road only drove an average of close to 0.8 miles before the safety driver had to take over for one reason or another. This metric, called miles per intervention, includes all the times drivers have had to take back control from the system over the course of a week. The reasons for these interventions can vary, but that can include navigating unclear lane markings, the system overshooting a turn or driving in inclement weather. The stat excludes “accidental disengagements, end-of-route disengagements and early takeovers.””
6) Millions of Smart Meters May Over-Inflate Readings by up to 600%
Smart meters allow the utility to do things like time of use billing and remote meter reading. You might think that the one thing a meter should be able to do is provide a correct reading of electricity consumption but that does not seem to be the case. It may be simply a case that the nature of the electric load is different nowadays as suggest by the issue with LED bulbs. Since the utility selects the smart meter they are probably far less concerned with accuracy than you might believe – especially if the meter overstates actual energy consumption.
“Lab tests carried out by Dutch scientists have shown that some of today’s “smart” electrical meters may give out false readings that in some cases can be 582% higher than actual energy consumption. … Test results varied wildly, with some meters reporting errors way above their disclosed range, going from -32% to +582%. Tests with uncommon results were repeated several times and the results were within a few percents of the original. …The greatest inaccuracies were seen when researchers combined dimmers with energy saving light bulbs and LED bulbs.|
7) FBI Used Best Buy’s Geek Squad To Increase Secret Public Surveillance
Heck – who needs a warrant when you can just pay employees to break constitutional guarantees for you? I admit that it is hard to have pity for alleged criminals, especially those dumb enough to turn electronics over to Best Buy, but this is pretty pathetic, even for the FBI. One thing to consider is that if Best Buy is snooping through your computer looking for signs of criminal activity they are also finding personal information, passwords, credit card information, and so on.
“Recently unsealed records reveal a much more extensive secret relationship than previously known between the FBI and Best Buy’s Geek Squad, including evidence the agency trained company technicians on law-enforcement operational tactics, shared lists of targeted citizens and, to covertly increase surveillance of the public, encouraged searches of computers even when unrelated to a customer’s request for repairs. To sidestep the U.S. Constitution’s prohibition against warrantless invasions of private property, federal prosecutors and FBI officials have argued that Geek Squad employees accidentally find and report, for example, potential child pornography on customers’ computers without any prodding by the government. Assistant United States Attorney M. Anthony Brown last year labeled allegations of a hidden partnership as “wild speculation.” But more than a dozen summaries of FBI memoranda filed inside Orange County’s Ronald Reagan Federal Courthouse this month in USA v. Mark Rettenmaier contradict the official line.”
8) Why Intel Bought Mobileye
Actually the reason Intel bought Mobileye is pretty much the reason they buy almost everything else: they prefer financial engineering over actual engineering and would rather give their money to Mobileye shareholders than their own shareholders. Intel has absolutely no understanding of the auto industry and buying Mobileye doesn’t change that. The auto industry is a high volume low margin business and there is not a chance in a thousand that auto vendors are going to rely on Intel as a major supplier for important technology. All this deal does is to give Mobileye’s competitors a boost. The big question is how long it will take before Intel writes the transaction off.
“Intel, the world’s largest chipmaker, announced it will acquire Mobileye, a leading automotive supplier of sensor systems that help prevent collisions, for $63.54 per share, which has a fully-diluted equity value of $15.3 billion and an enterprise value of $14.7 billion. The deal has left some scratching their heads such as Citron Research, a short-selling firm that once called the company “the short of 2016” in a tweet. Others have questioned the acquisition price, asking if Intel is paying too much? But the deal isn’t so surprising after a review of Intel’s acquisition and partnership history in the past two years. And it represents the next wave of deals in the automotive tech space, said Stefan Heck CEO of NAUTO, self-driving car tech startup that uses a combination of its own artificial intelligence algorithms, cameras, motion sensors, and GPS to detect what’s happening on the road and inside the car.”
9) Top Three iPhone 8 Rumors You Should Know
I suspect that Apple could launch a large stick of chewing gum with an iPhone label and sell a few million copies provided it charged a high enough price. None of the “top” rumors I have seen discuss any features which haven’t been on the market, in some cases for years. My Nexus 5 had wireless charging and that phone came out in 2013 and wireless charging wasn’t new then.
“Apple Inc. is expected to launch a new cool iPhone model this year. New reports leaked out of Japan claim the Cupertino-based tech giant has been testing multiple iPhone models. It has yet to finalize a 10th-anniversery iPhone to be launched this year alongside iPhone 7s and iPhone 7s Plus models. Rumors suggest that Apple will launch a 5.8-inch flagship handset with edge-to-edge OLED display in September. It is said to feature a long-distance wireless charging, an edge-to-edge OLED display, and a “revolutionary” front-facing 3D camera.”
10) Worldwide Augmented and Virtual Reality Headset Market Expected to Grow at a Compound Annual Rate of 58%, Reaching 99.4 Million Units in 2021, According to IDC
Gartner, IDC, and the like are in the business of selling research reports and believe me people prefer research reports which paint sunlit meadows far more than they like research reports which tell the truth. This is especially the case in the tech industry where bullish forecasts drive stock prices and funding valuations. Quite frankly I think you have to be on drugs if you believe the growth forecasts in this summary: it is pretty clear that, while there will be a market for VR and AR, that market will be a fraction of the size the size people predicted a year ago.
“New device launches, an expanding array of content for both consumer and enterprise users, and lower price points will propel the worldwide augmented and virtual reality headset device market at a breakneck pace. According to data from the International Data Corporation (IDC) Worldwide Quarterly Augmented and Virtual Reality Headset Tracker, total headset device shipments will reach 99.4 million units in 2021, up nearly 10-fold from the 10.1 million units shipped in 2016. This results in a compound annual growth rate (CAGR) of 58% across the five-year forecast period.”