Start up: Apple opens betas, Counter-Strike’s gambler scandal, Blackphone’s black future, and more

Too many of these things driving you mad? Get used to it. Photo by KylaBorg on Flickr.

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A selection of 10 links for you. Use them wisely. I’m charlesarthur on Twitter. Observations and links welcome.

Foxconn IPO shows an unfit industry • Bloomberg Gadfly

Tim Culpan:

»Foxconn Technology Group’s latest IPO is giving the world a clearer picture of just how tough the technology environment really is.

In 455 pages of pre-listing documents filed to the Hong Kong stock exchange, Foxconn affiliate FIT Hon Teng gives an array of data that, despite its sales pitch, actually shows how weak the industry looks.

FIT — which stands for Foxconn Interconnect Technology — is the connector unit of the world’s biggest contract electronics manufacturer. Crucially, it got 35.7% of sales last year from Foxconn’s Taipei-listed flagship Hon Hai, best known as the maker of iPhones.

While not sexy, connectors are at the heart of almost every electronics device. They include the USB cables and plugs that link your phone to your PC or wall charger, the HDMI cables that hook up your TV, and the myriad audio jacks used in everything from landline phones to music players. That makes the connector industry a good market to watch for signs on the state of the overall technology hardware industry.

FIT thinks it has an edge in the connector market.”We believe our customers value our collaboration with Hon Hai Group which help shorten development and production lead times and provide cost advantages for brand companies in the end markets we serve.”

That edge hasn’t staved off a continued slide in revenue, margins and profit over the past couple of years, according to the filing. What’s worse, revenue and gross margin both fell in the first four months of this year, FIT said.


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Apple beta software program • Apple

»The Apple Beta Software Program lets users try out pre-release software. The feedback you provide on quality and usability helps us identify issues, fix them, and make Apple software even better. Please note that since the public beta software has not yet been commercially released by Apple, it may contain errors or inaccuracies and may not function as well as commercially released software. Be sure to back up your Mac using Time Machine and your iOS device with iTunes before installing beta software. Install only on non-production devices that are not business critical. We strongly recommend installing on a secondary system or device, or on a secondary partition on your Mac.


One day will there be one for a car? Anyhow, presently just for Mac and iOS devices. No fee.
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Counter-Strike YouTuber offers apology in light of gambling scandal (update) • Polygon

Allegra Frank:

»Trevor “Tmartn” Martin uploaded a video apologizing for not disclosing his involvement in CS:GO Lotto, a popular gambling site that he and fellow YouTube creator Tom “ProSyndicate” Cassel have equity in and were promoting on their channels.

The two-minute video opens with Martin playing with his golden retriever before he launches into his public statement.

“I’m going to try to make this as short and sweet as possible,” he said, followed by an expression of gratitude for his fanbase and those who have stuck by him during the scandal, in which he was exposed by several YouTubers for obscuring the fact that he owned CS:GO Lotto during his promotional videos. He then moved into his involvement with CS:GO Lotto.

“Now, my connection to CS:GO Lotto has been a matter of public record since the company was first organized in December of 2015,” he said, a point that has been refuted by fans and others who have watched his older videos. (Martin has since made many of his Counter-Strike gambling videos private.) “However, I do feel like I owe you guys an apology. I’m sorry to each and every one of you who felt like that was not made clear enough to you.”…

…The exposure of YouTubers with financial stakes in the gambling sites they promote is just the latest development in the ongoing Counter-Strike: Global Offensive legal drama. A member of the game’s community filed suit against Valve in late June, charging that the company facilitated underage betting and other unlawful practices.


Ethics? What’s that? The BBC’s You & Yours programme recently had an item about Twitter tipsters who actually get kickbacks from the sites where people are encouraged to gamble. And they get more if people lose. This seems similar.
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End of cycle? • Elad’s blog

Elad Gil:

»we are seeing a shift to a boom in the variety and type of companies being funded as tech investors pursue other areas that I would characterize as “software aware” (I mean some software is used by the startup; however, the true basis for value for the startup has little to do with software despite claims by the founders) versus “software driven” . There are two ways I interpret this trend:

1. There are lots of industries suddenly available for transformation.

While I think the range of markets about to be transformed by software is large, the interpretation of what is truly a tech business is being misapplied. Software, the Internet, and AI are transforming a variety of industries on an ongoing basis and I am a huge fan of software is eating the world pmarca statement. However, people are starting to apply software valuations to low gross margin, physical good businesses that are not software businesses. In other words, lots of tech investors are now investing in areas they do not understand, at valuation multiples that do not make sense for these alternate businesses. This is similar to the 2001-2003 bad period of cleantech and nanotech.

2. We are at the end of an economic cycle for tech, and tech investors are desperate for the next new thing.

It is always hard to call the end of an economic or innovation cycle[2]. Technology-driven shifts will continue to be incredibly resilient and transformative. However, the rate of creation of truly fundamental massive businesses accelerated for a few years, and may decelerate for a few years before the next wave hits. During this period of deceleration, entrepreneurs and investors will go into a search pattern to try to find the next wave.


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Why Silicon Valley loves Universal Basic Income even though it is completely unworkable • The Policy

Dare Obsanjo:

»The fundamental challenge of UBI proposals is the Basic Income Impossible Trinity which I first discovered in a Bloomberg article about Switzerland’s plan to vote for a UBI.
The UBI impossible trinity is shown below

An explanation of the terms are as follows:
• Large basic transfer: A UBI proposal only makes sense as a replacement for people losing their jobs if it actually starts coming close to matching the income from a job. The Swiss proposal was for 2,500 Swiss francs which is about $2,560 which is inline with the average income in the US.

• Low phase out rate: This is effectively a low rejection rate for citizens getting access to the UBI check. This aligns with the railing against “means testing” and other requirements for citizens to get a check which is what makes it universal.

• Same cost as existing system: Self explanatory

Any universal basic income proposal can only have two of these. In Switzerland, the proposal was for a system that combined #1 and #2 above. This proposal was soundly rejected in a referendum by the Swiss people due to the fact that it would have cost an additional $200bn in taxes…

…Given a solution that seems so obviously unworkable, why is this idea so seductive to the seemingly brilliant techies who continue to write enthusiastically about universal basic income?

The primary reason is guilt.


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The tyranny of messaging and notifications • The Verge

Walt Mossberg bemoans how many alerts and notifications and messaging services he has to deal with:

»when I have to reach someone with something important and time-sensitive, I often wind up resorting to two or more similar but independent pathways, because I’m never sure which one will be likelier to work, since he or she is under a similar assault.

And then there are the notifications, ever-present on every operating system on every device. Sure, you can fine tune or even silence them with some work (more on that later), but most people don’t, or don’t know how, or feel they don’t dare. Notifications are supposed to save you time, but often they wind up doing the opposite.

Many mornings, it’s common for the lock screen of my iPhone and the right-hand side of my Mac’s screen to be jammed with notifications about “news” I don’t care about, messages whose relevance has come and gone overnight, tips on birthdays of people I’m not close to, reminders of meetings I’m not attending, and warnings of traffic tie-ups on roads I don’t use. The signal-to-noise ratio is very poor, and gets only marginally better during the work day.


Gee, I wonder what it would be like if you could gamify that. Perhaps like…
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Clash of Clans rules everything around me • Real Life

Tony Tulathimutte:

»In Clash, absolutely everything can be purchased, every building and troop is military and replaceable; the battle reports tell you how many troops you “expended.” Unlike other cartoon-styled games, where characters are “knocked out” or “eliminated,” there’s no ambiguity about death. When mowed down, troops turn briefly into ghostly skeletons, then gravestones, and tapping on the gravestones converts them into elixir (read again: oil).

This capitalist angle gets a lot more interesting when you consider that Clash’s purpose is to extract the world’s most important resource from its player base (this time, read: money). Gameplay largely involves waiting for things to finish building. If you don’t want to wait, you spend. Gems allow you to bypass the wait times for constructions and upgrades, which ordinarily take hours, days, or even weeks to complete. The bright green color of grass, greed, and envy, gems can be earned a few at a time through gameplay but can be purchased with real money to the tune of $4.99 for 500, or up to $99.99 for a 14,000-gem war chest; each gem is worth somewhere between one and 20 minutes of time.


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Sorry privacy lovers, the Blackphone is flirting with failure • Forbes

Thomas Fox-Brewster:

»The failure of the first Blackphone, according to the exhibits filed by Geeksphone lawyers, was in part down to a mistaken belief in demand for the device and associated partnerships that went sour. A letter dated March 21st 2016 from Matt Neiderman, Silent Circle’s general counsel, to Geeksphone co-founder Rodrigo Silva-Ramos Pidal, laid out the Blackphone project’s woes in detail. It noted that when Silent Circle agreed to buy back half of SPG, it did so in the belief it had secured big distributor agreements with three partners: BigOn Telecommunications in Dubai, South Korea’s Kumion and America Movil in South America. Between them, Silent Circle believed they would purchase 250,000 devices. But BigOn, according to Neiderman, never bought the 25,000 devices it was due to purchase. The Sumion deal also fell through, whilst America Movil had only acquired 6,000 of the 100,000 Blackphones it had promised to buy, the letter noted, adding the latter was “the one agreement that has had some legitimacy.”


The court documents (and another) make quite juicy reading. But the short version is: privacy alone is not a selling point for smartphone users in any volume. BlackBerry knows that already; it has been reliant on an existing user base for years.
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Tesla said autopilot crash would be ‘material’ contradicting CEO Musk • Fortune

Stephen Gandel:

»The fatal accident, the first known case related to the autopilot feature, occurred 11 days before Musk and Tesla sold $2bn shares in an offering on May 18. Yet the company made no mention of the crash in its offering documents. The news of the accident didn’t come out until last week, when it was reported by federal highway authorities — six weeks after the offering.

Musk told Fortune via email that the deadly crash wasn’t “material” information that Tesla investors needed to know. After the article appeared on Tuesday, Musk called the article “BS” in a tweet and said that the fact that Tesla’s shares rose on Friday following the accident’s disclosure showed that the accident wasn’t material.

But back in early May, Tesla said exactly the opposite of what its founder is saying now in an SEC filing. The company warned investors that a fatal crash related to its autopilot feature, even a single incident, would be a material event to “our brand, business, prospects, and operating results.” The disclosure said that the company may face product liability claims due to “failures of new technologies that we are pioneering, including autopilot in our vehicles,” adding that “product liability claims could harm our business, prospects, operating results and financial condition.”


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Tesla’s dubious claims about autopilot’s safety record • Technology Review

Tom Simonite:

»Tesla and Musk’s message is clear: the data proves Autopilot is much safer than human drivers. But experts say those comparisons are worthless, because the company is comparing apples and oranges.

“It has no meaning,” says Alain Kornhauser, a Princeton professor and director of the university’s transportation program, of Tesla’s comparison of U.S.-wide statistics with data collected from its own cars. Autopilot is designed to be used only for highway driving, and may well make that safer, but standard traffic safety statistics include a much broader range of driving conditions, he says.

Tesla’s comparisons are also undermined by the fact that its expensive, relatively large vehicles are much safer in a crash than most vehicles on the road, says Bryant Walker Smith, an assistant professor at the University of South Carolina. He describes comparisons of the rate of accidents by Autopilot with population-wide statistics as “ludicrous on their face.” Tesla did not respond to a request asking it to explain why Musk and the company compare figures from very different kinds of driving.


As Ben Thompson also pointed out in his Stratechery newsletter, the fact that Tesla opened its blogpost about this death significantly caused by its technology with statistics, rather than an expression of empathy for the dead person and those affected, is an indictment of its tone-deafness.
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Errata, corrigenda and ai no corrida: none notified.

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