Start Up No.1,168: Amazon’s unstoppable run, Yahoo slays Groups, camera chain shuttering?, we love smart speakers, and more


A ‘glass floor’ is keeping America’s richest dolts from the ignominy they deserve. CC-licensed photo by d_diony on Flickr.

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A selection of 11 links for you. Use them wisely. I’m @charlesarthur on Twitter. Observations and links welcome.

Is Amazon unstoppable? • The New Yorker

Charles Duhigg has a colossal piece, in which this passage seems to capture how things have changed:

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When David Kahan became the chief executive of Birkenstock Americas, in 2013, he began to discover how thoroughly Amazon had changed his industry. Kahan had started his career as a shoe salesman at Macy’s; he went on to become a sales manager at Nike and, eventually, a top executive at Reebok. Birkenstocks have been made by hand, in Germany, for two hundred and forty-five years—thirty-two workers touch every pair. When Kahan became C.E.O., Amazon was among the company’s top three shoe sellers. “They sold millions of dollars’ worth of our shoes,” Kahan told me. “But during my first year I was sitting in my office, where I can hear the customer-service department, and we were getting a flood of people saying their shoes were falling apart, or they were defective, or they were clearly counterfeits, and, every time the rep asked where they had been purchased, the customer said Amazon.”

Kahan investigated, and found that numerous companies were selling counterfeit or unauthorized Birkenstocks on Amazon; many were using Fulfillment by Amazon to ship their products, which caused them to appear prominently in search results. “We would ask Amazon to take sellers down—or, at least, tell us who is counterfeiting—but they said they couldn’t divulge private information,” Kahan told me.

Kahan also discovered that Amazon had started buying enormous numbers of Birkenstocks to resell on the site. The company had amassed more than a year’s worth of inventory. “That was terrifying, because it meant we could totally lose control of our brand,” he said. “What if Amazon decides to start selling the shoes for ninety-nine cents, or to give them away with Prime membership, or do a buy-one-get-one-free campaign? It would completely destroy how people see our shoes, and our only power to prevent something like that is to cut off a retailer’s supply. But Amazon had a year’s worth of inventory. We were powerless.”

…Kahan told me that, with the rise of Amazon, the give-and-take that has long undergirded the retail economy has become lopsided in a titan’s favor. “Capitalism is supposed to be a system of checks and balances,” he said. “It’s a marketplace where everyone haggles until we’re all basically satisfied, and it works because you can always threaten to walk away if you don’t get a fair deal. But when there’s only one marketplace, and it’s impossible to walk away, everything is out of balance. Amazon owns the marketplace. They can do whatever they want. That’s not capitalism. That’s piracy.”

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Understand what’s changing in Yahoo Groups • Groups Help – SLN31010

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Yahoo has made the decision to no longer allow users to upload content to the Yahoo Groups site. Beginning October 21, you won’t be able to upload any more content to the site, and as of December 14 all previously posted content on the site will be permanently removed. You’ll have until that date to save anything you’ve uploaded.

What features will go away?
• Files
• Polls
• Links
• Photos
• Folders
• Calendar
• Database
• Attachments
• Conversations
• Email Updates
• Message Digest
• Message History

What will happen to the site?
• The Yahoo Groups site will continue to exist, however, all public groups will be made private or restricted. Any new group members will need to request an invite or be invited by an admin. Admins will still be able to manage various group settings, though some functionality will be limited.

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It would have been simpler to say what features would remain, wouldn’t it? Seems like it’s going to become a write-only site. Well, apart from you can’t upload any content that isn’t an email.

So will you be able to use Yahoo Groups “going forward” (aka “after December 14”)?

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You’ll still be able to communicate with your groups via email and search for private groups on the site. In addition, admins will continue to have limited access to group settings and administration tools.

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IOW: mostly not. Not explained: why Yahoo is going this. My guess: to prevent liability for illegal and illicit content. (Thanks Paul G for the pointer.)
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Jessops owner plans to call in administrators • BBC News

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The owner of camera chain Jessops, Dragons Den star Peter Jones, plans to call in administrators to help salvage the struggling High Street brand.

Mr Jones bought the chain from administrators in 2013 after it collapsed under £81m of debt.
But since then, the firm, which has 46 shops, has not made a single profit and losses have mounted in recent years.

Now Mr Jones reportedly intends to seek a rescue deal for the firm’s property arm, JR Prop Limited.

Last year alone, the business, which employs 500 people, saw its rent costs increase to £4.7m.
Lease charges, which include rent on stores, increased from £4.4m in 2017.

Now Mr Jones is reportedly planning to seek a rescue deal, known as a company voluntary agreement (CVA) with its landlords and lenders. This is an insolvency process that allows a business to reach an agreement with its creditors to pay off all or part of its debts.

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How surprising, at a time when everyone is walking around the streets carrying devices with built-in cameras capable of sending a picture anywhere in the world, that a high street chain of shops selling cameras and accessories can’t turn a profit. I always thought Jones’s purchase was quixotic; I think it will struggle even with drastic rent cuts and shutterings.
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Google chief: I’d disclose smart speakers before guests enter my home • BBC News

Leo Kelion comes up with a question Rick Osterloh hadn’t expected:

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It’s an admission that appears to have caught Google’s devices chief by surprise.

After being challenged as to whether homeowners should tell guests smart devices – such as a Google Nest speaker or Amazon Echo display – are in use before they enter the building, he concludes that the answer is indeed yes.

“Gosh, I haven’t thought about this before in quite this way,” Rick Osterloh begins.

“It’s quite important for all these technologies to think about all users… we have to consider all stakeholders that might be in proximity.”

And then he commits.

“Does the owner of a home need to disclose to a guest? I would and do when someone enters into my home, and it’s probably something that the products themselves should try to indicate.”

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Despite security concerns, British owners still love their smart speakers • Strategy Analytics

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Nearly one in four UK households now owns a smart speaker, and while many users are concerned about security issues, the vast majority love their devices. A new survey by Strategy Analytics of more than a thousand smart speaker users found that nearly six in ten are concerned that voice-controlled devices will record sounds or conversations without their consent, and nearly half will not share payment information via their smart speaker.

However, 88% of users are satisfied with their smart speaker and three quarters say they are much more useful than they had expected. More than 60% prefer using voice to a touchscreen or keyboard, and 50% even say they now can’t imagine life without one. The results are based on an online survey of 1048 smart speaker users carried out in July/August 2019.

The report also found that 31% of non-owners plan to buy a smart speaker for the first time within the next 12 months. This is in spite of the fact that security is a concern for a minority of these potential buyers – 13% say that they haven’t bought one yet because they are concerned generally about security and 7% because they don’t want their data shared.

In addition, two thirds of existing owners say they will definitely buy another smart speaker, nearly a third within the next twelve months. More than half of owners already have more than one smart speaker in the home, confirming once again how these devices are becoming central to the emerging smart home lifestyle.

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Worried, but shrugging their shoulders. This seems to be how people deal with cognitive tension.
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The ‘glass floor’ is keeping America’s richest idiots from failing • Huffington Post

Michael Hobbes:

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In 2014, Zach Dell launched a dating app called Thread. It was nearly identical to Tinder: Users created a profile, uploaded photos and swiped through potential matches. 

The only twist on the formula was that Thread was restricted to university students and explicitly designed to produce relationships rather than hookups. The app’s tagline was “Stay Classy.” 

Zach Dell is the son of billionaire tech magnate Michael Dell. Though he told reporters that he wasn’t relying on family money, Thread’s early investors included a number of his father’s friends, including Salesforce CEO Marc Benioff. 

The app failed almost instantly. Perhaps the number of monogamy-seeking students just wasn’t large enough, or capping users at 10 matches per day limited the app’s addictiveness. It could also have been the mismatch between Thread’s chaste motto and its user experience. Users got just 70 characters to describe themselves on their profiles. Most of them resorted to catchphrases like “Hook ’em” and “Netflix is life.” 

After Thread went bust, Dell moved into philanthropy with a startup called Sqwatt, which promised to deliver “low-cost sanitation solutions for the developing world.” Aside from an empty website and a promotional video with fewer than 100 views, the effort seems to have disappeared. 

And yet, despite helming two failed ventures and having little work experience beyond an internship at a financial services company created to manage his father’s fortune, things seem to be working out for Zach Dell. According to his LinkedIn profile, he is now an analyst for the private equity firm Blackstone. He is 22. 

America has a social mobility problem. Children born in 1940 had a 90% chance of earning more than their parents. For children born in 1984, the odds were 50-50. 

Most accounts of this trend focus on the breakdown of upward mobility: it’s getting harder for the poor to become rich. But equally important is the decline of downward mobility: the rich, regardless of their intelligence, are becoming more likely to stay that way.

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If you haven’t watched the TV series Succession (which I came to late, in only the past three weeks), then you should. It’s about a rich family of venal, foolish, mostly incompetent children and their successful, venal, indifferent father. Though the tale of Zach Dell is enough to make you want to punch the soft furnishings.
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Analysis: UK renewables generate more electricity than fossil fuels for first time • Carbon Brief

Simon Evans:

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In the third quarter of 2019, the UK’s windfarms, solar panels, biomass and hydro plants generated more electricity than the combined output from power stations fired by coal, oil and gas, Carbon Brief analysis reveals.

During the three months of July, August and September, renewables generated an estimated total of 29.5 terawatt hours (TWh), compared with just 29.1TWh from fossil fuels, the analysis shows.

This is the first-ever quarter where renewables outpaced fossil fuels since the UK’s first public electricity generating station opened in 1882. It is another symbolic milestone in the stunning transformation of the UK’s electricity system over the past decade.

Nevertheless, a lack of progress in other parts of the economy means the UK remains far off track against its upcoming legally-binding carbon targets, let alone the recently adopted goal of net-zero greenhouse gas emissions by 2050.

At the start of this decade in 2010, the 288TWh generated from fossil fuels accounted for around three-quarters of the UK total. It was also more than 10 times as much electricity as the 26TWh that came from renewables.

Since then, electricity generation from renewable sources has more than quadrupled – and demand has fallen – leaving fossil fuels with a shrinking share of the total.

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Though of course this is electricity generation – not total energy, which includes vehicle fuel. I’d love to know how much the latter uses.
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Machine learning can’t flag false news, new studies show • Axios

Joe Uchill:

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After different researchers showed that computers can convincingly generate made-up news stories without much human oversight, some experts hoped that the same machine-learning-based systems could be trained to detect such stories. But MIT doctoral student Tal Schuster’s studies show that, while machines are great at detecting machine-generated text, they can’t identify whether stories are true or false.

Many automated fact-checking systems are trained using a database of true statements called Fact Extraction and Verification (FEVER).

In one study, Schuster and team showed that machine learning-taught fact-checking systems struggled to handle negative statements (“Greg never said his car wasn’t blue”) even when they would know the positive statement was true (“Greg says his car is blue”).
The problem, say the researchers, is that the database is filled with human bias. The people who created FEVER tended to write their false entries as negative statements and their true statements as positive statements — so the computers learned to rate sentences with negative statements as false.
That means the systems were solving a much easier problem than detecting fake news. “If you create for yourself an easy target, you can win at that target,” said MIT professor Regina Barzilay. “But it still doesn’t bring you any closer to separating fake news from real news.”
Both studies were headed by Schuster with teams of MIT collaborators.
The bottom line: The second study showed that machine-learning systems do a good job detecting stories that were machine-written, but not at separating the true ones from the false ones.

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Myanmar’s great tech switch is chance to become part of world’s web • Asia Nikkei

Chan Jia Hao:

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As early as 1999, Myanmarese characters had been added to the Unicode standard. But sanctions by the US against the country’s military dictatorship discouraged tech businesses like Microsoft from rolling out Unicode support for Myanmar. More than 90% of websites worldwide use Unicode today.

Instead, internet users relied on a homegrown font, Zawgyi, as a substitute. Approximately 90% of Myanmar-based websites have been using Zawgyi for their data encoding and digital content over the last decade.

Global tech giants like Huawei, Samsung and Facebook therefore supported both Unicode and Zawgyi standards, to capture the latter’s substantial user-base – but this did not mean Myanmar was properly integrated.

Eliminating Zawgyi now is no easy feat for a developing Myanmar. A shift in the standard implies normal internet users having to relearn how to input the script and the massive rewriting of digital content, such as webpages and databases. The bulk of Myanmar’s citizens and businesses had been relying on Zawgyi-based content for commercial and day-to-day purposes.

Converting millions of local data from Zawgyi to Unicode at different times also risks clashes. These can result in disrupted communications between Myanmar’s ministries, local telcos, devices, apps, website content and internet users for an indefinite period of time.

The decision to migrate now, however, does arrive with some time-sensitive reasons.

During its transition to civilian rule, Myanmar’s government produced an economic strategy with a strong emphasis on developing its information and communications technology sector. It also drafted a Universal Service Strategy, whose aim was for all of Myanmar’s citizens to have access to telecommunication services by 2022.

There has been promising growth in internet penetration already. Individuals using the internet rose from less than 1% of the population in 2011 to 31% in 2017. Fixed broadband subscriptions increased nearly fourfold between 2015 and 2017 to 121,000, albeit still at a low level in a country of 53 million.

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*whispers* don’t mention the genocide enabled by the internet. (And did the non-Unicode system make it even harder for Facebook to monitor posts?)
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Asynchronous communication: the real reason remote workers are more productive • Doist.com

Amir Salihefendic (who just happens to be CEO of the “asynchronous” Doist, but even so)
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If employees are consistently more productive when working away from the office, there’s something broken about the modern workplace.

According to the Harvard Business Review article “Collaborative Overload”, the time employees spend on collaboration has increased by 50% over the past two decades. Researchers found it was not uncommon for workers to spend a full 80% of their workdays communicating with colleagues in the form of email (on which workers’ spend an average of six hours a day); meetings (which fill up 15% of a company’s time, on average); and more recently instant messaging apps (the average Slack user sends an average of 200 messages a day, though 1,000-message power users are “not the exception”).

As one office worker told New York Magazine, “I used to wake up and turn off the alarm and check Tinder. Now I wake up and check Slack.”
This trend toward near-constant communication means that the average knowledge worker must organize their workday around multiple meetings, with the time in between spent doing their work half-distractedly with one eye on email and Slack.

To make matters worse, the rise of mobile technology means that workplace communication is no longer limited to the physical workplace or work hours. We can, and do, check email and respond to messages at any time, day or night. As a result, we’re never fully off the clock. As one office worker told New York Magazine, “I used to wake up and turn off the alarm and check Tinder. Now I wake up and check Slack.”

Slack boasts that users spend 9 hours per workday connected to the app. 90 minutes of active usage spread over 9 hours is a whole lot of interruptions.
This highly synchronous way of working would be understandable if it produced results, but there is more and more evidence that all the real-time communication overhead makes it hard to focus, drains employees’ mental resources, and generally makes it more difficult to make meaningful progress on work.

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Are China’s tantrums signs of strength or weakness? • The Atlantic

Zeynep Tufekci:

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maybe we are entering a new age when China will push around Western companies to make its point. For all we know, Xi Jinping is looking across the Pacific at the crumbling governance, the failing infrastructure, the hollowed-out manufacturing capacity, the myriad elite failures, and the general decay in Western societies and has decided that the time is here to confidently declare that if you want to do business with China, its China’s way or the (crumbling) highway. He might have decided that the time when it needed to deploy strategic silence on the divergence in stated values is over, essentially telling us “Free speech, free shmeech” and getting away with it.

Judging by the speed with which these companies have rushed to kowtow, maybe he’s right?

Or, alternatively, in this truly global and interconnected world, China might be experiencing its own form of failure and weakness, with a more and more centralized rule pushing a cult of personality around the leader. After all, China has its own problems with decadence, corruption, and inequality. Many high-level officials have families with multiple passports and expansive overseas wealth. A mixture of authoritarian malaise and loss of agility might be causing the country to lash out, without proper strategic analysis. This same dynamic seems to be at work in China’s approach to the Hong Kong protests, which could have been defused early through a few symbolic concessions. It’s as though China doesn’t even understand a city that is under its own jurisdiction.

Is China an integrated part of the global failure and corruption of elites, failing in its own way due to shortsightedness and incompetence? Or is it a confident new superpower that is just beginning to throw its weight around? I can’t say for sure…

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Insightful as ever; the extent to which western companies have self-censored (she points to another example involving jeweller Tiffany) is worrying.
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Errata, corrigenda and ai no corrida: none notified

5 thoughts on “Start Up No.1,168: Amazon’s unstoppable run, Yahoo slays Groups, camera chain shuttering?, we love smart speakers, and more

  1. Succession: I can believe that the children in it are that nasty, venal, and incompetent. I have hung around rich people and their children just enough to see that. What I can’t believe is that they would be allowed anywhere near the company. Michael Dell owns the whole of Dell computers. Does he let Zach anywhere near the driving seat? Hell, no — he gives him a couple of hundred million dollars to play in the sandpit with.
    In public companies the pressure would be still greater to keep familial incompetents away from positions of responsibility — I’m sure you can think of an example from a paper where we used to work.

    • I give you the Murdoch family, the Redstone family (apparently part of the Succession plot comes from that) and never forgetting the Trump family.

  2. You forgot Fairfax … But I think the Trump family is a special case in that Donald himself is a lousy businessman who coasted on the money Fred left him. Murdoch, I’m not sure. Have the second generation been massively incompetent? Who sold Rupert on MySpace? (I ask because I really don’t know).

  3. On the other hand, that’s true at every level though. I know people with a modest job in some field or other, or lucky connections, and are using / have used those to give their kids a leg up.
    The issue is not the individuals, the behaviour is built into the human psyche; it’s the system, when the system allows it to thrive to an unconscionably high degree.

    For al the reactionnary whining about affirmative action, there was a recent study about 47% (!!) of white students at some Ivy League Uni getting in there because either legacy status, sports, or donations. That’s the issue, and its systemic not individual. And it’s not just the mega-rich but at all levels, though it’s more visible and extreme up there.

    I’m obviously using this as an example, the same happens in all important areas (health, education, justice, jobs…), and assuming College is meaningful which I’m unsure about. Again, an example, but a recently-documented one.

    • Remembering my High School yeats. France has a fully egalitarian system (no AP classes, each class is supposed to be mixed and matched randomly, aside from the separate “crafts” track for those destined for manual labor – which is bad of course ^^). Of course that’s a facade; in my time, Maths was the king of subjects (key to a career as a engineer or manager in the private sector via a Grande Ecole after 2/3yrs of Classe Preparatoire, or at least scientific Uni). So we had “good” classes for the people with a shot at Grandes Ecoles, and then the rest.

      On the face of it, looks like meritocracy, and that’s OK if harsh and would be better if done officially not on the sly. Issues though:
      – in the end, all but 2 of my classmates were either scions of executive types or of gov. employees (a weird class in France: not overly paid, but 100% job security, huge benefits, limited working hours). 2 working-class classmates out of 30ish. The code to get into a good class was not only grades, but your name/address, and taking German as a first foreign language: wouldn’t want second-gen Spanish or Portuguese or Arab immigrants to . have. an.unfair. advantage…
      – there’s a huge amount of homework, you don’t stand a chance if you have to work outside of home, inside the home, and face an uphill struggle if you have no help w/schoolwork. Not really any time/place to do that work at school either, so you need your own room, and quiet. My elementary-school teacher sister has sob stories about kids esp. 1st-gen girls having to hide in toilets to do homework. I have sob stories about being helped at maths by my dad (I wasn’t sure which was worse, at the time ^^)

      So, wall of text to say, vilifying individuals is a nice way to externalize the guilt, but as Mrs. Warren says, “Trump isn’t the problem, he’s a manifestation of the problem.” (or somesuch).

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