Start Up No.1311: Huawei hits out over new sanctions, Uber cuts further, Disney loses exec to TikTok, Microsoft loves open source!, and more


The Isle of Wight: not the ideal place to find people with coronavirus, which is good – but also bad CC-licensed photo by Alwyn Ladell on Flickr.

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A selection of 9 links for you. Use them wisely. I’m @charlesarthur on Twitter. Observations and links welcome.

Huawei hits back at US as TSMC cuts off chip orders • The Verge

Sam Byford:

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“In its relentless pursuit to tighten its stranglehold on our company, the US government has decided to proceed and completely ignore the concerns of many companies and industry associations,” Huawei adds in an official statement. “This decision was arbitrary and pernicious, and threatens to undermine the entire industry worldwide. This new rule will impact the expansion, maintenance, and continuous operations of networks worth hundreds of billions of dollars that we have rolled out in more than 170 countries.”

“We expect that our business will inevitably be affected,” Huawei’s statement continues. “We will try all we can to seek a solution.”

Nikkei reported earlier today that TSMC has moved to stop new orders from Huawei following the US government’s announcement last week. The rules are specifically designed to target Huawei and its chip subsidiary HiSilicon, requiring a license for any shipments from manufacturers that use US technology or equipment. TSMC didn’t deny the reports but called them “purely market rumor,” according to Reuters.

Huawei has in the past suggested that it could switch its chip supply to Samsung in this eventuality. The company has also recently been exploring domestic chip production through China’s Semiconductor Manufacturing International Corporation (SMIC), which just received a $2.2 billion investment from the Chinese government.

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This is going to cripple both Huawei’s consumer and network businesses. The latter is way bigger and more important. It will also hasten China aiming to do everything itself. The US-China divide is going to get wider, rather than China becoming in any way subservient to the US.
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Isle of Wight contact-tracing app trial: a mixed verdict so far • BBC News

Rory Cellan-Jones:

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It is 10 days since all Isle of Wight residents were invited to test the NHS app at the heart of the government’s test, track and trace strategy. So how’s it going?
Mixed would probably be a fair verdict.

The big concern was how many people would download it. Epidemiologists suggest that for the UK as a whole, about 60% of the population needs to install and use the software for it to live up to its full potential. So when Downing Street says there have been roughly 60,000 downloads, that’s not a bad result. The island’s population is 140,000, and its inhabitants are slightly older and less likely to own a smartphone than the UK average.

But one cautionary note – that 60,000 may include some who downloaded it twice or are from the mainland. Still, that compares well with other experiments. About 20% of the population of Singapore downloaded its contact-tracing app, and last week an Australian government app had been installed by roughly a quarter of its population.

But here’s the key question – does it work? Are users being alerted to take action after coming into contact with the virus?

Here, there is very little to go on. What we know is that there are just 173 confirmed cases of Covid-19 on the Isle of Wight. With most people still in lockdown, it is quite unlikely that any single individual using the app would have come into contact with an infected person.

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Umm well that does seem like a bit of a drawback for testing your contact-responding app. Though Apple just released iOS 13.5 with the contact tracing API, so it’ll be back to the drawing board for the NHS.
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Uber cuts 3,000 more jobs, shuts 45 offices in coronavirus crunch • WSJ

Preetika Rana:

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Uber Technologies is cutting several thousand additional jobs, closing more than three dozen offices and re-evaluating big bets in areas ranging from freight to self-driving technology as Chief Executive Dara Khosrowshahi attempts to steer the ride-hailing giant through the coronavirus pandemic.

Mr. Khosrowshahi announced the plans in an email to staff Monday, less than two weeks after the company said it would eliminate about 3,700 jobs and planned to save more than $1 billion in fixed costs. Monday’s decision to close 45 offices and lay off some 3,000 more people means Uber is shedding roughly a quarter of its workforce in under a month’s time. Drivers aren’t classified as employees, so they aren’t included.

Stay-at-home orders have ravaged Uber’s core ride-hailing business, which accounted for three-quarters of the company’s revenue before the pandemic struck. Uber’s rides business in April was down 80% from a year earlier.

“We’re seeing some signs of a recovery, but it comes off of a deep hole, with limited visibility as to its speed and shape,” Mr. Khosrowshahi said in his note to employees. The company’s food-delivery arm, Uber Eats, has been a bright spot during the crisis, but “the business today doesn’t come close to covering our expenses,” he wrote.

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Uber used to lose money even when people were moving around all the time. The weird thing is that when things start opening up, its cost structure might actually make sense.
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Disney’s Mayer becomes TikTok CEO • The New York Times

Brooks Barnes:

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The Walt Disney Company’s top streaming executive, Kevin Mayer, resigned on Monday and will become the chief executive of TikTok, the app for making and sharing short videos that has exploded in popularity during the coronavirus pandemic.

Mr. Mayer, 58, will also serve as chief operating officer of ByteDance, the Chinese conglomerate that owns TikTok.

As Americans have stayed home during the pandemic, a growing number have turned to TikTok to help pass the time. New users in the United States downloaded the app about 11 million times in March, nearly twice the total in December, according to Sensor Tower, a company that tracks app usage data.

But national security concerns about TikTok’s growing influence have been raised by members of Congress, who have also questioned if there is a risk that the app could share user data with its Chinese parent company.

Mr. Mayer’s departure from Disney is not entirely a surprise. Disney’s board of directors passed over him earlier this year when it was looking for a successor for Robert A. Iger, who abruptly stepped down in February. (Mr. Iger remains executive chairman, with a focus on the creative process.) Many people in Hollywood and on Wall Street had viewed Mr. Mayer, 58, as the logical internal candidate because the future of Disney rests on its ability to transform itself into a streaming titan. The top job, however, went to Bob Chapek, the lower-profile chairman of Disney’s theme parks and consumer products businesses.

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Disney+ has hardly done badly, but this is quite a move. TikTok (and ByteDance) are going to get serious about monetisation now. And also the whole global domination thing.
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US lockdown protests may have spread virus widely, cellphone data suggests • The Guardian

Jason Wilson:

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Cellphone location data suggests that demonstrators at anti-lockdown protests – some of which have been connected with Covid-19 cases – are often traveling hundreds of miles to events, returning to all parts of their states, and even crossing into neighboring ones.

The data, provided to the Guardian by the progressive campaign group the Committee to Protect Medicare, raises the prospect that the protests will play a role in spreading the coronavirus epidemic to areas which have, so far, experienced relatively few infections.

The anonymized location data was captured from opt-in cellphone apps, and data scientists at the firm VoteMap used it to determine the movements of devices present at protests in late April and early May in five states: Michigan, Wisconsin, Illinois, Colorado and Florida.

They then created visualizations that tracked the movements of those devices up to 48 hours after the conclusion of protests. The visualizations only show movements within states, due to the queries analysts made in creating them. But the data scientist Jeremy Fair, executive-vice president of VoteMap, says that many of the devices that are seen to reach state borders are seen to continue across them in the underlying raw data.

One visualization shows that in Lansing, Michigan, after a 30 April protest in which armed protesters stormed the capitol building and state police were forced to physically block access to Governor Gretchen Whitmer, devices which had been present at the protest site can be seen returning to all parts of the state, from Detroit to remote towns in the state’s north.

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I know, you’re surprised that meeting up with people might spread the virus. Total shocker.
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Microsoft: we were wrong about open source • The Verge

Tom Warren:

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Microsoft has admitted it was wrong about open source, after the company battled it and Linux for years at the height of its desktop domination. Former Microsoft CEO Steve Ballmer famously branded Linux “a cancer that attaches itself in an intellectual property sense to everything it touches” back in 2001.

Microsoft president Brad Smith now believes the company was wrong about open source. “Microsoft was on the wrong side of history when open source exploded at the beginning of the century, and I can say that about me personally,” said Smith in a recent MIT event. Smith has been at Microsoft for more than 25 years and was one of the company’s senior lawyers during its battles with open-source software.

“The good news is that, if life is long enough, you can learn … that you need to change,” added Smith. Microsoft has certainly changed since the days of branding Linux a cancer. The software giant is now the single largest contributor to open-source projects in the world, beating Facebook, Docker, Google, Apache, and many others.

Microsoft has gradually been adopting open source in recent years, including open-sourcing PowerShell, Visual Studio Code, and even Microsoft Edge’s original JavaScript engine.

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Gather round, children, and let’s remember that Microsoft used to rely on licensing Windows as the engine of its revenues, and so open source was indeed anathema. But times change, and now Microsoft makes its money from licensing things that aren’t Windows, such as access to its cloud services. That makes it platform-agnostic, but it’s nice to pretend it’s a spiritual conversion.
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Not even wrong: ways to predict tech • Benedict Evans

He’s blogging again:

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there is no predictive value in saying ‘that doesn’t work’ or ‘that looks like a toy’ – and that there is also no predictive value in saying ‘people always say that’. As Pauli put it, statements like this are ‘not even wrong’ – they do not give you any insight into what will happen. You have to go one level further. You have to ask ‘do you have a theory for why this will get better, or why it won’t, and for why people will change their behaviour, or for why they won’t’?

To understand both of these, it’s useful to compare the Wright Flier with the Bell Rocket Belt. Both of these were expensive impractical toys, but one of them changed the world and the other did not. And there is no hindsight bias or survivor bias here.

The Wright Flier could only go 200 meters, and the Rocket Belt could only fly for 21 seconds. But the Flier was a breakthrough of principle. There was no reason why it couldn’t get much better, very quickly, and Blériot flew across the English Channel just six years later. There was a very clear and obvious path to make it better. Conversely, the Rocket Belt flew for 21 seconds because it used almost a litre of fuel per second – to fly like this for half a hour you’d need almost two tonnes of fuel, and you can’t carry that on your back. There was no roadmap to make it better without changing the laws of physics. We don’t just know that now – we knew it in 1962.

These roadmaps can come in steps. It took quite a few steps to get from the Flier to something that made ocean liners obsolete, and each of those steps were useful. The PC also came in steps – from hobbyists to spreadsheets to web browsers. The same thing for mobile – we went from expensive analogue phones for a few people to cheap GSM phones for billions of people to smartphones that changed what mobile meant. But there was always a path.

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A general point, though he does draw a comparison with self-driving cars.
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FBI: shooter at Pensacola military base linked to al-Qaida • The Washington Post

Eric Tucker:

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The Justice Department had previously asked Apple to help extract data from two iPhones that belonged to the gunman, including one that authorities say Alshamrani damaged with a bullet after being confronted by law enforcement. Wray said FBI agents were able to break the encryption without the help of Apple.

Law enforcement officials had previously left no doubt that Alshamrani was motivated by jihadist ideology, saying he visited a New York City memorial to the attacks of Sept. 11, 2001, over the Thanksgiving holiday weekend and posted anti-American and anti-Israeli messages on social media just two hours before the shooting.

Separately, AQAP, al-Qaida’s branch in Yemen, released a video in February claiming the attack. The branch has long been considered the global network’s most dangerous branch and has attempted to carry out attacks on the U.S. mainland.

But it was only with access to the phones that U.S. officials were able to establish certain suspicions as facts.

Barr said the information retrieved from Alshramani’s phone has already proved valuable, with U.S. officials recently conducting a counterterrorism operation targeting an AQAP operative who was one of Alshramani’s contacts…

Barr used Monday’s press conference to forcefully call on Apple to do more to cooperate with law enforcement.

“In cases like this, where the user is a terrorist, or in other cases, where the user is a violent criminal, human trafficker or child predator, Apple’s decision has dangerous consequences for public safety and national security and is, in my judgment, unacceptable,” Barr said.

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General principle: listen to any recommendation Barr makes, and do the opposite. Apple isn’t going to make a backdoor, and if a US law is passed obliging it to, it won’t start until that law has been challenged all the way to the Supreme Court – on the basis it would be “speech forced by the government”, violating the First Amendment.
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The American economy is imploding — and America is too • Medium

Umair Haque:

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The few jobs that are left are “low-income service jobs” offered by mega-monopolies, which means delivering groceries and driving cars and walking pets. But they don’t provide stable incomes, benefits, guarantees, much less raises, career paths, and so on But when economy’s labour force…goes nowhere…what future can it really have?

That brings me to the second transformation depressions wreak. Economies grow permanently poorer. Yes, as in “forever.” That’s already happening in America, too. yesterday’s if not great but somewhat decent jobs were already being substituted away by the new, gruesome “gigs” that modern-day American techno-capital offers — driving an Uber, delivering an Instacart, selling a pallet on Amazon — but coronavirus has accelerated that transition, massively. Megacorporations aren’t going to magically hire huge numbers of people once they’ve found out they can make do with permanently lowers levels of hiring. But lower levels of hiring across the economy mean that workers have less bargaining power. Bang! Incomes fall — the share of the economy going to working people craters. What’s the net result? Society grows poorer.

What happens to poorer societies? They’re left in a kind of terrible paradox, which is my third transformation: they can’t afford the very things they need to survive most. Why is it that the average American is the only person in the rich world by now who votes against their own healthcare, retirement, education, childcare, and so on? Because they can’t afford it. 80% of Americans lived paycheck to paycheck before coronavirus. Who can afford to pay an extra 5% or 10% in taxes for decent social systems? Nobody, really, except the already rich — who don’t need them. Hence, the famous paradox of the American Idiot: people who vote against their self-interest. It’s not their fault, really: they have no choice. They can’t afford to vote for things like public healthcare.

America was already becoming too poor a society to have functioning public goods, like healthcare or retirement for all. Coronavirus is going to seal that fate. America will be poor now — far too poor to ever really make the transition to having decent public goods. Think of that full half of the American population who’s now not employed. How exactly are they going to afford the higher taxes it takes to have a European or Canadian style social contract? They struggled to before — and after coronavirus, it’s going to be flatly impossible.

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One point apparently not considered: much higher taxes on those with higher incomes, and higher corporate taxes. That could pay for healthcare. Ah, but Haque is assuming, probably correctly, that the legislature is captured by corporate and personal interests which forestall those. His later points are even more concerning.
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Errata, corrigenda and ai no corrida: none notified

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