Start Up No.1442: how machine learning is changing financial reports, the trouble with aircraft, Utah monolith takers revealed, and more


The iconic telescope at Arecibo in Puerto Rico has collapsed after cables suspending this system broke. CC-licensed photo by Meredith P. on Flickr.

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

Salesforce to acquire Slack for $27.7bn • The New York Times

Erin Griffith and Lauren Hirsch:

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Demand for Slack’s products, which allow people to communicate and collaborate with one another, has increased as people work from home during the pandemic. While the company said in September that revenue rose 49% to $216m in the quarter ending in July and that the pandemic had created a “significant increase in demand and usage of Slack,” it also said it did not expect that rise to continue. Layoffs at some of its customers have hurt its business, the company said.

At the same time, Slack has faced increasing competitive pressure from Microsoft. Teams, Microsoft’s collaboration product, reported 115 million daily users in October, up 50% from April. Slack has not provided an update on the 12 million daily users it reported a year ago.
Editors’ Picks

In July, Slack filed a complaint against Microsoft with the European Commission, claiming Microsoft had unfairly bundled Teams with its suite of Microsoft Office work products. Microsoft has offered the software alongside Office since Teams was released in 2017.

“When you’re a scrappy start-up going against an 800-pound gorilla that’s one of the most well-capitalized companies in existence, its tough to compete,” Mr. Park said of Slack. “This is more or less saying, ‘We can’t compete with Microsoft Teams anymore. We need more firepower.’”

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I wonder if the complaint against Microsoft lapses once Slack becomes part of a much, much bigger company. I don’t think anyone’s expecting the interface to become any more friendly (or platform-specific). The amount works out to roughly $250,000 per paying user, by the way.
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52 things I learned in 2020 • Fluxx Studio Notes

Tom Whitwell:

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This year I edited another book, worked on fascinating projects at Fluxx, and learned many learnings.

1. Most cities plant only male trees because it’s expensive to clear up the fruit that falls from female trees. Male trees release pollen, and that’s one of the reasons your hay fever is getting worse. [Jessica Price]

2. In China, 🙂 doesn’t mean happy, it means “a despising, mocking, and even obnoxious attitude”. Use these, instead: 😁😄😀. [Echo Huang]

3. The hold music you hear when you phone Octopus Energy is personalised to your customer account: it’s a number one record from the year you were 14. [Clem Cowton]

4. If Apple AirPods was a standalone business (founded 2016, $12bn revenue, 125% growth, 30–50% margin), it would probably be the most valuable startup in the world. [Kevin Rooke]

5. Sarcasm detection has been a serious problem in computer science since the mid 2000s [Martin Gardiner]

6. All of the ten best-selling books of the last decade had female protagonists [Tyler Cowen]

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And that’s only the first six. Worth your time every year.
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Corporate reporting in the era of artificial intelligence • NBER

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Companies have long seen annual reports and other corporate disclosures as opportunities to portray their business health in a positive light. Increasingly, the audience for these disclosures is not just humans, but also machine readers that process the information as an input to investment recommendations.

In How to Talk When a Machine Is Listening: Corporate Disclosure in the Age of AI (NBER Working Paper 27950), Sean Cao, Wei Jiang, Baozhong Yang and Alan L. Zhang explore some of the implications of this trend. Rather than focusing on how investors and researchers apply machine learning to extract information, this study examines how companies adjust their language and reporting in order to achieve maximum impact with algorithms that are processing corporate disclosures.

To gauge the extent of a company’s expected machine readership, the researchers use a proxy: the number of machine downloads of the company’s filings from the US Securities and Exchange Commission’s electronic retrieval system. Mechanical downloads of corporate 10-K and 10-Q filings have increased exponentially, from 360,861 in 2003 to around 165 million in 2016. Machine downloads have become the dominant mode during this time — increasing from 39% of all downloads in 2003 to 78% in 2016.

…Companies also go beyond machine readability and manage the sentiment and tone of their disclosures to induce algorithmic readers to draw favorable conclusions about the content. For example, companies avoid words that are listed as negative in the directions given to algorithms.

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First we shape our tools and then they shape us, financial reporting edition.
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EU urged to address aviation’s full climate impact, including non-CO2 emissions • Climate Home News

Chloé Farand:

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The aviation sector’s climate impact is three times bigger than the effect of its carbon dioxide emissions alone, according to a study by the European Union Aviation Safety Agency (Easa), the EU’s aviation regulator, commissioned by the European Commission.

The study endorses findings published in the journal Atmospheric Environment, showing that non-CO2 emissions from planes such as of oxides of nitrogen (NOx), soot particles, sulphate aerosols, and water vapour at high altitude together drive significant global heating.

Current EU policies to curb the aviation sector’s growing emissions only take into account carbon dioxide emissions.

The EU estimates direct carbon emissions from aviation account for nearly 4% of the bloc’s total CO2 emissions. But when considering non-CO2 emissions, aviation is likely playing a much bigger role in the EU’s contribution to rising temperatures globally.

Campaigners at Transport & Environment (T&E) say the study is an acknowledgment by the European Commission that the aviation sector’s full impact on warming needs to be addressed — 12 years after it started to consider the issue.

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Nobody wants to take the hard decisions; and it’s impossible to defect because everyone else will continue. It’s too convenient. Which leads to our next item…
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Rising seas predicted to flood thousands of affordable housing units by 2050 – The Verge

Justine Calma:

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The number of affordable housing units vulnerable to flooding could triple by 2050 as the planet heats up, according to a new study. That amounts to more than 24,000 homes that could flood at least once a year by 2050, compared to about 8,000 in 2000.

The study, published in the journal Environmental Research Letters, ranks the states and cities at greatest risk. Its authors also unveiled a new interactive map that people can use to see how their hometown might be affected.

As the world warms, seas rise. That means tides are creeping further ashore, and storm surges are becoming a bigger threat to homes along the coast. The encroaching waters are just one way climate change is transforming cities, and the dangers are piling up on lower-income communities.

“I hope this can guide policy that will help the people who are most vulnerable to coastal flooding, which is low-income people in affordable housing. We feel like we’ve really pinpointed that problem with this study,” said Benjamin Strauss, a co-author of the study who is also chief scientist and CEO of the nonprofit research organization Climate Central. Seventy-five% of the affordable housing stock vulnerable to future floods is concentrated in just 20 cities. Those cities are where policymakers can make the biggest difference in residents’ lives by making housing there more resilient.

Many homes lining American coastlines are vulnerable to flooding — not just affordable housing. The researchers wanted to focus on homes for lower-income residents because they’re often older buildings that could have a harder time standing up to the stress of climate-related disasters. Residents here might also have less money and political clout to push for changes to infrastructure so that their homes are better protected. There’s already a shortage of affordable housing in the US, according to the nonprofit National Housing Trust, which contributed to the study. Climate change could make that situation worse.

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Ben Shapiro, the helium-voiced rightwinger, has the perfect solution for this: the people whose homes are being flooded should just sell them.
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The Arecibo radio telescope’s massive platform has collapsed • Scientific American

Meghan Bartels:

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After two cable failures in the span of four months, Puerto Rico’s most venerable astronomy facility, the Arecibo radio telescope, has collapsed in an uncontrolled structural failure.

The U.S. National Science Foundation (NSF), which owns the site, decided in November to proceed with decommissioning the telescope in response to the damage, which engineers deemed too severe to stabilize without risking lives. But the NSF needed time to come up with a plan for how to safely demolish the telescope in a controlled manner.

Instead, gravity did the job this morning (Dec. 1) at about 8 a.m. local time, according to reports from the area.

…Images shared on Twitter by Deborah Martorell, a meteorologist for Puerto Rican television stations, compare views of the observatory taken yesterday — showing the 900-ton science platform suspended over the massive dish strung up on cables — and today, when the observatory’s three supporting towers are bare.

None of the three towers collapsed fully, which was one of NSF’s key concerns about leaving the structure as it was. Martorell’s image does appear to show some damage in the knot of buildings at the base of one of the support towers, which includes administrative buildings and a public visitor’s center, although the buildings are still standing.

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Couldn’t be repaired without putting workers at too much risk. This Ars Technica article from earlier in November explains a lot of the why, and also why Arecibo was so famous. The cables began failing at well below their expected stress, which meant none of it could be properly trusted.
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Earthlings, not aliens, removed the Utah monolith • The New York Times

Serge F. Kovaleski, Deborah Solomon and Zoe Rosenberg:

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The office of the San Juan County Sheriff at first announced that it was declining to investigate the case in the absence of complaints about missing property. To underscore that point, it uploaded a “Most Wanted” poster on its website, or rather a jokey version of one in which the faces of suspects were replaced by nine big-eyed aliens. But by the end of Monday, the sheriff’s office had reversed its position and announced that it was planning a joint investigation with the Bureau of Land Management, a federal agency.

It was left to an adventure photographer, Ross Bernards, to disclose evidence on Instagram. Mr. Bernards, 34, of Edwards, Colo., was visiting the monolith on Friday night when, he said, four men arrived as if out of nowhere to dismantle the sculpture. Mr. Bernards had driven six hours for the chance to ogle the sculpture and to take dramatic photographs of it. Using upscale Lume Cube lights attached to a drone, he produced a series of glowy, moonlit pictures in which the monolith glistens against the red cliffs and the deep blue of the night sky.

Suddenly, around 8:40 p.m., he said, the men arrived, their voices echoing in the canyon. Working in twosomes, with an unmistakable sense of purpose, they gave the monolith hard shoves, and it started to tilt toward the ground. Then they pushed it in the opposite direction, trying to uproot it.
“This is why you don’t leave trash in the desert,” one of them said, suggesting that he viewed the monolith as an eyesore, a pollutant to the landscape, according to Mr. Bernards.

The sculpture popped out and landed on the ground with a bang. Then the men broke it apart and ferried it off in a wheelbarrow.

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Oh well. We still don’t know who put it there, of course.
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Another mysterious monolith has disappeared, in Romania • CNET

Abrar Al-Heeti:

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In case you thought the story of the mysterious metallic monolith couldn’t get any weirder, just remember it’s 2020 and anything’s possible. After the surprising discovery and subsequent disappearance of a monolith in the middle of the Utah desert earlier this month, it seems a similar object was found in Romania – before also disappearing.

A structure that appears to be identical to the one in the Utah desert was found on Batca Doamnei Hill in Romania on Nov. 26, according to The Mirror. But it didn’t remain for very long; according to a Tuesday report by Reuters, the Romanian monolith disappeared four days later.

“The 2.8 metre (9ft) tall structure disappeared overnight as quietly as it was erected last week,” journalist Robert Iosub of the Ziar Piatra Neamt local newspaper told Reuters. “An unidentified person, apparently a bad local welder, made it … now all that remains is just a small hole covered by rocky soil.”

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Not really as good as something really remote in Utah, though, is it. That’s 2020’s best mystery yet. (Thanks Gregory for the link.)
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The rhetoric and the reality of Operation Moonshot • Manchester Evening News

Jennifer Williams:

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If you were to follow the story of mass testing through ministerial pronouncements alone, you could be forgiven for making a number of assumptions.

You might think everywhere in ‘tier three’ is about to test its entire population using new, rapid turnaround tests, as has been the case in the pilot in Liverpool. You might think, too, that this was about to be carried out by thousands of soldiers.

Equally you might assume there was conclusive evidence that Liverpool’s pilot had been instrumental in bringing rates down on Merseyside – and that there was no debate whatsoever about the effectiveness of the technology being used. 

“This is a success story which we want other parts of the country to replicate,” said Boris Johnson decisively of the Liverpool whole-city testing trial this week. “So we will work with local government, public health leaders and our fantastic armed forces, to offer community testing to tier 3 areas as quickly as possible, opening the way for them to follow Liverpool’s example.” This, he has told MPs, is the route out of the top tier.

The reality is, as usual, more complicated.

Rapid testing, using the kind of new ‘lateral flow’ pregnancy test-style devices being piloted in Liverpool, involving a swab of the nose and throat and a 30-minute turnaround, is indeed about to be rolled out to other places, including – public health departments here hope – in Greater Manchester and other parts of northern England.

But it won’t be like the Liverpool trial. There won’t be thousands of squaddies out on the ground, for starters. In fact currently it is understood there are just four military personnel expected to be involved across the entire North West of England, largely doing logistical planning.

The testing due to begin at Manchester’s universities from this week will largely be carried out not by soldiers but by student nurses and other healthcare undergraduates, after no military support was made available.

Rapid testing won’t happen in every single place currently in tier three, either, because there isn’t the capacity in the national or local system. And where it does, we won’t all be offered a test, Liverpool-style.

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Williams has been slogging away writing about this topic, which is of enormous importance in the north of England. The reality of Cummings’s Operation Moonshot is more like Operation Firework.
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Errata, corrigenda and ai no corrida: none notified

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