Start up: Schrödinger’s Satoshi, the trouble with VC funding, stalking with Waze, dentists get malware, and more

Would you put yourself in front of a rifle underwater?

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A selection of 10 links for you. Proceed in a westerly direction. I’m charlesarthur on Twitter. Observations and links welcome.

Craig Wright’s New Evidence That He Is Satoshi Nakamoto Is Worthless | Motherboard

Jordan PEarson and Lorenzo Francheschi-Bucchierai:

»While that [blogpost signature] looks legit, according to experts, the evidence Wright provided seems to actually be worthless. As it turns out, Wright simply reused an old signature from a bitcoin transaction performed in 2009 by Satoshi.

Dan Kaminsky, a well-known security researcher, wrote in a post debunking Wright’s alleged evidence that the whole thing is a scam. “Satoshi signed a transaction in 2009. Wright copied that specific signature and tried to pass it off as new,” he added on Twitter. “He’s lying. Full stop.”

Longtime bitcoin developers also pointed out that this signature could have been copied from a public source, and does not prove that Wright controls the associated addresses.

“It would be like if I was trying to prove that I was George Washington and to do that provided a photocopy of the constitution and said, look, I have George Washington’s signature,” Bitcoin developer Peter Todd said.

Todd added that someone contacted him by email two weeks ago, claiming to be Satoshi, and using the same signature trick as proof. He says he ignored the email.

«

In the space of a few hours this story went from “Bitcoin inventor found!” to “HOAAAAXX!”, leaving a lot of very puzzled citizens in the middle. The point about the “ignored email” could be key: if Wright, or someone, has been hawking this around, something is fishy.
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Physicist fires a gun at himself underwater to prove a point » Mashable

»

To demonstrate the difference between air and water resistance, Norweigan physicist Andreas Wahl decided to plonk himself in front of a submerged rifle and pull the trigger.

«

Fantastic. Turns out that if you search on Wahl’s name on YouTube, he’s done a ton of these sorts of experiments.

It does however show that Leonardo DiCaprio need not have been so worried when he jumped into that river while being pursued by rifle-wielding enemies in The Revenant. Bigger risk was hypothermia.

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Theranos and Elizabeth Holmes expose the perverse incentives at work in Silicon Valley » Quartz

Jay Edelson and Christopher Dore, of the law firm Edelson (which has taken class actions against a number of tech companies), argue that the VC model drives companies to ignore rules:

»Take Zynga, the gaming company responsible for Farmville, which has earned the moniker “Scamville” for its allegedly deceptive advertising. The co-founder of Zynga, Mark Pincus, famously said, “I knew I needed revenues…. Like I needed revenues now. So I funded the company myself but I did every horrible thing in the book … just to get revenues right away.” While Pincus, incredibly, made this statement in public, he expressed the private sentiment of countless entrepreneurs faced with the ticking of the VC clock. (Disclosure: our law firm, Edelson PC, has brought class-action lawsuits against Zynga and some of the other companies mentioned below, but not for the conduct discussed in this article.)

This is bad for investors, including venture investors who care just about growth. (Fraudulent companies are, at best, an unreliable source of revenue.) But the reckless pursuit of growth often comes at consumers’ expense as well. That’s because the way that companies grow rapidly is to expand their user bases by hook or by crook, in a process called “growth hacking.”

One of the most common examples of this involves “spam-viting,” or hijacking a consumer’s contact list to blast them with text messages or emails, knowingly in violation of various federal and state statutes. Companies spam-vite because it works. Sending millions of text messages or emails to consumers, dressed up as if they came from those consumers’ friends, is a viable, illegal way to grow a business quickly. LinkedIn, for example, settled a lawsuit for $13 million over its practice of repeatedly sending “add connections” emails to a new user’s entire email contact list. And TextMe, a text-based social network, generated its growth by sending a large volume of text messages to new user’s phone contacts, although it eventually won its legal battle with the Federal Communications Commission.

The pressure to growth-hack begets pressure to disregard the law, at least temporarily.

«

This is a terrific essay; you read it and think “wow, that’s so true”. The saying in Silicon Valley is “it’s better to ask forgiveness than ask permission”; it’s how so many of today’s giants got started – Google, YouTube, Uber and AirBnB being particular examples. All broke, or break, the rules in many ways regularly.
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Google and Microsoft have made a pact to protect surveillance capitalism » The Guardian

Julia Powles on the surprising (to many) decision by Microsoft to withdraw from antitrust complaints and lobbying against Google:

»Microsoft today is facing a very different business ecosystem to the one it dominated in the 1990s. It needs to adapt. And it appears to want to do so by positioning itself at the heart of what Satya Nadella describes as “systems of intelligence”.

Explaining this concept at Hannover Messe 2016, Nadella defined systems of intelligence as cloud-enabled digital feedback loops. They rely on the continuous flow of data from people, places and things, connected to a web of activity. And they promise unprecedented power to reason, predict and gain insight.

This is unbridled Big Data utopianism. And it is a vision that brings Microsoft squarely into Google territory. So maybe Microsoft is pulling out of regulatory battles because it doesn’t want to shoot itself in the foot. For emeritus Harvard Business School professor Shoshana Zuboff, this gets to the core of the Google-Microsoft deal.

Zuboff is a leading critic of what she calls “surveillance capitalism”, the monetization of free behavioral data acquired through surveillance and sold on to entities with an interest in your future behaviour. As she explained to the Guardian: “Google discovered surveillance capitalism. Microsoft has been late to this game, but it has now waded in. Viewed in this way, its agreement with Google is predictable and rational.”

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Are maps necessary? » ROUGH TYPE

Nick Carr, musing on Jason O’Beirne’s post (linked yesterday) about the changes in Google Maps over the years:

»O’Beirne is a bit mystified by the changes Google has wrought. He suspects that they were inspired by a decision to optimize Google Maps for smartphone displays. “Unfortunately,” he writes, “these ‘optimizations’ only served to exacerbate the longstanding imbalances [between levels of detail] already in the maps. As is often the case with cartography: less isn’t more. Less is just less. And that’s certainly the case here.”

I’m sure that’s true. Adapting to “mobile” is the bane of the modern interface designer. (And, you’ll note, the “cleaner” Google Map provides a lot of open space for future ad placements.) But, when it comes to maps, there’s something more profound going on than just the need to squeeze a map onto a tiny screen. Implicit in the Google changes is the obsolescence of the map as a navigational tool. Turn-by-turn directions and automated route selection mean that fewer and fewer people ever have to figure out how to get from one place to another or even to know where they are. As a navigation aid, the map is a vestigial organ. So why not get rid of the useful details and start to think of the map as merely a picture or an image, or a canvas for advertisements?

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Carr has such a deliciously sardonic tone, yet deployed so sparingly and precisely, it’s shocking he isn’t British.
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Drake’s Spotify gamble is paying off: Views just made $8m in a day » Music Business Worldwide

Tim Ingham:

»On Friday (April 29), Beyonce’s Lemonade became the biggest album of the year so far in the US.

Within another 24 hours, Drake’s Views had surpassed Lemonade’s entire week-one album download figure, with around 600,000 sales.

Views is now easily on course to smash through a million North American sales before the weekend.

Drake and his team will have breathed a big sigh of relief at this news – early vindication for a digital strategy which was by no means a safe bet.

Aside from its status as one of the most eagerly anticipated records of the year, Views (previously ‘Views From The 6’), is a complete Apple exclusive.

In its first week, it’s available to stream on Apple Music and buy on iTunes, but not available anywhere else – including physical stores.

Significantly, fans can’t ‘un-bundle’ Views on iTunes, as they could with Beyonce’s Lemonade last week; they only have the option to buy it as one package, with the exception of recent singles One Dance and Hotline Bling.

Drake took a sizable risk with this approach.

«

Really interested by how some artists can still hit it out of the ground by going for the download-only/one-service-only approach, while others can’t. It’s not just about age, either.
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A poem about Silicon Valley, made up of Quora questions » Fusion

Jason Gilbert:

»Why do so many startups fail?
Why are all the hosts on CouchSurfing male?
Are we going to be tweeting for the rest of our lives?
Why do Silicon Valley billionaires choose average-looking wives?

What makes a startup ecosystem thrive?
What do people plan to do once they’re over 35?
Is an income of $160K enough to survive?
What kind of car does Mark Zuckerberg drive?

«

And there’s more. This is splendid.
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Dental Assn mails malware to members » Krebs on Security

Brian Krebs:

»The American Dental Association (ADA) says it may have inadvertently mailed malware-laced USB thumb drives to thousands of dental offices nationwide.

The problem first came to light in a post on the DSL Reports Security Forum. DSLR member “Mike” from Pittsburgh got curious about the integrity of a USB drive that the ADA mailed to members to share updated “dental procedure codes” — codes that dental offices use to track procedures for billing and insurance purposes…

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It had a launcher which would take a PC to a site which would try to download malware; and few antivirus checkers would find it.

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In response to questions from this author, the ADA said the USB media was manufactured in China by a subcontractor of an ADA vendor, and that some 37,000 of the devices have been distributed. The not-for-profit ADA is the nation’s largest dental association, with more than 159,000 members.

“Upon investigation, the ADA concluded that only a small percentage of the manufactured USB devices were infected,” the organization wrote in an emailed statement.

«

One should now routinely assume that anything involving (a) Flash (b) USB drives is potentially a malware route. Fortunately, both are avoidable in normal life.
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Yahoo’s $8bn black hole » Bloomberg Businessweek

Max Chafkin and Brian Womack:

»In some ways, [Yahoo CEO Marissa] Mayer’s strategy has worked. Yahoo’s apps have received stellar marks from both reviewers and users, and the company has created new lines of business that accounted for $390m in revenue last quarter. “Mavens as a revenue source didn’t exist at all in 2011 and was nascent in 2012,” Mayer said proudly on the February earnings call, using an acronym that stands for “mobile, video, native advertising, social.” Yahoo has more than 600 million mobile users, up from about 150 million before she took the job.

But those improvements are nowhere near big enough to turn the company around. “Marissa likes to present Mavens as though it should be compared to some nascent startup,” says SpringOwl’s Jackson. But startups, he points out, don’t begin with a billion users. “It’s as if Yahoo took an above-ground pool, dumped it into a bucket, and said, ‘Wow, we’re really filling up this bucket fast,’ ” he says.

And that traffic isn’t necessarily users delighting in Mayer’s new products and telling their friends; much of it comes from Yahoo paying ever-larger sums to other companies to direct their users to Yahoo’s sites and apps. It paid almost $900m in traffic acquisition fees in 2015, up from $200m in 2014. Predictably, Yahoo users are spending less and less time with its sites. A report by The Information, a tech news site, showed that as of early December, the average time spent on Yahoo properties had declined 32% for Yahoo Mail, 29% for the home page, and 20% for Tumblr over the previous 12 months.

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If you use Waze, hackers can stalk you » Fusion

Kashmir Hill:

»Last week, I tested the Waze vulnerability myself, to see how successfully the UC-Santa Barbara team could track me over a three-day period. I told them I’d be in Las Vegas and San Francisco, and where I was staying—the kind of information a snoopy stalker might know about someone he or she wanted to track. Then, their ghost army tried to keep tabs on where I went.

The researchers caught my movements on three occasions, including when I took a taxi to downtown Las Vegas for dinner:

And they caught me commuting to work on the bus in San Francisco. (Though they lost me when I went underground to take the subway.)

The security researchers were only able to track me while I was in a vehicle with Waze running in the foreground of my smartphone. Previously, they could track someone even if Waze was just running in the background of the phone. Waze, an Israeli start-up, was purchased by Google in 2013 for $1.1 billion. Zhao informed the security team at Google about the problem and made a version of the paper about their findings public last year. An update to the app in January of this year prevents it from broadcasting your location when the app is running in the background, an update that Waze described as an energy-saving feature. (So update your Waze app if you haven’t done so recently!)

«

The only way not to be trackable is to choose to be “invisible”. Or not to use Waze, of course. Once more, it’s a theoretical risk – you’d need clever, determined hackers to use it against you – but it also shows how much data these apps leak intentionally.
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Errata, corrigenda and ai no corrida: none notified.

Did you miss yesterday’s Start up: Overspill? Google’s health data grab, Intel’s mobile halt, satire wars, iPad Pro beats Surface Pro, and more.

Start up: Douglas Adams’s living video game, Sony cuts, Microsoft’s future, haunted empires and more


How To Train Your Dragon was a success for Dreamworks, but other films aren’t. Picture by donielle on Flickr.

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

Samsung patents home-screen backup and transfer solution » Phandroid

No major smartphone manufacturer has yet to create a solution for copying home screen setups from one device to another. It’s a feature we’ve been hoping to see in Android from Google’s own ingenuity for quite some time, but someone seems to have beaten them to the punch.

Samsung’s latest patent details a software solution that would allow a user to configure a home-screen and copy it to another remote device. The details in the patent are very specific about the process, but an abstract look at the thing reveals a few different possible scenarios…

Umm, “no major smartphone manufacturer”? Apple has had this backup thing called iCloud since 2011 which lets you create a phone that clones your previous layout, apps, settings, everything. Commenters also mention an app called Nova – and say that Lollipop does it anyway.


Sony to cut 1,000 jobs in smartphone business, says Nikkei » Re/code

Sony plans to cut another 1,000 jobs in its smartphone division, mainly in Europe and China, the Nikkei business daily reported.

The cuts are in addition to the 1,000 jobs Sony said it would eliminate in its mobile unit in October, the Nikkei said.

Overall, Sony’s mobile division workforce will shrink by about 30% to 5,000 by the end of the fiscal year ending March 2016, the report said.

Can’t remember when I saw a report of Sony expanding a division. (Maybe the PlayStation division does it quietly.) Of course, contract manufacturing means you don’t need a gigantic dedicated workforce to make a lot of phones. Just the right workforce.


My thesis on Microsoft » Beyond Devices

Jan Dawson:

I see a downward trajectory over time in sales of Windows in total, even accounting for the many different form factors Windows runs on. As such, last quarter’s poor performance in Windows sales is much more indicative of the longer-term trend than short-term headwinds. I see Windows 10 slowing the decline a little, but I actually think the free upgrades could stall or postpone new device purchases for some users, which may be counterproductive in the short term. I don’t see Windows 10 solving any of the fundamental challenges I just outlined.

Software sales to consumers will shrink to zero

To my mind, the other major question about Microsoft’s future is its ability to continue to sell software to consumers for a price. I’ve talked for some time now about the fact that, in Microsoft’s two major software categories (OS and productivity), its two major competitors and essentially every other company now give their software away for free.

Hard to argue with any part of this. The downward pressure on Microsoft is inescapable. Strange that at a time when software is eating the world, the ability to charge for it is vanishing.


Haunted Empire » Asymco

Horace Dediu:

I’ve often said that corporate governance is medieval, or pre-scientific in its approach to understanding causality. That may be too generous. As far as the reward/punishment system (also known as Human Resources) it’s probably pre-neolithic. The luxuries and extravagance which we heap upon the leader provide abundant evidence. Leaders insist on these ironic “pay packages” and boards approve them because they know they can and will be ritualistically sacrificed if and when the mobs turn against them.

A manager would be a fool to accept even generous pay given the risk, actually near certainty, of ritualistic slaughter. They demand and are unquestionably given absurd pay that has no relationship to performance. Such pay has no relationship to performance because it isn’t designed to reward performance but to account for the risk of arbitrary and very public sacrifice. Boards (and hence shareholders) are deliberately hiring a scapegoat for sins as yet unknown. Luxury and violence are thus finely balanced in what is called “Executive Search”.

A finely-judged thumb in the eye for a lot of management speak, and for a book about Apple.. oh, what was the name…


How DreamWorks Animation can claw its way back » The Hollywood Reporter

The maker of Shrek is in financial trouble:

And while the film unit is clearly troubled — four of the last six movies have resulted in write-downs (Rise of the Guardians, Mr. Peabody & Sherman, Turbo and Penguins of Madagascar) — Katzenberg has put new co-presidents (Bonnie Arnold and Mireille Soria) in charge of filmmaking and is making good on his 2013 promise to diversify “from an animated feature film company into a multifaceted, branded-entertainment company.” For its most recent quarter, DWA reported a $46.4m loss, but its television segment showed a $2.3m profit and consumer products posted a $4.2m profit.

There also are signs that its digital acquisition AwesomenessTV is profitable (DWA reported a $1.2m profit attributed to “other items,” which consists largely of Awesomeness). DWA paid $33m for Awesomeness in 2013 with a potential earn-out of another $115m. Instead, DWA settled the earn-out last year for $80m then sold 25% of Awesomeness to Hearst Corp. for $81.3m. The net result is that DWA paid about $33m for a 75% stake in a fast-growing, potentially highly profitable digital asset that has a perceived value of more than $300m.

But by focusing on expansion and diversification, Katzenberg acknowledges he might have been distracted from job No. 1: making profitable movies.

Contrast with Pixar, bought by Disney and still turning out successful films – yet always focussing on the story, and not just churning them out. Pixar, of course, was made successful by Steve Jobs. And it retains its focus.


The Apple Watch: The next big thing or living on borrowed time? » Harvard Business School

From September 2014:

Q Do you think the Apple Watch will fundamentally change our lives in a similar way the iPhone and iPad did?

Ryan Raffaelli, Harvard Business School assistant professor: We often define radical innovations as “competency- destroying,” meaning that they render all related products and services in the same market category obsolete. While the Apple Watch is certainly the most advanced smartwatch on the market today, I’m not sure it fits the traditional definition of a “radical” innovation. For instance, it is unlikely the Apple Watch will have the same transformative effect on society as other life-changing innovations throughout history – think about the steamship’s impact on the sailing industry, how the personal computer ended the use of typewriters, or how electronic fuel injection systems replaced carburettors.

The news that the Apple Watch isn’t as radical as the steamship or fuel injection will, surely, persuade Jony Ive once and for all that it’s time to give it up and head off into the sunset.


BlackPwn: BlackPhone SilentText type confusion vulnerability » Azimuth Security

In the phone market, one of the premier products to be released in recent years is undoubtedly the BlackPhone (http://www.blackphone.ch), which has been cited numerous times in tech publications as being one of the best available defences against mass surveillance, as it provides full end-to-end encryption facilities for voice calls and text/MMS messaging.

While exploring my recently purchased BlackPhone, I discovered that the messaging application contains a serious memory corruption vulnerability that can be triggered remotely by an attacker.  If exploited successfully, this flaw could be used to gain remote arbitrary code execution on the target’s handset. The code run by the attacker will have the privileges of the messaging application, which is a standard Android application with some additional privileges. Specifically, it is possible to:

• decrypt messages / commandeer SilentCircle account
• gather location information
• read contacts
• write to external storage
• run additional code of the attacker’s choosing (such as a privilege escalation exploit aimed at gaining root or kernel-mode access, thus taking complete control of the phone)

How surprising that people would believe a claim made by a company about having excellent security.


The secret Douglas Adams RPG people have been playing for 15 years » Kotaku

Fantastic tale from Lewis Packwood:

Yoz [Grahame] then quickly forgot all about the employee forum, but six months later he happened to take a quick peek. And there were ten thousand posts in there.

Bearing in mind that the forum was buried deep within the website and was (just about) password secured, this was a phenomenal result. But even more fascinatingly, the forum had evolved into an extension of the game itself.

Visitors to the forum had created fictional employees and passengers on the Starship Titanic and begun role playing as them. Someone would make up an implausible, Adams-esque scenario, and everyone else would react to it in character, resulting in some enormously complex storylines and in-jokes that developed and diversified over years. And this strange fictional world had appeared entirely spontaneously, without any input from Douglas Adams or The Digital Village. Indeed, Yoz was as surprised as anyone when he stumbled across it: “It was like ignoring the vegetable drawer of your fridge for a year, then opening it to find a bunch of very grateful sentient tomatoes busily working on their third opera,” he says.

I loved Starship Titanic. Not least because there were two alternative endings, diametrically opposed in their result.


A pirated version of the Assassin’s Creed application for Android is bundled with malware » 0xicf

“Blackpiano”:

The Trojanized variety of the Assassin’s Creed application has the potential to be quite potent, because when a user downloads it, what he or she is actually downloading is malware. The malware in turn downloads a fully functional, pirated version of the actual application. The gaming app works as advertised, so the standard mobile gamer is going to have a tough time realizing that the package they’ve downloaded is malicious…

…The malicious application is capable of sending multi-part text messages, harvesting text messages from a victim’s device, and sending stolen information to a remote Command & Control (C2) server. We were able to locate phone numbers belonging to Russian bank “Volga-Vyatka Bank of Sberbank of Russia” in the malicious application code for which SMS messages are being intercepted to steal sensitive information.

Sneaky.