Start up: who’ll buy HERE?, Loon gets ready, Vermeer and the Apple Watch, web v native redux, and more


A Project Loon balloon. Photo by theglobalpanorama on Flickr.

A selection of 8 links for you. Links as in, you know, links. I’m charlesarthur on Twitter. Observations and links welcome.

Microsoft’s Q3 2015: Surface and Lumia up, but profit down » The Verge

Tom Warren:

Microsoft sold 8.6m Lumia devices in the most recent quarter, and the company says that’s an 18% increase over the prior year. Microsoft completed its acquisition of Nokia around this time last year, and neither company revealed Lumia sales at the time, but it’s safe to say they’re rising again. Either way, Windows Phone revenue has dropped by 16%.

While Microsoft is heading towards finalizing Windows 10 in the coming months, the PC market is still fragile. OEM revenue for Windows decreased by a massive 22% this quarter, following an equally bad quarter over the holiday period. Part of this decline is related to less business PC sales, and the general PC market as a whole. Office appears to be a mixed bag for Microsoft. While it’s helping drive commercial revenues, Office consumer revenues declined 41% due to the transition to Office 365 and weaknesses in Japan where Office is popular on PCs. However, Office 365 Consumer subscriptions have grown to 12.4m, so Microsoft is continuing to convince consumers that the cloud is the future.

If 8.6m is an 18% increase, a total of 7.3m were sold (well, shipped) in Q1 2014. The fall in revenue maybe isn’t surprising as the Lumia line has all been focussed on the lower end.

Surface revenue was up 44% year-on-year to $713m. As usual, no news on how many sold.


How Uber surge pricing really works » The Washington Post

Nicholas Diakopoulos:

is Uber’s surge pricing algorithm really doing what they claim? Do surge prices really get more cars on the road?

My analysis suggests that rather than motivating a fresh supply of drivers, surge pricing instead re-distributes drivers already on the road.

I collected four weeks worth of Uber’s dynamic pricing information from their own publicly available data for five locations in Washington, DC. Every 15 seconds between March 15 and April 11, I pinged their servers and collected the surge price and estimated waiting time for an UberX car at those locations. Though only a tiny sliver of all of Uber’s data, it provided an initial window into how their algorithms are working

…So, why don’t surge prices work to get new drivers on the road? It might simply be that surge prices jump around too much.

Reverse-engineering these algorithms seems to be the way forward.


Nokia targeting Apple, Alibaba and Amazon in maps-unit sale » Bloomberg Business

Nokia Oyj, the Finnish company selling its money-losing maps business, is trying to drum up interest from some of the biggest names in technology including Apple Inc., Alibaba Group Holding Ltd. and Amazon.com Inc., people with knowledge of the matter said.
Those companies as well as Facebook Inc., a group of German carmakers, and private-equity firms are among the companies looking at Nokia’s maps operations, known as HERE, highlighting the ubiquity and utility of location-based services. Nokia is seeking more than €3bn ($3.2bn) from a sale of the unit, said one of the people, who asked not to be identified discussing private information.

Bought it for €8.1bn in 2008; valued at €2bn in the accounts last year. Big lossmaker; the question is how any company that bought HERE would be able to make the purchase worthwhile in monetary terms.


Google’s Project Loon close to launching thousands of balloons » Computerworld

Martyn Williams:

Google says its Project Loon is close to being able to produce and launch thousands of balloons to provide Internet access from the sky.

Such a number would be required to provide reliable Internet access to users in remote areas that are currently unserved by terrestrial networks, said Mike Cassidy, the Google engineer in charge of the project, in a video posted Friday.

The ambitious project has been under way for a couple of years and involves beaming down LTE cellular signals to handsets on the ground from balloons thousands of feet in the air, well above the altitude that passenger jets fly.

“At first it would take us 3 or 4 days to tape together a balloon,” Cassidy says in the video. “Today, through our own manufacturing facility, the automated systems can get a balloon produced in just a few hours. We’re getting close to the point where we can roll out thousands of balloons.”


Why Apple Watch margins should set a new record for Apple » carlhowe.com/blog

Carl Howe with a new thought experiment:

Last week, I asked readers to imagine how they’d manufacture a million Origami lobsters out of paper. I’m going to continue that though experiment theme this week with a different question. If you’re not interested in such context, skip ahead to the next section where we’ll dive into revisions to the model I posted last week.

Meanwhile, this week’s thought experiment question is this:

What were the parts cost and gross margin of a Johannes Vermeer painting in his day?

Johannes Vermeer, of course, was a modestly successful 17th century Dutch painter, known for such paintings as Girl with a Pearl Earring and The Music Lesson. Art historians the world over praise his works for their subtle portrayal of light and his use of brilliant and lifelike color. Today, historians attribute 34 surviving paintings to undoubtedly be Vermeer’s work. While priceless due to their rarity, owners who have sold Vermeer paintings have invariably seen prices in the tens of millions of dollars.

But what did they cost to paint?

In other words, why do we think it’s OK for art to have high added value, but not technology? The whole post is wonderful.


In Google case, do what’s best for consumers » TheHill

Thomas Lenard:

Since the FTC closed its [antitrust investigation] case in 2013, the search space has become, if anything, more competitive. In addition to competition from general search engines such as Bing, Google faces competition from Facebook, Apple (Siri) and Amazon — all of which perform search functions. There is vigorous competition in shopping sites in Europe with Amazon and eBay being the major players. Numerous local shopping sites provide additional competition. In fact, Google is a minor player with a very small share of this (online shopping) market. And there is a whole new world of apps through which consumers search for a variety of information, including product information.

Thus, despite the fact that Google’s share of general search is higher in Europe than in the U.S., it is unlikely the European authorities will now find harm to consumers or to competition where the U.S. authorities didn’t.

Lenard is a senior fellow at the Technology Policy Institute, whose “supporters” include Amazon, Facebook, Intel, the MPAA, Motorola, Yahoo and – hey! – Google. I include this to show the way that one can distort reality by chucking some names in: look at all the alternative search engines! Bing, Yahoo, DuckDuckGo, er, Yandex.. but the reality is that none has more than a tiny fraction of the market in Europe. It’s like Microsoft suggesting that there are loads of desktop OSs – MacOS, Ubuntu, FreeBSD, umm..

And while Google might be a minor player in the local shopping market, the EC data (and to some extent Google itself) suggests it would be nowhere if Google Shopping had to compete in the same way as all the other shopping sites – and hadn’t penalised the search ranking and access to AdWords of rivals (who then complained).

And, finally, “harm to consumers” isn’t the EC test for antitrust. It’s the US test.


Skipping the web » Remains of the Day

Eugene Wei:

Having grown up in the U.S., the web was one of the first and still longest-running touchpoint to the internet. My first was using newsgroups in college, and the web came about towards the end of my undergrad days. I can understand why so many in the U.S. are nostalgic and defensive of the web as a medium. Seeing so much content and online interaction move behind the walls of social networks seems like an epic tragedy to many, and I empathize.

Many people in India, China, and other parts of the world, where bandwidth is low and slow, and where mobile phones are their one and only computer, have no room for such sentimentality. They may never have experienced the same heyday of the web, so they feel no analogous nostalgia for it as a medium. Path dependence matters here, as it does in lots of areas of tech, and one of the best ways to detect it is to widen your geographic scope of study outside the U.S. Asia is a wonderful comparison group, especially for me because I have so many friends and relatives there and because I still interact with them online at a decent frequency.

In the U.S., many tech companies were lauded as pioneers for going mobile first when in Asia companies are already going mobile only.


Mobile malware is like Ebola – an overhyped threat » Net Security

Reporting from the RSA Conference 2015:

In 2012, monitoring 33% of US Mobile Data Traffic, Damballa saw 3,492 out of a total of 23M mobile devices – 0.015% – contacting a domain on the mobile blacklist (MBL). In Q4 2014, monitoring nearly 50% of US Mobile Data Traffic, only 9,688 out of a total of 151M mobile devices contacted mobile black list domains (.0064%). The National Weather Services says the odds of being struck by lightning in a lifetime are 0.01%.

“This research shows that mobile malware in the Unites States is very much like Ebola – harmful, but greatly over exaggerated, and contained to a limited percentage of the population that are engaging in behavior that puts them at risk for infection,” said Charles Lever, senior scientific researcher at Damballa. “Ask yourself, ‘How many of you have been infected by mobile malware? How many of you know someone infected by mobile malware?’”


Start up: Roombas v dogs, native v web redux, Intel’s mobile loss, Samsung slims, and more


“Hatin’ on Roomba” by obloquy on Flickr

A selection of 8 links for you. Use them wisely. I’m @charlesarthur on Twitter. Send links, comments, etc there, or drop them at the end of the article.

Intel to combine PC and mobile chip divisions to reflect market shifts >> Computerworld

The Mobile and Communications Group, as it’s known, will be broken up. The teams that develop mobile processors will join the new client group, while the remainder, which builds modems, will be part of a new wireless R&D group.

Herman Eul, who leads the mobile group today, will oversee the move to the new structure until at least the end of the first quarter, with a new role for him to be announced after that, Mulloy said.

The reorganization comes as Intel battles to improve its position in the market for smartphones and tablets, which is dominated by chips based on designs from Arm Holdings, a UK competitor.

The Mobile and Communications Group reported an operating loss of more than US$1bn in the third quarter, in part because it’s been making payments to tablet makers to encourage them to use its chips. As a result of those and other efforts, Intel has said it aims to get its processors into 40m new tablets this year.

Ah. A good way to bury bad losses.


Samsung plans to cut smartphone models by up to 30% in 2015 >> WSJ

Here we are in November 2014:

Samsung Electronics said it would reduce the number of smartphone models it offers next year, part of a move to cut costs to combat declining profit.

The South Korean technology major said it would cut the number of models by about 25% to 30%, Robert Yi, head of investor relations, said during a presentation in New York. His remarks were confirmed by a company spokesman Tuesday.

Samsung didn’t disclose the exact number of models that would be affected by the reduction.

Yeah, so cost-cutting. But now – with thanks to Stefan Constantinelet’s revisit Nokia in April 2011:

An unnamed Nokia Executive, in an interview with the Hindustan Times, has said: “We will be launching 40 models in 2011 of which at least 30% would be smartphones.” This news isn’t exactly making us bust out the champagne because that’s right around how many models Nokia has been releasing every year for the past five years. The Finnish firm has consistently told us that they’re going to take a “more wood behind fewer arrows” approach, meaning that they’ll come out with less new models, but said models would be further refined, but we’ve yet to actually see that materialize.

“Fewer models” seems easy to say, but when your business has been about “lots of models” is hard to do.


Google’s secret NSA alliance: The terrifying deals between Silicon Valley and the security state >> Salon.com

Remember when Google’s servers were broken into by Chinese hackers at the end of 2009? Shane Harris points out that something more happened afterwards:

On the day that Google’s lawyer [David Drummond] wrote the blog post [condemning China], the NSA’s general counsel began drafting a “cooperative research and development agreement,” a legal pact that was originally devised under a 1980 law to speed up the commercial development of new technologies that are of mutual interest to companies and the government. The agreement’s purpose is to build something — a device or a technique, for instance. The participating company isn’t paid, but it can rely on the government to front the research and development costs, and it can use government personnel and facilities for the research. Each side gets to keep the products of the collaboration private until they choose to disclose them. In the end, the company has the exclusive patent rights to build whatever was designed, and the government can use any information that was generated during the collaboration.

It’s not clear what the NSA and Google built after the China hack. But a spokeswoman at the agency gave hints at the time the agreement was written. “As a general matter, as part of its information-assurance mission, NSA works with a broad range of commercial partners and research associates to ensure the availability of secure tailored solutions for Department of Defense and national security systems customers,” she said. It was the phrase “tailored solutions” that was so intriguing. That implied something custom built for the agency, so that it could perform its intelligence-gathering mission.

According to officials who were privy to the details of Google’s arrangements with the NSA, the company agreed to provide information about traffic on its networks in exchange for intelligence from the NSA about what it knew of foreign hackers. It was a quid pro quo, information for information.

Must-read. Including this:

Google’s Sergey Brin is just one of hundreds of CEOs who have been brought into the NSA’s circle of secrecy. Starting in 2008, the agency began offering executives temporary security clearances, some good for only one day, so they could sit in on classified threat briefings.

Starts slow. Goes deep, deep.


4K lens development limited by physics >> TVTechnology

Craig Johnston:

Large venue live sports production promises to be a huge market for 4K production equipment in what could be the very near future. And while there are 4K cameras aplenty, switchers that can be upgraded and a host of other 4K equipment ready to go, there’s no long focal-range, highly telephoto 4K lenses to mate with the Super 35 single-sensor cameras.
 
The motto of high quality lens makers might as well be: “Physics will fight you.”

“When we talk about a 100×1 zoom, and the 35mm sensor, 4K, we’re talking about something we don’t think is very practical today,” said Larry Thorpe, national marketing executive at Canon USA Inc. “Once you jump from 2/3-inch imagers up to something like a Super 35, you set a baseline in element sizes, so the lens by definition is going to be larger.”

Long story short, it’s going to be expensive, or perhaps just not feasible.


Samsung strikes chip deal with Apple >> Korea Times

“Apple has designated Samsung as the primary supplier of its next A-series chips powering iOS devices from 2016 as the alliance with GlobalFoundries (GF) enabled Samsung to cut off capacity risk,” a source familiar with the deal said.

The value of the deal is said to be worth “billions of dollars,” according to the sources.

Production of the APs will start early next year at Samsung’s local factory in Giheung, Gyeonggi Province, and the volume will grow as Samsung plans to use its facilities in Austin, Texas and the GF-owned factory in New York for increased output, another source said.

That will be about 80% of the application processors for iOS devices. Good for Samsung, though doesn’t really get its flywheel (make chips and screens for more profitable devices such as its own smartphones) turning.


Nokia partners with Foxconn to take on Apple with tablet device >> FT.com

Daniel Thomas:

Ramzi Haidamus, Nokia’s technology chief, said the N1 tablet would be as good as Apple’s iPad mini but cost less. He added that it was just the first consumer product that would be designed and labelled as Nokia devices.

“It’s the first of many coming – more SKUs [items for sale], more sizes, more features,” he told the Financial Times in his first interview since becoming head of Nokia’s technology division three months ago. “We will go beyond tablets for sure.”

Nokia is prohibited from making smartphones until 2016 under the terms of the sale of its handset business to Microsoft. But Mr Haidamus said that “we will be looking at going into the cell phone licensing business post-Microsoft rights”.

The N1 is the first Nokia-branded consumer device brought to market following the sale of the Lumia and Asha businesses to Microsoft. Nokia did not manufacture tablets. 
The company said it would be the first tablet operated by a “predictive engine” that gradually learnt a user’s habits and created customised shortcuts to commonly used apps, contacts and web content.

The tablet has a 7.9 inch screen, a 2.4Ghz 64-bit quad-core processor, 2GB of memory and 32GB of storage.

Foxconn also makes lots of Apple devices, and is partnering with BlackBerry too. Big ambitions. Can’t see Nokia’s tablet making much impression on the Chinese market though.


Native apps are part of the web >> Daring Fireball

John Gruber wrote the complete rejoinder (with some pointed notes about paywalls and free sites) to Christopher Mims’s “web is dying” piece from the previous roundup:

Users love apps, developers love apps — the only people who don’t love apps are pundits who don’t understand that apps aren’t really in opposition to the open Internet. They’re just superior clients to open Internet services. Instagram didn’t even have a web interface for years, but native app clients for iOS and Android didn’t lock Instagram into anything. Their back-end is just as open as it would have been if they had only had a web browser client interface. They just wouldn’t have gotten popular.

I spoke about this four years ago at O’Reilly’s Web 2.0 conference, in a talk titled “Apple and the Open Web: A Love Story”. The gist of it being that native iOS apps (and native apps for Android, Mac OS X, Windows, and everything else) aren’t in opposition to the “web”. They live on top of the web. A new layer. They are alternatives to websites that run in web browsers. They’re just better clients.

Clear thinking is easy to recognise when you see it. This is an example. Although the debate goes on: Tim Bray says on Twitter: “What @gruber says is correct, but native apps have gatekeepers, browser apps don’t. Call me old-fashioned, but that really bothers me. It doesn’t trump all the other issues, but it’s a big deal.” (The discussion continued on Twitter.)


When dogs and robots collide, somebody needs a talking to >> WSJ

This dates from 2008, but is still relevant:

To keep the peace at home, Keith Hearn had to scold his new robotic vacuum cleaner.

The trouble started when Mr. Hearn first turned on his Roomba automatic cleaner. When the device started scooting around the floor, Mr. Hearn’s dog, Argos, attacked it.

Seeking help, Mr. Hearn found an online forum dedicated to the hundred-dollar Roomba buzzing with similar stories of pet assailants. Owners were offering advice. Among the most popular: chastise the vacuum in front of the dog.

And so, with Argos looking on, Mr. Hearn shook his finger at his gadget and sternly called it “a bad Roomba.” Argos appeared to be mollified. “After that, he never tried nipping at it again,” says Mr. Hearn, a software engineer in San Carlos, Calif.

We’re only just beginning to get self-organising devices in the home, but where will pets fit into the internet of things? They have their own social structures that they believe exist.