Sep
17

We did the math to calculate exactly how long it would take Salesforce CEO Marc Benioff to earn the $190 million he used to buy Time magazine

On Sunday, Salesforce CEO and co-founder Marc Benioff and wife Lynne Benioff announced they are buying Time Magazine for $190 million cash as individuals.

This isn't the first time Time magazine finds itself in new hands recently: The move comes not even one year after Meredith Corporation acquired its namesake company, Time Inc., which also houses well-known titles including People, Better Homes and Gardens, and Entertainment Weekly.

Nearly $200 million is a fortune, but to Benioff, it's not as much as it sounds. According to Forbes, his 2018 net worth is $4.9 billion, nearly $1 billion more than his $4 billion net worth in 2017. That means in just a year, his net worth increased by $900 million, earning him a spot on Forbes' 2017 and 2018 richest people in the world lists.

Broken down, that's:

$102,740 an hour $2.47 million a day $17.3 million a week $75 million a month

According to the Wall Street Journal, Time, which generated $173 million in revenue in 2017, has an operating profit of $33 million. At $190 million, the Benioffs purchased the nearly century-old magazine for more than five-and-a-half times its operating profit — and around 21% of Benioff's estimated earnings over the past year. At $75 million a month, Benioff's wealth only had to grow for two and a half months to be able to afford the deal.

When you look at Time's purchase price compared to Benioff's total $4.9 billion net worth, it cost him a measly 3.88% of his wealth to acquire the magazine.

To put things in perspective, the median annual US salary in the second quarter of 2018 was $45,552, according to data by the Bureau of Labor Statistics. Benioff makes more than twice that much in an hour.

As noted above, the $190 million Benioff spent on Time is roughly 21% of his earnings last year. For the median US worker, that 21% rate is equivalent to $9,565. A person earning the median annual US salary every day would need 4,171 days, or more than 11 years, just to be able to afford Benioff's Time acquisition.

Benioff may be a billionaire, but these numbers don't even begin to stack up compared to how much other billionaires make in an hour. Other notable billionaires, like Mark Zuckerberg and Jeff Bezos, make Benioff's $102,739 hourly rate look like pennies.

Shayanne Gal/Business Insider

Benioff follows in the footsteps of other billionaires — Jeff Bezos bought The Washington Post for $250 million in 2013, and Laurene Powell Jobs acquired a majority stake in The Atlantic.

The deal is expected to close in 30 days. As of September 17, one day following his acquisition announcement, Benioff's net worth is estimated at $6.6 billion by Forbes.

Original author: Hillary Hoffower

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Jan
25

Whopper Neutrality – The Burger Based Version of Net Neutrality

This is a preview of a research report from Business Insider Intelligence, Business Insider's premium research service. To learn more about Business Insider Intelligence, click here. Current subscribers can read the report here.

Business Insider Intelligence

The healthcare industry is undergoing a necessary transformation due to pressure from ballooning healthcare costs, a rising burden of chronic disease, and shifting consumer expectations. And wearables — including smartwatches, fitness trackers, and other connected devices — are playing a key role in this transformation.

Wearables have gained traction in the US healthcare industry, driven by consumers' demand to play a more active role in managing their health. US consumer use of wearables for health purposes jumped from 9% in 2014 to 33% in 2018, according to Accenture.

And penetration should continue to climb — more than 80% of consumers are willing to wear tech that measures health data.

The growing adoption of wearables and the breadth of health functions they offer will capture a fuller picture of consumer health and behavior, enabling healthcare organizations to differentiate from the competition, drive value, and engage consumers.

In this new report, Business Insider Intelligence details the current and future market landscape of wearables in the US healthcare sector. We explore the key drivers behind wearable usage by insurers, healthcare providers, and employers, and the opportunities wearables afford to each of these stakeholders.

By outlining a successful case study from each stakeholder, we highlight best practices in implementing wearables to reduce healthcare claims, improve patient outcomes, and drive insurance cost savings. Finally, we identify the key device manufacturers and service providers facilitating wearable adoption and discuss the untapped future opportunities wearables offer insurers, providers, and employers.

Here are some of the key takeaways from the report:

The wearable market is nearing maturation in the US. Consumers are becoming increasingly comfortable sharing the health data captured in these devices with their doctors, employers, and insurers. Data from wearables offer stakeholders opportunities to improve outcomes, reduce healthcare costs, and engage customers. Insurers can use wearable data to enhance risk assessments and drive customer lifetime value. Providers can use wearables to improve chronic disease management, lessen the burden of a burgeoning staff shortage, and navigate a changing reimbursement model. Employers can combine wearables with cash incentives to lower insurance costs and improve employee productivity.

In full, the report:

Details the current and future US wearable landscape. Identifies the value of wearables to US businesses. Highlights how stakeholders are already seeing early returns from implementing wearable strategies. Discusses how the evolution of the wearable market will create new, untapped opportunities for businesses.
Original author: Nicky Lineaweaver

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Sep
15

BMW just unveiled a new electric SUV concept to take on Tesla's Model X — take a closer look

BMW unveiled an electric concept SUV, the Vision iNEXT, on Saturday. The concept shows some of the technology the company may use in the future. A production vehicle based on the concept is planned for 2021.

The concept includes autonomous driving technology, voice control, a projector that can show images or videos on objects held by passengers, and a touch control feature that allows drivers and passengers to change vehicle settings by drawing on their seats with their fingers.

Here's what the Vision iNEXT looks like:

BMW

BMW

BMW

Original author: Mark Matousek

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Sep
15

Google may have just revealed the colors of its upcoming Pixel 3 phone (GOOG, GOOGL)

We may now know the colors of the upcoming Google Pixel 3.

A Google promo site first spotted by Droid Life displays what might be the Pixel 3 in three colors: white, black, and mint. The page features the outline of a phone, along with the words "Coming Soon" and some digital confetti. Clicking on the Google logo on the phone switches between each color.

Here's the white version:

Google

And here's the black version:

Google

Google is expected to unveil the new Pixel 3 in both regular and the larger XL sizes at its Made By Google event on October 9. But Google's thunder may have already been stolen: In the weeks and months leading up to the event, numerous photos and videos have leaked that appear to reveal the design and specs of the upcoming phone. In fact, someone seems to have left one of the new phones in the back of a Lyft car earlier this month.

So far, looks like the Pixel 3 XL will have a design similar to the Pixel 2 XL, except for a notch at the top of the device similar to the iPhone X. The standard-sized Pixel 3 will likely look similar to last year's Pixel 2.

Original author: Avery Hartmans

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Jan
25

Robinhood adds zero-fee cryptocurrency trading and tracking

Forget "Sex & the City" — HBO's version of Manhattan never let Carrie swing majestically from the skyscraper rooftops, like some sort of magical bird.

In the brand-new "Spider-Man" game for the PlayStation 4, you've got free reign to fly across vast swaths of Manhattan's iconic skyline. From Battery Park to North Harlem, the West Side Highway to the FDR Drive, Spidey's able to soar through the air and take in the sights.

Sony/Marvel

What's most impressive isn't just the scale, but how closely that virtual version of Manhattan matches up with the real thing.

See for yourself:

Original author: Ben Gilbert

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Sep
15

The Nintendo Switch online service costs $20 a year, granting access to classic games and long-awaited new features when it lights up on September 18 (NTDOY)

For years, Nintendo fans have fantasized about a paid online service that would grant access to Nintendo's rich, decades-long library of classic games. For years, Nintendo has demurred.

In 2018, that fantasy is finally becoming a reality, through the Nintendo Switch Online service.

Nintendo's new service costs $20 per year ($4/month, $8/three months), and is scheduled to launch on September 18. With that subscription price, you'll get access to a library of classic games, the ability to play various Nintendo Switch games online, cloud saves for some games, and voice chat through the Nintendo Switch online smartphone app.

When the service arrives later this month, it'll only be available on the Nintendo Switch — Nintendo's newest game console, which operates as both a portable handheld and a home console.

Nintendo

So, what's in the classic game library? "20 games, with more added on a regular basis," Nintendo said in a press release earlier this year.

Nintendo also announced the first 10 of those 20 games: "Super Mario Bros. 3," "Dr. Mario," "Balloon Fight," "Donkey Kong," "Ice Climber," "The Legend of Zelda," "Mario Bros.," "Soccer," "Super Mario Bros." and "Tennis."

Even better: Every classic NES game on the Switch will have new online functionality. In some games, you can play co-op online with friends or go head to head, and in all games you can watch a friend play remotely. Friends can even "share" the controller online by handing off control of a game over the internet. The original "The Legend of Zelda" will be included in the $20/year Nintendo Switch Online service.World of Longplays/YouTube

The classic games library only includes Nintendo Entertainment System games, at least for now — it's specifically referred to as a collection. Nintendo even gave the classic game library its own name: "NES - Nintendo Switch Online, a compilation of classic NES games."

Perhaps a "SNES — Nintendo Switch Online" library will be added later? Or something similar for Nintendo 64, GameCube, or other Nintendo console games? Perhaps, perhaps not — Nintendo isn't saying. The Japanese game company told Kotaku last year, "Super NES games continue to be under consideration, but we have nothing further to announce at this time."

But the classic game library isn't Nintendo Switch Online's primary component — the service is intended as a paid subscription for access to online gameplay. Indeed, you'll need the service to play games online.

In other words, you'll need a Nintendo Switch Online subscription to play online multiplayer games on the console — including existing games like "Mario Kart 8 Deluxe" and "Splatoon 2," which have to date let people play online for free. After September 18th, you'll need a Nintendo Switch Online subscription to keep using the online features.

The Switch console itself lacks system-wide functionality for online interaction — stuff that's standard on other consoles, like joining an online party, and voice chat, barely exist on the Switch.

In fact, online services are the crucial flaw of the Nintendo Switch.

Nintendo

The console lacks basic functionality that Microsoft and Sony had in their respective consoles over a decade ago. Beyond missing stuff like voice chat and parties, the Switch also doesn't have access to services like Netflix, YouTube, and Amazon. The Nintendo Switch app for iPhone and Android enables voice chat for select games, like "Splatoon 2," but it's not a feature that's built into the system.

It looks like Nintendo intends to remedy that situation with Nintendo Switch Online, at least in part.

More than just offering multiplayer and a classic game library, Nintendo Switch Online promises cloud saves — the ability to upload your save data to Nintendo's servers, then easily re-download it. As Nintendo puts it, "This is great for people who want to retrieve their data if they lose, break or purchase an additional Nintendo Switch system."

One thing Nintendo didn't mention is the much requested Virtual Console service, which was a digital storefront for classic games on previous Nintendo consoles.

Super Mario 64 box art

Though the Nintendo Switch launched with a digital storefront (the "eShop"), there's no way to buy classic games through Nintendo's long-running Virtual Console service. That's an especially big shame on the Switch — a console more-than-capable of running classic games, and one you can bring with you anywhere.

Nintendo hasn't offered details on the whereabouts of the Virtual Console service. A Nintendo representative gave us the following statement via email earlier this year:

"There are currently no plans to bring classic games together under the Virtual Console banner as has been done on other Nintendo systems. There are a variety of ways in which classic games from Nintendo and other publishers are made available on Nintendo Switch, such as through Nintendo Entertainment System - Nintendo Switch Online, Nintendo eShop or as packaged collections."

That doesn't mean it's never going to happen, but you probably shouldn't hold your breath in anticipation either.

Original author: Ben Gilbert

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Sep
15

Chinese entrepreneurs have a completely different definition of winning than other startups, and Google's former China boss says that's a big problem for US tech companies

When Kai-Fu Lee, prominent Chinese tech investor and former president of Google China, considers some of the leading technology products in the United States, he's underwhelmed.

"Look at YouTube or Instagram or Snapchat," said Lee in an interview with Business Insider. "If China had one of those companies and it moved at the pace that those companies move, it would likely be dead in the water."

For decades, Chinese developers closely watched America's tech sector for signs of innovation. But now, with its fast-developing mobile market breaking new ground, the country's tech sector is swiftly gaining confidence.

According to Lee, China has already outpaced the US in terms of creating better mobile applications and mobile payment systems. In the future, he predicts that technologies in the fields of retail, education, and healthcare will all soon leapfrog ahead of their US counterparts.

Notably, said Lee, Chinese entrepreneurs aren't interested in being followers.

"Chinese entrepreneurs are at a stage where they no longer feel they have to copy anyone else," said Lee. "They have enough experience and knowledge of the market and know how to build a deep, long moat around their castle."

This so-called "castle" of China's burgeoning tech sector is among the fastest developing markets in the world, and Lee predicts that it's on track to outpace the US, particularly in the area of artificial intelligence.

Chinese ecommerce sharing site Pinduoduo was founded less than four years ago. Already, its valued at more than $20 billion.Pinduoduo app download page

Among the 13 companies Lee has invested in that are worth $1 billion or more, five are artificial intelligence companies. Together, said Lee, these five companies make up a cumulative value of $23 billion.

See more: 'The future will be won or lost on this technology. I'm very concerned': The co-founder of a $9 billion company warns that China is on track to dominate the US in AI

There's several factors at play in the country's flourishing tech economy.

For one, Chinese companies simply innovate differently than those within the US.

Lee offered up an example of how video has evolved within the country.

"China pushed the market to change from longform videos to short-form videos," he said. "From there, it changed from videos being watched to videos that you're apart of, and then to real-time videos, to using videos as a form of social networking. There is always someone trying to iterate and do something more."

Chinese entrepreneurs think differently, as well, said Lee.

"The business practice in China is 'winner takes all,'" said Lee. "They're not constrained by cornering only a sliver of the market. It's not about having a niche. The entire eco-system is interdependent."

This ecosystem differs from the way US entrepreneurs innovate, said Lee.

"The American system is a gentlemanly system that involves respect, innovation, and consensus," said Lee. "People work in teams. They brainstorm and go into stealth and then come up with something."

But in China, entrepreneurs are less preoccupied with cultivating a creative, communal process.

"China is a giant experimental ground where people test things out," said Lee. "If they don't work they keep iterating over and over again. They want to be first. In China, you assume from the start that someone is coming after you."

Original author: Zoë Bernard

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Sep
15

40 AND UNDER: The Silicon Valley biotech stars who are backing startups aiming to cure disease, prolong life, and fix the food system

Title: Managing partner, Refactor Capital

Age: 36

Zal Bilimoria may be one of the most qualified operators in Silicon Valley. The Wharton School graduate spent 10 years building features and products at Microsoft, Google, Netflix, and LinkedIn, before joining top venture firm Andreessen Horowitz.

As a partner who helped launch the firm's Bio Fund, one of the first specialized funds to emerge from Andreessen, Bilimoria sourced deals at the intersection of biology and engineering. He doubled down on his investment thesis with the creation of a new firm, called Refactor Capital, which backs founders solving "fundamental human problems."

"Marc Andreessen said in 2011 that 'software is eating the world.' We believe 'biology is eating the world'; as in, literally everything around us is being re-thought and re-engineered using biology instead of pure chemistry," Bilimoria told Business Insider.

He said he's most excited about the "tremendous" opportunity for biotech to transform consumer and industrial applications outside healthcare — spanning the food we eat, the clothes we wear, and "the ingredients in almost every physical product we touch."

Among Refractor's investments are PathAI, an AI platform that aids doctors with cancer diagnostics and treatments, and Checkerspot, which uses fatty acids from algae to create outdoor recreation products like moisture-wicking fabrics and other materials.

Original author: Erin Brodwin and Melia Robinson

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Sep
15

After a huge user revolt, nobody wanted to work at Reddit. 3 years later, the CEO explains how the 'front page of the internet' rebuilt the team.

Steve Huffman returned to Reddit, the company he helped launch and later abandoned after its multimillion-dollar acquisition, to find that it had become one of the most radioactive companies in Silicon Valley.

Almost no one wanted to work at Reddit in 2015.

Huffman told Business Insider that in seeking to hire engineers, "it was hard to get people to respond."

"Reddit was in the press for all the wrong reasons — all of them," he said, adding, "Our reputation was in the dumps across pretty much every dimension."

Reddit, known as the "front page of the internet," is the fifth-most-visited website in the US. And yet it has nearly imploded on several occasions over the past decade. The site has been engulfed in controversies fueled by internet trolls and disgruntled users. A revolving door of CEOs did little to stabilize the startup's reputation or improve morale among a shrinking number of Reddit employees.

Huffman stepped back into the role of CEO to save Reddit, but he didn't do it alone.

Despite a series of crises, the San Francisco-based company would double its staff over 2016, growing from approximately 75 to 150 employees. They would transform the site from looking like a dystopian Craigslist— or "hot garbage," as one top Reddit executive described it — into a place where new users could more easily find their people online and share news, images, memes, and videos.

Today, Reddit has more than 400 employees on its payroll, with the biggest gains in engineering. The company raised $200 million last year from several well-known Silicon Valley investors, including Andreessen Horowitz and Sequoia Capital, to continue its hiring spree. It seems Reddit's renaissance has just begun.

Business Insider spoke with Huffman and a handful of engineers at Reddit and checked out the journalist Christine Lagorio-Chafkin's excellent forthcoming book about Reddit, called "We Are the Nerds," to learn how the internet's front page got its mojo back.

Reddit put out a call to 'every engineer in the Valley,' Huffman said

Reddit hadn't hired an engineer in nine months when Huffman — who left Reddit after his contract with the company's buyer, the publisher Condé Nast, ran out — rejoined in 2015. And it showed.

The site looked very similar to the version that Huffman and his cofounder, Alexis Ohanian, launched 10 years earlier.

"It wasn't really hard at that time to look at Reddit and think about ways to improve it," Nick Caldwell, Reddit's vice president of engineering, told Business Insider.

Reddit got a new — but still familiar — look in 2018. Reddit

Over 15 years, Caldwell had worked his way up from an intern to a general manager at Microsoft. When a recruiting firm approached him about going to Reddit in 2016, he was skeptical.

"I visited Reddit like four times before I took this job," Caldwell said.

Huffman needed help trying to staff up Reddit. New hires would allow the company to give the site a refresh, replace much of the original, clunky code, and build new products and features aimed at stamping out hate speech and other noxious content on Reddit.

That was easier said than done. Not only did few people want to work at Reddit in 2015, but the San Francisco Bay Area faced a shortage of engineering talent. The problem worsened over the years, as described in a recent workforce report from LinkedIn, as demand for data scientists in particular outstripped supply.

In addition to its struggles in recruiting engineers, the company had trouble holding onto its existing employees.

According to Lagorio-Chafkin's book, about 50 staffers quit or were terminated in the months following Huffman's return to Reddit. Some of them left in protest of Ellen Pao's ouster. (The Silicon Valley power player was asked to resign as CEO of Reddit amid a user revolt.) Others said they couldn't get behind Huffman's vision for a new era at Reddit, he told Lagorio-Chafkin.

Reddit hired a recruiting firm that, according to Huffman, "called every engineer in the Valley" in a "brute force" attempt.

After accepting the job, Caldwell also hired as many Microsoft employees who were interested in jobs at Reddit as he could.

"That turned out to be not a huge number of people," he said.

With his network tapped out, Caldwell had to search in new places for candidates. It required a change in perspective.

Reddit widened the pipeline for talent

Caldwell has acknowledged that at Microsoft he would scan people's résumés for top schools and major companies "before taking a deeper look." This strategy can often surface the usual suspects: white, male engineers in the Bay Area.

Nick Caldwell, Reddit's vice president of engineering, says the stigma against hiring from coding boot camps is fading. Reddit In seeking to widen the net, Caldwell began recruiting from coding boot camps, such as Hackbright Academy, whose mission is to help women from diverse backgrounds land jobs in tech. It specializes in providing opportunities to women with a few years of work experience under their belts who want to explore a new career path.

There's an old stigma that people who emerge from coding boot camps are less skilled than those with computer-science degrees. That's changing rapidly, according to Caldwell.

"People are realizing that technology changes so fast nowadays that you don't necessarily get practical knowledge from a college degree," he said. "And boot camps are only practical knowledge."

As a bonus, companies that aim to improve the ratio of male to female employees may find that "boot camps bypass a lot of the traditional problems that people have with the pipeline," Caldwell said. These programs are often much more affordable than college and can be completed in weeks or months, not years, making them accessible to a wider range of potential students.

Building a diverse organization is especially important when you run a site viewed by millions of people each month.

"You cannot build a product that appeals to a diverse set of people without having a diverse set of people designing the product," Huffman said.

Reddit declined to release its hiring or diversity statistics. However, the company has hired half a dozen graduates of Hackbright Academy alone, and it has even more employees — including Huffman — serving as program mentors to aid in recruiting efforts.

Reddit has over 400 employees today. Reddit

Having an impact matters

With its headcount ticking up, Reddit began shipping product again.

In 2016, the startup overhauled its mobile app, created new tools for tracking site traffic, and launched a new department, known internally as the "anti-evil" team, dedicated to ridding the site of harassment, spam, and abuse. Their efforts slashed the number of spam reports coming from users and moderators by 90%.

Huffman set out to double the staff again the following year.

By then, the team had made a key discovery about how to get people to come work for Reddit: It had to sell them on the story.

Bhavana Shanbhag was comfortable with her gig as an engineering manager at Groupon when she received a cold message on LinkedIn from a Reddit director of engineering in 2017. In it, he described some of the problems the company was trying to solve.

"We need people like you," Shanbhag remembered him saying.

Shanbhag, who described herself as more of a "lurker" on Reddit than a hardcore user, arranged to interview with 12 employees — more than what was required of her — before accepting the offer.

"I didn't want to switch my job for the sake of switching it," she said. "I wanted to make sure that I would actually have an impact."

Caldwell heard this from prospective hires a lot. The team members started to think critically about how they pitched candidates on the startup.

"What we settled on in those early days was: The value of Reddit was really about building community, and people coming into the company had huge amounts of opportunity to pick up the low-hanging fruit, to help us toward that mission," Caldwell said. "Once we really understood that, the pitch was pretty straightforward."

He explained the pitch as: "Hey, you can be the first person to come into Reddit and help us build our machine-learning processes. And by 'first person,' I mean literally there's no one else here — please come help us."

Alexis Ohanian, a cofounder of Reddit, drew the company's little alien mascot, Snoo, while he was sitting, bored, in class at the University of Virginia.Flickr / Anirudh Koul

A more established company like Facebook or Google could pay them better, Caldwell said. But Reddit offered ambitious engineers the ability to have a huge impact on a product under rapid development.

"It's pretty cool as well," he said.

In her role as senior director of engineering, Shanbhag often hears the question she asked — "Will I have an impact?" — from people she's trying to recruit, she said. She gives them a resounding "yes."

The startup is still hiring, but not without growing pains

There's still more to do, according to Huffman.

"I don't think the pitch has changed tremendously," Huffman said. "Everything is changing here. Like, we're rebuilding this company that has more potential energy than any company that you're talking to or thinking about joining. I can guarantee you that."

Reddit grew its number of engineers by 270% since the start of 2017, and it's still hiring. There are about two dozen job listings on the website, spanning data science, engineering, legal, and marketing, across offices in San Francisco, Los Angeles, New York, and Chicago.

It hasn't been all kittens and rainbows.

Employees agreed that Reddit grew too quickly, and the situation left some new hires feeling underutilized. The company slowed recruiting this past summer to catch its breath and see what the full capacity of all its new hires was before ramping back up.

"We're 400-some people now, and fewer than 20 of those people were here in 2016," Huffman said. "Every quarter, we joke that it's a new company. And it is a new company."

Original author: Melia Robinson

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Sep
15

What it's really like to fly into a hurricane, and why it's a critical part of your forecast

Before he heads to work, Jon Zawislak sometimes pops a ginger pill in his mouth to settle his stomach. He also prefers to stick to bland foods like pretzels and crackers before he gets to the office, because he wouldn't want to hurl all over his desk.

Zawislak is a Hurricane Hunter.

He spends 8-hour long days soaring 10,000 miles in the air, collecting data on the wind, temperature, pressure, humidity, and rain falling inside big storms, where hurricane-force winds top 75 mph.

While others on the ground are figuring out the best ways to avoid the eyes of these dangerous storms, he flies right into them.

"Aircraft are still the single best platform that we have to measure the state of a storm," Zawislak told Business Insider. "When it comes to the windfield, or the central pressure of the storm, that kind of data can only really come from an aircraft, and the instruments on the airplane."

In the past week, he's traveled through both Tropical Storm Isaac and Hurricane Florence, collecting vital data that the National Hurricane Center uses to upgrade a storm's category, or better track where it's headed next.

What an 8 hour workday in the air is like

Hurricane hunting flights have been around for 75 years, ever since British fighter pilots essentially dared a US Colonel to fly directly into a storm during WWII.

Today, Zawislak says there are two critical devices on the Lockheed Martin WP-3D he flies in for the National Oceanic and Atmospheric Administration (NOAA) that help inform our National Hurricane Center forcasts. First, there's the plane's on-board radar that measures wind and rain, and then there's a little device that's essentially a paper towel roll with a parachute on its back, called a dropsonde.

The dropsonde is a disposable instrument outfitted with a GPS receiver, as well as pressure, temperature and humidity sensors. The throw-away package gets stuffed out a window, and then sucked away from the plane. Over the course of a typical 8 hour flight, a dropsonde operator might plop 20 of them down into a storm, everywhere from the eye to the very outer rim, to examine how the windfield changes at different locations and heights in the storm.

As it falls to the surface of the ocean, each dropsonde radios its information back to the plane.

"It really allows us to profile the atmosphere, which is one of the most important things," Zawislak said. "So we can see how the wind speed changes with height."

All this information can dramatically shift how forecasters characterize a storm.

Take Zawislak's Monday flight into Hurricane Florence, for instance. "It went from what looked like a category 2 hurricane, all the way to a category 4 hurricane, just because we had the aircraft," he said.

Getting a job as a flying scientist

Zawislak, who holds a PhD in atmospheric science, has been working on both planes and unmanned drones that fly through hurricanes for roughly a decade.

Zawislak at work. Jon Zawislak

As a Hurricane Field Program Director for NOAA, he is essentially in charge of a plane-sized research lab in the sky. He decides where the flight path will head to collect its best data, and makes sure the instruments on board are getting all the information they'll need to answer key research questions in flight.

One of the biggest unanswered questions Zawislak still has about hurricanes is how they get so fierce, so fast. It's still not well understood how storms organize and gather strength, developing from uneven messes of rain and light wind to powerful, swirling hurricanes that can rip through homes and pummel the shore with water.

It's an important research question for Zawislak, because if he can better understand why and how the storms are intensifying, forcasts will improve.

Zawislak and a colleague examine the flight track and check data coming in from their instruments in flight. Jon Zawislak

Zawislak says he's "not crazy," he just wants to learn more about big storms

Zawislak tries to steer clear of greasy foods before he boards the plane, but he says that flying into a storm isn't always a bumpy ride. In fact, inside the storm it can feel just like a commercial flight, with the seatbelt sign off and all.

The pilots Zawislak files with (there are three of them in the cockpit) typically try to keep the plane level, for the sake of the instruments, and maintain a height of about 10,000 feet.

"We have the best pilots, the best engineers, the best mechanics, this is the best-maintained airplane you can find," he said.

Still, the turbulence inside the plane can be unnerving at times, even with a harness on.

"You have flights where you're in moderate to severe turbulence for two to three hours," Zawislak said.

Inside the eye of a big storm like Florence, things clear up. At its very inner core, a hurricane is a place of peace, surrounded by violent chaos. Hurricane hunters say it looks like a big stadium, clear and serene.

"It's much bigger than any stadium you've been in," Zawislak said. When he flew through the eye of Florence, as a category 4 storm, the center was more than 15 miles wide, and took four minutes to fly through.

Despite the fact that Zawislak has to muscle his stomach through several long and bumpy rainy joy rides every hurricane season, he still wants you to know that he's not completely out of his mind for taking this job.

"We're not crazy" he said, before boarding another flight into tropical storm Isaac. "We are playing a humongous role in getting the information to the National Hurricane Center, so that they can tell the public how strong the storm is."

Original author: Hilary Brueck

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Sep
15

Biotech billionaire and Los Angeles Times owner Patrick Soon-Shiong is talking to newspaper chain McClatchy about buying Tronc

Biotech billionaire and Los Angeles Times owner Patrick Soon-Shiong, who had been in talks to team up with a hedge fund manager for newspaper publisher Tronc, is now considering a competing bid, according to people familiar with the matter.

Soon-Shiong is considering a joint bid with newspaper publisher McClatchy, the people said, asking not to be named because the matter is private. McClatchy is in "early stage" discussions to buy Tronc, the Chicago Tribune reported Friday.

Soon-Shiong, through his investment firm Nant Capital, had been in talks to partner with Donerail Group, the private-equity firm led by hedge-fund manager William Z. Wyatt, which has been looking to acquire Tronc since early August.

But these talks, while not dead, are seen as less likely and Soon-Shiong is now considering a bid with McClatchy. The people cautioned that no bids are finalized and Soon-Shiong may choose not to go ahead with a deal in the end. Soon-Shiong has also been shopping for other partners, sources said.

A representative for Soon-Shiong could not be reached for comment. Representatives for McClatchy and Donerail declined to comment.

Soon-Shiong spent $500 million in June to acquire the Los Angeles Times and The San Diego Union-Tribune along with a bunch of other community newspapers from Chicago-based Tronc.

Soon-Shiong also remains Tronc's second-largest shareholder, with a nearly 25% stake. Michael Ferro, the Chicago entrepreneur who was formerly Tronc's chairman, is the largest shareholder, with a nearly 26% stake.

Soon-Shiong has access to Tronc's backend to manage the California newspapers' website operations for the next year, by which time he must either set up a new structure or acquire it. A partnership to acquire Tronc would enable Soon-Shiong to seize control of those operations and implement a smoother transition.

A 66-year-old South African native and former UCLA surgeon, Soon-Shiong amassed a fortune by building and subsequently selling two biopharmaceutical companies. Since taking over the Times, he has been on a mission to rebuild and revitalize the newsroom, which has seen three editors in 10 months and five publishers in four years.

Original author: Tanya Dua

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Jun
14

We just saw one of the weirdest self driving cars yet in San Francisco, and no one knows who it belongs to

Amazon has 14 leadership principles that guide its employees' business decisions, but founder Jeff Bezos said just one is the "secret sauce" to the trillion-dollar company's success.

"(T)he No. 1 thing that has made us successful by far is obsessive compulsive focus on the customer as opposed to obsession over the competitor," Bezos said in a talk at the Economic Club of Washington on September 13.

Focusing on what customers want or need has driven many of Amazon's most profitable business moves.

Take Amazon Prime. Bezos said at the talk that Amazon developed Prime, a paid subscription service for free two-day delivery, because he knew consumers love free shipping. Introduced in 2005, the service drew ire for being "too good to be true" and helped underline the idea that Amazon is too inexpensive to be profitable. The message was clear: Prime is draining Amazon's profits and its stock.

But it's clear now that pleasing its customers, rather than bumping Amazon's short-term bottom line, has been a shrewd business move. Amazon Prime customers spend an average of $1,300 in a year, nearly twice that of non-members. More than 100 milion people globally are Prime members.

Bezos added that it's easy to see if an entrepreneur or CEO has that same customer obsession, or if they're just trying to nudge out their competitors and boost their stock.

"I talk so often to other CEOs and founders and entrepreneurs, and I can tell even though they're talking about customers, they're really focused on competitors," Bezos said.

When he senses a lack of customer obsession, Bezos said he doesn't want to invest in or acquire the company. He's previously drawn a line between "missionaries" and "mercenaries" in the business world.

"The missionary is building the product and building the service because they love the customer, because they love the product, because they love the service," he said in 2015. "The mercenary is building the product or service so that they can flip the company and make money."

And as he added in 2018, "It's usually the missionaries who make the most money."

As an example, Bezos highlighted The Washington Post, which he bought in 2013. He said the Post, which is now profitable, has been successful by focusing on delighting its readers, not simply courting advertisement dollars.

"By the way, where do advertisers want to be? Advertisers want to be where there are readers," Bezos said. "It's really not that complicated. It comes around really well."

Original author: Rachel Premack

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Sep
15

The guy who used to head up Google China says he knows the key to the company's success if it were to return — and it's not search (GOOG, GOOGL)

If we're talking exclusively about Google's financial interests, then management's decision to pull out of China in 2010 was clearly a mistake, and Kai-Fu Lee, the former president of Google's operations in China, begrudgingly acknowledges that.

"Had they stayed and continued to operate legally, they would be in a much better position to launch products," Lee told reporters on Thursday. But the longtime tech executive and investor quickly noted that Google didn't leave China with an eye on its pocketbook.

The company was forced to choose between complying with a demand by China's government to censor search results, or stop operating in the country. Google's management chose to leave.

More recently, however, Google appears to have experienced a change of heart, and managers recently acknowledged they're considering a return to China. According to reports, Google is eager enough to return to China that it has already built a censored search engine.

The revelation that Google may bow to China's censorship demands has drawn criticism from human-rights groups, US politicians, and even some of the company's employees. Lee, who worked for Google China for four years before leaving in 2009, made his comments following a panel discussion he participated in at the Artificial Intelligence 2018 Conference in San Francisco.

Lee addressing the audience at the Artificial Intelligence 2018 Conference. Photo by Doug Cody, courtesy of O'Reilly Media

Lee declined to say whether he thought the stand Google took nine years ago for free speech was the right one. He did, however, have no problem listing the many competitive reasons Google might not want to reenter China.

For starters, the search business there is packed with homegrown competitors, whom Lee earlier likened to entrepreneurial "gladiators." According to Lee, Google shouldn't even bother facing off against this lot because the odds are all with the home team.

"When you're in a market that is already 20 years old and mature like search, to go in now with a zero market share and build it up is such an uphill struggle," Lee said. "When I went into the search market it was maybe eight years old and Google had 9% market share, so we had something to work with and a brand name."

Lee said that before Google left China, he and his staff had carved out a 24% share of the market. He's doubtful Google could come close to that again.

The search giant, however, would stand a better chance of finding success if it moved into a segment that wasn't as mature, Lee said — say, for example, autonomous vehicles.

"In search, it's just not meant to be," Lee said. "If Google wants to do anything, they should enter an area with a new product in which there are no entrenched players, nor are there clear user expectations and biases. For example, if Waymo could land in China, Google would have such advantages. A two-year lead and also if there's proper deployment, it could be a runaway success."

Original author: Greg Sandoval

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Jun
13

10 things in tech you need to know today

Apple fans waiting to hear about the company's futuristic wireless charging mat will have been disappointed on Wednesday, as the AirPower charger did not get a single mention at Apple's annual iPhone launch event.

Apple previewed AirPower last year, showing a flat pad that could wirelessly charge multiple devices at once, such as an Apple Watch, iPhone, and AirPods case. But there was, surprisingly, no mention of the mat in Cupertino on Wednesday.

Now commentators are speculating that Apple has experienced some kind of setback. 9to5Mac reported that most mentions of AirPower have been scrubbed from Apple's website. According to 9to5Mac, the product page for last year's iPhone X mentioned AirPower and a release date of some time in 2018. Since the iPhone X itself has been discontinued, there's no longer any mention of AirPower.

Tech blogger and well-known Apple watcher John Gruber also weighed in, noting that he could find a picture of an AirPower mat, but no mention of the product itself on Apple's site. "No one from Apple I've spoken to today will say a word about AirPower other than that they have nothing to say about it today. I wouldn't be surprised if it's been scrapped, and they just don't want to say so yet," he wrote on Wednesday.

Forrester analyst Thomas Husson told Business Insider he would be surprised if Apple had scrapped AirPower altogether.

"Given the importance of the battery life for the Apple Watch, it would have been a nice way to sell accessories to consumers who own multiple Apple devices and create a continuum of experiences across the product portfolio," he said.

"I would assume this is still the plan and that is only a matter of months before we know more details and see an official product launch."

Apple announced in September last year that it would release AirPower in 2018, but speculation about the precise release date has varied. Shortly afterwards it was confirmed that Apple had bought wireless charging company PowerbyProxi in order to "help create a wireless future," according to Apple's senior vice president of hardware engineering Dan Riccio.

The wireless future seems to have stalled however, as Bloomberg reported in June that engineers were struggling to stop the mats from overheating. The same report suggested that AirPower would be released in September.

Business Insider contacted Apple for comment.

Original author: Isobel Asher Hamilton

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Sep
13

10 things in tech you need to know today

Shayanne Gal/Business Insider

Good morning! This is the tech news you need to know this Thursday.

1. Apple announced its biggest iPhone to date, the $1,100 iPhone XS Max, during its annual event in Cupertino. It also unveiled the smaller, $999 iPhone XS and the "budget" $749 iPhone XR.

2. President Trump's campaign manager called Google a 'threat to the republic', after a leaked video emerged showing company executives lamenting Trump's 2016 victory. Republicans seized on the video as indicative of bias in Google's search results, though the video didn't back up their claims.

3. Apple unveiled an updated version of the Apple Watch with new features apparently targeted at older wearers. The Apple Watch 4 can take ECGs and detect if the wearer falls.

4. Tesla's vice president of worldwide finance and operations is the latest senior staffer to leave the company.Justin McAnear said he was offered the job of CFO at a different company, and his departure comes less than a week after chief accounting officer Dave Morton resigned.

5. Troubled games studio Riot Games has brought in a former Uber executive to try and fix its culture, after employees complained of bullying and harassment. Uber's former senior vice president for leadership and strategy, Frances Frei, will act as an adviser to Riot's culture team.

6. European politicians voted to back controversial legislation that could radically change the internet. Tough new copyright legislation, should it come into effect, would mean tech giants will have to pay to link to journalistic articles, and scan content uploaded content for any copyright breaches.

7. Google quietly announced it would discontinue Inbox, its innovative email app. Many of Inbox's features, such as smart reply, have made their way into Google's main service Gmail, and it appears the firm has decided the app has served its time.

8. Apple's latest mobile software, iOS 12, will be available on Monday and it includes major changes. The update will include changes to how notifications are displayed, updates to the Photos app, and a new augmented-reality Measure app to take measurements with only your iPhone camera.

9. There were two major no-shows at the Apple event on Wednesday: wireless charging mat Airpower, and updated Airpods headphones. Apple gave a sneak peek at Airpower last year, but said it wasn't ready, and it's been two years since the first-generation of Airpods came out.

10. Uber's new northern European boss, Jamie Heywood, made his first speech on Wednesday, radically upending what the company is best known for. Heywood didn't just talk about cab rides, but talked about the future of transportation including shared electric vehicles such as bikes and scooters.

Have an Amazon Alexa device? Now you can hear 10 Things in Tech each morning. Just search for "Business Insider" in your Alexa's flash briefing settings.

Original author: Shona Ghosh

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Jan
18

Birch raises $1 million to help you reap the best credit card rewards

Didi Chuxing, China's largest ride-hailing company, is now recording in-car audio during passenger trips in an effort that it says will improve customer safety.

The company, most recently valued at $50 billion, began trialing the new feature on one of its platforms, Didi Hitch, on Saturday, which asks users for a one-time authorization to create a voice recording for the duration of their rides before they're able to book a car. If they decline, the booking cannot be completed.

A message on the app says recording is done on the driver's phone, and recordings will be uploaded to the company's servers as an encrypted file only accessible by Didi or law-enforcement. According to the message, the recording will be used as evidence in dealing with complaints or bad reviews, and will be automatically deleted within seven days if a complaint is not filed.

In July, the app tested out an optional video recording function in 20 cities, which asked users if they wanted to be recorded when they entered into a vehicle equipped with a camera.

The company has also rolled out driver facial recognition software before each trip, limited late-night rides to drivers and passengers of the same sex, and announced it would temporarily be suspending late night services on the app from September 8 while the company evaluates risks and continues to make improvements.

The increased safety measures follow two high-profile murders that happened during Didi rides in the last several months.

Last month, a 20-year-old woman was allegedly raped and murdered by a driver after using the service in the eastern province of Zhejiang, and in May, a 21-year-old flight attendant raped and murdered in Zhengzhou by an unregistered driver who allegedly hijacked his father's account.

Public records seen by the South China Morning Post indicate that the service had at least a dozen instances of sexual assault convictions involving drivers and passengers.

Wang He/Getty Images

Some users have expressed concern that the new safety measures are an invasion of privacy.

"This is sacrificing privacy for safety," one user wrote on popular microblogging platform Weibo, according to Sixth Tone. "Why can't [Didi] let passengers make their own choice?"

"We can't talk about work and life during a journey after this," a Didi passenger told Global Times. "I feel that both the driver and passenger are being monitored."

The new measures also raise wider concerns about surveillance of Chinese citizens as they go about their daily lives.

China has already announced plans for a mandatory "social credit system" to be rolled out by 2020, which ranks citizens behavior and "trustworthiness" by monitoring most things about people — from their spending habits, to their internet use, to traffic violations.

Good social credit can lead to preferential treatment when renting apartments, staying in hotels, or getting a job promotion. But a poor score could result in travel bans, lower internet speeds, limited job prospects, or even public shaming.

The methodology of how China cultivates the score remains foggy, though the country could be using widespread facial recognition technology, monitoring online messages, forcing citizens to download government-linked monitoring apps, and tracking citizens' social media posts.

The credit system has been rolled out in dozens of cities across the country, and citizens are already witnessing the effects of state monitored surveillance from suspended university enrollment, to banned travel access.

Several popular apps have been found to record sensitive user data stored in their mobile devices, which could be used to track and monitor Chinese citizens, according to Hong Kong Free Press. And Chinese authorities have acknowledged they have accessed deleted conversations from the popular messaging app WeChat.

Still, when it comes to ensuring safety, users in Chinese citizens are among the most willing to sacrifice privacy for safety and convenience, according to a report by market research firms Experian and International Data Corporation.

Original author: Rosie Perper

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Sep
13

Hands-on with all the new iPhones Apple just introduced (AAPL)

Apple introduced its new iPhone lineup on Wednesday.

The iPhone's flagship X series will now consist of three models.

The iPhone XS and iPhone XS Max go on sale next week, on September 21.

The less-expensive and more colorful iPhone XR goes on sale on October 26.

Business Insider was at the launch event at Apple's Cupertino, California headquarters and was able to briefly handle the new devices after they were announced. Here's what we thought:

Original author: Kif Leswing

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Sep
13

Oracle's head of cloud left after butting heads with Larry Ellison, source says (ORCL)

Last week, the Oracle eco-system was surprised to learn that Thomas Kurian, one of Oracle's longest serving executives in charge of Oracle's all-important cloud business, had left for an extended leave of absence.

Inside Oracle, word is that Kurian's departure was due to butting heads with his boss Larry Ellison, a source tells Business Insider. This person says that Kurian's good-bye was intended as a resignation, although the company says that he has not resigned but is simply "taking some time off. We expect him to return soon," a spokesperson said.

The disagreement seems to have centered on the direction Oracle should take with its bet-the-company cloud computing business, reports Bloomberg.

Sources told Bloomberg that Kurian was pushing Ellison to allow more of Oracle's software to run on clouds that compete with Oracle, particularly market leaders Amazon and Microsoft.

If true, this disagreement between the two strategies, and the two men, would not be surprising. Both of them are known for being tough, outspoken and opinionated — characteristics which describe a lot of Oracle's culture.

A page ripped out of the Microsoft playbook

If Kurian is pushing Oracle to embrace multiple clouds — even the clouds of its bitter enemies — the strategy would make a lot of sense.

It's similar to what Microsoft CEO Satya Nadella has done. There was a time when Microsoft's Bill Gates and Steve Ballmer were protectionist about Windows. But, with the rise of cloud computing, Nadella recognized that the world had changed.

Microsoft CEO Satya Nadella REUTERS/Clodagh Kilcoyne It became far less important to push people to use Windows than to ensure that Microsoft's enormous catalog of software, particularly Office, could run on any device. So, Microsoft built out its cloud to serve up Office 365 to run on any device; it made sure that its Windows Server software could run on other clouds; and it embraced competitive software, like Linux, on its own cloud.

That way, Microsoft makes money when customers run its software on a competitive cloud (they still have to buy the software) or when they run a competitor's software on their own cloud (they have to pay for Microsoft cloud usage).

Oracle is in a similar quandary but with one key difference: Amazon has become a major threat to Oracle.

Amazon isn't just trying to get Oracle's customers to bring Oracle software to Amazon Web Services (which they can already do), it's trying to get customers to ditch Oracle's database and use Amazon's database instead. Amazon even built a tool to make it easier to move from an Oracle database to an Amazon one. Microsoft also has its own database and has been a bitter competitor with Oracle for years.

So Ellison has been building an Oracle cloud that competes with Amazon (and Microsoft) insisting Oracle's cloud is a faster, better way to run the database. If Oracle's customers don't stay within Oracle's own sphere, Oracle could lose them altogether.

The clock is ticking

Oracle executive chairman and CTO Larry Ellison Oracle The problem is, Oracle's cloud is years behind Amazon's in terms of features. It will take Oracle billions of dollars and several years to catch-up, if it even can because Amazon is adding features at an ever increasing rate, hundreds or more per quarter. Microsoft is widely considered the No. 2 cloud.

Enterprise customers are choosing their cloud providers now, based on the features they want and need now.

Oracle may not have years to play catch up. And the person responsible for that catch-up is 22-year Oracle veteran Kurian, and his team. Kurian is the president who heads engineering and product development. About a quarter of the company reports up to him.

There have been signs that Oracle's cloud ambitions are not growing as well as the company wants, too, putting Kurian on the hot seat. Although, to be fair, Oracle is doing a good job in getting many of its customers to sign up for the certain parts of its cloud. They like the cloud versions of its HR, marketing and financial software (similar to how Microsoft moved people from MS Office to Office 365).

Should Ellison allow more of that software to run on competitors' clouds? And should it partner with its rivals (assuming such partnerships were an option) to run their software on its own cloud?

Probably yes. Other would-be Amazon competitors have either been crushed (Rackspace) or forced to eat crow and partner up (VMware). Once VMware got past the bitter taste, its partnership with Amazon has proved fruitful, filling a need with enterprise customers who want their datacenters to work better with the Amazon cloud (and making Amazon more of a beast, in the process).

But there's no question it's risky, and Ellison certainly wouldn't be crazy for being wary.

Oracle declined comment.

Original author: Julie Bort

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Jul
03

As Q3 kicks off, four more companies join the $100M ARR club

To hear the technoratti tell it, Apple's iPhone event Wednesday was a snooze fest.

But as the assembled reporters and analysts were starting to zone out, and as Apple's stock price slipped, the company unveiled what will prove to be its sleeper hit. The iPhone XR, the most low-ranking member of Apple's expanding X family of devices, is exactly what the company needs to revive its sluggish smartphone sales.

The new device offers many of the high-end features of last year's iPhone X and this year's XS with a price that's in line with that of the iPhone 8 and older models. My sense is that's going to be more than enough to convince iPhone owners who are holding on to aging devices to upgrade.

Apple could use the help. On an annual basis, the number of iPhones the company has been selling recently has barely budged and is actually down from what it sold three years ago. While last year's premium priced iPhone X helped boost the company's smartphone revenue, the stagnating unit sales are holding back the company's overall growth, and have led to declining market share.

You can chalk up Apple's stalling smartphone sales to a pair of factors. It basically stuck with the same design from 2014's iPhone 6 models to last year's iPhone 8. Although the innards of those phones changed over time, they looked basically the same and the new features they offered weren't compelling enough to encourage consumers to upgrade en masse.

Prior to Apple's official unveiling of the iPhone X last year, many analysts expected its anticipated revamped design to spark a massive upgrade cycle. But it didn't, due to the product's steep $1,000 price tag. That was a $350 premium over the starting price of the flagship models it replaced and put it out of reach of many consumers.

That's where the new iPhone XR comes in. The device was announced at the end of Apple's press event, which was dominated by the company's unveiling of its new flagship XS models that have little noticeable difference from last year's iPhone X.

But the XR is a wholly new model. It's got the same basic design of the iPhone X and XS, with a large edge-to-edge screen. In fact, while its display is bigger than that found in any other iPhone model other than the XS Max, the phone itself is actually smaller than the iPhone 8 Plus and previous plus-sized models.

What's more, it comes in a rainbow's assortment of colors. So for iPhone owners who have been holding out for something that looks different and new, it will likely fit the bill.

But if that's not enough to convince them it's a worthy upgrade, the XR also offers many of the same cutting-edge features found on the top-of-the-line XS models. Among them: Apple's Face ID facial recognition system; the company's latest and fastest chip, the A12 Bionic processor; and support for both wireless charging and some advanced photo features, such as the ability to take "portrait" photos with blurred backgrounds.

The iPhone XR comes in an assortment of colors. Apple The XR's most compelling feature, though, is likely to be its price. At $750, the XR isn't exactly cheap. But that's $250 less than the starting price for the XS, and XR comes with a bigger screen. And it's actually $50 less than Apple charged for the iPhone 8 Plus last year.

To be sure, the XR doesn't have all of the bells and whistles in the XS. It's got a lower resolution screen than the flagship models, and, unlike them, its display is based on LCD technology, not OLED. Consumers will likely be able to tell the difference if they compare them side by side.

What's more, it lacks the telephoto lens found not only in the XS and XS Max but in previous years' Plus models. And it doesn't have 3D Touch, Apple's technology that typically shows users more options or information if they press down on an app icon or menu option.

But my guess is none of that will matter. I think lots of Apple customers with aging phones are going to jump at the chance to have a device that looks like an even more fun and colorful version of the iPhone X. I think the long-awaited iPhone upgrade cycle may finally be here.

Original author: Troy Wolverton

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Jul
03

Bootstrapping with a Paycheck from New Jersey: Suuchi Ramesh, CEO of Suuchi (Part 4) - Sramana Mitra

Amazon wants a bigger piece of the TV advertising business.

The question is, will TV's giants let the ruthlessly efficient e-commerce behemoth into their highly lucrative, highly exclusive world?

As Business Insider has reported, Amazon has been working building out an ad network for TV apps within its Fire TV system — very much like Roku. In fact, Amazon has been asking small and mid-sized video apps to supply 30% of their ad inventory on Fire TV devices in exchange for distribution.

Now, Amazon is putting together a pilot program with select video apps along the lines of Crackle, Tubi and Pluto to sell ad space using Amazon's powerful data sets, said people familiar with the matter. And Amazon would like big TV companies like Fox, NBCUniversal and Hulu to be part of the pilot.

That would be a marked change for the TV business, where TV networks do not traditionally allow third parties to sell their valuable ad inventory. In fact, the biggest TV players typically sell the vast majority of their linear ad space in an annual upfront sales bonanza to a few hundred national advertisers.

But OTT is changing things. Devices manufacturers like Roku, Xbox and Amazon control the new TV delivery systems ecosystems much like cable companies have in the past.

In Amazon's case, the company can offer TV networks a compelling two-pronged argument:

With our data, we can target customer-specific customers, since we know who our customers are and what they like to buy. Our data will also let you know if your ads work — that is, if people end up buying things on Amazon after seeing ads.

It's bound to be an intriguing pitch. Amazon could claim that it can help TV companies more money from OTT advertising than they can on their own — theoretically.

"This would almost certainly be big if they can get it going," said one ad buyer.

"It could really change TV," said another.

But they'd have to be open to partnering — not something the TV business is famous for.

Amazon

"I believe that a fully built out and ad-supported Fire TV product could have an enormous disruptive impact on the TV and video ad ecosystem," said Dave Morgan, CEO of the TV ad targeting firm Simulmedia.

That also means relinquishing control in an industry known for its small cadre of high powered sellers and buyers.

Some say, not a chance. After all, the TV business, despite ratings plummeting, just enjoyed an outstanding upfront. It's only getting harder to reach people in mass media. Why mess with things?

"It will be scary for them," said Torrential CEO Matt Wasserlauf, a veteran digital media exec who also logged time at CBS.

Or as one consultant put it, "my guess is [NBCU sales chief Linda] Yaccarino says, 'yeah right. Drop dead, unless you want to write me a massive check.'"

On the other hand, TV is undoubtedly going through massive changes, and advertisers are pining for more data-driven, automated buying. Amazon could build a self-serve platform with this new offering, and let loads of brands plug in and buy ads without making a phone call, paying for a lunch or taking an ad buyer to a Knicks game.

As one former TV exec said, 'how long can you justify having these high priced ad sales groups? If you can make more money from partnering with Amazon, even if you have to share revenue, you could automatically do it cheaper by cutting back on sales executives, dinners, lunches and splashy upfront presentations.'"

TV networks are unlikely to get rid of all their sales executives overnight. And if they partner with Amazon, it may initially be focused on smaller networks and/or limited to unsold inventory.

Some have wondered whether top TV networks may look to rent Amazon's data rather then let Amazon get its hands on their ad space. Yet even as Amazon's ad business has soared, the company has not shown much inclination to share any of its precious data.

Regardless, big TV companies have a big decision to make.

Original author: Mike Shields

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