Year: 2019

Huawei mobile chief Richard Yu has already made mention of the company’s upcoming foldable phone amid talks of smartphone world domination. This morning, however, we caught our first glimpse of the handset in profile, along with the promise of more, arriving February 24, during Mobile World Congress in Barcelona.

Foldables are very much heating up to be the highlight of the 2019 smartphone race. Royole’s already shipping a handset to devs, and Samsung is set to give us a lot more info at an Unpacked event a mere days before MWC kicks off.

Xiaomi’s offering is merely a concept, but it’s the coolest of the bunch, and then there’s the return of the Motorola Razr, which seems, if nothing else, a solid play for smartphone nostable. Google, too, has been working hard at building in support for what’s sure to be a broad range of different foldable form factors, as hardware companies fumble to find the best design.

Also notable on the teaser is the Connecting the Future text, which appears to be a reference to the phone’s inclusion of 5G, which would really put the handset smack dab in the middle of the mobile zeitgeist. It would also likely further drive up an already pricey design.

Amazon had a record-breaking holiday quarter, with revenue of $72.4 billion and profits of $3 billion, but it’s not making much money off its top-selling item, the Alexa-powered Echo Dot. While the e-commerce giant said the device was its 2018 holidays best seller across all products, it also reminded investors on yesterday’s earnings call that Echo devices aren’t priced “to make money.”

Instead, Amazon sees Echos as another means of connecting with its customer base – its most avid, engaged customers, that is.

“There are a group of customers who use our devices and then we monetize that in different ways – commitment to Amazon and the video and everything else,” noted Amazon CFO Brian Olsavsky, speaking to investors on Thursday.

While some reports have dismissed Echo devices’ potential for online shopping, Amazon appears to be playing the long game with regard to voice computing. With an Echo in the home, consumers are more likely to remain a Prime subscriber, streaming Prime music or audiobooks, or – on its devices with a screen – watching Prime Video. As Amazon advances its e-commerce strategy with Whole Foods and Prime Now, it also sees Echo as a means of getting items to your door within an hour or two, simply by way of voice commands.

That means, for now, Amazon’s goal is to get an Echo into the home – even if it has to sell the gadgets at cost (or even less).

And the devices are selling. Amazon said the Echo Dot was the best-selling item across all of Amazon globally during the holiday quarter, and customers purchased “millions more devices from the Echo family” in 2018 than they did in 2017.

Amazon had also said last month that over 100 million Alexa devices had been sold to date, including the Echo Dot and other Echo-branded devices, along with those from third-parties.

As the company is usually cagey about sharing exact numbers when it comes to things like this, it was a notable milestone.

Google, of course, quickly responded with a note that its Assistant AI will be on a billion devices by the end of January. But it wasn’t a fair comparison, because Google was counting Android smartphones while Amazon’s number, we confirmed at the time, didn’t include smartphones – even though you can use Alexa from within the Alexa mobile app and even within the widely installed Amazon shopping app.

However, Echo devices aren’t Amazon’s only means of introducing Alexa to consumers.

The Echo Dot is the best seller in terms of Alexa-powered devices, due to its low price point and regular discounts during major shopping events like the 2018 holidays, Black Friday and Amazon’s own Prime Day, but it’s joined by a growing number of other Alexa products.

In 2018, the company saw over 100 new products with Alexa built-in launched from third-party manufacturers, bringing the total up to over 150. And Alexa works with over 28,000 devices, like smart home devices and other hardware, from across 4,500 brands.

Amazon, itself, is trying to figure out how to put Alexa into more things. It even jokes about this in its latest TV commercial, set to be aired during the Super Bowl.

The ad references a more offbeat device – the AmazonBasics Alexa-powered microwave – but then makes cracks about the Alexa devices that didn’t work – like an Alexa dog collar and hot tub, for example.

Alexa skills top 80,000

The growing Alex ecosystem means the number of things you can do using the voice assistant, by way of its voice apps called “skills,” is also increasing.

A new number Amazon shared yesterday was that the number of voice applications built for Alexa had now topped over 80,000 worldwide. That’s up from the 70,000 skills Amazon was touting back in December.

Amazon CEO Jeff Bezos mentioned this figure and other milestones related to Alexa’s improvements in a statement, on Thursday.

“The number of research scientists working on Alexa has more than doubled in the past year, and the results of the team’s hard work are clear. In 2018, we improved Alexa’s ability to understand requests and answer questions by more than 20 percent through advances in machine learning, we added billions of facts making Alexa more knowledgeable than ever, developers doubled the number of Alexa skills to over 80,000, and customers spoke to Alexa tens of billions more times in 2018 compared to 2017,” Bezos said.

The company said in November it now has over 10,000 employees working on Alexa, as a point of reference. But it’s challenged in building up a knowledge base of questions and answers – something Google has worked on since the launch of its Knowledge Graph in 2012.

At the end of the day, consumers may not pick a device only because of what facts it can spout off, but rather because of how well it fits into the home in other ways. Alexa can play your music and share the news like any voice assistant, but it also works with other Amazon devices, like Ring doorbells and Amazon security cameras, keyless entry systems, and more. And it can deliver your food and other items.

Google, meanwhile, doesn’t have a successful e-commerce business and just lost a key partner for its Google Express shopping service, with Walmart’s exit from the platform.

That leaves Google at something of a disadvantage as assistants cater more to our needs to not just answer questions or turn on the lights, but to make anything appear at our door. If Amazon has to give away a few million devices to stake out its place in the future of shopping, it believes that’s money worth losing.

 

Vice Media plans to cut 250 jobs — about 10 percent of its total workforce.

The Hollywood Reporter broke the news. When contacted by TechCrunch, a Vice spokesperson confirmed the story but declined to comment further.

This comes after a brutal couple of weeks in the media business, as companies began the year with major cuts. BuzzFeed is trimming its staff by 15 percent. Verizon Media Group (which owns TechCrunch) laid off 10 percent of its workforce. And traditional media wasn’t immune, with Gannett eliminating as many as 400 jobs.

Alongside the broader industry issues, Vice has had a tumultuous year of its own. Reporting by The New York Times at the end of 2017 led to the departure of multiple executives. Nancy Dubuc, previously the chief executive at A+E Networks, replaced co-founder Shane Smith as CEO in March. And in November, the company instituted a hiring freeze aimed at cutting the workforce by up to 15 percent.

According to the Hollywood Reporter, once Vice executives had created their strategic plan for 2019, they decided to complete those cuts with layoffs. Every department of the company will be affected, but the goal is to allow Vice to focus on growth areas like branded content and film and TV production.

“We will make Vice the best manifestation of itself and cement its place long into the future,” Dubuc said in a memo sent to Vice staff.

Sony posted record quarterly earnings this week on the strength of very strong music profits. Those numbers were catapulted thanks to the company’s $2.3 billion acquisition of EMI as part of an ever-consolidating music industry.

The electronics giant’s operating profit rose to $3.46 billion for the quarter — up from $3.21 billion a year prior, marking the highest single-quarter profit for the company. Things were less rosy on the gaming front, however, where the company was hit by declining hardware sales of its mature PS4 consoles for the holiday quarter.

The console sold 8.1 million units for the quarter — though the company says that’s roughly in line with its own expectations, as the latest PlayStation turns six. The long-awaited Marvel’s Spider-Man game was a hit for Sony, but not enough to make up for diminishing hardware sales. Profit for the gaming business dropped 14 percent, year over year.

The news comes as the younger (and cheaper) Switch continues to sell at a brisk pace — though Nintendo did notably trim expectations from 20 million to 17 million for the year. Sony was also hit by lowered demand for mobile imaging as the global smartphone market continues to struggle.

Juul Labs, the e-cig company under fire for its product’s popularity with young people, has brought on a new VP of Intellectual Property Protection with Adrian Punderson, formerly of PwC and Apple.

Punderson’s job is all about working alongside government agencies, as well as Juul Labs Intellectual Property VP Wayne Sobon, to combat the sale of counterfeit and infringing products. These can range from copycat vapes and pods that are actually marketed as Juul products all the way to products that are designed specifically to be Juul compatible without using the trademark.

These counterfeit and infringing products pose a serious threat to the company. Of course, no business wants its products infringed or its marketshare stolen.

With Juul, however, it’s far more complicated. Juul Labs is currently under heavy FDA scrutiny over the popularity of its products with minors.

“As you start to enforce generally on the sale of these types of products to youth, oftentimes they are going to look for another seller or distribution point of this product,” said Punderson. “The challenge is that oftentimes they’re going to platforms or places for this and you have no idea what the origin of the product is. A lot of it is counterfeit. So they get something they believe is Juul only to find out they have a counterfeit device or pod.”

He went on to say that, for Juul, a top priority is identifying counterfeit sellers and quickly putting that information into the hands of law enforcement. To the extent that they can’t take action, said Punderson, Juul will take civil action.

Part of the concern is that there is zero transparency into what ingredients are being used in infringing products, whereas Juul’s recipe at least meets the legal requirements for disclosure as it seeks full FDA approval.

Juul doesn’t currently have data around the scale of infringing products on the market, but counterfeit Juul products may inaccurately increase sales figures, intensifying scrutiny from the FDA.

Juul has already taken legal action against many infringing manufacturers and distributors, but Punderson aims to take Juul’s efforts against infringing products to a new level.

He sees the issue as threefold: Juul Labs must work to stop these products from being manufactured in the first place, ensure they aren’t allowed across borders into the country, and take action against retailers who sell infringing products and remove them from the market.

“This isn’t a problem where there is only a production problem but there isn’t really a distribution or consumption problem,” said Punderson. “We don’t have the luxury of looking at the problem singly-faceted. From a global perspective, we want to stop the production and distribution of infringing products around the world, and we’ll work closely with government agencies attempting to stop illicit distribution of goods.”

Punderson previously served as Managing Director of IP Protection at PriceWaterhouse Coopers, VP of Global Anti-Counterfeiting/Anti-Diversion at Oakley, and worked at Apple on the Intellectual Property Enforcement team.

Juul is currently viewed by many as a Facebook-ified, 2018 version of Marlboro. Notably, Juul Labs recently closed a $12.8 billion investment from Altria Group, the makers of Marlboro cigarettes. When asked why he chose to work for Juul, Punderson said his initial reaction was no. But that after he did some research around the mission of the company, and thought of his own personal experience losing his father to emphysema, he came around quickly.

“I would do anything to get two or three more years with my dad, who was a lifelong smoker,” said Punderson. “[…] We’re trying to do good things here, move people away from tobacco and give them an alternative. To me, it’s a valuable, noble cause that’s worth being involved in and I’m proud to be here.”

It remains to be seen just how big of an issue infringing products are for Juul and other above-board e-cig makers, but Juul is ramping up its efforts to combat copycats from getting into the hands of consumers.

Twilio’s bid to become the go-to platform for all of a business’s external communication needs took a big step ahead today. The company said that it has closed its acquisition of email specialist SendGrid. First announced four months ago, Twilio today said the all-stock deal is valued at $3 billion — up from a $2 billion price tag when it was initially announced.

Specifically, this is because the prices of both company’s stocks have been on a roll. Based on the closing price of Twilio Class A common stock on Jan. 31, 2019 and an exchange ratio of 0.485 shares of Twilio Class A common stock per share of SendGrid common stock, Twilio said SendGrid stockholders received $53.99 of aggregate value per share of SendGrid common stock. (SendGrid has now ceased trading and has been removed from the NYSE, as it becomes a full subsidiary of Twilio led by its CEO Sameer Dholakia.)

The name of the game these days when it comes to communications with customers is omnichannel, and this acquisition aims to address that.

The deal brings together Twilio, a powerhouse in messaging and voice communications — by way of a set of APIs, Twilio allows developers of apps, web sites and other digitial properties easily to integrate custom phone numbers and to manage messaging communications with customers covering not just voice and SMS but also custom messaging channels like Facebook Messenger and WhatsApp, as well as video — with SendGrid, a company that has made similar innovations in email, which had been a gap in Twilio’s range of services.

Together the companies will be managing 140,000 active customer accounts covering some 600 billion interactions on an annualized basis.

“Effective customer engagement is a strategic imperative for every company. With SendGrid now a part of Twilio, our goal is to provide a complete platform for every form of customer engagement,” said Jeff Lawson, Twilio co-founder and CEO, in a statement. “Through our mutual developer-first approach, we empower the builders of the world to create magical customer experiences unique to every interaction.”

“Together, we serve more than 140,000 active customer accounts and power more than 600 billion annualized interactions each year. We have a shared vision, a shared model and shared values that will set us up for success,” said . “As we join forces today, I’m more confident than ever that we can accelerate our vision of creating one unquestioned platform of choice for developers and companies around the world and help them transform the way they engage with their customers,” added Dholakia in a statement.

The federal government yesterday published the final rule for changes to the H1-B visa program, which is one of the primary conduits for technical talent to come and work in the United States.

There are two key changes coming with the rule. First, the government will require applicants for an H1-B visa to electronically register with the immigration office for the H1-B lottery before they submit their applications or documentation.

Due to hard caps imposed by Congress on the number of workers who can be admitted under the program, tens of thousands of people apply for a visa who ultimately do not attain it. Under the current process, applicants must submit their entire applications including supporting documentation in order to apply for a lottery run by USCIS, the immigration authority.

Last year, roughly 190,000 applicants applied for 85,000 total slots. That means 105,000 people put together complete applications but lost out on the lottery.

Under the new rule that will be in force for this year’s H1-B process, applicants will first register with USCIS electronically, which will process the lottery. If selected in the lottery, an applicant would then be invited to submit their application and supporting materials. The idea is that you only have to do all the work of applying when there is an actual slot available.

The change is likely to cut into the revenue of immigration attorneys, who today prepare full applications for all applicants. A typical H1-B visa application retainer for an attorney today in Silicon Valley runs in the low thousands of dollars each, with companies picking up the tab. I am sure attorneys will still recommend doing some prep work, but the new rules should cut costs for employers.

The second change of the final rule has to do with how the lottery is conducted. Be very careful here, as the changes are somewhat subtle and there is a lot of malarkey being written across the internet about it.

Under the H1-B program, there are two pools of applicants: let’s call them the regular pool and the advanced degree holders pool. There is a cap of 65,000 for the regular pool, and 20,000 for the advanced degree pool, which is limited to applicants holding a master’s degree or better.

In today’s process, advanced degree applicants first go through the lottery of the advanced degree pool, and if they fail, they get added to the regular pool for the second lottery. In the new process just confirmed by USCIS, that process is inverted: the regular pool lottery will be run first with all applicants, and then the advanced degree pool will happen second with advanced degree applicants who failed in the first lottery.

What does that mean for applicants? Well, we have to do a bit of table napkin probability math to understand* (feel free to skip ahead if you just want the answer).

Using last year’s numbers there were 95,885 advanced degree applicants for 20,000 spots, so a roughly 20.85% chance of receiving a visa. That means 75,885 advanced degree applicants who lost out were then added to the regular pool of 94,213 applicants. That’s 170,098 applicants for 65,000 visas, or roughly a 38.21% chance of getting a visa. Across the two lotteries then, advanced degree holders statistically would have gotten 20,000 visas from the first lottery, and then 38.21% of 75,885 or 28,998 visas from the regular pool lottery. So an advanced degree holder had a 51.1% of getting an H1-B visa, compared to 38.21% for regular pool applicants.

That’s the old probabilities, so let’s see how reversing the sequence of lotteries change the probabilities. Now, 95,885 advanced degree holders join 94,213 regular applicants for 65,000 spots, for a success rate of 34.19%. That means 32,786 advanced degree holders will be successful in the regular pool. From there, the 63,099 advanced degree applicants who were not successful would get to go through the advanced degree lottery of 20,000 spots, a probability rate of 31.70%. Combined then, you have 20,000 + 32,786 = 52,786 successful advanced degree holders out of 95,885, for a combined statistical success rate of 55.05%.

Net-net, the changes in the lottery sequence mean that advanced degree holders would have been successful 55.05% of the time last year, compared with 51.1% under the previous system. For regular applicants, the success rate declines from 38.21% to 31.70%.

So to be accurate in language, I would say that USCIS is (from a statistical point of view) “placing an additional emphasis” on advanced degree holders. It’s a meaningful adjustment if you are applying of course, but ultimately nothing has changed since immigration priorities are written into the law and the executive branch doesn’t have much flexibility to change these systems.

(*One side note: that probability math is “rough” because the H1-B program has a variety of small preferences and set asides that make the probability math unique for each person. Citizens of Chile and Singapore get special treatment, and if you apply to work in Guam and a few other territories, you also have your own special process).

Talking about borders: Huawei and smartphone privacy

The U.S., like many countries around the world, doesn’t provide a lot of privacy rights at the border. The country can scan the electronic devices of any traveler, and save files and other data in those sweeps, and such tactics are increasingly common much to the chagrin of privacy advocates like the ACLU.

But there is a benefit of these sweeps when it comes to closing in on an international investigation. The U.S. Department of Justice charged Huawei’s CFO Meng Wanzhou with a variety of crimes including bank fraud and wire fraud this week in connection with Huawei’s alleged breach of U.S. sanctions on Iran.

From the indictment, some of the key evidence for the case comes from a sweep of Meng’s smartphone while she passed through JFK Airport, where border officials captured Huawei’s talking points about the Iran / Skycom situation. From the indictment, “When she entered the United States, MENG was carrying an electronic device that contained a file in unallocated space—indicating that the file may have been deleted […]”

As with debates over end-to-end encryption, there are complexities to the level of privacy that should be offered at national borders. While the general right to privacy should be protected, law enforcement should also have the tools it needs to stop crimes within a proper due process system.

Talking about borders: Brexit and manufacturing scale

I talked about manufacturing scale yesterday in the context of Foxconn’s multiple shutdowns of its factories in Wisconsin and Guangzhou this week. Apple isn’t the only one failing to find a screw these days — now the entirety of Britain’s industrial base is worried about finding components.

Bloomberg noted that British “Companies’ inventory holdings grew in January at the quickest rate in the 27-year history of IHS Markit’s survey, the group said in a report Friday.” Companies are stockpiling everything from screws and parts to medications as the risk of a no-deal Brexit increases after Parliament has repeatedly struck down plans for Britain’s withdrawal from the European Union.

Stockpile as much as you want, but China’s success over the past three decades since reform and opening up has been making its borders, customs, and ports some of the most efficient in the world. If Britain wants to compete, it needs to do the same.

TechCrunch is experimenting with new content forms. This is a rough draft of something new – provide your feedback directly to the author (Danny at danny@techcrunch.com) if you like or hate something here.

Share your feedback on your startup’s attorney

My colleague Eric Eldon and I are reaching out to startup founders and execs about their experiences with their attorneys. Our goal is to identify the leading lights of the industry and help spark discussions around best practices. If you have an attorney you thought did a fantastic job for your startup, let us know using this short Google Forms survey and also spread the word. We will share the results and more in the coming weeks.

What’s Next

• More work on societal resilience
• I’m reading a Korean novel called The Human Jungle by Cho Chongnae that places a multi-national cast of characters in China’s economy. It’s been a great read a quarter of the way in.

This newsletter is written with the assistance of Arman Tabatabai from New York

Just in time to ride the last of the pre-Super Bowl buzz, Carbon today announced that it’s teaming up with sports equipment giant Riddell to 3D print customized football helmet padding.

Referred to as “Diamond technology,” the collaboration creates lattice design pads of resin that are custom built to a player’s dimensions and position. Carbon says the pads were created by analyzing data from more than five million on-field collisions collected by Riddell smart helmets.

“We scan heads, and then you’ve got the shell of the helmet,” Carbon co-founder and CEO Joseph DeSimone told TechCrunch. “The gap between the head and the shell is now customized. That space is now custom to everybody, and we fill that space with a lattice that controls the impact of the sport. It allows you to get really great performance as you control the impact that the players see.”

The technology arrives as the health impacts of football are receiving stronger scrutiny. The repetitive nature of football hits has been tied to a number of unfortunate side effects, including, notably, CTE. A recent study found that the dementia-causing condition was found in 110 out of 111 brains of autopsied football players. 

“As someone who’s spent thousands of hours watching film, I know that no two players play the same way,” quarterback and Riddell spokesperson Peyton Manning said in a release tied to the news. “They all have different styles and tendencies on the field, which is another key benefit to Riddell’s Diamond technology. With the SpeedFlex Precision Diamond, players are not only experiencing the latest in head protection, they can also dictate where the helmet is positioned to improve sight lines and maximize field vision.”

The customized helmets will be made available for pro and college level athletes later this year. They’ll be printed using the L1, a newly announced printer designed for manufacturing that brings the company’s Digital Light Synthesis technology to a larger scale. The L1 has 10 times the build area as its predecessor, the M1 and five times the M2 (that’s “M” for “Medium” and “L” for “Large, by the way).

The advent of the new printer could go a ways toward helping Carbon realize its goal of bringing this technology to a manufacturing-level scale. Of course, the company’s already got a decent head start on that front, having produced 100,000 pairs of mid-soles through its ongoing partnership with Adidas.

I know first-hand how frustrating it is to get locked out of your Google account and to lose access to much of your online life. I’m hoping this simple work-around will help get you get through the account recovery process much faster than the manual method, which takes a minimum of 3-5 days (and in my case ended up taking weeks).

This week, a colleague who remembered my article on my lock-out experience, asked me for advice after she was locked out of her account. And a solution occurred to me, one that I had actually discovered last year, but had never put to use myself. It worked for her, and I hope it works for you too. It’s actually pretty simple.

If you have paid storage on Google, follow these steps:

1. Go to Google One.
2. Click the Call button at the top of the screen.
3. Tell the person who answers that you’re locked out. They should be able to you.

If you don’t have a Google One account, follow these steps:

1. Go to Google One.
2. Choose a monthly storage option. You can get started with a 100 gigs of storage for just $1.99 a month.
3. After you set up your storage, click the Call button and tell them you’re locked out.

While I can’t absolutely guarantee this will help you get your Google account back in short order, I can tell you it worked flawlessly for my colleague and she got back into hers shortly after opening a Google One account. While some may object to paying, if you can afford to spend $23.88 a year for 100 gigs of storage and access to human tech support (for this or any problem you have), it could be well worth it if it solves your issue quickly and gives you overall peace of mind.

Three days after Apple pulled its new Group FaceTime feature offline after users found they could eavesdrop on people before accepting a call, the company says it’s fixed the bug on its end.

“We have fixed the Group FaceTime security bug on Apple’s servers and we will issue a software update to re-enable the feature for users next week,” said Apple in a statement. “We sincerely apologize to our customers who were affected and all who were concerned about this security issue. We appreciate everyone’s patience as we complete this process.”

The bug allowed anyone to swipe up and add themselves to a Group FaceTime call, a new group video feature that Apple introduced last year. TechCrunch verified the bug after it began making the rounds on social media.

To prevent misuse, Apple pulled the plug on Group FaceTime on its servers.

Apple continued: “We want to assure our customers that as soon as our engineering team became aware of the details necessary to reproduce the bug, they quickly disabled Group FaceTime and began work on the fix.”

But the privacy issue came after reports that a 14-year-old from Arizona and his mother tried to report the bug to Apple days before to no avail, citing difficulties in contacting the company.

In Friday’s statement, Apple thanked the Thompson family for reporting the bug,

“We are committed to improving the process by which we receive and escalate these reports, in order to get them to the right people as fast as possible. We take the security of our products extremely seriously and we are committed to continuing to earn the trust Apple customers place in us,” the statement added.

New York’s attorney general Letitia James and governor Andrew Cuomo said they would investigate the incident.