Daily Tech Snippet: Wednesday, August 31

• EU hits Apple with $14.5 billion Irish tax demand: The European Commission ordered Apple Inc to pay Ireland unpaid taxes of up to 13 billion euros ($14.5 billion) on Tuesday as it ruled the firm had received illegal state aid. Apple and Dublin said the U.S. company's tax treatment was in line with Irish and European Union law and they would appeal the ruling, which is part of a drive against what the EU says are sweetheart tax deals that usually smaller states in the bloc offer multinational companies to lure jobs and investment. Analysts said the size of the claim underlined the Commission's aggressive stance, but since each case involves different circumstances and tax rules, lawyers said it was hard to see if further big claims were any more or less likely. Apple, which had more than $200 billion in cash and readily marketable securities at the end of June, is likely to see the case drag out for years in EU and possibly Irish courts. Apple warned investors in a July regulatory filing that the Commission's investigation could lead to "material" liability for further tax payments, but that it could not estimate the impact. On Tuesday the company said it expects to place "some amount of cash" in an escrow account. Tax experts say the European Commission faces a tough battle to convince courts to back up its stand. While the EU has found that certain tax regulations are anti-competitive, it has never before ruled whether countries have applied tax regulations fairly in the way it has with Apple, Starbucks and others. As a result, some lawyers and accountants said they doubted Apple would end up paying back any tax.

• Twitter is finally paying its best users to create videos: Twitter wants the kind of video creators YouTube has — and the massive audiences that come with them. To make this dream a reality, the company is pulling a page from YouTube’s playbook: It’s going to sell ads alongside creator videos and share that ad revenue with the people making the content. And Twitter is offering very appealing terms. Unlike YouTube, which gives 55 percent of the money to creators and keeps 45 percent, Twitter is using the same revenue split it already offers other Amplify video partners, like the NFL: 70 percent to the content creator and 30 percent back to Twitter, according to a person familiar with the arrangement. Of course, Twitter needs to offer an appealing revenue split like this. It’s nowhere close to the video destination YouTube and even Facebook have become, and it’s late to the game when it comes to paying creators. The network’s high-profile stars have wanted a revenue split for some time — it’s been a point of contention for the company’s stable of “Vine stars,” many of whom have left for places like YouTube where their videos actually make money.

• A few dozen Nest Labs employees just headed to Google; here’s why: Nest Labs, the maker of smart thermostats and smoke detectors, is parting ways with a few dozen employees who work on its Internet of Things platform. According to a Fortunereport that we’ve independently confirmed, those employees are joining Google per a restructuring. Both companies are subsidiaries of parent company Alphabet. The move would seem to make sense. Like Nest, Google has delved into the business of the connected home, including with its OnHub wireless router and Google Home, a portable speaker that’s powered by voice assistance technology and will take direct aim at Amazon’s popular Echo product once it ships later this year. Nest’s thermometers and cameras promise to communicate with Google Home. Nest employs roughly 1,000 people, including in engineering, product marketing and product management. Though its platform team was responsible for building out Nest’s APIs (so Nest products can communicate with other devices), as well as Nest’s Weave protocol (which allows Nest devices to communicate with each other), Nest will continue to build and develop software around its app, site and other services.

Daily Tech Snippet: Tuesday, August 30

• Alphabet’s Legal Chief Steps Down From Uber Board: David Drummond, the chief legal officer at Alphabet Inc., has stepped down from Uber Technologies Inc.’s board of directors as the two companies move further into each other’s territories. Drummond joined the board in 2013 when GV, the venture capital arm of Alphabet formerly known as Google Ventures, led a $258 million round of financing for Uber. It remains GV’s largest investment, and the two companies worked together on projects, including the ability to call a car through Google Maps. However, relations between Alphabet’s Google unit and Uber have become strained in recent years. Bloomberg reported last year that Google had been working on a ride-hailing service using self-driving cars. Uber acquired Otto, an autonomous driving startup staffed by former Google employees, and is working with Volvo on driverless vehicles of its own, which the companies expect to begin rolling out in Pittsburgh this month. Uber has been developing its own mapping operation and is shooting street photography to create an alternative to Google’s map data. 

• EU to hand Apple Irish tax bill of $1.1 billion, source says: The European Commission will rule against Ireland's tax dealings with Apple (AAPL.O) on Tuesday, two source familiar with the decision told Reuters, one of whom said Dublin would be told to recoup over 1 billion euros in back taxes. The European Commission accused Ireland in 2014 of dodging international tax rules by letting Apple shelter profits worth tens of billions of dollars from tax collectors in return for maintaining jobs. Apple and Ireland rejected the accusation; both have said they will appeal any adverse ruling. The source said the Commission will recommend a figure in back taxes that it expects to be collected, but it will be up to Irish authorities to calculate exactly what is owed. A bill in excess of 1 billion euros ($1.12 billion) would be far more than the 30 million euros each the European Commission previously ordered Dutch authorities to recover from U.S. coffee chain Starbucks (SBUX.O) and Luxembourg from Fiat Chrysler (FCHA.MI) for their tax deals. Apple employs 5,500 workers, or about a quarter of its European-based staff in the Irish city of Cork, where it is the largest private sector employer. It has said it paid Ireland's 12.5 percent rate on all the income that it generates in the country. Ireland's low corporate tax rate has been a cornerstone of economic policy for 20 years, drawing investors from major multinational companies whose staff account for almost one in 10 workers in Ireland. Some opposition Irish lawmakers have urged Dublin to collect whatever tax the Commission orders it to. But the main opposition party Fianna Fail, whose support the minority administration relies on to pass laws, said it would support an appeal based on the reassurances it had been given by the government to date.

• You earn a million dollars a year and can’t get funded? If you’re in the position of struggling to raise funds, here are some reasons why your pitch may not be resonating. You paid $1.2 million to make $1 million: The most common case of seemingly successful businesses struggling to raise funding is when they are paying $1.2 million to generate $1 million. Or, it’s not clear how you’ll turn $1 million into $10 million: We seriously don’t expect every company to be a billion-dollar business. Our model works with $50 million and $100 million exits, but if you’re going to raise venture capital, youshould also be able to explain how you’ll achieve step-function growth — convincingly. A hockey-stick growth path to a billion dollar valuation isn’t required; it can be as simple as taking revenue from $1 million to $10 million. So… If you’ve built a million-dollar business and are struggling to convince VCs, we’d love to talk to you! Just know that when you’re pitching investors, not all revenue is valued equally, and it’s just one factor among many that investors will use to evaluate your business. Bryce Roberts put it well when he tweeted “Not all good businesses are good investments. Not all good investments are good businesses.” Your favorite neighborhood restaurant might generate a million dollars a year in revenue, but it would be a bad bet for VCs. Facebook lost money for years before going on to dominate global communication. If youdecide you want to play the VC game, just be sure to learn how the score is tallied.

Daily Tech Snippet: Monday, August 29

• China’s Murky World Where E-Commerce Meets Student Lending: Across college campuses in China, a small army of marketers is recruiting students to borrow money at interest rates many times that charged by the nation’s banks. Those without a credit history or parental approval can borrow money to buy a smartphone, pay for holidays, or get the latest sneakers through a raft of apps such as Fenqile. The market leader, whose name literally means Happy Installment Payments, has 50,000 part-time marketers across more than 3,000 universities and proudly touts the slogan “Wait no more; love what I love.” Welcome to the regulatory gray area where peer-to-peer lending meets e-commerce in China. In the last three years, tens of millions of students have taken out micro-loans with the tap of a button to buy things. Once just the realm of startups, the sector has attracted heavy hitters in China’s online industry, including Alibaba Group Holding Ltd.’s finance affiliate and JD.com Inc., which are pouring hundreds of millions of dollars into the lending model. In a nation with 37 million college students, the market is expected to reach $15 billion, according to the Beijing-based market research firm Analysys. The apps sell everything from cameras to concert tickets sourced from third-parties, charging students annualized interest rates typically above 10 percent. The loans are then packaged and sold to wealthy individuals, who find the expected return of as much as 10 percent much more attractive than the central bank’s benchmark savings rate of 1.75 percent.

• How long before Amazon forces its Indian rivals into a merger or sale? Three years into Amazon’s aggressive push in India, the country’s two home-grown e-commerce competitors are feeling the pressure. Both Flipkart and Snapdeal have raised more than a billion dollars, but have historically recorded big losses as they’ve engaged in discounting battles with each other and with Amazon. Amazon has made it clear it is willing to spend big to become the No. 1 e-commerce player in the country after failing to make a dent in another huge international market, China. Now, it seems like every week there’s a new rumor of the two homegrown players considering a merger or sale. Alibaba, which owns a stake in Snapdeal and another Indian player, Paytm, is often in the conversation. In any potential talks, however, Flipkart and Snapdeal’s frothy valuations could be a problem. Flipkart was valued last year at $15 billion while Snapdeal most recently secured a $6.5 billion valuation.

Daily Tech Snippet: Friday, August 26

• Four years and $22 billion later, WhatsApp has decided ads aren’t awful, after all: First rule about being bought by an advertising company: You’re probably going to end up selling advertising.  WhatsApp to share user data with Facebook for ad targeting. Facebook-owned messaging giant WhatsApp has announced a big change to its privacy policy which, once a user accepts its new T&Cs, will see it start to share some user data with its parent company — including for ad-targeting purposes on the latter service. “[B]y coordinating more with Facebook, we’ll be able to do things like track basic metrics about how often people use our services and better fight spam on WhatsApp,” WhatsApp writes in a blog on the change today. “Facebook can offer better friend suggestions and show you more relevant ads if you have an account with them. For example, you might see an ad from a company you already work with, rather than one from someone you’ve never heard of.” WhatsApp will also be sharing the data with the “Facebook family of companies” — so presumably its user data could also be fed to VR firm Oculus Rift, another Fb acquisition, and photo-sharing network Instagram. WhatsApp data that will be shared under the new T&Cs includes the phone number a user used to verify their account, and the last time they used the service. Two pieces of data which — on a creepiness scale of ‘personal intel you’d rather not hand over to a data-mining tech giant’ — are both right up there.

• Google Fiber is pulling back on its broadband rollout as pressure grows to cut costs: For the past year, Ruth Porat, the CFO of Google and its parent Alphabet, has told Wall Street that Google Fiber is her most expensive unit outside of the core business — and is well worth the costs. Her bosses may be telling Fiber employees the opposite. According to a report in The Information, Alphabet chiefs Larry Page and Sergey Brin recently instructed Fiber to severely trim staff and expenses, frustrated with mounting costs of delivering high-speed internet by digging up dirt. Creating broadband networks via traditional pipes is enormously expensive. And Fiber still hasn’t proven that it has figured out a better way to do it. The Information story comes on the heels of reports that Fiber has put plans to build broadband networks on hold in two cities as it ponders ways to roll out experimental wireless tech. Fiber, like the “Other Bets” businesses outside of Google, is facing ongoing scrutiny about its operations. Here are the key parts of The Information’s report. The unit initially shot for five million broadband subscribers in its first years, but has fallen short of that. Last month, Page told Craig Barratt, the CEO of Fiber (or Access, as it’s known), to halve his staff down to 500. Porat, who has developed a reputation as a cost cutter, interceded on Fiber’s behalf, arguing to Page that Fiber’s business model is defensible. Barratt considered leaving earlier in the year, reportedly irked by the changes at Alphabet. If he did, he would not be the first “Other Bets” exec to do so.

• Uber Loses at Least $1.2 Billion in First Half of 2016: The ride-hailing giant Uber Technologies Inc. is not a public company, but every three months, dozens of shareholders get on a conference call to hear the latest details on its business performance from its head of finance, Gautam Gupta. On Friday, Gupta told investors that Uber's losses mounted in the second quarter. Even in the U.S., where Uber had turned a profit during its first quarter, the company was once again losing money. In the first quarter of this year, Uber lost about $520 million before interest, taxes, depreciation and amortization, according to people familiar with the matter. In the second quarter the losses significantly exceeded $750 million, including a roughly $100 million shortfall in the U.S., those people said. That means Uber's losses in the first half of 2016 totaled at least $1.27 billion. Subsidies for Uber's drivers are responsible for the majority of the company's losses globally, Gupta told investors, according to people familiar with the matter. "You won't find too many technology companies that could lose this much money, this quickly," said Aswath Damodaran, a business professor at New York University who has written skeptically of Uber's astronomical valuation on his blog. "For a private business to raise as much capital as Uber has been able to is unprecedented." Bookings grew tremendously from the first quarter of this year to the second, from above $3.8 billion to more than $5 billion. Net revenue, under generally accepted accounting principles, grew about 18 percent, from about $960 million in the first quarter to about $1.1 billion in the second. Uber also told investors during the call that it was changing how it calculates UberPool's contribution to revenue in the second quarter, which had the effect of increasing revenue. Uber's losses and revenue have generally grown in lockstep as the company's global ambitions have expanded. Uber has lost money quarter after quarter. In 2015, Uber lost at least $2 billion before interest, taxes, depreciation and amortization. Uber, which is seven years old, has lost at least $4 billion in the history of the company.

• First driverless taxi hits the streets of Singapore: The first driverless taxi began work on Thursday in a limited public trial on the streets of Singapore. Developer nuTonomy invited a select group of people to download their app and ride for free in its "robo-taxi" in a western Singapore hi-tech business district, hoping to get feedback ahead of a planned full launch of the service in 2018.The trial rides took place in a Mitsubishi i-MiEv electric vehicle, with an engineer sitting behind the steering wheel to monitor the system and take control if necessary. The trial is on an on-going basis, nuTonomy said, and follows private testing that began in April. Parker, whose company has partnered with the Singapore government on the project, said he hoped to have 100 taxis working commercially in the Southeast Asian citystate by 2018.

Daily Tech Snippet: Thursday, August 25

• Most Americans streamed the Olympics from PCs, not mobile devices. Mobile devices, such as smartphones and tablets, accounted for almost 20 percent of the evening's Olympics stream. An additional 17 percent went to set-top boxes, such as Apple TV and Amazon Fire TV. Of these, Roku boxes were the overwhelming favorite among Olympics viewers, eating up a 10 percent share. In the end, however, PCs took the prize, accounting for more than 60 percent of consumption.  Why is this so interesting? Well, much of the narrative surrounding entertainment and technology these days has to do with mobile devices becoming a more dominant platform. Sandvine's data show that iPhones, Android devices and iPads account for almost one-third of general Internet consumption, much higher than what we see from the chart above. Analysts say this discrepancy highlights the particular way in which Americans could access their Olympics coverage online. To watch the Internet live stream, viewers needed to log in through their cable subscription. The downside to this meant being chained to a cable provider, but the upside was that once you authenticated you could watch from any device — mobile or otherwise. Although much of our media consumption is increasingly shifting toward mobile devices, live-stream events such as the Olympics may be one area where PCs could remain dominant for some time.

• HP Inc. Forecasts Earnings That Fall Short of Estimates: HP Inc., which sells personal computers and printers, forecast fiscal fourth-quarter profit that may fall short of analysts’ estimates, hurt by slumping demand for its products. The shares fell as much as 5.8 percent in extended trading after the announcement. Sales fell 3.8 percent to $11.9 billion, compared with estimates of $11.5 billion. Sales of personal systems, which includes the computer lines, of $7.5 billion was unchanged from a year earlier. That compares with a decline of 10 percent in the second quarter. Commercial sales fell 3 percent while the consumer business climbed 8 percent in the personal systems unit. Printing revenue declined 14 percent to $4.4 billion, compared with a decline of 16 percent in the previous quarter. Consumer printing sales fared worse than the commercial business.

• Ford leads $24M investment in India-based vehicle rental company Zoomcar: Hot on the heels of a deal with a self-driving sensor technology startup, the automotive giant has backed Zoomcar, a Zipcar-like company that operates in India. Subsidiary Ford Smart Mobility led a $24 million Series B round, with participation from returning investors Sequoia Capital, Nokia Growth Partners (NGP) and Empire Angels. The company’s valuation was not disclosed. Four-year-old Zoomcar closed an $11 million Series B round last summer following an $8 million raise in late 2014. This new round — which had been reported in Indian press as early as July — takes it to over $46 million in VC money to date. Zoomcar is a car rental service based on successful Western models like Zipcar, which wasbought by Avis for $500 million three years ago. The startup is based in Bangalore and it currently claims to offer 2,000 cars around seven of India’s tier-one cities, with 75 percent occupancy and 1.5 million app downloads. Ford was Zoomcar’s first OEM partner, and the startup said Ford provides “most” of the vehicles on its platform.

Daily Tech Snippet: Wednesday, August 24

• Tesla’s new 100 kWH battery makes it the third-fastest accelerating car ever: Tesla’s Model S and Model X vehicles just got faster. On a call with journalists today, Elon Musk unveiled a larger battery pack — 100 kWH — that enables the Model S to accelerate from 0 to 60 mph in 2.5 seconds in what the company calls “ludicrous” mode. That makes the Model S the third-fastest production car ever made, after the Ferrari LaFerrari and the Porsche 918 Spyder, but it’s the quickest pure electric vehicle that has the capacity to seat up to five adults and two children, according to the company. In an industry first, the battery also enables the car to drive an estimated 315 miles on a single charge. This is the first electric vehicle to go above a range of 300 miles, according to Tesla. The Model S P100D will start at $135,000 — compared to a $125,000 MSRP for the Model S P90D equipped with ludicrous mode — and the Model X P100D will start at $135,500. The Model X P90D started at $115,500.

• Narrative Science can now describe your Tableau charts for you: Tableau Software‘s shares soared 13 percent on Tuesday following the announcement that the data analytics provider has partnered with Narrative Science, a Chicago-based company that develops natural language generation (NLG) tools. The result of the partnership is Narratives for Tableau, a free Chrome extension that automatically creates written explanations for Tableau graphics. Let’s say, for example, that you have a chart — made with Tableau — of sales and profits of your business for a certain amount of time. The extension, which works with Tableau Server 10.0 or the free Tableau Public service, will generate a narrative description of the data by writing sentences such as “Sales and profit ratio moved in opposite directions from January 2011 to December 2014,” as shown in this example. Narrative Science is best known for Quill, a platform that can take data — say, sports scores — and turn them into stories. Narratives for Tableau is one example of applying Quill’s capabilities, Frankel pointed out. Once Narratives for Tableau has generated the text, users can customize it by choosing a paragraph- or bullet point-style for the description, among other things. If users are not satisfied with the results, they can also make changes to the text.

• Pinterest Acquires Instapaper to Get Smarter About Articles: Pinterest Inc. is buying Instapaper, the app that lets you save an article to read later, as it works to understand the technology behind recommending stories for people. The acquisition of Instapaper, which has expertise in saving, curating and analyzing articles, aligns with Pinterest's goal to provide content that fits users' interests, the company said in a statement. Pinterest declined to comment on a price for the deal. Instapaper, started in 2008 by Tumblr co-founder Marco Arment, is known for helping people save longer-form stories they don't have time to read. Pinterest said people use its application to save articles, though they often tend to be image-based how-to stories about recipes or from inspirational do-it-yourself blogs. Instapaper's technology could help improve Pinterest's ability to match content with its users' interests.

• One Kings Lane sold for less than $30 million after being valued at $900 million: One Kings Lane, an online home-furnishings retailer, fetched less than $30 million in its recent sale to Bed Bath & Beyond, according to three people familiar with the deal. The purchase price marks a massive discount from a valuation of $900 million that the startup had secured when it raised more than $100 million from investors in early 2014. In the wake of Dollar Shave Club’s $1 billion sale to Unilever and Walmart’s impending $3.3 billion acquisition of Jet, the One Kings Lane outcome is a reminder of how brutal the e-commerce industry can be for many startups.

Daily Tech Snippet: Tuesday, August 23

• Former Flipkart CEO’s Employee Clash Shows Indian Startup Trauma..: India’s largest online shopping service is heating up, and not in a good way. Flipkart’s regular Friday townhall grew tense after employees incensed by hundreds of job cuts openly accused management of betrayal. Taken aback, chairman Sachin Bansal countered that the departures stemmed from poor performance and he lost his job as chief executive for the same reason. The co-founder admitted the company had missed financial targets in recent months, prompting an overhaul of its top rungs, according to employees who attended the meeting. He didn’t elaborate but recent moves -- including a brief decision to go mobile app-only after ditching its fashion site -- may have granted an opening to a hard-charging Amazon.com Inc. Bansal’s unusual candor, which drew applause, underscores the plight of the country’s technology sector as competition intensifies and funding begins to dry up.

• ..Even as analysts opine that Amazon overtook Flipkart in India July e-commerce sales: Barely three years after launching in India, Amazon (Amazon Seller Services Pvt. Ltd) likely exceeded Flipkart in terms of gross sales in July. Flipkart reported gross sales or gross merchandise value (GMV) of less than Rs.2,000 crore in July, while Amazon’s gross sales crept up above Rs.2,000 crore, according to five people familiar with the companies’ numbers. Another local online marketplace Snapdeal (Jasper Infotech Pvt. Ltd) reported gross sales numbers of roughly Rs.600 crore, a fall of more than 50% from the sales it had been generating until the end of last year, said two other people, familiar with the company’s numbers. Gross sales refer to the value of goods sold on a site, and not net revenue. (Flipkart, Snapdeal and Amazon are structured as marketplaces because of regulations; their net revenue comprises the commissions they charge their third-party sellers on every transaction and fees for services) To be sure, the numbers are only for the month of July and the market share battle between Flipkart and Amazon is far from over. Flipkart’s numbers also exclude revenue at Myntra and Jabong, the two large fashion retailers it owns. Snapdeal’s numbers exclude sales at FreeCharge, its payments arm. Including Myntra and Jabong revenues, Flipkart is still comfortably ahead of Amazon. Yet, the numbers confirm reports in Mint and other publications since the start of the year that Flipkart and Amazon are running neck-and-neck in the e-commerce market share battle and the latter is close to overtaking it. This is the first time the exact picture has emerged.

• Chinese investors buy ad tech startup Media.net for $900 million: Advertising technology startup Media.net, founded by tech entrepreneur Divyank Turakhia, said on Monday it had been acquired for about $900 million by a group of Chinese investors. The deal would represent the third-largest in the ad tech industry, after Google's acquisition of DoubleClick and Microsoft Corp's for aQuantive. More here: Ad-tech firm Media.net Sells to China Group for $900 Million: The startup, which powers contextual ads offered by Yahoo! and Microsoft’s Bing, plans a move akin to a reverse merger that would make it a public company in China.Media.net, which is based in Dubai and New York, is touting this as the third-largest ad-tech acquisition in history. However, the complex deal more closely resembles a reverse merger, where a private company takes over a public one and bypasses the formalities of an initial public offering. Technology entrepreneur Divyank Turakhia started Media.net in 2010 and bootstrapped the business. The company provides the technology powering contextual ads offered by Yahoo! Inc. and Microsoft Corp.’s Bing search engine. The system is similar to one offered by Google, choosing which ads to show based on the content of the web page they appear on. The deal comes as merger activity involving ad-tech companies is declining. There were 43 deals during the first half of the year, according to research firm PitchBook Data. That’s a 45 percent decline from the same period last year. Media.net generated $232 million in revenue last year, more than half of which came from mobile visitors, Turakhia said. The U.S. accounts for 90 percent of Media.net’s revenue, but the company is hoping to make a big push into China after the deal, he said. 

• Amazon wants to sell a cheaper music subscription service that will only work on its Echo player: Spotify, Apple Music and everyone else cost $10 a month. Amazon wants to charge half of that. Amazon wants to launch a music subscription service that would work the same way services from Apple, Spotify and many others work: $10 a month, for all the music you can stream, anywhere you want to stream it.  But Amazon is also working on a second service that would differ in two significant ways from industry rivals: It would cost half the price, and it would only work on Amazon’s Echo hardware. Industry sources say Amazon would like to launch both services in September, but has yet to finalize deals with major music labels and publishers. One sticking point, sources say, is whether Amazon will sell the cheaper service for $4 or $5 a month.

Daily Tech Snippet: Monday, August 22

• Lyft Is Said to Seek a Buyer, Without Success: It is not an easy thing to be an independent ride-hailing company these days. For one, it takes billions of dollars and hundreds of employees to spread to new cities, to market the service and to recruit drivers. Legislators and local laws are often not in your favor. And competitors with deep pockets from all over the world are waiting to cheer if you happen to fail. Lyft, the second-biggest ride-hailing company in the United States behind Uber, is grappling with those forces — but has found that its options are limited. The company, which is based in San Francisco, has in recent months held talks or made approaches to sell itself to companies including General Motors, Apple, Google, Amazon, Uber and Didi Chuxing, according to a dozen people who spoke on the condition of anonymity because the discussions were private. Lyft’s discussions were most serious with G.M., which is one of the ride-hailing company’s largest investors. Still, G.M. never made a written offer to buy Lyft, said the people, and in the end, Lyft did not find a buyer. Lyft is not in danger of closing down and has a cash cushion of $1.4 billion, some of these people added, so the company will continue as an independent entity. Still, the talks underline how difficult it has become to operate in the ride-hailing market, where people can book rides from drivers through a smartphone app. While ride-hailing companies do not own fleets of cars and instead rely on drivers who have their own vehicles, the business is highly capital-intensive. Venture capitalists and other investors have poured billions of dollars into the companies.

• Uber Tells Investors It Wouldn’t Pay Above $2 Billion for Lyft: As Lyft Inc. was gauging interest from prospective acquirers, executives from Uber Technologies Inc. told investors in the past few weeks that the company wouldn't pay more than $2 billion to purchase its main U.S. ride-hailing competitor, said people familiar with the matter. Uber didn't make a formal offer, said the people, who asked not to be named because the discussions were private. Uber had previously considered purchasing Lyft as far back as 2014, and the two San Francisco companies have discussed the prospect informally, one of the people said. Despite executives floating the $2 billion price tag, Uber Chief Executive Officer Travis Kalanick has said privately that he would not support such a deal because he believes it would face intense regulatory scrutiny, the person said. Regardless, Lyft wouldn't consider $2 billion to be a credible offer, said another person familiar with the matter. Recode reported on Friday that Lyft sought as much as $9 billion but failed to secure serious interest. As fierce rivals, Uber has every incentive to downplay Lyft's value to investors and has done so in the past. Lyft and Uber declined to comment.

• Hampton Creek, Maker of Just Mayo, Is Said to Be Under Inquiry: Hampton Creek, a prominent start-up that is trying to bring tech industry panache to the world of mayonnaise, ranch dressing and other food products, has come under scrutiny by regulators for its business practices. The Securities and Exchange Commission has opened a preliminary inquiry into Hampton Creek, according to a person briefed on the situation who asked not to be named because it had not been announced publicly. The S.E.C. inquiry is a response to a recent report from Bloomberg News that described an organized effort by Hampton Creek to buy large quantities of its Just Mayo product — a mayonnaise that uses a plant-based ingredient instead of eggs — by sending undercover contractors into stores.Bloomberg’s report said the product buyback effort, which took place in 2014, made Just Mayo seem more popular than it was, not long before Hampton Creek raised $90 million from venture capitalists and other private investors. The basic details of the program were confirmed by a former Hampton Creek employee, who asked for anonymity because of confidentiality restrictions with his onetime employer. The inquiry may be only the start of tougher questions facing Hampton Creek. The company is believed to be losing significant amounts of money. It is raising up to $220 million from investors, according to a Delaware filing provided by Equidate, which tracks private company shares. It’s not uncommon, of course, for start-ups to bleed red ink in their early days. But Hampton Creek, founded in 2011, faces some basic challenges with the manufacturing costs for its products. According to one former employee, in 2014 the company had negative gross margins of about 20 percent on Just Mayo, meaning that the raw cost to the company for every $1 it got in sales was about $1.20. The issue arises from Hampton Creek’s use of premium ingredients in its products without charging shoppers the often eye-popping prices attached to such food products. The vegetable oil used in Just Mayo, for example, does not come from genetically modified organism sources, which adds significant cost, according to the former employee. But on Walmart.com on Friday, a 30-ounce jar of Just Mayo was selling for $3.66 — 32 cents less than a jar of Hellmann’s mayonnaise of the same size.

Daily Tech Snippet: Friday, August 19, 2016

• Uber Aims for an Edge in the Race for a Self-Driving Future: On Thursday, Uber said that it would begin testing self-driving cars in Pittsburgh in a matter of weeks, allowing people in the city to hail modified versions of Volvo sport utility vehicles to get around the city. Uber also said it had acquired Otto, a 90-person start-up including former Google and Carnegie Mellon engineers that is focused on developing self-driving truck technology to upend the shipping industry. Those moves are the most recent indications of Uber’s ambitions for autonomous vehicles that can provide services to both consumers and businesses. And they come after Ford Motor’s announcement this week that it would put fleets of self-driving taxis onto American roads in five years. As part of that effort, Ford said it had acquired an Israeli start-up, Saips, that specializes in computer vision, a crucial technology for self-driving cars. Ford also announced investments in three other companies involved in major technologies for driverless vehicles. Suddenly, it seems, both Silicon Valley and Detroit are doubling down on their bets for autonomous vehicles. And in what could emerge as a self-driving-car arms race, the players are investing in, or partnering with, or buying outright the specialty companies most focused on the requisite hardware, software and artificial intelligence capabilities.

• When Google quietly began working on cars that drive themselves, über was just a German word. Now, nine years later, Uber the ride-hailing company looks set to get regular people inside autonomous vehicles first — a move that’s critical for Uber, and dispiriting for the audacious project hatched inside of Google. Uber said on Thursday that, along with Volvo, it will test a fleet of on-demand autonomous cars in Pittsburgh later this month. An Uber driver will still be in the car. But, more importantly, so will a customer. That’s something that Google has yet to do. When the search giant first unfurled its self-driving plans, it was the only company tackling the advanced tech. Not anymore: All the major car companies have joined the fray — and shown a willingness to cut big checks for the tech behind it. Google is well ahead on the technical challenges of driverless vehicles, according to most in the industry. But those same people, in recent months, have begun asking why, nearly a decade after hiring top roboticists to build its project, Google has not delivered something to market. There are a number of reasons why Google has been a laggard to new rivals in the field. One is its devotion to going fully driverless, a far more difficult feat. That’s partially because, unlike the car companies and Uber, the Google self-driving cars don’t need an immediate revenue stream. They have search ads to bankroll them. Yet other forces may be holding back Google’s cars — like internal dynamics at the project, now within the X subsidiary under Google parent Alphabet. Alphabet has kept its revenue strategy for the unit under wraps. Some sources say that is because they have not settled on one yet. “They went back and forth all the time,” said one person who recently left X. Still, frustration with the inertia of Google’s self-driving car looks to be hitting its own ranks. Chris Urmson, the CTO and former director of the car unit, recently departed, along with two early engineers. Earlier this year, several members of the project, including co-founder Anthony Levandowski, decamped to form Otto, an autonomous trucking startup. With its announcement this morning, Uber also said it had acquired Otto.

• Applied Materials forecast beats on chip, display demand: Applied Materials Inc forecast current-quarter revenue and profit far above analysts' estimates as the company benefits from demand for newer technology to make displays and smartphone memory chips. Shares of the world's largest supplier of tools used to make semiconductors rose 5.7 percent to $29.25 in after-hours trading on Thursday. If the current gains hold, the stock is set to open at a 15-year high on Friday. The rising popularity of mobile devices has fueled demand and investments in 3D NAND memory chips, which can store data without using up power. Applied Materials is considered an bellwether and its results are seen as an indicator for the overall chip industry. The company has also gained from growing demand for displays using organic light-emitting diode (OLED) technology, where its products help manufacture displays used in televisions, phones and computer screens. Orders in the business surged 153 percent to $803 million in the latest quarter. Applied Materials' net sales rose 13.3 percent to $2.82 billion in the third quarter. The company's net income rose to $505 million, or 46 cents per share, from $329 million, or 27 cents per share, a year earlier.Up to Thursday's close, the company's stock had gained about 48 percent this year.

Daily Tech Snippet: Thursday, August 18

• Pinterest Follows Rivals Into Selling Video Ads: Pinterest is finally taking the plunge that many other tech companies already have: It has started selling video advertising. Video ads from brands like Kate Spade and bareMinerals will start appearing in the virtual scrapbook-like Pinterest feed on Wednesday and into the coming weeks, and Pinterest is hopeful that ads from other brands will soon follow. The new ads will show up in a silent, GIF-like format within Pinterest’s feed, and will play with sound once clicked. Users will be able to click images, or pins, of featured products next to the videos. That could, for instance, bring them to a brand’s website or allow them to buy the product without leaving Pinterest. The move puts the social-bookmarking site in competition with the likes of Facebook, Twitter and Snapchat, as well as large digital publishers, which are all vying for the increasingly large amounts of marketers’ digital ad dollars. Pinterest allows people to save links to images and videos, known as pins, to aesthetically pleasing virtual bulletin boards, and to follow the boards created by others. It has become a popular destination for consumers looking to buy goods, particularly in areas like home improvement and cooking, and for the brands looking to reach them. Pinterest says 75 percent of the content people consume on its site comes from businesses. Pinterest, which says it has more than 100 million visitors a month, has largely been absent from conversations about videos, even as such content has boomed in popularity on its site. The company said it had seen a 60 percent increase in the number of videos saved by users in the last year. Last year, Etsy was the website with the greatest number of links from Pinterest’s Save button. Now, it is YouTube. “Candidly, the company just in general has underinvested until now in video as a platform,” Jon Kaplan, the head of global sales at Pinterest, said in an interview. “We wanted to make sure it was customized and specific to the way people use our platform. What you’re going to see going forward is a very big investment in video.”

• An Expert in Valuation Says Uber Is Only Worth $28 Billion, Not $62.5 Billion: According to Aswath Damodaran, a professor who specializes in equity valuation at NYU's Stern School of Business, Uber is running up against the roadblock that has thwarted many upstart businesses: Profit. While Damodaran thinks Uber and riding sharing will continue to expand, albeit at a slower pace, he's concerned about whether revenues will follow. China especially worries him given Uber's recent sale of its operations in that country to Didi Chuxing, its biggest rival there. The decision to exit "even if it was the right one from the perspective of saving itself from a cash war, will reduce its potential revenues in the future."  In the other places where Uber does continue to operate, there are often large discounts for riders and other special promotions. This is proof that the business model is challenged, according to Damodaran. "I believe that a significant portion of their expenses are associating with maintaining revenues rather than growing them," he says. "In effect, it looks like the business model that has brought these companies as far as they have in such a short time period are flawed, because what allowed these companies to grow incredibly fast is getting in the way of converting revenues to profits, since there are no moats to defend." Damodaran says that young companies all face a point in time that he calls the "Bar Mitzvah Moment," when the focus shifts from growth to evidence that the business model can be profitable. In his mind, that moment is right now for ride sharing. "After an initial life, where investors have been easily sated with reports of more ride sharing usage (number of cities served, rides, drivers etc.), these investors are starting to ask the tough questions about how ride sharing companies propose turning these impressive usage statistics into profits."

• Lenovo's first-quarter profit jumps 64 percent, beating estimates: China's Lenovo Group Ltd, the world's biggest personal computer (PC) maker, said on Thursday its first-quarter net profit rose 64 percent, beating estimates as solid PC sales offset tepid smartphone demand. Beijing-based Lenovo said in a filing that net profit grew to $173 million for the quarter ended June from $105 million in the same period a year earlier. That was more than the $130.1 million average of analysts polled by Thomson Reuters SmartEstimates. First-quarter revenue dropped 6 percent to $10.05 billion from a year earlier, compared with an average of $9.63 billion estimated by analysts. Lenovo consolidated its hold on the slowing PC market during the quarter. PC shipments fell 2 percent year-on-year, compared with a 4 percent decline in the broader industry. Like peer Xiaomi Inc, Lenovo has been focusing on diversifying away from intense competition in low-margin devices in China - still the world's largest handset market but affected by the slowing Chinese economy.According to researcher TrendForce, Lenovo had a 4.5 percent share of the global smartphone market in April-June, leaving it a distant seventh after top player Samsung Electronics Co Ltd's 24 percent and Apple Inc's 15 percent.

Daily Tech Snippet: Wednesday, August 17

• Ola shuts TaxiForSure unit, lays off up to 1,000 people: Cab-hailing company Ola has shut its TaxiForSure unit and is laying off as many as 1,000 employees, as the SoftBank Group Corp-backed firm tightens its belt to take on US-based rival Uber. According to at least half-a-dozen people with the direct knowledge of the development, about 90% of the staff being laid off from TaxiForSure works in the company’s call centres, driver relations and business development units. The employees that are being retrenched are located across a dozen cities and are being given three months’ salary as compensation, said the people mentioned above. These include current and former employees of the cab hailing company.Ola had acquired smaller rival TaxiForSure for $200 million in early 2015 to strengthen its position against Uber Technologies Inc. After the acquisition, Ola had centralized TaxiForSure’s operations to three major cities–Mumbai, Bengaluru and Delhi–and eight smaller cities. The company kept around 250 employees each in the three metros and around 30 each in the eight other cities. The layoff and shutdown comes at a time when Ola is locked in a bruising battle with Uber that involved public spats and legal wrangling. It is also dealing with adverse regulatory environment in various states that affect its operations. The company has been trying for a large fundraise for quite some time. Ola has so far raised around $1.2 billion from investors including Japan’s SoftBank Group Corp. The taxi-hailing firm was valued around $5 billion at the time of its last fundraising. Although Ola had initially planned to retain TaxiForSure as a separate brand, resource crunch seems to have forced the company to wind down the unit. The people cited above said that drivers on TaxiForSure have been moved to the Ola platform. The company has also been prompting TaxiForSure users to migrate to the Ola app in recent months.

• Cisco Systems to lay off about 14,000 employees: CRN: Cisco is laying off about 14,000 employees, representing nearly 20 percent of the network equipment maker's global workforce, technology news site CRN reported, citing sources close to the company. San Jose, California-based Cisco is expected to announce the cuts within the next few weeks, the report said, as the company transition from its hardware roots into a software-centric organization. Cisco, which had more than 70,000 employees as of April 30, declined to comment. Cisco increasingly requires "different skill sets" for the "software-defined future" than it did in the past, as it pushes to capture a higher share of the addressable market and aims to boost its margins, the CRN report said citing a source familiar with the situation. Cisco has been investing in new products such as data analytics software and cloud-based tools for data centers, to offset the impact of sluggish spending by telecom carriers and enterprises on its main business of making network switches and routers. The company has already offered many early retirement package plans to Cisco's employees, according to CRN.

• Ford Promises Fleets of Driverless Cars Within Five Years: At a news conference on Tuesday at the company’s research center in Palo Alto, Calif., Mark Fields, Ford’s chief executive, said the company planned to mass produce driverless cars and have them in commercial operation in a ride-hailing service by 2021.Beyond that, Mr. Fields’s announcement was short on specifics. But he said that the vehicles Ford envisioned would be radically different from those that populate American roads now. “That means there’s going to be no steering wheel. There’s going to be no gas pedal. There’s going to be no brake pedal,’’ he said. “If someone had told you 10 years ago, or even five years ago, that the C.E.O. of a major automaker American car company is going to be announcing the mass production of fully autonomous vehicles, they would have been called crazy or nuts or both.” The company also said on Tuesday that as part of the effort, it planned to expand its Palo Alto center, doubling the number of employees who work there over the next year, from the current 130. Ford also said it had acquired an Israeli start-up, Saips, that specializes in computer vision, a crucial technology for self-driving cars. And the automaker announced investments in three other companies involved in major technologies for driverless vehicles.

• Univision is buying Gawker Media for $135 million: Univision has won the auction for Gawker Media. The TV network and digital publisher has agreed to pay $135 million for the bankrupt blog network, according to a person familiar with the deal. Univision’s offer will encompass all seven of Gawker Media’s sites, including Gawker.com Ziff Davis and Univision were the only two bidders for Gawker, which filed for bankruptcy after Hulk Hogan and Peter Thiel won a $140 million judgment in a privacy case. Ziff Davis had originally offered $90 million for Gawker Media. The deal won’t be official for a bit. For starters, a U.S. bankruptcy court judge needs to sign off on the transaction. When it is final, the judgment funds will be set aside while Gawker appeals its court case; eventually the money will go to the side that wins. Whatever the result of the case, the auction is a disappointing conclusion for Denton, who founded the company in 2002. Last year, as rival media companies like Vice, BuzzFeed and Vox Media (which owns this site) were raising money at increasingly high valuations, Denton was arguing that his company was worth $250 million or more.

• ‘Shadow Brokers’ Leak Raises Alarming Question: Was the N.S.A. Hacked? The release on websites this week of what appears to be top-secret computer code that the National Security Agency has used to break into the networks of foreign governments and other espionage targets has caused deep concern inside American intelligence agencies, raising the question of whether America’s own elite operatives have been hacked and their methods revealed. Most outside experts who examined the posts, by a group calling itself the Shadow Brokers, said they contained what appeared to be genuine samples of the code — though somewhat outdated — used in the production of the N.S.A.’s custom-built malware.Most of the code was designed to break through network firewalls and get inside the computer systems of competitors like Russia, China and Iran. That, in turn, allows the N.S.A. to place “implants” in the system, which can lurk unseen for years and be used to monitor network traffic or enable a debilitating computer attack. According to these experts, the coding resembled a series of “products” developed inside the N.S.A.’s highly classified Tailored Access Operations unit, some of which were described in general terms in documents stolen three years ago by Edward J. Snowden, the former N.S.A. contractor now living in Russia. But the code does not appear to have come from Mr. Snowden’s archive, which was mostly composed of PowerPoint files and other documents that described N.S.A. programs. The documents released by Mr. Snowden and his associates contained no actual source code used to break into the networks of foreign powers. Whoever obtained the source code apparently broke into either the top-secret, highly compartmentalized computer servers of the N.S.A. or other servers around the world that the agency would have used to store the files. The code that was published on Monday dates to mid-2013, when, after Mr. Snowden’s disclosures, the agency shuttered many of its existing servers and moved code to new ones as a security measure. While still widely considered the most talented group of state-sponsored hackers in the world, the N.S.A. is still recovering from Mr. Snowden’s disclosures; it has spent hundreds of millions of dollars reconfiguring and locking down its systems.

Daily Tech Snippet: Tuesday, August 16

• Xiaomi Phone Shipments Fall 38% in China as Huawei Takes Lead; Apple Falls Behind: Xiaomi Corp., the once-hot Chinese smartphone maker, saw shipments tumble 38 percent in China in the second quarter as Huawei Technologies Co. took over the top spot in the world’s largest market. Xiaomi shipped 10.5 million smartphones in the quarter, down from 17.1 million in the same period a year earlier, according to research from International Data Corp. That made the company the fourth-largest competitor in the market behind Huawei, OPPO and Vivo. Xiaomi was once valued at $46 billion, according to CB Insights. The Chinese market has grown increasingly competitive as domestic manufacturers have improved their quality, design and marketing, putting pressure on global leaders Apple Inc. and Samsung Electronics Co. Apple saw shipments in China drop 32 percent in the second quarter and the iPhone maker fell to fifth in the market, according to IDC. The research firm said that Huawei and OPPO gained ground by concentrating on one or two key attributes in their marketing messages. Huawei emphasized the Leica lens now available on its phones, while OPPO pitched fast-charging technology. Apple’s global shipments are set to decline in 2016 as it continues to lose ground in its largest overseas market, Canalys said in a separate report. “The iPhones lack features such as waterproofing and wireless charging. Apple needs to catch up with the competition if it wants to compete,” Canalys research analyst Jessie Ding wrote.

• Microsoft’s HoloLens Technology Adopted by Israeli Military: If Pokemon Go achieved one thing, it was showing the world that augmented realitytechnologies are ready for the mainstream. Israel’s military thinks AR is ready for another use: battlefield training. The Israeli army’s C2 Systems Department recently purchased two HoloLens glasses from Microsoft Corp. The commander of the head programming department, Major Rotem Bashi, intends to develop the technology to improve battlefield strategy and train field personnel. And quickly: He intends for HoloLens to be used on active duty within months. At the army base outside Tel Aviv, a handful of developers in Bashi’s team created a software program in less than a month that allows commanders to manipulate military terrain models and intelligence data to monitor troop positioning from enemy vantage points. Battlefield maps are superimposed on top of the real terrain, streamed in via satellite, to create a blend that can be interacted with via sight, voice and hand gestures. The unit is now finding ways to allow HoloLens-wearing medics to operate on wounded with simultaneous instruction from trained surgeons, and combat soldiers to fix equipment malfunctions. It’s far removed from hurling Pokeballs at Pidgeys and Rattatas in Pokemon Go, but based on similar principles. Besides adapting the HoloLens to military life, Bashi’s unit is working on a product that will give headquarters an online report about a combatant’s physiological state in the field.

• LinkedIn sues anonymous data scrapers: LinkedIn is trying to lock down its exclusive relationship with its users. The professional networking company filed suit against 100 unnamed individuals last week for using bots to harvest user profiles from its website. The lawsuit is a preliminary step to revealing the identities of the scrapers — LinkedIn intends to ask the court to reveal the true identities behind the scrapers’ IP addresses — and a way to maintain its exclusive hold on users’ resumes. But LinkedIn’s lawsuit also raises questions about how to police bot use. The company, which was recently snapped up by Microsoft for $26.2 billion, has invoked the controversial Computer Fraud and Abuse Act (CFAA) in its suit against the unidentified scrapers, claiming that collecting user profiles from the site amounts to hacking. LinkedIn’s case accuses the anonymous scrapers of building a massive botnet and circumventing the restrictions LinkedIn uses to prevent profile collection by undesirable third parties. The lawsuit details several of LinkedIn’s automated tools that prevent data harvesting. Dubbed FUSE, Quicksand and Sentinel, these tools monitor the web traffic of LinkedIn users and limit how many other profiles a user can view, and how quickly a user can view those profiles. This tracking is intended to prevent scrapers from signing up for fake LinkedIn profiles and then vacuuming up vast amounts of data. The company also uses a tool called Org Block to block IP addresses it suspects of scraping and uses Member and Guest Request Scoring to track page requests. But paradoxically, LinkedIn doesn’t want to prohibit scraping altogether. Search engines like Google use bots to index websites and turn up relevant results — and LinkedIn wants to allow this type of scraping to occur. “LinkedIn ‘whitelists’ a number of popular and reputable service providers, search engines, and other platforms so as to permit them to query and index the LinkedIn website, without being subject to all of LinkedIn’s security measures,” the company explains in its suit. The scrapers targeted in the lawsuit circumvented LinkedIn’s bot-blocking tools by sending their requests through one of these ‘whitelisted’ entities, a third-party cloud service provider.

• Peter Thiel says journalism will be just fine, since he’ll decide what’s good journalism: Peter Thiel is a billionaire who decided he didn’t like Gawker Media after it outed him as gay. So he funded Hulk Hogan’s lawsuit against the company, and they won. Now Gawker is selling itself in a bankruptcy auction. Today, the same day that bids for Gawker are due, Thiel published an op-ed in the New York Timesas a sort of victory lap, but also to muster votes for a bill currently wending its way through Congress, the Intimate Privacy Protection Act. It's more commonly known as the revenge-porn bill, which would make it illegal to transmit private images and messages, but Thiel has co-opted it for his own purposes, referring to it by a lesser-known nickname, the Gawker Bill. But the most interesting part of Thiel’s editorial is what he says about the need for a free press: It’s telling that despite the fact he felt Gawker had invaded his privacy, Thiel himself never filed a lawsuit — he’s fighting via proxies. In trying to determine what should and shouldn’t qualify as journalism, Thiel is exercising the classic Silicon Valley pretension to attempt to own the definition, to write its own narrative, devoid of context or skepticism. But smart publishers will react to Thiel’s call to arms in a similar vein to the closing words of his editorial: He can’t do it, if we don’t let him.

Daily Tech Snippet: Friday, August 12

• Alibaba passes earnings milestones, silent on SEC probe: China's Alibaba Group Holding posted its best revenue growth since before the e-commerce titan's listing in late 2014, lifting its shares to their highest level in a year. But Alibaba was silent on the U.S. Securities and Exchange Commission (SEC) investigation into its accounting practices, which have long been the subject of criticism. In the three months to June 30, Alibaba also made more money from mobile shopping than from PCs for the first time, helping to send its shares up by more than 5 percent to $92.10 in New York, its highest level in more than a year."This is a decoupling of revenue from GMV (gross merchandise volume)," he said, referring to a measure of the total value of goods transacted on Alibaba's online shopping platforms. Despite GMV growth remaining low compared to previous years, rising 24 percent to 837 billion yuan, Alibaba is squeezing more money out of its e-commerce business, chiefly from advertising. That translated to quarterly revenues of 32.15 billion yuan ($4.84 billion), a 59 percent leap from the previous year and the highest growth rate since late 2013. While China e-commerce was strong for Alibaba in its first quarter, the company is also investing in other businesses including cloud computing arm Aliyun, driverless vehicles and online shopping in Southeast Asia. It hopes these can become an eventual source of growth as Alibaba faces the prospect of a saturated online retail market in China. Although some are showing promise - Aliyun sales rose 156 percent, though only contributed 4 percent of total revenue - most are still loss-making.

• Microsoft is buying a company that lets viewers control video game live streams: Today, Microsoft announced its plans to acquire live streaming service Beam, a Seattle-based company that lets users influence and interact with a video game being streamed by another player. Beam launched in January to compete against well-established game streaming services from Twitch and YouTube. It set itself apart by taking a core concept made popular by streamers — the notion of letting players control a game from afar — and turning into a unique streaming platform. For instance, Beam lets viewers suggest challenges for streamers and even alter in-game aspects like weapon loadout and quest selection. It also lets developers create special button layouts for viewers to interact with games being streamed through Beam. To maintain quality, the company's technology drastically reduces the lag between a player's actions and what the viewers see on the stream, whereas competitors like Twitch have a roughly 10 to 15 second delay. It's unclear how Microsoft plans to incorporate Beam's technology into its own online gaming platform. But the company points to Minecraft, now a Microsoft property, as the type of game well-suited to Beam's technology. Microsoft did not disclose the financial terms of the deal.

Daily Tech Snippet: Thursday, August 11

• One year later, Alphabet is a tale of two Googles: Today marks the one year anniversary of the day Google co-founders Larry Page and Sergey Brin picked a new name and an audacious corporate structure in an attempt to spawn gigantic tech businesses in industries way beyond web search. So far, the year has been great for Google. Unshackled from the unprofitable moonshots, its balance sheet and steady ads business growth has reassured investors. The business soars: Revenues topped 21 percent growth last quarter and operating margins keep getting fatter. More focus: One senior exec at Google recently explained a key change from the Alphabet reorg: Before, meetings cluttered with discussion of extraneous projects — the self-driving cars, medical doodads and internet balloons. Now, Google meetings are spent on Google alone. Porat appeases Wall Street: Not too long ago, investors were making fretful phone calls about Google’s abundant spending. Not anymore. Thank Ruth Porat, the former Morgan Stanley CFO who helped orchestrate the Alphabet reshuffle. “Implementing a competitive culture in what was becoming a behemoth — that’s critical,” said Colin Gillis, an analyst with BGC Partners. “Ruth Porat has been priced into the stock.” About that stock: It has climbed nearly 24 percent since August 10th of last year. It’s been bumpier for “Other Bets,” the hodgepodge, ever-evolving group of companies outside of Google that Page and Brin desperately want to behave like lean, world-changing startups. Losses added: Alphabet poured $859 million into these units last quarter, nearly $300 million more than the same quarter last year. New equity: Employees at the non-Google company may soon have to get used to new stock packages — ones that aren’t tied to that soaring Google.

• China's JD.com revenue meets expectations as slowdown set to continue: JD.com Inc, China's second biggest e-commerce company, reported revenue for the second quarter of 2016 that was within company forecasts, even as the growth rate continued a steady decline that is expected to continue. The company said on Wednesday revenue for the quarter rose 42 percent to 65.2 billion yuan ($9.83 billion), within JD.com's forecast range of 64.2-66.2 billion yuan. But the company is predicting an even sharper decline in growth for the third quarter, compounding concerns that China's e-commerce sector is saturating. JD.com's revenue from Amazon-like online direct sales rose 40 percent in the quarter, versus a 67 percent jump in sales from services and other businesses.JD.com now expects revenues for the third quarter to be 59-61 billion yuan, a rise of 34-38 percent from the same quarter in 2015. Net losses were 132.1 million yuan ($19.92 million), compared to a loss of 510.4 million yuan in the previous year. The total value of merchandise transactions on JD.com's platforms was 108.7 billion yuan in the quarter, up 47 percent excluding online marketplace Paipai.com, which JD.com shut down. JD.com shares were up around 3 percent at $23.10 in pre-market trading in New York, but well below the $29.53 price at the beginning of the year. 

• VC Funding Is Drying Up for Media Startups: As venture capitalists exercise more caution and place fewer bets, they’re leaving media startups behind. Venture funding to media-tech companies slid for the third consecutive quarter to $91.7 million, the lowest amount since mid-2013, according to data from industry researcher CB Insights. Investment activity followed a similar trend, declining to the fewest number of deals since the second quarter of 2012. While U.S. venture deals were down overall in the first half of the year, the drop in funding to media companies has outpaced declines in other sectors, said Garrett Black, an analyst at researcher PitchBook. Investors worry the businesses are expensive to run compared with software makers and struggle to keep readers’ attention.The decline in venture funding comes amid a moment of reckoning across the digital media landscape. Web publishers like Mashable Inc. and International Business Times have fired dozens of employees this year. Smaller players are seeking new business models as they struggle to sustain themselves on digital advertising, which is being increasingly dominated by Google and Facebook Inc. Many of them are shifting their business to focus on web video, where advertising rates are higher. Media hasn’t traditionally been the top investment area for VCs, but some big wins drew interest to the sector. AOL spent $315 million to acquire the Huffington Post in 2011, and the publication has become a cornerstone of Verizon Communications Inc.’s media strategy since it bought AOL. German publisher Axel Springer SE took over Business Insider last year in a $343 million deal, a win for backers including Institutional Venture Partners and Amazon.com Inc.’s Jeff Bezos.

• Bill Maris, the CEO and founder of Google Ventures, is leaving: Bill Maris, the founder and chief of Google Ventures (or GV), is leaving the firm and its parent, Alphabet,Recode has learned. His last day, said sources, is Friday. Maris would be the third high-ranking executive to depart from the Alphabet units outside of the main Google search business in recent months, as the tech giant continues to stumble through the transition into its new corporate structure. Sources say Maris is being replaced by David Krane, a managing partner for the venture arm and one of the earliest corporate communications managers at Google.Maris, an early web entrepreneur, founded Google’s venture capital arm in 2009 and quickly built it into a formidable presence in Silicon Valley. In 2015, the firm managed upwards of $2.4 billion in capital. Although GV cut back on investments in Europe and with early stage companies, the firm is still willing to cut checks. For the first six months of this year, it passed Intel Capital as the most active corporate venture arm, according to CB Insights. Under Maris, GV has had some high-profile misses — most notably, the disastrous app Secret. But those were outweighed by early bets in gigantic startups like Uber, Nest, Slack and Jet.com, which just went to Walmart for $3 billion.

Daily Tech Snippet: Wednesday, August 10

• Yelp swings to surprise profit, raises full-year revenue forecast: Consumer review website operator Yelp Inc swung to an unexpected second-quarter profit and raised its full-year revenue forecast as investments in sales and marketing led to more businesses and consumers signing up for its services. The company also gave a better-than-expected revenue forecast for the current quarter and said it partnered with and made a small investment in Nowait, a mobile platform that allows restaurants to manage their waiting lists. Shares of Yelp, whose website and app allow users to rate restaurants and a variety of other businesses, jumped more than 13 percent to $35.90 in extended trading on Tuesday. They hit a 52-week high of $32.90 in regular trading. Yelp posted a net profit of $449,000, or 1 cent per share, for quarter ended June 30, compared with a net loss of $1.3 million a year earlier and $15.5 million in the prior quarter. Revenue rose 29.5 percent to $173.4 million.

• P&G, the biggest advertiser in the world, reminded us why Facebook wants to be TV: Facebook is a giant, mega-successful advertising business. It has 1.7 billion users, and it knows a ton about them, which is why it did $17 billion in ad revenue last year. But despite years of trying to convince advertisers otherwise, Facebook is still not TV — the place advertisers go when they want to spend huge sums on brand advertising, meant to create overall awareness of their products. Instead, Facebook is the place advertisers go for direct response ads: Ads that send you somewhere when you click on them, so you can buy or download something immediately. Facebook is better at DR ads than anyone — see that second sentence at the top — but DR ads are of limited use for some advertisers. We got a reminder of that today, when the Wall Street Journal reported that P&G, the world’s biggest advertiser, was going to pull back on the targeted ads it was running on Facebook, because targeted ads weren’t helping P&G sell Tide and Pampers. But P&G is increasing its TV budget. P&G isn’t cutting back on its overall Facebook spend, and this news isn’t going to be a long-term problem for Facebook.

• Virtual Reality Classrooms Another Way Chinese Kids Gain an Edge: Deep within a building shaped like the Starship Enterprise, a little-known Chinese company is working on the future of education. Vast banks of servers record children at work and play, tracking touchscreen swipes, shrugs and head swivels - amassing a database that will be used to build intimate profiles of millions of kids. This is the Fuzhou hive of NetDragon Websoft Holdings Ltd. a hack-and-slash videogame maker and unlikely candidate to transform learning via headset-mounted virtual reality teachers. It’s one of a growing number of companies from International Business Machines Corp. to Lenovo Group Ltd. studying how to use technology like VR to arrest a fickle child’s attention. (And perhaps someday to make a mint from that data by showing them ads.) China - where parents have been known to try anything to give their kids an edge and tend to be less obsessive about privacy - may be an ideal testing ground for the VR classroom of the future. As it’s envisioned, there’ll be no napping in the back row. Lessons change when software predicts a student’s mind is wandering by spotting an upward tilt of the head. Dull lectures can be immediately livened up with pop quizzes. Even the instructor’s gender can change to suit the audience, such as making the virtual educator male in cultures where teachers are typically men.The notion of adaptive, computer-based teaching has bounced around for more than a decade. Done right, it’s got the potential to fundamentally alter learning. Educators who’ve relied on their gut and visual cues could be replaced or augmented by digital avatars powered by algorithms, which can in turn be replicated across the planet. Advocates argue that the benefits of using machines to scrutinize children and learning to adapt to their foibles will outweigh questions of privacy because soon there won’t be enough human teachers.

• Facebook Blocks Ad Blockers, but It Strives to Make Ads More Relevant: Digital ads pop up online so frequently and ubiquitously that many people are using software to block them. But if you try to stop ads from showing up onFacebook’s desktop website, you will now be out of luck: The social network has found a way to block the ad blockers. On Tuesday, Facebook flipped a switch on its desktop website that essentially renders all ad blockers — the programs that prevent websites from displaying ads on the page when a user visits the site — useless. The change allows the Silicon Valley company to serve ads on its desktop site even to people who have ad-blocking software installed and running.Facebook’s move is set to add to a furious debate about the ethics of ad blocking. On one hand, many digital ads are a nuisance — they slow loading times of web pages and detract from the online experience. Yet the ads also serve as the business foundation for many digital publishers to provide content to readers. Ad blockers have become a threat to publishers including The New York Times and The Wall Street Journal, which are facing declining advertising revenue. About 200 million people worldwide use ad-blocking software on their desktop computers, according to estimates from PageFair, an anti-ad-blocking start-up. An additional 420 million use ad blockers on their smartphones, the company said. Several digital publishers, including Wired, Forbes and The Times, have begun experimenting with anti-ad-blocking techniques, including asking visitors who use ad blockers to “whitelist” their sites so that ads may still appear.

Daily Tech Snippet: Tuesday, August 9

• India ride-hailing firm Ola sideswiped as Uber, Didi team up in China: Didi Chuxing's acquisition of Uber's China business last week reshapes the landscape in Asia's growing ride-hailing sector, and leaves India's Ola more vulnerable to attack by Uber in its $12 billion home market. Four months ago, Ola executives met with Didi hoping the Chinese firm would invest fresh capital to help it fight Uber Technologies Inc which, with its deeper pockets, has made rapid inroads into India. They were told Didi wanted first to sort out its own challenges in China, said a person with direct knowledge of Ola's plans. Didi and Uber have raised and spent billions of dollars in a discount slugfest to win drivers, passengers and market share in China. Didi, now worth around $35 billion, last year invested about $30 million in Ola, which is also backed by Japan's SoftBank Group, and the two are allies in an anti-Uber group that also includes U.S.-based Lyft and Southeast Asia-focused Grab. "This (Didi/Uber China) deal changes the dynamics of how they (Didi) will invest in India," said the person, who didn't want to be named because the discussions were private. If Didi invests more in Ola, it's effectively betting against Uber, its new partner in China, the person said. It's not clear whether Didi would provide equity or debt to Ola, which has raised around $1.3 billion in funding and is valued at over $5 billion. SoftBank Capital, Ola's key investor, faces its own financial issues and is selling assets to raise cash and reduce debt, which may pose another fundraising challenge for Ola, which was aiming to raise another $1 billion this year.After the Didi deal, Uber is even more focused on India, which it has previously called its No. 2 priority overseas market, doubling down on resources, staffing and technology deployed there, said two people familiar with Uber's plans, one of whom is based in the United States.

• Twitter Seeks to Sublease Part of San Francisco Headquarters: Twitter Inc. is offering about a quarter of the space at its San Francisco headquarters complex for sublease, adding to a growing amount of excess offices available in the city as the technology industry cools. About 78,800 square feet (7,320 square meters) is listed for sublease on the seventh floor of 1355 Market St., a renovated 1930s furniture mart, and 104,850 square feet is available along three floors in an adjacent building at One Tenth St., according to marketing materials from Cresa, a commercial real estate firm.Subleasing is becoming more prevalent in San Francisco as venture-capital investments decline and tech firms slow their hiring from a breakneck pace. While the city’s overall office market remains strong, extra space is a warning sign that some companies overestimated their growth rate and are being forced to scale back. An increase in subleasing predated commercial real estate downturns following the 2008 financial crisis and the dot-com bust in the late 1990s.

• Walmart was the only bidder in $3 billion Jet.com acquisition: When news first broke of Walmart’s interest in acquiring Jet.com, the $3 billion price tag was a surprise to many. Why would Walmart pay such a premium for a startup that was unprofitable and just a year old? One hypothesis was that Walmart may have been competing against other bidders for Jet — possibly Alibaba or even Google. Turns out that was not the case, Jet CEO Marc Lore told Recode in an interview Monday afternoon. “This was about trust between Doug and I,” Lore said in reference to Walmart CEO Doug McMillon, noting that the conversations between the two sides began in the spring. “It never occurred to me to go out and get another offer, quite honestly,” he added.  As part of the deal, Lore will take over as head of Walmart.com in addition to Jet, as Recode first reportedSunday evening. Neil Ashe, Walmart’s CEO of global e-commerce, will depart at the end of Walmart’s fiscal year. In a conference call with reporters, McMillon outlined why Walmart found Jet so valuable. It was a combination of the speed of the shopping site’s growth (a $1 billion annualized sales volume run rate within eight months of launch); the expertise of the exec team led by Lore that is joining Walmart in the deal; and the proprietary pricing and back-end technology that is expected to eventually be used in some capacity on Walmart.com.

• LendingClub turmoil takes toll as company posts widening losses: LendingClub Corp on Monday reported its largest quarterly loss in a year as it struggles to bring banks back to its online lending platform following the departure of its chief executive and a scandal involving altered loan documents. LendingClub, which matches borrowers and lenders via an online marketplace, reported a second-quarter loss of $81.4 million, or 21 cents per share, compared to a loss of $4.1 million, or 1 cent per share, a year ago. The company also continued its executive shakeup, with the resignation of Chief Financial Officer Carrie Dolan. Her departure is the first high-profile exit since the departure of Renaud Laplanche, the company's founder, as chief executive on May 9.The second-quarter earnings report follows a tumultuous period for LendingClub, once considered the standard bearer in a new generation of online lenders but which has been pummeled by revelations of lending improprieties, a U.S. Department of Justice investigation, the departure of loan investors and layoffs of 179 employees. "The good thing is (the second quarter) is now behind us," said Scott Sanborn, who took over as president and CEO in June. "We have accomplished quite a bit since the events of May 9." LendingClub's shares were down more than 2 percent at about $4.68 in after-hours trading. That puts the company's market cap at about $1.8 billion, about one-third its market value of about $5.4 billion when it went public in December 2014 in an offering priced at $15 a share.

Daily Tech Snippet: Monday, August 8

• Airbnb raising a reported $850M at a $30B valuation: Almost a year after its last raise of $1.6 billion, the company is said to be adding $850 million to its coffers, according to information obtained by Equidate. While $850 million is a ton of cash, it is not the largest round the company has raised. Last year, the company raised $1.5 billion in one of the largest VC rounds in history. The additional capital would only move Airbnb from the fifth to the forth most valuable tech unicorn at a potential valuation of $30 billion (tear).  Even as a late-stage company, Airbnb has to be increasingly conscious of the capital it takes on. Too much equity dilutes early investors, while too much debt could put investors at risk if valuations were to suddenly tank. Debt as an asset class is paid off before equity. Airbnb has notoriously taken actions to strategically prolong an IPO, bringing on a $1 billion credit faculty last year to support growth without diluting investors. The company previously had an approximate valuation of $27 billion, so while the round is large, it doesn’t deviate from prior anti-dilution strategies. With respect to deals that Airbnb reportedly walked away from, the $850 million dollar deal is tame. The Wall Street Journalreported that Airbnb left money on the table, rejecting a deal that would have valued the company at $34 billion.

• Google keeps finding new and creative ways to piss off Yelp and TripAdvisor: There’s no love lost between Yelp and Google. And, more recently, between TripAdvisor and Google, too. Now, Google is giving those companies a new reason to believe that the search giant is intentionally pushing listings from their review sites way down in search rankings. The most recent brouhaha centers on a new search feature that highlights critic reviews of restaurants from sites like Zagat, which Google owns, as well as “best of” lists from publishers. The end result, as shown below in a tweet from Yelp’s CEO, is that Yelp and TripAdvisor reviews don’t show up even if you scroll down to the second screen of results on a phone. In this instance, you would have to scroll to the third screen to see Yelp reviews.Both Yelp and TripAdvisor have been complainants in the European Union’s case against Google for anticompetitive practices. These companies continue to believe that Google intentionally promotes its own products — like local reviews of restaurants and hotels — over others, including theirs. Google denies this. Google has historically been a large source of traffic for both review companies, so it’s been critical for them to get people to frequent their apps on mobile phones rather than search for local spots through Google. A Google spokeswoman declined to comment.

• Bitfinex exchange customers to get 36 percent haircut, debt token: Crypto-currency exchange Bitfinex, which lost $72 million to hackers last week, told customers on Sunday they would lose just over 36 percent of the assets they had on the platform but would be compensated for these losses with tokens of credit. The Hong Kong-based exchange said losses from the theft would be shared, or "generalized", across all the company's clients and assets, widening the group of those affected announced last week. "This is the closest approximation to what would happen in a liquidation context," Bitfinex said on its website early on Sunday. "Upon logging into the platform, customers will see that they have experienced a generalized loss percentage of 36.067 percent." The company said it would also give all affected clients a "BFX" token crediting their losses that could be redeemed by the exchange or for shares in iFinex, the exchange's parent company. Bitfinex said it would explain its methodology in a later update and that it was talking to investors about how to fully compensate its customers. Hackers stole 119,756 bitcoin from Bitfinex last week in the second-biggest breach of a crypto-currency exchange ever, in U.S. dollar terms. The hack accounted for about 0.75 percent of all bitcoins in circulation. The exchange is the world's largest for trading digital currencies such as bitcoin, litecoin and ether, and is used for its deep liquidity in U.S. dollar/bitcoin trades. It is still not clear how the hackers gained access to the company's customer accounts. However, both Bitfinex and outside experts have dismissed suggestions the breach was due to the security of the blockchain, the decentralized ledger that tracks every bitcoin transaction, and which traditional banks are considering adopting to increase the speed and transparency of their transactions.