Daily Tech Snippet: Wednesday, September 21

• Researchers remotely hack Tesla Model S: Chinese researchers announced Monday that they had discovered security vulnerabilities in the Tesla Model S that allowed them to take over the vehicle’s brakes and more without laying a finger on the car. While other researchers have hacked into Tesla vehicles, this appears to be the first time researchers were able to do so remotely — highlighting the security risks of the sophisticated software and online features now being built into vehicles. A video posted by the researchers from Tencent’s Keen Security Lab appears to show them controlling the vehicle's brakes, as well as manipulating its side mirrors, running the windshield wipers and popping the trunk while the car is in motion. The researchers were also able to manipulate some other features while the vehicle was parked, including opening the sunroof, controlling some of the vehicle’s lights and unlocking the doors, according to the video. In a blog post, the researchers wrote that they reported the vulnerabilities to Tesla, and the company confirmed the hack. The researchers only tested out their method on “multiple varieties of Tesla Model S,” but said that it’s “reasonable to assume that other Tesla models are affected." Tesla said in an emailed statement that it "deployed an over-the-air software update" to fix the problem within 10 days of being informed about the bug. The company said the vulnerabilities that Keen Security Lab uncovered would only be accessible under a very specific circumstance: when the vehicle’s Web browser was in use and the car was connected to a malicious WiFi hotspot. Tesla plans to reward the researchers under its bug bounty program, according to the statement. Tesla was the first automaker to roll out such a program, which offers cash rewards to independent researchers who help the company uncover problems in its software. The company pays up to $10,000 per bug.

• iPhone 7 Teardown Shows Margins Slimming on Storage, Displays: Apple Inc.’s iPhone margins have narrowed with the release of its latest smartphone line, the iPhone 7, with higher costs to provide greater storage options, a glossy black cover and more advanced displays, according to an analysis by IHS Inc. The component analysis firm estimates that the total manufacturing cost of an entry-level iPhone 7, a model with a 4.7-inch screen and 32 GB of storage, is $224.80. This compares with an updated IHS estimate of $200 for an entry-level iPhone 6S in 2015. IHS didn’t perform an analysis of the larger iPhone 7 Plus but said the costs are likely higher than last year’s iPhone 6S Plus due to the presence of additional components. Based on the IHS breakdown, the margins on the 4.7-inch iPhones have narrowed as Apple maintained the $649 starting price, but the company seems to have offset this by raising the price of the iPhone 7 Plus. The iPhone 7 Plus costs $769 for a model with 32 GB of storage compared with last year’s $749 entry-level price. Apple is also holding up its overall margins by reserving the more costly glossy black manufacturing process for the 128 GB and 256 GB models. While Apple hasn’t released sales numbers for the iPhone 7 line’s opening weekend, the company indicated its initial supply sold out. Despite early knocks against the device for its lack of a headphone jack, reviews have been positive and the company’s stock has gained 5.4 percent since the new phone was introduced about two weeks ago. The iPhone represented about 66 percent of Apple’s revenue last year, and the product’s unit sales, margins, and average-sales-price are critical to the company’s quarterly earnings results.

• Microsoft Plans Another $40 Billion Buyback, Boosts Dividend: Microsoft Corp.’s board authorized the buyback of an additional $40 billion of stock on top of an existing $40 billion repurchase program it will finish by year’s end, keeping up a strategy of returning money to shareholders as its cash pile grows. The Redmond, Washington-based software maker also raised its quarterly dividend by 8.3 percent to 39 cents a share, according to a statement Tuesday. The company’s stock has jumped 31 percent in the past year, giving Microsoft a market capitalization of $442.7 billion -- the third-largest in the Standard & Poor’s 500 Index. Chief Executive Officer Satya Nadella has been working to jump-start revenue growth -- which analysts project will be 2 percent this fiscal year after a decline of 2 percent the previous year -- amid continued restructuring efforts related to the failed acquisition of Nokia Oyj’s phone business. Since Nadella took the helm in 2014, the company’s cloud and internet-based Office software businesses have fueled growth and boosted investor optimism. The stock this year has been hovering close to a 1999 record high.Microsoft shares rose about 1 percent in extended trading after the announcement. They slipped less than 1 percent to $56.81 at the close in New York.The company had $113.2 billion in cash and short-term investments as of June 30. Microsoft is spending about $26 billion to acquire LinkedIn Corp., a deal that will be largely funded by debt sales.

Daily Tech Snippet: Friday, August 5

• Meet the China ‘whisperers’ who get the big deals done in Silicon Valley: When Uber chief executive Travis Kalanick wanted advice about whom to hire to run his ride-hailing business in China, he asked Carmen Chang, a longtime Silicon Valley lawyer and investor who had helped a previous generation of tech companies navigate that murky territory. When Uber sold its China business to its rival Didi this week, Chang was a trusted confidante.When Lyft, Uber’s smaller rival, needed an entree into China, the company’s president turned to another Silicon Valley insider who shuttles between worlds. The introduction from Connie Chan, a partner at the venture capital firm Andreessen Horowitz, to China’s largest ride-hailing company led to a $100 million investment and partnership. Behind the scenes of an unprecedented flood of capital from China into Silicon Valley over the past two years is an elite network of brokers. These brokers do more than deal-making; they play anthropologist and cultural translator -- from coaching startup founders about the culturally appropriate place to sit at a conference room table in China to breaking down how emojis are used in Chinese apps. Their acumen is growing more valuable, entrepreneurs say, as they navigate a cast of hard-to-parse characters with alluring deep pockets and promises of big business opportunities overseas. “She is the whisperer between China and Silicon Valley,” said Matthew Prince, chief executive of Cloudflare, a web security startup, of Chang. Last year, Chang helped Prince -- whose company had given up on China in 2011 -- clinch a partnership with Baidu, China’s search giant. “There’s very few that really understand both sides.” Chang, who was born in Nanjing, China, came to the States to seek a doctorate in Modern Chinese History. She got pulled into tech industry after graduating from Stanford Law School in the early 1990s, when she got a job as an associate at Wilson Sonsini Goodrich & Rosati, the Silicon Valley firm known for its ties to the clubby venture capitalists on Sand Hill Road. One of her early clients was Masayoshi Son, the billionaire Japanese investor who founded the Japanese telcommunications giant Softbank. At the time, she said, senior management at the firm had never been to Asia, and Son “wasn’t considered important enough” to be represented by a general partner. “So he got an associate,” she says.

• Snapchat Used to Spook Advertisers. Not Anymore. When Snapchat opened itself up to advertisers more than a year ago, many initially griped that the company needed to lower its ad prices. Some were mystified about how to reach the right audience with the ads, since Snapchat did not provide traditional ad-targeting tools. Most of all, brands wondered how Snapchat could be effective when the ads — like Snapchat messages — disappeared. In the last 15 months, Snapchat has moved to respond. It introduced new ad formats. It dangled its attractive user base — the service now claims 150 million daily users, including nearly half the country’s population from ages 18 to 34 — to lure advertisers. Most important, Snapchat has persuaded brands like Tiffany & Company, Kraft Foods and Burger King that its ads let them interact playfully with this young audience.Now Snapchat faces the challenge of keeping up its nascent ad business as its early success raises the competitive hackles of rivals. On Tuesday, Instagram, the photo-sharing app owned by Facebook, introduced a near carbon copy of a Snapchat photo and video service known as Stories. A lot is riding on Snapchat’s building up its ad business. The company, which Mr. Spiegel helped found in 2011 and is now based in the Venice Beach neighborhood of Los Angeles, needs to justify a valuation of about $19 billion that its investors have placed on it. The company also faces sky-high revenue expectations; the investment bank Jefferies recently projected that Snapchat’s revenue would grow to $1 billion next year from more than $350 million this year.Mr. Khan’s biggest job was to explain why Snapchat’s unusual platform was better for advertisers. The task was thorny because Snapchat is a messaging, sharing and broadcast service where most content disappears. Companies had few comparable apps to judge Snapchat against. The potential became clearer after brands started experimenting with Snapchat’s geofilters, a tool that adds custom stickers, a type of colorful icon, to the app when people enter a certain geographic area, and lenses, which are whimsical images that transform someone’s face in the app.

• Facebook's News Feed to show fewer 'clickbait' headlines: Facebook's News Feed will show fewer "clickbait" headlines over the next few weeks, the company announced Thursday, as it seeks to establish itself as the prime web destination for news and social updates. The company receives thousands of complaints a day about clickbait, headlines that intentionally withhold information or mislead users to get people to click on them, Adam Mosseri, vice president of product management for News Feed, said in an interview. In an effort to eliminate clickbait from the site, Facebook created a system that identifies and classifies such headlines. It can then determine which pages or web domains post large amounts of clickbait and rank them lower in News Feed. Facebook routinely updates its algorithm for News Feed, the place most people see postings on the site, to show users what they are most interested in and encourage them to spend even more time on the site. The system looks for commonly used phrases in clickbait headlines, similar to how filters for email spam work, Facebook said in a blog post. It categorized tens of thousands of headlines as clickbait by looking for headlines that intentionally withheld information and those that exaggerated the content of an article. News Feed, a team of about 200 people, uses a similar classification system to determine what it should show each user, Mosseri said.

• Amazon adds several new devices to its Dash Replenishment auto ordering service: At the beginning of the year, Amazon flipped the switch on Dash Replenishment, a service aimed at bringing the instant reordering of its devoted product buttons directly to connected devices. The idea being that you don’t have to, say, order ink for your printer or batteries for your smart lock — the devices will do it for you. The retail giant has already announced a slew of different partners for the program, including Brother Printers, the Gmate SMART blood glucose monitor and a GE washing machine, all of which went live in the first round. Today the company announced a number of new additions. The highest profile of the additions is GE, which will be extending its involvement to driers and dishwashers, which will be updated to order fabric softener and dishwasher detergent, respectively, when supplies start to dwindle. Neato joins the list as well, bringing the Wi-Fi-connected robot to the service to order replacement filters and brushes, while Petcube’s Kickstarter-supported Bites camera will be able to order pet food. Also on the list are the Behmore Connected coffee brewer, Simplehuman trashcan and SmartThings platform. Even The Hershey Company has been added to the stable with an unnamed device. That should be interesting.

• LinkedIn Results Beat Expectations Ahead of Microsoft Deal: LinkedIn Corp. reported earnings and revenue that were higher than analysts expected, after the company negotiated a $26.2 billion sale to Microsoft Corp. LinkedIn said second-quarter revenue was $933 million, up 31 percent from a year earlier. The average analyst estimate was $899 million. Earnings, excluding some items, were $1.13 cents per share in the second quarter, compared with analysts’ projection of 78 cents. This may be LinkedIn’s last earnings report as an independent company, before it joins Microsoft in one of the largest technology industry deals on record. 

• As Chinese hacking abates, FireEye plans layoffs, cuts forecasts; shares plunge: Cyber security firm FireEye Inc said on Thursday it planned to lay off 300 to 400 of its 3,400 workers as it announced quarterly sales below its own forecast, due to a slowdown in demand for its services helping businesses respond to hacking attacks. FireEye's shares were down 16.2 percent at $14.02 in extended trading.Chief Executive Kevin Mandia said the company is now responding more frequently to financially driven cyber criminals, who engage in crimes such as ransomware, which are relatively simple to clean up. "The size and scope have changed. The whole remediation was more complex" when the company was responding to large numbers of state-sponsored hacks from China, he said. FireEye cut its full-year revenue forecast to $716 million-$728 million from $780 million-$810 million.Executives blamed much of the trouble on a slowdown in its services business, including its high-profile Mandiant forensics unit that helps organizations respond to cyber attacks. That division's revenue rose just 2 percent in the second quarter, compared to a 40 percent increase in the first quarter. Its total number of engagements rose, but average revenue from each one fell dramatically because work performed was less extensive. Mandia said that was due to a shift away from previous years where there were large numbers of state-sponsored espionage hackers from China attacking customers in the United States. FireEye and other cyber security firms said in June that cyber espionage attacks from China appeared to have dropped this year as the Chinese government made good on a pledge with the United States to stop supporting the digital theft of U.S. trade secrets.

• Zynga plummets 9% in after-hours trading: Social game developer Zynga tumbled 9 percent in after-hours trading following the second quarter 2016 earnings announcement after the bell today. The company reported a net loss of $4.4 million, while still beating analysts’ expectations in terms of revenue.For the second quarter ended June 30, the San Francisco-based maker of FarmVille and Words with Friends posted revenue of $181.7 million and non-GAAP net earnings came in at $0. 

• Grand Theft Auto' publisher Take-Two's revenue jumps 13 percent: Videogame publisher Take-Two Interactive Software Inc reported a 13 percent rise in revenue, helped by strong sales of its "Grand Theft Auto V" and "NBA 2K16" titles. Take-Two, like its rivals, has also benefited from a shift by players downloading digital copies of its videogames – which generate higher margins – rather than buying physical game discs. Take Two's net revenue rose to $311.55 million in the first quarter ended June 30 from $257.30 million a year earlier. Digital downloads accounted for about 55 percent of revenue in the quarter. Net loss narrowed to $38.57 million, or 46 cents per share, from $67.02 million, or 81 cents per share.

• Activision revenue surges on "Overwatch" launch, "Candy Crush" deal: Activision Blizzard Inc reported a 50.4 percent surge in quarterly revenue on Thursday, propelled by the popularity of the newly-launched "Overwatch" game and the boost from the acquisition of "Candy Crush" maker King Digital. Activision's total adjusted revenue, which excludes deferred revenue and related costs, rose to $1.57 billion in the second quarter ended June 30 from $1.04 billion a year earlier.The company's shares were up 1.4 percent at $41.40 in extended trading. Activision, best known for its "Call of Duty" and "World of Warcraft" games, released "Overwatch" on May 24 to rave reviews. The multi-player futuristic game now has more than 15 million players and has generated about $500 million in revenue to date, excluding deferrals, the company said. The company's net income dropped 40 percent to $127 million, or 17 cents per share, mainly due to costs associated with the near $6 billion acquisition of King Digital in February.

Daily Tech Snippet: Tuesday, June 21

• VR is the future of porn, and it’s a creepy future indeed: This got real weird, real fast. And not just because I was demoing the technology in the middle of the E3 floor, surrounded by fellow show-goers. It’s just — well, even after all the explainers in the world, it’s hard to sufficiently brace your mind for all that virtual reality porn entails. It occupied a small space, tucked in the rear of the LA Convention Center, but Naughty America may just have had the one booth capable of rivaling Nintendo’s for sheer show buzz. We must have walked by the thing a dozen times during our three days on the floor, and there was always a small army of show-goers lined up to take it for a spin. Much like, say, your standard first-person shooter, the technology is built around a POV (point-of-view) shot, putting the viewer in the place of the camera. The effect is already a bit jolting (and, at times nausea-inducing) in standard VR, but all of that really goes next level when you look down and you’ve swapped your bits and bobs with someone else’s. The company’s demo cycles through a few short clips, in which the scenery, scenarios and co-stars change, but, well, the view pretty much stays the same. It’s hard to say how much of the initial shock is due to the newness of the technology and how much is firmly entrenched in the uncanny valley, though the company told me that many attendees enjoyed the demo, strange setting and all.Once you get past the somewhat off-putting nature of swapping nether regions with a professional, VR porn does offer an interesting way forward for an industry that, like many others, has been hard hit by the prevalence of free online content.

• Apple May Soon Open Retail Stores in India: After months of delays, Apple is likely to open its first retail stores in India, a fast-growing market for smartphones where the American technology giant has little presence. New rules issued by the Indian government on Monday exempt foreign-owned companies that want to open stores selling a single brand of products from requirements that 30 percent of the content of those products come from India. The exemption, which lasts three years, can be extended to eight years in the case of companies selling “cutting edge” items, such as Apple’s iPhones and Macs. Apple, which makes virtually all of its devices in China, lobbied for months for the loosening, and Timothy D. Cook, the company’s chief executive, discussed it with government officials during his first visit to India last month.An Apple spokesman declined to comment on the issue on Monday. The company has not yet received any formal response from the Indian government on its application to open stores. By themselves, new stores will have little impact on Apple’s small market share in India, beyond serving as a marketing tool. Although Indians will buy an estimated 139 million smartphones this year, Android models that cost less than $120 dominate the market, according to the Gartner research firm.Apple says its sales in India grew 56 percent during its last fiscal quarter, but its cheapest phones typically run $400 or more. Its total annual sales in India were around two million units last year, according to Gartner.

• Chinese Curb Cyberattacks on U.S. Interests, Report Finds: Nine months after President Obama and President Xi Jinping of China agreed to a broad crackdown on cyberespionage aimed at curbing the theft of intellectual property, the first detailed study of Chinese hacking has found a sharp drop-off in almost daily raids on Silicon Valley firms, military contractors and other commercial targets. But the study, conducted by the iSight intelligence unit of FireEye, a company that manages large network breaches, also concluded that the drop-off began a year before Mr. Obama and Mr. Xi announced their accord in the White House Rose Garden. In a conclusion that is largely echoed by American intelligence officials, the study said the change is part of Mr. Xi’s broad effort to bring the Chinese military, which is considered one of the main sponsors of the attacks, further under his control. As a result, the same political forces that may be alleviating the theft of data from American companies are also responsible for Mr. Xi’s stunningly swift crackdown on the Chinese media, bloggers and others who could challenge the Communist Party.

• Wal-Mart to Buy 5% Stake in JD.com as Part of Chinese Deal: Wal-Mart Stores will acquire a 5 percent stake in Asian e-commerce giant JD.com Inc. in a deal that will reshape the U.S. retail chain’s operations in China. As part of the agreement, JD.com will take ownership of Wal-Mart’s Yihaodian online marketplace, the companies said in a statement Monday. The Chinese branch of Sam’s Club also will open a store on JD.com, and the two companies will link up their supply chains. The partnership gives Wal-Mart a fresh start in China after it struggled to adapt to a slowing local economy and a rise in online shopping. Wal-Mart Chief Executive Officer Doug McMillon has said that the company needs to succeed in China, where it estimates that 25 percent of global retail growth will come from in the next five years.A 5 percent stake in JD.com would be worth about $1.5 billion at its current stock price. Wal-Mart will receive about 145 million newly issued Class A shares of JD.com in the transaction. That deal will increase the retailer’s earnings per share by 16 to 19 cents in the second quarter, according to the statement.

• Apple to lose weighting in Russell index, shares could fall: After dropping more than $200 billion in market capitalization in one year, Apple shares could fall further as they are set to lose their weighting and be reclassified in the annual reconstitution of the widely followed Russell indexes. When all is said and done, about $1.3 billion more will be sold in Apple Inc shares at the market close on Friday, when the reconstitution of the Russell indexes takes effect, according to an analysis by Credit Suisse. Because Apple has been aggressively buying back and retiring its stock, outstanding shares have dropped to less than 5.5 billion from 5.8 billion in late June 2015, when the Russell indexes were last recalibrated, according to Reuters data. Apple's weighting in the Russell 1000 will roughly fall to 2.52 percent from 2.77 percent, Credit Suisse said. The decline is due to the combination of fewer shares outstanding and Apple's smaller part of the index's capitalization. The performance of a market-weighted index is more influenced by larger companies, like Apple. Adding to the selling pressure, Apple will be classified as both a value and a growth company at Russell. After the close on Friday, 92 percent of Apple will be considered "growth" and 8 percent "value" according to index provider FTSE Russell, splitting it between two Russell subindexes. The move matters because value managers that peg their investments to the Russell indexes will be buying Apple while growth managers will be selling. Because there are more assets benchmarked to growth than to value, there will be net selling of Apple, said Meera Krishnan, U.S. index strategist at Credit Suisse in New York. She estimated there will be over $850 million of selling in Apple out of the growth component of the Russell 1000 and about $400 million of buying from the value side.

Daily Tech Snippet: Wednesday, June 1

• Why you should delete the online accounts you don’t use anymore — right now: Despite falling out of vogue years ago, MySpace — that old precursor to Facebook — still has details on more user accounts than the United States has people. And now a hefty chunk of those account credentials has been leaked to the entire Internet, in a humbling reminder that the Matchbox Twenty-inspired username you probably made in high school is still worth a heck of a lot to companies and criminals. As many as 360 million MySpace accounts turned up for sale Friday in a 33-gigabyte dump online, according to reports that were confirmed Monday by MySpace's parent, Time Inc. The massive leak includes passwords, email addresses and usernames that were swiped from MySpace in a hack dating back to June 2013, before MySpace made a site redesign that closed some security gaps. It's unclear how many of the accounts in the MySpace hack were still "active," in the sense that they belong to people who continue to log into the service today. But chances are at least some of these accounts hadn't been touched for years. The reason this makes you vulnerable is the same reason experts say you shouldn't use the same username and password for every online service — it makes it easy to take one set of stolen credentials and plug them into others, giving hackers potential access to large swaths of your digital life. Personal data from the MySpace breach was going for sale to the tune of thousands of dollars, highlighting how even outdated information can still carry significant value. But whether your old data gets used for marketing, fraud or some other nefarious purpose is still at least partly within your control.

• Inside Uber’s Auto-Lease Machine, Where Almost Anyone Can Get a Car: In its relentless pursuit for growth, Uber needs new drivers, and many of those drivers need cars. To help them get started, Uber has been offering short-term leases since July through a wholly owned Delaware-based subsidiary called Xchange Leasing, LLC. It partners with auto dealerships, advertises to drivers, manages risk, and even pays repo men to chase down cars whose drivers aren't making their payments. Xchange may be key to Uber's continued expansion as it tangles with Lyft in the U.S. and a bevy of competitors abroad. Uber announced a partnership with Toyota last week to finance even more cars. This year, Uber said its financing and discount programs, which include Xchange, will put more than 100,000 drivers on the road. That requires dipping into the vast pool of people with bad or no credit. In a deal led by Goldman Sachs, Xchange received a $1 billion credit facility to fund new car leases, according to a person familiar with the matter. The deal will help Uber grow its U.S. subprime auto leasing business and it will give many of the world's biggest financial institutions exposure to the company's auto leases.  The credit facility is basically a line of credit that Xchange can use to lease out cars to Uber drivers.

• Instagram Adds Business Profiles in Advertising Growth Push: Facebook’s photo-sharing application Instagram is unveiling tools to help businesses differentiate themselves from regular users in a bid to help drive advertising revenue. Instagram, which has been heralded by analysts as a key source of growth for Facebook, will now let businesses create special profiles that will allow customers to contact them directly rather than posting public comments. Instagram will also offer business users new data on which posts are getting the most engagement and give them the ability to turn posts into advertisements. Facebook is working to leverage Instagram’s 400 million monthly users to keep up its pace of revenue growth. Instagram ads are expected to bring in $1.53 billion in revenue in 2016, or 15 percent of Facebook’s total ad sales, according to eMarketer. Instagram has 8.5 million users in Canada, Levine said.

• Microsoft sells patents to Xiaomi, builds 'long-term partnership': Software maker Microsoft  is selling about 1,500 of its patents to Chinese device maker Xiaomi [XTC.UL], a rare departure for the U.S. company and part of what the two companies say is the start of a long-term partnership. The deal, announced on Wednesday, also includes a patent cross-licensing arrangement and a commitment by Xiaomi to install copies of Microsoft software, including Office and Skype, on its phones and tablets. Both companies declined to discuss financial terms of the deal.  Jonathan Tinter, corporate vice president at Microsoft, said the company was keen to tap into Xiaomi's young, affluent and educated users by having its products pre-installed on their devices. He declined to go into detail about the patent deals, but said the overall deal was something "we do only with a few strategic partners." Microsoft has cut licensing deals with many Android device makers over the years, but has had less luck with Chinese manufacturers. Florian Mueller, a patents expert who consulted for Microsoft in the past, said it was rare for Microsoft to actually sell its patents, adding "it's possible Microsoft found it easier to impose its Android patent tax on Xiaomi as part of a broader deal that also involved a transfer of patents." 

Daily Tech Snippet: Monday, May 16

• Why a staggering number of Americans have stopped using the Internet the way they used to: Nearly one in two Internet users say privacy and security concerns have now stopped them from doing basic things online — such as posting to social networks, expressing opinions in forums or even buying things from websites, according to a new government survey released Friday. This chilling effect, pulled out of a survey of 41,000 U.S. households who use the Internet, show the insecurity of the Web is beginning to have consequences that stretch beyond the direct fall-out of an individual losing personal data in breach. The research suggests some consumers are reaching a tipping point where they feel they can no longer trust using the Internet for everyday activities. The survey showed that nearly 20 percent of the survey's respondents had personally experienced some form of identity theft, an online security breach, or another similar problem over the year before the survey was taken last July. Overall, 45 percent said their concerns about online privacy and security stopped them from using the Web in very practical ways. The NTIA survey also showed that the more connected devices people owned, the more they experienced a breach of data. For those with only one laptop or computer or smartphone, 9 percent reported a security incident. That number more than tripled for those with at least five devices.

• Uber China Rival Didi to Consider U.S. IPO as Soon as 2017: Apple may not need to wait that long before it reaps the benefits of investing $1 billion in Chinese car-hailing service Didi Chuxing. Didi is targeting an initial public offering in New York next year, according to people familiar with the matter. The timing will depend on how its battle with Uber Technologies Inc. in China plays out, said the people, who requested not to be named because the matter is private. Such a move may put the Chinese app ahead of its U.S. rival in going public, with Uber having said it wants to hold off as long as possible. China’s biggest ride-hailing app is in the process of raising about $3 billion of funding, including Apple’s $1 billion contribution, which has swelled the company’s valuation to about $26 billion, people familiar have said. Didi, already backed by Alibaba Group Holding Ltd. and Tencent Holdings Ltd., has reached break even in about half of the 400 Chinese cities it operates in as Uber spends heavily to win both drivers and riders. At Didi’s current valuation, a U.S. IPO could be the biggest by a Chinese company since Alibaba’s record offering in 2014. The company is among a list of ride-sharing apps including Uber and Lyft Inc. that could conduct a public offering. Didi hasn’t decided on which exchange and which banks to hire yet, the people said. Didi was created last year when separate apps backed by Tencent and Alibaba merged after brutal competition drove up losses. The company now has 14 million registered drivers in China, delivering more than 11 million rides a day, and last month said it’s on track to turn an operating profit “soon.”

• Exclusive: Warren Buffett, Quicken Loans founder in Yahoo bid - sources: Berkshire Hathaway Inc Chairman Warren Buffett is backing a consortium vying for Yahoo Inc's internet assets that includes Quicken Loans Inc founder Dan Gilbert, people familiar with the matter said on Friday. While there is no certainty that the consortium will prevail in the auction, the interest of Buffett and Gilbert is a boost for the Sunnyvale, California-based company, which has been surpassed in recent years by rivals such as Alphabet Inc in the race for internet users and advertising dollars. The consortium's participation in the sale process also represents a challenge to U.S. telecommunications carrier Verizon Communications Inc, whose deal to acquire AOL last year for $4.4 billion has made it a favorite to prevail in its bid for Yahoo's assets among industry analysts.

• Amazon is going to sell its own lines of food, detergent and diapers, and it's going to be a really big deal: Amazon is going to start selling its own brands of snacks, diapers, detergent — a move lots of traditional retailers have already made. But Amazon isn't a traditional retailer, so this move could be very meaningful for Amazon, and its competitors. The e-commerce powerhouse will soon begin selling its own packaged goods, exclusively to Amazon Prime members under brands like Happy Belly and Mama Bear, the Wall Street Journal reports. While some people will point out that so-called "private-labeling" is nothing new -- grocery stores and big-box retailers have been increasingly pushing their in-house brands -- this is a much bigger deal. That's because the growth in retail is all going to be online, and Amazon owns online. It already accounts for half of all sales growth in U.S. e-commerce. So Amazon's move into consumer packaged goods gives it even more opportunity to flex its muscle with suppliers. That means giving its own products better placement on its site, and undercutting competitors on pricing. The move also offers Amazon the chance to pad its bottom line -- something Jeff Bezos hasn't traditionally been willing or able to do. Private-label brands typically carry higher profit margins , in part because the companies selling them don't put big marketing campaigns behind them. Think of the damage Amazon already does its to competitors as a low-margin business. Now imagine what happens when if it starts generating real profits on stuff like cereal and soap. The move is also a way to increase the power of Amazon Prime, the $99-a-year unlimited shipping program that fuels Amazon's retail growth. Prime customers spend more on Amazon than non-members and are more loyal, too. By adding another perk, Amazon can make its best customers even even more loyal. There's risk here, of course. Some Amazon-branded products have already flopped, including its Amazon Element diapers, which were pulled for design flaws shortly after launch.

Daily Tech Snippet: Thursday, February 18

• Zenefits Scandal Highlights Perils of Hypergrowth at Start-Ups: Zenefits may be among the first of several cautionary tales to highlight a sobering lesson: For a start-up, growing too quickly can produce just as spectacular a failure as growing too slowly. Zenefits is a three-year-old company that makes software for small businesses. In its short life span, it has been called both the most unsexy company in tech, and one of the most promising.Its investors have argued that Zenefits, which makes money by acting as a health-insurance brokerage firm for its customers, has the potential to cut the red tape that small businesses have to battle to provide benefits for their employees.These grand promises were bolstered by Zenefits’ early growth. Its annual recurring revenue — an accounting measure preferred by subscription-based software companies — reached $1 million by the end of 2013, the year Zenefits was founded. Recurring revenue hit $20 million by late 2014, and was projected to reach $100 million by late 2015. The exponential growth was catnip to investors. The start-up raised $500 million last year at a $4 billion valuation, one of the largest financing rounds in a year of mega-fundings. At one point, Andreessen Horowitz, Silicon Valley’s pre-eminent venture firm, had invested more in Zenefits than in any other company. In total, Zenefits has raised about $581 million. Then, last week, poof. Zenefits announced that Parker Conrad, its co-founder and chief executive, had resigned. In emails to employees, David O. Sacks, the former chief operating officer and new chief executive, explained that Mr. Conrad had overseen a company that had become derelict in its culture and ethics. Zenefits has sought to paint the executive changes as a new beginning. One person close to the company said when Mr. Sacks briefed employees on Mr. Conrad’s exit last week, there were celebrations and tears of relief at the San Francisco headquarters of Zenefits.  Yet the story is more complicated than the single instance of a founder’s misdeeds. Zenefits’ recklessness seems to have been merely the worst symptom of a larger sickness that infected the company, according to investors, former employees and others who worked with the management team (and who all requested anonymity because no one in Silicon Valley wants to be seen as kicking a start-up when it’s down).  That sickness: Zenefits was a company consumed by impossible expectations. In return for fund-raising at a stratospheric value, Mr. Conrad promised the moon to investors. Then, to reach the moon, he began to transform a tiny start-up into a mighty rocket ship — only to watch it careen out of control as it stretched to accomplish the impossible. Though many noticed trouble, neither Mr. Conrad, nor the board of directors, nor anyone else in management could afford to stop, take a breath and fix the problems. Growth was the only imperative.

• Cybersecurity concerns - Why US Naval Academy students are learning to sail by the stars for the first time in a decade: batteries run out, systems get hacked, and even advanced technology can be balky. In a pinch — or in a war — sailors need something to fall back on. And stars and sextants have been working pretty well for hundreds of years. So the Naval Academy started teaching its sailors how to navigate ships by looking to the heavens again this academic year. The training was dropped altogether in 2006. “I thought that we had computers and all that for navigation,” Hogan, 20, a Charleston, S.C., native said this week during a class on the subject. But amid concerns about cyberattacks and new weapons that can shut off the electricity of a ship or a plane, the Naval Academy made celestial navigation a requirement for third-year students. “Redundancy is the best policy,” said Lt. Alex Reardon, who taught three sections of the class. Especially because, when it comes to a Navy ship on the open seas, “we’re typically alone in what we do.” That could be a major problem in the event of a cyberattack, said Salvatore Mercogliano, an assistant professor focused on naval history at Campbell University and a former merchant mariner. During World War II, the U.S. began using land-based radio beacons known as the LORAN system to help guide ships. And the space race helped further celestial navigation’s decline: The Navy sponsored the development of the first operational satellite navigation system, dubbed TRANSIT, which went into active service in 1964 — providing navigation assistance for naval submarines and surface vessels. But TRANSIT was retired in the mid-’90s after the Air Force completed the modern GPS system, which uses dozens of satellites circling the globe.

• Amazon expanding deliveries by its 'on-demand' drivers: Amazon.com Inc (AMZN.O) is quietly inviting drivers for its new "on-demand" delivery service to handle its standard packages, as the online retailer known for low prices and razor-thin profit margins looks to speed up delivery times and tamp down its growing multi-billion dollar logistics bill.The move, which has not been announced publicly, is the latest sign that the world's biggest e-commerce company wants to control more of its own deliveries. Media reports have said the company plans to lease its own fleet of jets, and CEO Jeff Bezos eventually wants to use drones to get packages to customers. Amazon outlined details of its latest plan over the last few weeks in an email to contract drivers who deliver parcels for Amazon Flex, a program launched last year to handle speedy deliveries of common household goods to customers using Prime Now, a mobile app that comes with Amazon's popular $99-a-year Prime membership. They are not Amazon employees. If the gambit works, industry analysts said it could help Amazon contain its shipping costs, which grew more than 18 percent to $11.5 billion last year. It might also create a logistics network to compete with UPS and FedEx.

• Blippar’s New Augmented Reality App Is Supposed to Recognize Any Object You Point It At. Augmented reality app Blippar has been around since 2011, but until recently it focusedmostly on advertising and content for brands: Point your Blippar smartphone app at a bold “B” embossed on the pages of a magazine or a bottle of ketchup and more information would pop out on your phone’s display. But it’s safe to say that augmented reality is coming into a new phase: The contextual information being supplied is getting smarter, and people are gradually becoming more aware of the capabilities of AR and virtual reality (some are even excited to wear headsets, if you can believe it). So Blippar, in an effort to evolve along with the rest of the AR world, has just launched a new version of its smartphone app that is supposed to recognize literally any object you point at it — whether it has been “tagged” with an AR code or not. Blippar co-founder and CEO Ambarish Mitra showed off the new version of the mobile app today at the Code/Media conference at The Ritz-Carlton, Laguna Niguel in Dana Point, Calif. He pointed the app at a variety of random objects — a magazine, a salad and an apple — to demonstrate how the app’s image recognition capabilities work. “This is a really big change in our business model,” Mitra had said in an interview before the conference kicked off. “Initially, AR was about very static image recognition. You store images of Starbucks or Coca-Cola or General Mills in our database, and the images match. But now you’re able to analyze any environment in the world in real time, over a 3G connection.” Mitra said over the past year and a half he has moved his technology team from the U.K. to Mountain View, Calif., to focus on machine learning, which is all the rage in Silicon Valley right now, with everyone from small upstarts to behemoths like Google trying to crack the code on how to make accurate predictions from large sets of data. (Google, actually, has an app that works similarly called Google Goggles, but it works when you point the app at a QR code or a famous landmark or something else recognizable — not necessarily everyday objects.) In short, this is not an easy thing to do. In fact, ahead of the event, one of our staffers tried it out by pointing the app at his dog, and it thought the pup was a goat. Mitra has said that, right now, the technology has elementary capabilities, like the brain of a six-year-old; it can recognize “car,” but not “Prius,” or it can recognize an item of clothing, but not the label. However, with machine learning, the app should be able to get to the level of an 18-year-old pretty quickly, Mitra said, in terms of its recognition abilities. And during the onstage demo, it did properly identify a pug named Milton as a dog.

Daily Tech Snippet: Tuesday, December 22

• Cisco reviews code after Juniper code backdoor found; more scrutiny expected: Networking equipment maker Cisco said on Monday it has launched a product review to look for tampering after rival Juniper Networks's disclosure found code in firewall software that made it vulnerable to cyber attacks. Juniper warned customers on Thursday that it had uncovered "unauthorized code" in its firewall software, saying it could be exploited to allow an attacker to unscramble encrypted communications that travel through the security devices. That prompted the code review by Cisco. Security experts said they expect other technology companies to conduct similar investigations after last week's unprecedented news from Juniper. It was the first time a major technology firm discovered the addition of an unauthorized 'back door," or code that could be exploited to facilitate cyber attacks, according to security experts. Meanwhile, the U.S. Department of Homeland Security said it was investigating how the Juniper "back door" might impact government networks.

• Toshiba Plans to Cut 7,800 Jobs as It Warns of Huge Loss:  Toshiba warned on Monday that it would incur its largest net loss ever as it tries to restructure a stable of unprofitable businesses. The Japanese company, whose financial struggles were laid bare this year in a $1.2 billion accounting scandal, said it would eliminate 7,800 jobs, mostly in its slumping consumer electronics division. That brings the number of job cuts announced this year to more than 10,000 total, or roughly 5 percent of its work force. Shedding workers is expensive in Japan, where the majority of employees enjoy legal protection from layoffs. Toshiba will have to negotiate voluntary buyouts instead, a process it said would contribute to a loss of 550 billion yen, or $4.5 billion, in the financial year ending in March. The bookkeeping scandal has been an embarrassment for corporate Japan. Though wrongdoing by businesses is hardly unheard-of here, Toshiba was among the bluest of blue-chip companies, featuring on a prominent index of businesses believed to combine profitability with clean, modern corporate governance. Instead, it turned out that the company had been massaging its earnings since the global financial crisis took hold in 2008. A committee of investigators hired by the company concluded in the summer that it had engaged in a “systematic cover-up.” The committee found problems in virtually all corners of Toshiba’s business, which encompasses products as various as refrigerators and nuclear power plants. Half the company’s board of directors stepped down. The more than 150 billion yen in profit overstatement discovered by the committee was equal to about a third of the pretax profits that Toshiba reported during the seven-year period under scrutiny.

• Ericsson signs patent deal with Apple, shares soar: Swedish mobile telecom gear maker Ericsson said it had signed a patent license deal with Apple Inc over technology that helps smartphones and tablets connect to mobile networks, sending its shares up much as 8 percent. The deal ends a year-long dispute with Apple, one of the biggest legal battles in mobile technology and Ericson said it would pave the way for cooperation between the companies on future technologies. Ericsson had said in its filing to a U.S. district court in January that Apple's license to use the technology developed by the Swedish firm had expired, and that two years of negotiations had not led to a new deal. Ericsson on Monday estimated overall revenue from intellectual property rights in 2015 would hit 13 to 14 billion crowns ($1.52-$1.64 billion) up from 9.9 billion in 2014 as a result of the agreement.

• Uber's Rival Lyft Plans to Raise Up to $1 Billion in New Funds: Ride-hailing company Lyft plans to raise as much as $1 billion in new funds, according to a Delaware state filing, in a round of financing analysts said could sharply boost the valuation of Uber’s largest U.S. rival. Lyft didn’t indicate in the Friday evening filing how much had been raised, who was investing in the round or list a valuation. Sven Weber, a financial filings expert, pegged the pre-money valuation at about $4.5 billion while Justin Byers at VC Experts estimates it closer to $3.9 billion. Lyft was valued at $2.5 billion when it announced a previous funding round in March. The latest fundraising round contained some downside protection for new investors, including the provision of extra shares should Lyft go public at a lower valuation. Lyft is competing aggressively with Uber, which recently filed to raise $2.1 billion at a $62.5 billion valuation. The discrepancies in the valuations reflect Uber’s pole position in the U.S. and its global ambitions. On Dec. 3, Lyft said it was teaming up with Uber’s biggest rivals in Asia, including China’s Didi Kuaidi, Singapore’s GrabTaxi, India’s Ola, to form a global alliance that will make their apps cross-compatible for travelers. Lyft lost $127 million in the first half of 2015 on $46.7 million in revenue, according to fundraising documents obtained by Bloomberg. It said last month it has gained market share in key markets such as San Francisco, and has a gross revenue “run rate” of $1 billion.

Daily Tech Snippet: Tuesday, December 1, 2015

• Holiday Shopping Is Chilly for ‘Buy’ Buttons at Twitter, Facebook and Pinterest: More than a year after Twitter and Facebook began placing Buy buttons on their social networks, their e-commerce initiatives still appear to be relegated to experimental side projects. And at Pinterest, the tech platform that many believe is most conducive to e-commerce, one of its mainstream launch partners is seeing fewer than 10 purchases a day via so-called Buyable Pins. The lack of aggressiveness on the part of Facebook and Twitter, and tepid early results at Pinterest, highlight the myriad challenges all three platforms face in transforming their immense user bases into shoppers. The sluggishness of the combined efforts also serves as a warning to other industry players betting big on the idea of social commerce that it’s still unclear if consumers will make purchases in big numbers on platforms that aren’t mainly retail destinations. Spokespeople for the three companies declined to disclose sales numbers for these initiatives. While each platform had its own reasons for pursuing e-commerce initiatives, the central idea was that they thought there was an opportunity to make it easier for their users to buy a product when they discover it on the platform. In theory, the usefulnesses of such a feature would be the biggest on mobile phones, where clicking through to make a purchase on another site can make purchases less likely because of uneven mobile webpage experiences. Facebook was the first to take a crack. Sixteen months after Facebook first began testing Buy buttons on ads and regular posts to let people purchase products they discover on Facebook without leaving Facebook, the initiative is still being dubbed a beta test, restricted solely to online merchants who work with e-commerce software provider Shopify. The company has also recently added purchase capabilities to some Facebook business pages and to a dedicated shopping section of Facebook, but these features, too, are being characterized as “tests” that aren’t available to all Facebook users in the U.S. At Twitter, it’s still unclear how big of a priority e-commerce will be going forward under the leadership of new CEO Jack Dorsey. The company began placing Buy buttons in tweets in September of 2014, and struck partnerships in October of this year with software partners such as Bigcommerce and Stripe to get more merchants on board. Best Buy, for example, will soon join the program — just not in time for the just-passed Black Friday weekend. But regular Twitter users can still go weeks without seeing any tweets enabled with e-commerce; most Re/code colleagues I polled, who are absolute Twitter power users, said they never come across them at all. Then there’s Pinterest, the massive tech platform that retailers were most excited about for its e-commerce potential. The company began inserting Buyable Pins into its iPhone app in late June, and just added the feature to its Android app in early November. The company says more than 10,000 merchants have joined the program, including big retailers and brands like Macy’s, Nordstrom, Neiman Marcus, Cole Haan and Tory Burch, but at least one of these big partners is seeing fewer than 10 purchases a day on Pinterest, according to a person with direct knowledge of the sales figures. This source and another also said that Pinterest insiders have privately admitted to being disappointed with early sales numbers.

• AppDynamics Raises $158M; Now Valued At $1.9 Billion: Last month, based on an SEC filing, we told you that seven-year-old, San Francisco-based AppDynamics had raised a fresh $83.4 million in funding as part of a round that was targeting up to $150 million. Turns out the company met that target and then some. CEO David Wadhwani — who joined the firm in September after spending more than a decade as an executive at Adobe, including as its digital chief — says the company has just closed on $158 million in a round led by General Catalyst and Altimeter Capital. Other participants in the round include Adage Capital, Industry Ventures, Goldman Sachs, and Cross Creek Advisors, as well as earlier backers Institutional Venture Partners, Greylock Partners and Lightspeed Venture Partners. AppDynamics makes software to monitor the performance of business applications, competing with some traditional firms like IBM, as well as younger outfits like New Relic, which went public last December and has seen relatively steady stock performance since. (New Relic, which raised $214 million in venture funding, has a current market cap of $1.8 billion.) AppDynamics had previously raised roughly $206 million in debt and equity, including a $120 million round — $70 million equity and $50 million of debt — that closed in July of last year. At the time of the funding announcement, the company told VentureBeat that the money represented “pre-IPO growth financing.” Asked today what this new round means, Wadhwani said he “won’t speculate on the exact timing” of an IPO but added, “I was brought in to take this company public, and that’s what I intend to do.” The new funding, he said, “represents freedom. We can [execute on our plans for the company] on this money and effectively choose when we want to go public.” Wadhwani declined to discuss the company’s post-money valuation, but a source close to the company pegs it at $1.9 billion.

• In a Global Market for Hacking Talent, Argentines Stand Out: Want to learn how to break into the computerized heart of a medical device or an electronic voting machine? Maybe a smartphone or even a car? Thanks to the legacy of military rule and a culture of breaking rules of all sorts, Argentina has become one of the best places on earth to find people who could show you how. As Silicon Valley’s talent war has gone global, particularly for those skilled at breaking into things, this Latin American nation has become a rich recruiting ground for corporations and foreign governments. Companies need hackers to help defend against online criminals and state-sponsored spies. And as the world’s critical infrastructure moves online and the threat of war moves into cyberspace, governments are desperate to acquire hackers’ tools. Within Latin America, Brazil has become known in recent years as the world leader in Internet banking fraud. But Argentina’s hackers have a reputation for creativity. In particular, they are known for their ability to find so-called zero-day flaws, which are unpatched holes in widely used technology that can be used to spy on or even destroy adversaries’ computer networks. Technology companies like Apple, Facebook and Google have encrypted their products and services so that in many cases the only way to monitor a target’s communications is to hack directly into its device. As a result, there is a new urgency among governments in acquiring zero-day exploits. A mix of executives from around the world, government officials, contractors and — or so it was rumored — spies gathered here in October in an industrial building converted into a cultural center to watch hacking done the Argentine way at the 11th annual EkoParty, the largest hacking conference in Latin America. Long before foreign companies came calling, hacking things was a life skill in Argentina, a way to get by through decades of repressive military rule and a volatile economy. Argentines have a saying, “atado con alambre,” which translates roughly as “held together with wire,” to describe the inventive nature of so many here who learned to do much with little. The country still has one foot in the tech industry’s past because of stringent import rules. Amazon will not ship to your door here. BlackBerry has more market share here than Apple. A new iPhone costs $2,000 or more on MercadoLibre, an online auction site, but many iPhone owners said they had been able to persuade a friend traveling from abroad to sneak one through customs. To get their hands on the latest, greatest devices, Argentines often have to think like a hacker — or even become one. “You make do without resources, without high-end technology, with poor Wi-Fi connections,” said Sergio Berensztein, an Argentine political analyst. “We improvise creative solutions, for lack of other options, and many have applied these same procedures to the technical industry.”

• FAA Permit for Drone Flight School May Help Amazon, Google Speed Up Delivery Plans: The Federal Aviation Administration is plotting how to regulate drones. Tech companies with plans for drones — Amazon, Google, DJI, GoPro and a bevy of others looking to tap a potential multi-billion dollar market — are itching for the FAA to get on with it already. Last week, the agency made a small legal maneuver that advocates hope indicates more leniency to come on the commercial applications of drones. The FAA authorized the Kansas State University Polytechnic campus to train students and outside companies on flying unmanned aircraft. This type of authorization, called a Section 333 exemption, is common; construction sites, news outlets and disaster relief groups have received them. Amazon scored one in April. The notable difference here is in how close the FAA lets drones get to people. Even with flight authorization, drones must stay 500 feet from people, unless the craft meet some stringent safety and logistics requirements. The only exception had been on closed film and TV sets, which deploy drones for movie magic. But the FAA lifted the 500-foot restriction for the Kansas school, even though it didn’t ask for the specific closed-set exemption.

• Target and PayPal Sites Report Problems on Cyber Monday: Cyber Monday, the online version of Black Friday, is not immune to traffic jams of shoppers rushing to take advantage of post-Thanksgiving sales. Some of the most popular websites experienced an overload on Monday, similar to a crowd pushing its way into an already packed brick-and-mortar store. Shoppers were for a period of time unable to gain access to the site of Target, the discount chain,and PayPal, the online payments processing service. Both are now back online after an onslaught that reflects the shifting trends in the way consumers are looking for shopping bargains. Foot Locker, Groupon and Victoria’s Secret also experienced brief outages or slowdowns Monday afternoon, according to Catchpoint Systems, a web monitoring firm. In a statement on Monday, Target said it was experiencing its biggest online volumes ever in response to a 15 percent online discount that it had announced previously. Visitors to the site early Monday got a message saying: “Please hold tight. So sorry, but high traffic’s causing delays. If you wouldn’t mind holding, we’ll refresh automatically & get things going ASAP.” According to a statement from Target, the company said it placed online shoppers in a queue in order to manage the volume of users, but it then allowed them to keep trying to gain access by refreshing their browser. A heat map on downdetector.com showed most of the problems with PayPal were reported in North America and Europe. Problems started around 8:30 a.m. Eastern time. PayPal said in an emailed statement that the “brief, intermittent interruption” in service was resolved. It did not provide a reason. The holiday buying frenzy has evolved over the years as more stores offer sales before and sometimes on Thanksgiving Day. It has also shifted away from physical stores as Americans have increasingly turned to online shopping. For many people, Monday was their first day back at work after the long Thanksgiving weekend, so some shopping was presumably being done surreptitiously while at work.

Daily Tech Snippet: Wednesday, November 18

• Earnest, Fueled by Growth in Student Loans, Raises $275 Million: At the start of this year, Earnest was an intriguing but small entrant in an emerging field of start-ups using new tools of data and software to analyze credit risk and make consumer loans. Its loans were typically a few thousand dollars for things like relocation expenses and professional training. But today, the lender, based in San Francisco, is growing at a torrid pace, and on Tuesday it announced a $275 million round of debt and equity to fund further expansion. Already this year, Earnest has made 50 times as many loans as last year, and it is lending from $2 million to $5 million every day, said Louis Beryl, a co-founder and chief executive. In this round, $75 million is equity investment, and $200 million is debt funding. The debt portion is led by New York Life. The new financing brings the total raised by Earnest, founded in 2013, to $325 million. Earnest now employees 165 people, up from 30 at the start of this year. Mr. Beryl says he plans to hire about 200 more employees over the next year, especially technical people like software engineers, data scientists and user-experience designers. The long-term goal, he said, is to “build a platform for the next generation of consumer financial services.” The financial service that has carried Earnest so far is refinancing student loans, which it began at the end of January. It is by far the largest part of the company’s business, and Earnest’s success points to the opportunity in services to ease the burden on the nation’s debt-laden students and recent graduates. Student loan debt is more than $1.2 trillion, growing by about 10 percent a year. Student loans are held by 40 million Americans. Earnest is focusing on the more indebted recent graduates. The size of its average refinancing loan is $70,000. The start-up says the average saving, on its refinanced loans, is $18,000, typically over 10 years. Other online lenders, like SoFi and CommonBond, have also done well in the market for refinancing student loans. But Earnest says its approach is particularly data-intensive, which it says allows it to tailor rates to individual circumstances. It asks its customers for digital links to their bank, credit card and retirement and investment accounts, and information on all their loans. “They are willing to share their data for a better consumer finance experience,” Mr. Beryl said. Earnest says it has read-only access to the information. It pledges not to store personal data or sell it. Earnest has made individual loans of more than $250,000. Traditional credit scoring, Mr. Beryl said, tends to punish high student debt loads. But such Earnest borrowers, he said, are in fields like brain surgery and dental surgery, where education is lengthy and costly. “These are people with great jobs, great educations and great earning potential,” he added. Earnest borrowers average a bit over 30-years-old — young people with slender credit histories and thus charged higher rates by traditional banks. Mr. Beryl said Earnest has had no delinquency problems on its student refinancing loans. And Mr. Beryl, 34, is one of those prompt-paying customers. Having attended Princeton, Harvard Business School and Harvard‘s Kennedy School of Government, he had $100,000 in student loans at the start of the year. He has paid down some, but still holds student loan debt, he said.

• Latest Craze for Chinese Parents: Preschool Coding Classes: Wu Pei began teaching her 6-year-old son to code this year, thinking he’d enjoy learning a skill that might boost his future job prospects in an increasingly digitized world. Now, she runs classes in Nanjing, China, and is helping more than 100 parents introduce their children to coding. The 35-year-old former computer programmer with Foxconn Technology Group is tapping growing demand from parents intent on preparing their preschoolers for a world in which Oxford University researchers predict half the jobs in some countries may be eliminated by robots and computers. Similar classes are taking off across China. Reynold Ren has taught about 150 primary school-age children in Beijing to use Scratch, a project developed by the MIT Media Lab and Arduino, which enables users to create interactive objects such as robots. In Hong Kong, about 2,500 students have taken courses that Michelle Sun runs at her First Code Academy. “Teaching the next generation coding is something that should be elevated to a strategical national importance,” said Wang Jiulin, the Xi’an-based creator of Kidscode.cn, a website that shares free information and courses. “Even today, the majority of programmers in China can only perform very basic-level tasks and there’s huge demand for top notch coders.”  

• Lyft executive says on track to hit $1 billion in gross revenue: Ride-hailing app Lyft, Uber's biggest competition in the United States, expects to reach $1 billion in gross annual revenue, the company's co-founder told Reuters. Hitting a $1 billion run rate suggests privately owned Lyft has increased market share in some U.S. cities, despite competition from Uber, a larger and better-financed ride-hailing app. Lyft's net revenue was estimated at $130 million in 2014, according to company financial documents cited by Bloomberg. By comparison, Uber's gross bookings are projected to rise to $10.84 billion this year and $26.12 billion the next, according to a presentation for potential investors seen by Reuters earlier this year. Based on those figures, Uber's 2015 net revenue would be $2 billion. Lyft, founded in 2012, calculated its $1 billion run rate from its gross bookings in October, when the company made about $83 million off of 7 million rides. That did not include Halloween, Zimmer said, which will be counted in November's figures and is one of the ride-hailing industry's busiest nights of the year. Lyft has more than a 40 percent market share in San Francisco, its hometown, and in Austin, Texas, Zimmer said. The majority of rides in San Francisco and New York City are through the Lyft Line service, a carpool feature that brings several passengers together to share a car, Lyft co-counder and Chief Executive Logan Green said last week. However, Lyft's continued growth also hinges on its ability to tap investors for money. A recent pullback in late- and mid-stage investing and the cooling IPO market are expected to make capital tougher to raise for high-priced companies.

• Microsoft sheds reputation as easy mark for hackers:  Microsoft was once the epitome of everything wrong with security in technology. Its products were so infested with vulnerabilities that the company’s co-founder, Bill Gates, once ordered all of Microsoft engineers to stop writing new code for a month and focus on fixing the bugs in software they had already built. But in recent years, Microsoft has cleaned up its act, even impressing security specialists like Mikko Hypponen, the chief research officer for F-Secure, a Finnish security company, who used to cringe at Microsoft’s practices. “They’ve changed themselves from worst in class to the best in class,” Mr. Hypponen said. “The change is complete. They started taking security very seriously.” Microsoft estimates that it now spends more than $1 billion a year on security-related initiatives, including acquisitions. It acquired three security start-ups in the last year alone, and the number of security employees at the company increased 20 percent during that time. Soon after he became Microsoft’s chief executive in February 2014, Mr. Nadella instituted a monthly meeting with security leaders from across the company. They meet to discuss industry trends and analyze threats. He also altered how Microsoft watched the Internet for hacker attacks, an effort that had been splintered among different product groups and other divisions within the company. Microsoft now pays hackers more when they find and turn over a security hole.