Cyber Saturday—Marriott’s Data Breach Baloney, Quora Hack, Aussie Encryption Law

Happy weekend, Cyber Saturday readers.

I’m back stateside after a week-and-a-half stay in China, where I helped host Fortune‘s 2018 Global Tech Forum. I hope you understand the absence of last weekend’s dispatch; following the event, I took an impromptu vacation in Hong Kong. Thankfully, I did not stay at a Marriott hotel. Speaking of which.

As you have no doubt heard by now, Marriott disclosed a massive data breach that exposed up to 500 million customer records. Hackers accessed information in the company’s Starwood reservation system, which affected brands such as W Hotels, St. Regis, Sheraton Hotels & Resorts, Westin Hotels & Resorts, and other properties in the Starwood portfolio, the company said. The intrusion apparently began in 2014, two years before Marriott acquired Starwood. This oversight in the M&A process calls to mind another recent, post-acquisition hacker-surprise: Yahoo, whose two mega-breaches remained undetected when the company sold to Verizon last year. Coincidentally, Marriott’s hack is the biggest suffered by a corporation, second only to those at Yahoo.

After news of the Marriott breach came out, Sen. Charles E. Schumer (D-N.Y.) called on the hotel chain to foot the bill and replace people’s passports which were potentially compromised as part of the breach. Marriott quickly promised to cover the cost for as many as 327 million people whose passport numbers may have been exposed. At a fee of $110 per passport, that would put Marriott on the hook to pay up to $36 billion—a price tag equivalent to the value of the entire company, per its market capitalization. A devastating payout.

Here’s the thing though: While seemingly noble, Marriott’s promise is a bunch of baloney. The company said it will follow through on reimbursement only in instances where it “determine[s] that fraud has taken place.” What this caveat conveniently excludes is that Marriott’s hack likely had little to do with fraud and everything to do with espionage. In other words, if you’re a victim, don’t expect remuneration.

As Reuters reported, investigators believe the perpetrators of this attack were Chinese spies. The breach used tools, tactics, and procedures that matched Beijing’s style. The intrusion is said to have begun shortly after a breach of the government’s Office of Personnel Management, which government officials have attributed to China. The Starwood database represents a massive trove of potential intelligence: information on who is staying where, when—a bonanza for building up profiles of targets and tracking people of interest.

Geng Shuang, China’s Ministry of Foreign Affairs spokesperson, issued a statement saying the country “opposes all forms of cyber attack,” per Reuters. He said the country would investigate the claims, if offered evidence. Meanwhile, Connie Kim, a Marriott spokesperson, said “we’ve got nothing to share” about the Chinese attribution claim.

The Marriott breach—which took place quietly over years, as spies prefer—does not appear to have been a cybercriminal score. The passport payment pledge is probably bunk; nevertheless, if you think you might have been affected, it won’t hurt to follow these steps to refresh your cybersecurity hygiene and better protect yourself.

Have a great weekend.

Robert Hackett

@rhhackett

[email protected]

Welcome to the Cyber Saturday edition of Data Sheet, Fortune’s daily tech newsletter. Fortune reporter Robert Hackett here. You may reach Robert Hackett via Twitter, Cryptocat, Jabber (see OTR fingerprint on my about.me), PGP encrypted email (see public key on my Keybase.io), Wickr, Signal, or however you (securely) prefer. Feedback welcome.

Marriott Says It Will Pay for Replacement Passports After Data Breach. Here’s Why That’s Likely Baloney.

As you have no doubt heard by now, Marriott disclosed a massive data breach that exposed up to 500 million customer records. Hackers accessed information in the company’s Starwood reservation system, which affected brands such as W Hotels, St. Regis, Sheraton Hotels & Resorts, Westin Hotels & Resorts, and other properties in the Starwood portfolio, the company said. The intrusion apparently began in 2014, two years before Marriott acquired Starwood. This oversight in the M&A process calls to mind another recent, post-acquisition hacker-surprise: Yahoo, whose two mega-breaches remained undetected when the company sold to Verizon last year. Coincidentally, Marriott’s hack is the biggest suffered by a corporation, second only to those at Yahoo.

After news of the Marriott breach came out, Sen. Charles E. Schumer (D-N.Y.) called on the hotel chain to foot the bill and replace people’s passports which were potentially compromised as part of the breach. Marriott quickly promised to cover the cost for as many as 327 million people whose passport numbers may have been exposed. At a fee of $110 per passport, that would put Marriott on the hook to pay up to $36 billion—a price tag equivalent to the value of the entire company, per its market capitalization. A devastating payout.

Here’s the thing though: While seemingly noble, Marriott’s promise is a bunch of baloney. The company said it will follow through on reimbursement only in instances where it “determine[s] that fraud has taken place.” What this caveat conveniently excludes is that Marriott’s hack likely had little to do with fraud and everything to do with espionage. In other words, if you’re a victim, don’t expect remuneration.

As Reuters reported, investigators believe the perpetrators of this attack were Chinese spies. The breach used tools, tactics, and procedures that matched Beijing’s style. The intrusion is said to have begun shortly after a breach of the government’s Office of Personnel Management, which government officials have attributed to China. The Starwood database represents a massive trove of potential intelligence: information on who is staying where, when—a bonanza for building up profiles of targets and tracking people of interest.

Geng Shuang, China’s Ministry of Foreign Affairs spokesperson, issued a statement saying the country “opposes all forms of cyber attack,” per Reuters. He said the country would investigate the claims, if offered evidence. Meanwhile, Connie Kim, a Marriott spokesperson, said “we’ve got nothing to share” about the Chinese attribution claim.

The Marriott breach—which took place quietly over years, as spies prefer—does not appear to have been a cybercriminal score. That’s why the passport payment pledge is probably bunk; nevertheless, if you think you might have been affected, it won’t hurt to follow these steps to refresh your cybersecurity hygiene and better protect yourself.

A version of this article first appeared in Cyber Saturday, the weekend edition of Fortune’s tech newsletter Data Sheet. Sign up here.

Why You Need to Start Tracking Your Time Every Day

Time tracking is a controversial topic. It evokes images of teams clocking in and out of a factory floor or being tethered to their desks for 60 hours a week. Of course, those scenarios are awful. I don’t want to dismiss the very real ways that time tracking can become a horrible way to run a team, but I do want to tell you why I believe it should be used–and how.

Before we get into the rationale, I want you to question your assumption that time tracking makes you a control freak or a micromanager.

For a brief moment, let’s imagine together an alternative way of looking at this, in which you have time tracking set up not because you don’t value your team’s time (and their ability to finish their days on time and have a life afterward), but because you do. Time tracking is the path toward work-life balance, not away from it. The only way to do that is by understanding how their time is being spent–and what it’s being spent on.

Still with me? Here are three reasons you should use time tracking–not just for your business’ benefit, but also for your employees’ benefit.

1. Tracking your employees’ time helps you make good spending decisions.

Businesses often view the use of internal resources as “free” and the use of external resources as an investment. I believe that’s foolish. Let’s say you have an employee who has never built a website before, and your business needs a website built. If you aren’t considering the value of your employee’s time, you could easily assign them this job, and then they spend 100 hours learning, tweaking, and finally refining a project that an outside specialist could have done in 10 hours.

Assuming your internal and external resources receive about the same hourly rate, this is a huge mistake for your business from a return on investment perspective, and an error that is all too common. And, it’s not great for productivity.

Now, take that one step further. Imagine you decide to do a content marketing campaign, which will mean your employee is writing two articles per week for 10 weeks. In order to acquire the same number of customers, you could also run a Google AdWords campaign for $500. How will you know what’s the best spending decision if you aren’t tracking time?

2. Time tracking means better management of working hours.

The natural assumption is that managers use time tracking to see if their team is working enough. In my experience, that’s never the issue. But, if you think your team isn’t working enough, time tracking isn’t going to solve or diagnose that problem–you’ve got a deeper underlying problem that starts with either motivation or poor hiring technique.

In an office environment, it wouldn’t be uncommon for a manager to walk around the halls in the evening and encourage the team to go home if they felt that people were working too hard. But in a remote setting, there is no similar way to know if work hours are getting out of hand. Time tracking provides early warning signs for burnout or the need to hire additional resources.

3. Time tracking will help you pinpoint priorities.

What’s most interesting to me is not how much people are working (unless, of course, we’re worried about burnout), but the potential of each individual to manage their own use of time.

Time tracking allows me to hold myself accountable to whether or not I have focused on my most important work each week. Without monitoring, there’s no real way to see that. Giving employees the power to see this for themselves grants them agency over their workday which naturally increases productivity.

With great data comes great responsibility. If you do set up time tracking, you need to make sure you are using it for good, not evil. Time tracking has a bad rap because some micromanagers use it to push people to work more or turn the business into a (virtual) face time culture. What they should be doing is using it to foster work-life balance for members of their team.

So, if the reason you want to use time tracking is to get more hours out of your team or catch someone using Facebook, this is not the tool for you. However, if you buy into Stephen Covey’s belief that “the key is in not spending time, but investing it,” then the natural solution is to get better visibility of how your business uses time, which can only be done effectively through time tracking.

Kroger Just Made the Sort of Massive Decision That'll Make Competitors Scramble In Panic

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

There’s panic in the supermarket aisles.

For once, it’s not a vegan who can’t find the right strain of cabbage.

No, this is the panic of supermarket chains worried that the game has changed and no one will tell them the new rules.

Amazon‘s tentacles seem to be wrapping themselves around everything and everyone and the more traditional chains need to react. But how?

In Kroger’s case, the answer seems to be to stop people shopping at Kroger.

Or, rather, to make it not entirely necessary.

The chain has announced that it’ll be perfectly happy if you go to Walgreen’s instead.

In essence, this supermarket within a drugstore will contain “a curated assortment of 2,300 products” that’ll take up around a third of the space in your average Walgreen’s.

Which wise people will do the curating, I hear you cry. 

Oh, not so much people, but “customer data and insights provided by Kroger subsidiary 84.51.”

In 13 Northern Kentucky Walgreen’s, you’ll be able to pick up essentials such as chicken or beef. Or, for the especially adventurous, Home Chef meal kits.

Some might see this as two big brands feeling threatened and huddling together for a little warmth.

This is your number 2 and number 6 biggest American retailers getting together.

But if you’re up against the twisted might of Amazon and Whole Foods, what are you going to do?

You’re going to think about where people regularly go and try and make things easier for them to buy your wares. 

People are lazy. They’re getting lazier. Help them solve their own little daily problems that, for so many, tend to involve surviving more than thriving.

Other chain stores have found it harder to find huddle-partners.

It’s trying to get foot traffic, after all.

And who’s next? Safeway and CVS? 

How about Costco and H&M? 

You have to think creatively about these things. Amazon’s getting into food and fashion. It’s creeping its way into your kitchen, living room and bedroom with its Echo.

There are only so many means of escape.

Attention Passengers: Your Next Flight Will Likely Arrive Early. Here's Why

As frequent fliers, Kellogg’s Jan Van Mieghem and Yuval Salant have seen the same scene unfold numerous times: Their plane touches down and the pilot announces over the loudspeaker that the flight arrived ahead of schedule. Upon hearing about this stroke of good luck, the passengers immediately perk up.

“Everybody is smiling,” says Van Mieghem.

But are these smiles due to more than good luck? Van Mieghem, the Stuart professor of managerial economics and operations, and Salant, an associate professor of managerial economics and decision sciences, began to wonder whether airlines were strategically adjusting their schedules to make early arrivals more likely.

In a new study with Assistant Professor Dennis Zhang of Washington University in St. Louis, the researchers analyze two decades of data on 43 million domestic U.S. flights. They discover that published flight times–the flight duration that consumers see when they shop for plane tickets–increased 8.1 percent between 1997 and 2017, amounting to an additional 341 million passenger hours.

But when the researchers break down what caused that increase, they find that planes are not flying slower than they used to.

Rather, nearly half of the additional time comes from airlines strategically padding their schedules. Late planes are bad for business–so, by adding time to their predicted flight lengths, airlines can increase the odds that their planes will arrive on time. This schedule padding is especially common on flight routes with less competition, the researchers find.

In Search of Lost Time

The team looked at historical data from the Bureau of Transportation Statistics containing detailed data on 43 million flights over the last 21 years. They analyzed changes in flight duration for the same route operated by the same carrier year over year.

On paper, it appeared that the same flights now take significantly longer than they did in the ’90s.

The researchers knew that there were several possible explanations for this. Planes may be spending more time circling in the air waiting for an open landing strip, or more time on the ground waiting for a gate to become available. Another possibility is that air travel has become less predictable–if so, airlines could be adding more buffer time to guard against increasingly frequent delays from bad weather or other unplanned events.

A final possibility was “strategic padding”: airlines might extend their scheduled flight times not for any logistical reason, but as a matter of sheer business strategy. 

“When flights arrive on time or ahead of schedule, you get happy customers,” says Van Mieghem. 

However, Salant notes, “there are costs associated with that.” For one, if an airline pads too much, a competitor can undercut them by offering a shorter flight. Furthermore, flight crew members are often paid for the full scheduled flight duration, regardless of how long the flight actually takes.

The researchers created a mathematical model to tease out how much each factor–air time, ground time, unpredictability, and strategic padding–contributed to the increase in published flight times. 

They found that planes spend roughly the same amount of time in the air as they did 21 years ago. And unpredictability did not seem to be playing much of a role in the increase, either.

Ground time was a different story. “Passengers were spending more time on the plane waiting for take-off, or waiting for a gate after landing, possibly because of increased air traffic,” Salant says.

But that increase in ground time explained about half of the increase in published flight times, leaving more than 150 million passenger hours unaccounted for. The researchers concluded that this remaining time was the result of strategic padding.

“We find that the missing time is not due to physical constraints like air time and ground time or variability. It’s due to strategic decision-making by airlines. They’re padding their schedules, and they’re doing it for a reason.”

— Jan Van Mieghem

Less Competition Means Longer Flight Times

Why has strategic padding become more common? The researchers suspected that part of the reason is dwindling competition. 

“If you have plenty of competitors, logic dictates that you will seek to offer customers the most efficient route from A to B. You’ll cut back your scheduled flight time,” Van Mieghem explains.

But due to bankruptcies and mergers, there are fewer large U.S. airlines today than in 1997. So airlines today may feel less competitive pressure to offer shorter flight times.

To test this theory, the researchers looked at how published flight times changed after competitors either started or stopped offering flights on a particular route. 

As predicted, when competition grew stiffer, airlines cut down travel time. Conversely, Van Mieghem says, “as the playing field thins out, less competition makes it easier for airlines to do the opposite.

A Silver Lining to Schedule Padding?

Walk around O’Hare airport, for example, and you are likely to come across a billboard advertising the “reliability” of United Airlines’ flights.

“But it’s not really about reliability,” Van Mieghem says. “If airlines really wanted to improve reliability, they’d focus their efforts on enhancing their operations. What our study shows is that this is not the case. What they’re going for instead is the easier–and cheaper–option of schedule padding.”

Nonetheless, the researchers stress that schedule padding has its benefits. After all, a flight that usually takes 90 minutes may indeed take 120 on an unlucky day. By publishing a time closer to two hours, the researchers explain, airlines are simply erring more on the side of caution.

In fact, schedule padding may actually help travel go more smoothly. Passengers are not only more likely to experience the joy of an on-time arrival, but also get more buffer time to make a connecting flight.

And the paper’s revelations suggest that there is an opportunity for passengers to be strategic, too, says Van Mieghem.

“We tend to allow a little extra time for delays or hold-ups when we’re travelling,” he notes. But if consumers know that their flight is likely to get in on time, they might save time by reducing that buffer in their schedule. “Of course,” he adds, “this is a question of our individual tolerance for risk.”

Black Friday 2018: Best Laptop, Tablet, and Phone Deals

Laptop makers love to hitch their wagon to a good sale, and Black Friday weekend is one of their favorites. There are a bunch of PC deals going on all the way through Cyber Monday as well. We’ve spent days sifting through sales to find devices worth your time. Below are the best laptop deals we’ve found so far, along with our favorite tablet and smartphone deals for good measure.

Note: Deals tend to flow and out of availability at a rapid rate during Black Friday, and some may not be available until 12 a.m. Friday, or early in the morning. Please bear with us. We will continue to update this list as we learn about new deals, and items sell out. You can read more WIRED Black Friday 2018 Deals guides here.

Best Black Friday Laptop Deals

Microsoft

For a little insight on the laptops we like, check out our new list of Best Laptops for 2018.

Samsung 11-Inch Chromebook 3 $99 ($100 off)

Walmart

This is a petite, lightweight Chromebook for lightweight tasks. It’s good for email, browsing, and some basics but it should do them admirably. At this price, that’s OK.

HP Pavilion 15-Inch Gaming Laptop $750 ($250 off)

Walmart

This HP laptop has a Nvidia GeForce GTX 1060 GPU, Intel Core i7 (8th Gen) CPU, a 1TB hard drive with 16GB of Optane memory, and 8GB RAM. If you like color LED-lit keys, it can likely rip through some office work, as well.

Asus 17-Inch Gaming Laptop for $999 ($400 off)

Best Buy

With an Intel Core i7 CPU, an Nvidia GeForce GTX 1060 GPU, a 512 GB SSD, and 16 GB of RAM, you should be able to do just about anything on this gaming laptop, even a little VR. To get all that for one grand is a great deal.

Microsoft Surface Pro 6 with Keyboard for $799 ($260 off)

Microsoft, Newegg (+$20 gift card)

When the first Surface debuted, it was a strange tablet/laptop hybrid. Years later, the Pro 6 is one of the best, most versatile PCs you can buy, and its keyboard rocks (8/10, WIRED Recommends). To get it for under $1,000 with a Keyboard cover is an excellent example of a good Black Friday laptop deal.

Huawei MateBook X Pro with All the Fixins’ for $1,350 ($150 off)

Microsoft Store, B&H, Newegg

If you want just about the most kickass little laptop money can buy, the 14-inch upgraded MateBook X Pro is it (7/10, WIRED Review), with an Intel Core i7 (8th Gen), 16GB RAM, 512GB SSD, and a Nvidia GeForce MX150 graphics card. The screen is extra nice on this one. It’s touch and stretches all the way to the edges, meaning you get a 13-inch screen in a much smaller body. The only downside is the webcam, which is stored inside a key on the F keys. It’s really fun to pop open, like old Corvette headlights, but isn’t a fun angle.

SHOP HAPPY

Get Gadget Lab’s picks of the best holiday deals this season. Headphones, laptops, TVs, oh my!

Lenovo Ideapad 720S Laptop with 4K Display for $950 ($550 off)

Newegg, Lenovo ($450 off)

If you want a Retina-like display on a Windows machine, this IdeaPad packs a lot of pixels into a 13-inch rectangle. With an Intel Core i7 (8th Gen), 8GB RAM, a fingerprint reader, and a 512-gigabyte SSD for storage, it should be able to handle most work tasks with ease. If you want to spend a bit less, the Lenovo 710S is also a good buy and only costs $760 on Amazon right now.

Gigabyte Aero 15X VR-Capable Laptop $1,749 ($550 off)

Newegg

Deal ends Saturday, November 24

This is another nice gaming laptop, this one with top-notch specs, 8 GB of video RAM and a Nvidia GeForce GTX 1070, which is quite capable of almost any gaming or VR system you can throw at it. It has all the ports you’ll need too.

Google Pixelbook Chromebook for $899 ($300 off)

Amazon

Is the Pixelbook excessive? Maybe, but even if you’re only running the Chrome browser, it doesn’t hurt to have a powerful processor and plenty of RAM/storage. And that’s just what Google’s official Chromebook has. Read our full review to learn more.

Black Friday Tablet Deals

Apple

To learn more about what’s hot, read our Best Tablets and Best iPads guides.

Apple iPad 2018 for $249 ($80 off)

Amazon, Apple

This is a rare iPad deal. The standard iPad is compatible with the Apple Pencil, making it the most well-rounded affordable tablet you can own. Period. It has better apps and better games than any other platform. It’s the same iPad you’ve seen before, and should last you years.

Apple iPad Mini 4 (128GB) for $300 ($100 off)

Amazon, Apple

Apple only sells a 128GB iPad Mini 4 now. It hasn’t updated its smallest tablet in a while, but it’s still the best option if you want a more travel-friendly screen size—and it still works great. The storage is more than you’ll likely need, and we’ve never seen it at this low a price before.

Apple iPad Pro 10.5 for $575 ($75 off)

Amazon, Apple

Apple may have released a new iPad Pro with Face ID and no home button, but it’s still selling last year’s 10.5-inch Pro, and it’s still an awesome Pro-level tablet. It can do most everything (work-wise) that the new iPads can do, and at this price, it’s hundreds cheaper.

Kindle Paperwhite for $80 ($40 off)

Amazon

No, it’s not technically a laptop, phone, or tablet, but whatcha gonna do? The Kindle is one of the last surviving ebook readers, and for good reason: it’s a fantastic reading device and gets a month of battery life on a charge. This model isn’t the brand new waterproof Kindle, but it’s still fantastic and has a wonderful built-in backlight

Fire HD 10 for $100 ($50 off)

Amazon

The Fire HD 10 is no workhorse, but it’s big enough and powerful enough to act as a second (larger) screen when you need one—perfect for simple games, hands-free Alexa, reading, or Netflix binging. (Of course, Amazon would prefer that you stream Prime Videos instead.)

Best Black Friday Smartphone Deals

Nokia

There are some smartphone deals happening on Black Friday too. To understand the market a bit more, you may want to check our Best Android Phones and Best iPhones guides.

Belkin 5,000mAh Portable Charger for $15 ($15 off)

Amazon

This charger is smaller than your phone, but will recharge it almost two times from an empty battery (depending on your phone model).

OnePlus 6 for $429 ($100 off)

OnePlus

The OnePlus 6 is still as powerful as any phone on the market, with a Snapdragon 845 processor and plenty of RAM. At less than $500, it’s a complete steal. Unlike the new OnePlus 6T (which we also really like!), the 6 still has a headphone jack. It also comes with a case in the box. The only downside: it won’t work on Sprint or Verizon. Read our full review to learn more.

Samsung Galaxy S9 for $520 ($200 off)

Amazon, Walmart, Samsung, Best Buy, B&H

The Galaxy S9 is still at the top of the class of 2018 phones. It’s as fast as they come, and its camera shines brighter than most Android phones outside the Pixel 3 (see below). It’s now on sale for $520 for the holidays, making it the cheapest flagship phone around—even cheaper than the latest OnePlus, though you should consider the OnePlus 6 above if you’re on AT&T or T-Mobile. If not, Samsung’s phone will work on any carrier.

Apple iPhone XR for $600 ($150 off)

Best Buy

This is our favorite new iPhone. It has the full-size screen like the X and XS iPhones, along with Face ID, and it comes in a rainbow assortment of colors. We like that Best Buy is just offering a straight discount on the phone for any carrier, though they like it if you sign up for a 24-month payment plan.

Sandisk 64GB MicroSD Card for $14 ($11 off)

Amazon

If you’re running low on storage and your phone has a MicroSD slot (many do), this is a cheap way to extend the life of your phone—and extend your sanity.

Nokia 6.1 for $180 ($75 off)

Amazon, Best Buy, B&H

The Nokia 6.1 is always a good deal, but during Black Friday weekend, it’s an outstanding phone deal. It’s a bit speedier than a Motorola Moto G6 (the go-to affordable phone), but even cheaper. Thanks to a nice metal unibody design and Android One, it’s a better overall phone. It gets security updates and new OS updates direct from Google. Very few other phones, even expensive ones, will get a fraction of the software love this little Nokia gets. It works on AT&T and T-Mobile networks.

Motorola Moto Z3 Play for $370 ($80 off)

Amazon

The Moto Z3 Play is such a nice mid-range Android phone that I kept using it for more than a month after I wrote my review of it. For a professional phone reviewer, that’s a life time. It doesn’t lag much and I really like the Moto Mod that comes in the box. It’s a magnetic battery pack you can snap on the back, and it’s thin enough that I just kinda left it on for days at a time. With it, you’ll always get at least two days of battery life. It works on all major wireless networks.

Motorola Moto X4 for $180 ($70 off)

Amazon

The Moto X4 is just a nice little phone. It’s right up there with the Nokia 6.1 and a step above the Moto G. If you want a dependable phone that won’t break the bank or drive you nuts, this is it. It’s not perfect, but it works well. It works on any U.S. wireless carrier.

Google Pixel 3 for $650 ($150 off)

Google Store

The Pixel 3 is the best Android phone you can buy for all these reasons. For Black Friday, Google is running a few different Pixel deals. The Pixel 3 will have a discount on it, and if you buy two, you’ll get the second one half off. On Cyber Monday, it will also run a promotion bundling it with the new Home Hub.

Black Friday Sale Pages for 2018

We’ve sifted through the mess of deals, but if you want to look for yourself, here are some links. Many of these prices may not be live until day-of.

When you buy something using the retail links in our articles, we may earn a small affiliate commission. Read more about how this works.

Have You Built a Culture of Creativity?

But before a company can build their business value of design, some critical building blocks must be in place. 

They must first prime the organization to have a culture of creativity that supports design-centric initiatives.  This only happens when companies get really good at leveraging creativity as an innovation resource.  

I’ve written in an earlier article about the significance of “the human quotient” in companies as they grapple with the future of work in the midst of our 4th Industrial Revolution- a time when we are tethered to cloud technology, AI, VR, robotics and data in ubiquitous ways.  Pointing out the business value of design is another way of acknowledging that when a company starts with their customers’ human needs and desired experiences, and builds products and services around those drivers, it is ultimately a more efficient way to run a business.

The human quotient is grounded in creativity.  Creative approaches to business outcomes can positively affect revenue generation, market share diversification, efficiencies and cost reductions.  This has to happen in an inside-out manner.  That is, the creative impact of your products and services on people’s lives will only come to pass when the company builds a culture of creativity.  This is especially true at a time when employee engagement, generative thinking and thought diversity in a company are critical means to innovation.  

Here are three ways companies can build their creative competencies, and thus prime themselves to build the business value of design.

1.     Encourage Curiosity

Leaders need to model that inquiry – versus certainty- gets us to the next level. There are market leader companies- such as Amazon, Whole Foods and Lyft- who would have never anticipated 5 years ago with certainty, where they are today.  There are new alliances they now make based on macro-environmental drivers.  Encouraging people to ask lots of questions and not equate curiosity with appearing ignorant is a crucial first step.

2.     Improvise

Companies that design flexible structures and processes, versus rigid rulebooks, are better off.  Humans respond well to structure – to an extent.  Structure helps us to understand the limits we can push.  This is the very nature of improvisation.  Like jazz music, all improvisational systems have rules.  It’s the ability to stretch and rebound off the rules which allows for adaptive and responsive solutions to customer needs.  

3.     Intuit

While most corporate boardrooms don’t admit out loud the role of intuition in decision making- because of our culture’s leniency on the rational- the truth of the matter is that plans are fiction:  they haven’t happened yet.  Although honing intuition is not something we teach in business school, the majority of successful entrepreneurs can speak to pivotal moments when they followed their heart, paid attention to subtle patterns, and great things happened.  

Companies that implement great design practice linked to positive business outcomes, have also created opportunities for encouraging curiosity, improvising solutions through adaptive structures and acknowledging intuition.  Try experimenting with implementing your own version of these 3 building blocks, one per month over the next quarter.

Google reveals new policy for election ads ahead of EU vote: Bloomberg

An illuminated Google logo is seen inside an office building in Zurich September 5, 2018. REUTERS/Arnd WIegmann

(Reuters) – Alphabet Inc’s Google said it will roll out new policies in Europe to provide more transparency around political ads, ahead of European Union elections in the spring, Bloomberg reported on Wednesday, citing a blog post.

According to the report, Google said it would require advertisers to submit an application and receive verification before they can pay for political ads.

Google did not immediately respond to a request for comment.

The European Commission said in September that Facebook Inc, Google and other tech firms had agreed a code of conduct to do more to tackle the spread of fake news, over concerns it can influence elections.

Google also said it would publish an EU transparency report, along with a searchable ad library, to provide more information about who is purchasing election ads, for how much, and to whom they are targeted, Bloomberg reported.

Public databases that shine a light on online political ads – launched by Facebook and Google before U.S. elections – offer the public the first broad view of how quickly the companies yank advertisements that break their rules.

Reporting by Akanksha Rana in Bengaluru; Editing by Leslie Adler

How Did the 'Freedom From Facebook' Campaign Get Its Start?

In July, executives from YouTube, Facebook, and Twitter testified before Congress about their company’s content moderation practices. While Facebook’s head of global policy Monika Bickert spoke, protesters from a group called Freedom From Facebook, seated just behind her, held signs depicting Sheryl Sandberg and Mark Zuckerberg’s heads atop an octopus whose tentacles reached around the planet.

Freedom From Facebook has garnered renewed attention this week, after The New York Times revealed that Facebook employed an opposition firm called Definers to fight the group. Definers reportedly urged journalists to find links between Freedom From Facebook and billionaire philanthropist George Soros, a frequent target of far-right, anti-semitic conspiracy theories. That direct connection didn’t materialize. But where Freedom From Facebook did come from—and how Facebook countered it—does illustrate how seemingly grassroots movements in Washington aren’t always what they first appear.

The point here isn’t to question Freedom From Facebook’s intentions. Their efforts seem to stem from genuine concern over Facebook’s outsized role in the world. But the labyrinthine relationships and shadowy catalysts of the efforts on all sides of that debate show just how little involvement actual Facebook users have in the fight over reining the company in.

Since the 2016 presidential election, Facebook has confronted an onslaught of scandals, many of which drew scrutiny from federal lawmakers. First, Russian propagandists exploited the social network, using duplicitously bought ads to sway US voters. This March, journalists revealed data firm Cambridge Analytica had siphoned off information belonging to tens of millions of users. In the wake of this second controversy, Freedom From Facebook was born.

The initiative wasn’t formed by everyday Facebook users. It’s instead the product of progressive groups with established records of opposing tech companies, whose own relationships illustrate just how tangled these connections can be.

Specifically, Freedom From Facebook is an offshoot of the Open Markets Institute, a think tank that operated under the auspices of the New America Foundation until OMI head Barry Lynn publicly applauded antitrust fines levied against Google in Europe. Google is a major New America donor; Lynn’s entire team studying tech market dominance and monopolies got the ax, and spun out Open Markets as an independent body.

Earlier this year, former hedge fund executive David Magerman approached Lynn’s group with the idea to start to start a campaign in opposition to Facebook. Magerman poured over $400,000 into what became Freedom From Facebook, according to Axios. His involvement wasn’t known until Thursday. The connected between Freedom From Facebook and OMI was also not entirely explicit.

Freedom From Facebook has done more than stage protests on Capitol Hill. During Facebook’s annual shareholder meeting in May, the group chartered an airplane to fly overhead with a banner that read “YOU BROKE DEMOCRACY.” When Sandberg spoke at MIT in June, Freedom From Facebook took out a full-page advertisement in the student newspaper calling for the social network to be broken up. On Thursday, the group filed a complaint with the Federal Trade Commission asking the agency to investigate a Facebook breach disclosed in September that affected 30 million user accounts.

Freedom From Facebook also formed a coalition with a diverse set of progressive organizations, like Jewish Voice For Peace, which promotes peace in Israel and Palestine, and the Communications Workers of America, a labor union that represents media workers. The coalition now comprises 12 groups, who “all organize around this fundamental principle that Facebook is too powerful,” says Sarah Miller, the deputy director of Open Markets Institute. Confusingly, according to Freedom From Facebook’s website, the coalition also includes Citizens Against Monopoly, a nonprofit Miller says was set up by Open Markets itself.

Eddie Vale, a progressive public affairs consultant, also confirmed in an email that Open Markets hired him to work on the Freedom For Facebook Initiative. He led the protest in July featuring the octopus signs.

Definers began lobbying journalists, including those from WIRED, to look into Freedom From Facebook’s financial ties this past summer. The effort was led by Tim Miller, a former spokesperson for Jeb Bush and an independent public affairs consultant, according to The New York Times. “It matters because people should know whether FFF is a grassroots group as they claimed or something being run by professional Facebook critics,” Miller wrote in a blog post published Friday. He added that he believes the push to connect the group to Soros does not amount to anti-semitism, especially if it contains a modicum of truth. Facebook itself asserted much the same in a statement it released Thursday.

The extent of the Soros relationship seems to be that the billionaire philanthropist does provide funding to both Open Markets and some of the progressive groups who constitute the Freedom From Facebook coalition. There’s no indication, though, that he has any direct involvement with the initiative. Open Markets’ Miller says the think tank wasn’t aware Facebook was paying an opposition firm to ask journalists to look into its work. “I just think knowing Facebook as we do, I don’t know that I would say that we were surprised, but I do think the Soros angle was surprising,” she says.

After The Times published its report Wednesday evening, Facebook severed its ties with Definers. “This type of firm might be normal in Washington, but it’s not the sort of thing I want Facebook associated with,” CEO Mark Zuckerberg said on a call with reporters Thursday. Both Sheryl Sandberg and Mark Zuckerberg claim they didn’t know Facebook was working with Definers until the The Times published its story. This is not the first time Facebook has employed an opposition research firm. In 2011, the social network hired a public relations firm to plant unflattering stories about Google’s user privacy practices.

By distancing itself from Definers, Zuckerberg and Sandberg are putting space between themselves and how the sausage gets made in Washington. As they have grown more powerful, tech organizations including Facebook, but also Google, Amazon, and others, have poured millions into lobbying on Capitol Hill. Those efforts include fighting back against well-funded and sometimes secretive campaigns, like Freedom From Facebook. Meanwhile, the social network’s over two billion users mostly sit on the sidelines, watching the high-stakes battle unfold.


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The Legacy of Stan Lee and the Marvel Characters That Inspire Us

Stan Lee, the patriarch of Marvel Comics, died this week at 95. Lee created hundreds of characters including Spider-Man, the Incredible Hulk,  X-Men, the Avengers, Fantastic Four, Black Panther, Daredevil and Iron Man just to name a few. Lee has been credited with revitalizing the comic book industry beginning in the 1950s, and helped usher in a new age of silver screen comic book heroes — brought to life in mega-budget movies.

It wasn’t just the larger than life physiques and powerful abilities that made Lee’s characters so special in the hearts and minds of his fans. It was also the way he infused the human element into their super-human personas. They were at once fearless and mighty — and at the same time vulnerable, in some way or another. This duality afforded these superheroes some real emotional connections to their lives — some even experiencing everyday dilemmas such as how they would pay the bills. Lee was often able to weave a thread of humanistic emotional intelligence into his comic-book heroes, and was once quoted as saying, “America is made of different races and different religions, but we’re all co-travelers on the spaceship Earth and must respect and help each other along the way.”

Within Lee’s super-human realms of fantasy tinged with realism, he was able to break barriers, tackling off-limits subjects such as diversity, equality and other taboo issues of the day — but entertainment was his constant objective. He has been quoted as saying, “And then I began to realize: entertainment is one of the most important things in people’s lives. Without it, they might go off the deep end. I feel that if you’re able to entertain people, you’re doing a good thing.”

Rest in peace, Mr. Lee, you will never be forgotten.

Here are some quotes inspired by Lee’s vision that are sure to live on in perpetuity:

“Just because someone stumbles and loses their path, doesn’t mean they can’t be saved.” — Professor Charles Xavier, X-men

“A true Defender never raises arms against an innocent, no matter how they threaten you.” — Doctor Strange

“Whatever life holds in store for me, I will never forget these words: ‘With great power, comes great responsibility.’ This is my gift, my curse.” — Spiderman.

“The failures of my generation are the opportunities of yours.” — Franklin Storm, The Fantastic Four

“We can’t change the past but we can change the future.” — Sue Storm, The Fantastic Four

“Heroes are made by the path they choose, not the powers they are graced with.” — Iron Man

“Something is coming your way — something big.” — Bruce Banner, The Hulk

“Just because something works doesn’t mean it can’t be improved.” —  Princess Shuri, Black Panther

“You’ve got to feel what’s not there as much as what is.” — Daredevil

“Intelligence is a privilege, and it needs to be used for the greater good of the people.” —  Doctor Octopus

“When you decide not to be afraid, you can find friends in super unexpected places.” — Ms. Marvel

“The door is more than it appears. It separates who you are from who you can be. You do not have to walk through it… You can run.” — Franklin Richards, The Fantastic Four

“All we can do is our best, and sometimes the best we can do is start over.” — Agent Carter, Captain America

“In times of crisis, the wise build bridges, while the foolish build barriers. We must find a way to look after one another as if we were one single tribe.” — T’Challa, Black Panther

 “This is saying our generation will never matter. But we have to matter. If we don’t, there is no future worth saving.” — Ms. Marvel

The Afrotech Conference Captured in One Powerful Quote

One of the biggest discussions came from a Grammy-award winning panel featuring rapper Common, producer Karriem Riggins and musician Robert Glasper, collaborators in the new supergroup August Greene. All of them had outgrown their defining monikers, expanding into acting, music scoring, and so on. Glasper shared his own key to success:

Other people don’t know what your lane is, so they can’t tell you what your lane isn’t.

Sure, it’s about defining yourself and not relying on the acceptance of others. It also means not being afraid to fail until you get it right – even while others are watching. This challenge becomes more important for minority entrepreneurs who may have a vision less understood by the mainstream public.

What is uniquely yours?

I recently interviewed TED Speaker and RETI founder DeAndrea Salvador. She wasn’t focused on engineering, but she saw a need in her community for fair energy use and distribution. That desire planted the seed for RETI, the energy equity company that now educates and spreads insight into low-income communities.

Get comfortable with being a fool

As Glasper mentions, your lane is only defined by you – and, often, is defined by only your own insecurities.  So, the ability to be comfortable with being uncomfortable directly dictates your ability to grow.

Serial entrepreneur Naveen Jain said it recently: When you don’t know, you can ask dumb questions.” And dumb questions allow true breakthroughs. Sitting with Glasper and Riggins, Common shared how coming from a hip-hop background actually helped him make an impact on Hollywood, as he didn’t automatically follow the traditional Hollywood rules or pathway. Instead, he questioned long-held beliefs and was able to bypass the classic barriers to success.

So pay attention when a new arena is calling you. It may not be your lane, but it may be the area where you can make an even deeper impact.

Apple finds quality problems in some iPhone X and MacBook models

The new Apple iPhone X are seen on display at the Apple Store in Manhattan, New York, U.S., September 21, 2018. REUTERS/Shannon Stapleton

(Reuters) – Apple Inc said on Friday it had found some issues affecting some of its iPhone X and 13-inch MacBook pro products and said the company would fix them free of charge.

The repair offers are the latest in a string of product quality problems over the past year even as Apple has raised prices for most of its laptops, tablets and phones to new heights. Its top-end iPhones now sell for as much as $1,449 and its best iPad goes for as much as $1,899.

Apple said displays on iPhone X, which came out in 2017 with a starting price of $999, may experience touch issues due to a component failure, adding it would replace those parts for free. The company said it only affects the original iPhone X, which has been superseded by the iPhone XS and XR released this autumn.

The screens on affected phones may not respond correctly to touch or it could react even without being touched, the Cupertino, California-based company said.

For the 13-inch MacBook Pro computers, it said an issue may result in data loss and failure of the storage drive. Apple said it would service those affected drives.

Only a limited number of 128GB and 256GB solid-state drives in 13-inch MacBook Pro units sold between June 2017 and June 2018 were affected, Apple said apple.co/2AXkeEw on its website.

Last year, Apple began a massive battery replacement program after it conceded that a software update intended to help some iPhone models deal with aging batteries slowed down the performance of the phones. The battery imbroglio resulted in inquires from U.S. lawmakers.

In June, Apple said it would offer free replacements for the keyboards in some MacBook and MacBook Pro models. The keyboards, which Apple introduced in laptops starting in 2015, had generated complaints on social media for how much noise they made while typing and for malfunctioning unexpectedly. Apple changed the design of the keyboard this year, adding a layer of silicone underneath the keys.

Reporting by Ismail Shakil in Bengaluru and Stephen Nellis in San Francisco

The House Science Committee May Soon Become… Pro-Science

For the past eight years, climate science has been under a sort of spell in the House of Representatives. Instead of trying to understand it better or even acknowledging some of the field’s current uncertainties, House Science Committee Chairman Rep. Lamar Smith (R-Texas) used his position to harass federal climate scientists with subpoenas while holding hearings on “Making the EPA Great Again” or whether “global warming theories are alarmist” and researchers are pursuing a “personal agenda.”

But Smith retired this year and Democrats won control of the House on Tuesday. Now some on Capitol Hill say that the anti-climate science spell may be broken.

“Hopefully we will no longer see the science committee used as a messaging tool for the fossil fuel industry,” says Rep. Bill Foster, an Illinois Democrat and science committee member. “I look forward to hearings with a balance of witnesses that reflect mainstream scientific hearings instead of a small group of industry players.”

Foster, who was a particle physicist before being elected to Congress in 2008, said he also wants to see more appearances from cabinet members like Energy Secretary Rick Perry or EPA Administrator Andrew Wheeler to explain both their budget and their rulemaking on environmental and science issues. Neither agency head was called before Smith’s committee during his tenure, Foster says.

Ranking member Eddie Bernice Johnson (D-Texas) issued a statement after the election results Tuesday night stating that, if elected chairwoman, she wants to restore the credibility of the science committee “as a place where science is respected and recognized as a crucial input to good policymaking.” Johnson said that includes acknowledging that climate change is real, “seeking to understand what climate science is telling us, and working to understand the ways we can mitigate it.”

House Minority Leader Nancy Pelosi, who is in line to become Speaker of the House, hinted recently that she may push her members to form a new select committee on climate and renewable energy issues similar to one that operated from 2007 to 2011.

Capitol Hill observers and advocacy groups, however, say it’s not clear that a more science-friendly House will result in any new legislation getting passed or in stopping Cabinet heads that report to President Trump. “The attempt to embarrass the Trump White House isn’t going to work,” says Jeff Ruch, director of the Public Employees for Environmental Responsibility, an advocacy group representing federal workers in several scientific and environmental agencies. PEER has been litigating the EPA over the enforcement of pollution rules as well as the disclosure of ethics violations during the tenure of former administrator Scott Pruitt.

Ruck says environmental and science policies need to be changed with votes, not hearings. He foresees some Democratic House members introducing what he calls “green riders,” climate- or energy-related amendments to larger, unrelated pieces of legislation that might be able to pass both the House and a Republican-controlled Senate.

Others predict greater congressional oversight as well over issues including pollution enforcement, vehicle emissions standards, and the localized effects of climate change. “Too many people are seeing the impact of climate change in their communities, whether it’s wildfires or drought or storms,” says Andrew Rosenberg, director of the center for science and democracy at the Union of Concerned Scientists, a Washington-based advocacy group. “So at some point members have to respond to their constituents.”

If nothing else, there will be a greater representation of scientists and members with STEM degrees in the next session of Congress. Of the 14 House and Senate members endorsed and backed by the pro-science group 314 Action, eight won their general election race on Tuesday, while one, Seattle-area pediatrician Kim Schrier, holds a 52-48 percentage point lead with absentee ballots still to be counted.

This mini-wave of STEM-trained politicians might result in more evidence-based policymaking, according to Shaughnessy Naughton, the founder and president of 314 Action. “They have a lot of credibility, whether it’s on the environment or health care, and it resonates with voters,” she says.

Of course, climate deniers might still have a home on the north side of the Capitol, where the Senate meets and where Texas’ Ted Cruz is expected to keep his gavel as chairman of the Senate Science Committee.


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A changing New York neighborhood wonders how Amazon would fit

NEW YORK (Reuters) – It was the lunch-hour rush at the Court Square Diner in New York’s Long Island City on Wednesday, and co-owner Nick Kanellos pointed to the elevated subway tracks that rattle overhead as he fretted over the news that Amazon may build a major outpost in the neighborhood.

People wait for the arrival of 7 train in Long Island City, where Amazon.com is reportedly considering as part of its new second headquarters, New York, U.S. November 7, 2018. REUTERS/Eduardo Munoz

Like many long-time inhabitants, he worries how this once-sleepy enclave in Queens would absorb the up to 25,000 people the online retail giant may employ here as it expands outside its Seattle home base.

“It’s a whole soccer stadium at 8 a.m. each day coming in,” Kanellos said, gesturing at the narrow metal staircases leading from the subway platform to the street, already crowded with commuters at rush hour.

Amazon announced in September last year that it was seeking a site for a second corporate headquarters that would eventually employ up to 50,000 people. But it now plans to split its new headquarters between two sites, including Long Island City, according to a New York Times report.

Amazon again declined on Wednesday to comment on its selection process.

Kanellos’ apprehension was shared by other long-time residents interviewed on Wednesday on their home turf, a rapidly gentrifying area that sits just across the East River from Midtown Manhattan.

Few, if any, objected to Amazon.com itself: Many conceded they were happy customers of the world’s largest online retailer, some paying for its Prime membership service. They just fear that their neighborhood is already bursting at the seams, with scores of glass apartment towers transforming an area long characterized by a mismatched jumble of low-rise buildings.

The cost of this rapid development, residents say, is that local hardware stores and pharmacies have been priced out and an aging sewer system is often overwhelmed by the more than 10,000 new apartments and 1.5 million square feet of office space built in recent years, according to city data.

Kanellos, 50, took over the Court Square Diner in 1991, when it was one of the few places where the artists then using old factory buildings as studios could sit down for a cheap meal.

The neighborhood’s cinematic views of Manhattan only heightened the sense it was a quiet village overlooked by the rest of New York City, residents say.

“We felt like we had the place to ourselves,” said Pat Irwin, a musician and composer who for years played with The B-52’s and settled in Long Island City in the mid-1980s.

The 50-story, blue-glass tower that Citigroup built in 1990 was an early harbinger of the transformation. The reports this week that Amazon had decided to build part of its “second” headquarters here, along with an outpost in northern Virginia’s Crystal City, feels to some residents like the death knell for a neighborhood they love.

“It feels like we’re being walled in and it’s out of control and the neighborhood can’t handle it,” Irwin said.

Irwin’s wife, Terri Gloyd, is the co-owner of the LIC Corner Cafe, which sits around the corner from MoMA PS1, a major outer-borough arts museum, and sells coffee, cookies and a pastry confection described as “a guava goat cheese Pop-Tart.”

Some of the residents who moved into the new apartment towers have become welcome regulars, even while some artist friends have been priced out of the area, she said. But construction and the ubiquitous film and television shoots, thanks to the proximity of Silvercup Studios, sometimes make the streets barely navigable to pedestrians.

“It already feels so oversaturated,” said Gloyd, who moved here in 1987.

Even so, if Amazon’s arrival brought with it a decent supermarket or helped bring a much-needed school to an underserved area, then perhaps that could soften its landing, she said.

Slideshow (17 Images)

If there is one constant in the crane-filled neighborhood these days, it is Manducatis, a white-tablecloth, Italian restaurant that Vincenzo Cerbone, 88, has presided over since 1974, after moving to the area in the 1950s. His wife, Ida, still cooks there most days, walking from their home around the corner.

“My husband, in the ‘50s, he predicted this,” she said with a proud smile, explaining their decision to acquire property in an area so close to Manhattan, no matter how unprepossessing it seemed at the time.

As for Cerbone, he shrugged at the Amazon news: New York City has always been changing. “These days, everything is new,” he said. “I don’t know if it’s an upgrade or a downgrade.”

Reporting by Jonathan Allen; Additional reporting by Hilary Russ in New York and Jeffrey Dastin in San Francisco,; Editing by Frank McGurty and Leslie Adler

US Accuses Chinese Company of Stealing Micron Trade Secrets

The Chinese government has made manufacturing computer chips that store data—memory—a major priority of its centralized science and technology strategy. According to the US Department of Justice, China plans to do it not just through research and development, but through old-fashioned espionage.

In an indictment unsealed Thursday, DOJ accused China’s Fujian Jinhua Integrated Circuit, Taiwan’s United Microelectronics Corporation, and employees including Jinhua’s president, of economic espionage—of stealing proprietary technology from US-based Micron Technology to make dynamic random access memory chips, which are found in just about every gadget. It’s not clear how the companies will respond, nor whether the individuals accused of espionage could ever be extradited to the US. So think of this as a virtual shot in the cold-but-warming trade war between China and the US. “Chinese espionage against the United States has been increasing—and it has been increasing rapidly,” US Attorney General Jeff Sessions said in a statement. “I am here to say that enough is enough.”

How much was enough? In 2013, Micron bought a Taiwanese chipmaker and formed Micron Memory Taiwan, where it planned to build DRAM, the mostly commoditized “short-term memory” in computers and related things that go beep. The DOJ indictment alleges that the president of MMT, Stephen Chen, quit and moved to UMC, set up a $700 million joint agreement with Jinhua (owned by the Chinese government), and then hired two more MMT employees, who starting in roughly 2016 began to bring over Micron trade secrets.

Micron is one of just a handful of companies making DRAM, and the only American one—it’s worth $45 billion and has a fifth of the global market. The technology is essentially a commodity; Micron and its two competitors, both Korean, differentiate themselves through being able to construct smaller and smaller features on their chips and the facility with which those chips talk among themselves and to other components. Jinhua, says the indictment, acquired the processes to build a range of chips, including those that use Micron’s “1x-nm” technology. Over the past year, Micron management has been touting that advance as a major piece of its business.

Until Jinhua started cranking them out, China didn’t have the technology to make tiny-featured DRAM, even though factories there make and assemble a wide swath of the planet’s gadgetry. But China’s government had tabbed developing the capacity as a priority in its most recent Five-Year Plan … which, in retrospect, looks to the US government as an invitation to stochastic espionage. Their ears were open, in other words, if DRAM technology should happen to fall off the back of a truck.

That may well be what happened. It’s possible that Chen, JT Ho, and Kenny Wang realized that their access to Micron’s proprietary technology meant a financial windfall if they took it to the government-owned chipmaker. But the US government hasn’t laid out that part of their case; Chinese economic espionage on the US mainland has typically involved a more elaborate process of spotting and recruitment of assets in advance of their access to information.

In this case, Micron complained; In August 2017, Taiwan filed criminal charges against UMC, and in December, Micron sued UMC and Jinhua. So in January, Jinhua turned around and sued Micron—for infringing on Jinhua’s DRAM patent. Meanwhile, the Taiwanese Ministry of Justice had pinged the San Francisco Division of the FBI, which has made something of a franchise of handling technology-related economic espionage.

That tripped another breaker; in late September, after two years of investigation, the FBI indicted the companies and the employees. (The indictment was only unsealed Thursday.) And last week the Department of Commerce added Jinhua to its “Entity List” of companies presumed to pose a national security threat to the United States (on the grounds that like everyone else in the world, the US military uses a lot of DRAM). That means US companies need a license, which they probably won’t get, for all “exports, re-exports, and transfers of commodities, software and technology” to Jinhua—including components and materials crucial to making DRAM.

From the US perspective, that’s about as tough a move as it can make, because redress through the courts is unlikely. “I don’t want to say we can never extradite people. We’ve seen time and again where somebody goes on vacation and they forget this country has extradition,” says John Bennett, special agent in charge of the FBI’s San Francisco division. “We’re not saying these people are guilty of anything but we’ve been able to provide enough evidence to a court to indict them. If they would like to argue that point, that’s what the American justice system is designed to do.”

In a release, UMC representatives say that the company “takes seriously any allegation that it may have violated any laws and fully intends to respond to these allegations.” The company said it “regrets that the US Attorney’s Office brought these charges without first notifying UMC and giving it an opportunity to discuss the matter.” Jinhua’s website is offline, and the Chinese Consulate General in San Francisco did not return a call asking for comment.

Whether any of this action will protect Micron’s position in the global market is an open question. The US government is operating under the assumption that, since Jinhua is owned by the state, the technologies for making DRAM may well find their way to other companies in China. It’s possible that the resulting chips will be recognizable as Micron-derived. “We appreciate the US Department of Justice’s decision to prosecute the criminal theft of our intellectual property,” said Joel Poppen, Micron’s general counsel in a press release. “Micron has invested billions of dollars over decades to develop its intellectual property. The actions announced today reinforce that criminal misappropriation will be appropriately addressed.” But company representatives did not answer questions about what impact increased Chinese DRAM production might have.

Whatever effects the indictments have on DRAM and the companies that make it, they might make broader geopolitical noise. An agreement between China and the US to not engage in trade-secret theft seems to have mostly collapsed under the Trump administration (even though the president tweeted Thursday morning that trade talks with China are going swell), so it makes sense that its agents are talking tougher. And the FBI’s San Francisco division hopes to further solidify relationships with Silicon Valley, a frequent victim of Chinese economic espionage. “A lot of times, they have this close hold [on information] because they don’t want to impact stock prices,” Bennett says. But he hopes that the fact that his office was able to investigate the alleged Micron theft for two years with no leaks will help show that his office is trustworthy. “Whether that’s being used as [political] chips or not, we don’t see that in the FBI. This is cases for us. We have economic loss,” Bennett says. “They broke American law, and we’re going to bring them to justice.”

Here is the indictment in the case:


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Investors bristle as Apple's iPhone data goes the way of its headphone jacks

(Reuters) – First Apple Inc took away the headphone jack on its iPhones. Then it took away the home button.

FILE PHOTO: The Apple iPhone 7 and AirPods are displayed during an Apple media event in San Francisco, California, U.S. September 7, 2016. Reuters/Beck Diefenbach/File Photo

And now, it has taken away a closely watched performance metric that it has disclosed to investors for 20 years.

The Cupertino, California-based company on Thursday said that it will stop reporting unit sales data for its iPhone, iPad and Mac computer products, the latter of which it has given out since 1998. Analysts and investors use the figures to calculate the average selling price of Apple’s devices and gauge the health of the company.

Apple said the data is less relevant to the strength of its business as customers bundle products, such as an iPhone paired with its wireless AirPods headphones, along with paid subscription services like Apple Music to listen to songs and iCloud storage for photos. Analysts were skeptical.

“Companies typically stop reporting metrics when the metrics are about to turn. This is not a good look for Apple,” said analyst Walter Piecyk from BTIG Research.

The move cost Apple dearly, helping to send shares down about 7 percent in after-hours trading. They later settled at $207.81, about 6.5 percent below their previous close.

“Apple is a complex company with lot of moving parts,” said analyst Ivan Fienseth from Tigress “I think they need to give more transparency to their shareholders and not less.”

But now, Apple will give cost-of-sales data for both its total product businesses and its total services business, which will let investors evaluate a gross margin for both. In the past, Apple gave only an overall gross margin figure for the company.

The new numbers are important for two reasons. First, they will show just how lucrative Apple’s hardware business really is. But more importantly, for the first time they give margin information on Apple’s services business, which reached $10 billion in its fiscal fourth quarter, up 17 percent.

Many of Apple’s fastest-growing businesses are subscription based, like its $9.99 a month Apple Music service. And investors tend to value subscription business through a combination of their revenue growth rate and margins – information that Apple investors will now have, said Tien Tzuo, chief executive of Zuora Inc, a company that helps subscription businesses track their finances.

But one problem Apple investors will face is not knowing what the margin mix is within the services business. Some parts of it, like iCloud storage, are likely lucrative, but others, like Apple Music, are probably less so because Apple has to pay music licenses costs and competes with rival Spotify Technology SA.

“You would value the music business with one (revenue) multiple closer to Spotify, and the cloud business with a (subscription software) multiple,” said Tzuo. “Having some sense of which business is growing faster would be nice.”

Reporting by Stephen Nellis in San Francisco; Editing by Lisa Shumaker

Should You Buy Amazon On The Dip?

Amazon (AMZN) has corrected about 25% from its all-time high of $2,050.50 in September. Following the release of the earnings report on Friday Oct. 26, 2018, the stock fell as much as 9% during intraday trading, and closed 7.82% lower for the day. The company’s 3rd quarter earnings per share came in at $5.75, beating estimates of $5.62. However, Amazon (AMZN) reported sales revenue of $56.6 billion, missing the estimate of $57.08 billion. Nevertheless, revenue still showed YoY growth of 29.33%. The company also forecasted lower than expected revenue for Q4, between $66.5 billion and $72.5 billion. Even though Amazon (AMZN) beat earnings, market was more focused on the company missing revenue estimates. Top-line growth is usually seen as more important than bottom-line growth, because top-line growth is harder to manipulate than bottom-line earnings.

I believe the market has overreacted last week. The real reason we saw shares of Amazon (AMZN) sell-off heavily on Friday was due to short-term traders unwinding their long positions as fast as possible following the earnings release. The stock had climbed 7% on Thursday Oct. 25, 2018 as traders had built up bullish positions while anticipating a strong earnings report, and what we saw was a ‘buy the dip, sell the news’ play out over those two trading sessions. I believe long-term investors have good reasons to stay bullish on the stock.

Since the market has reacted so negatively to the company’s sales miss and guidance, let us take a dig deeper into its main sources of revenue using its latest 10-Q filings for Q3.

Revenue Breakdown

Source: Amazon (AMZN) Q3 10-Q Filing

Online Stores

‘Online Stores’ sales grew by 10.11% YoY. Breaking it down even further, Sales for North America grew by 35% YoY, while international sales grew by 13% YoY, as shown by the charts below from the 10-Q filings.

North America

North America

Source: Amazon Q3 Earnings Slides

International

International

Source: Amazon Q3 Earnings Slides

While North American growth is solid, international growth rate is comparatively quite mediocre. Over the past several years, Amazon (AMZN) has invested heavily to develop its presence in several countries. However, the main two international markets where e-commerce growth is high are India and China. Amazon (AMZN) is clearly struggling to repeat its US growth story in these countries. The chart below shows operating profits for its international segment over the past year.

International

International Operating Profit

Source: Amazon Q3 Earnings Slides

While it is not profitable presently, it is encouraging to see that the losses have narrowed. The e-commerce market is growing in India at an annual growth rate of 51%, and in China at 34.3%. However, the two markets are where Amazon (AMZN) faces the most local competition as well.

In China, Alibaba (BABA) leads the Chinese e-commerce market with a 58.2% market share, dwarfing Amazon (AMZN) China’s market share at 0.7%, as shown in the chart below.

China Market Share

Source: emarketer

Amazon (AMZN)’s current place in China’s e-commerce market and the number and size of competitors it is up against certainly make it an uphill battle for the company. However, Amazon (AMZN) China is nowhere as weak as this chart may show. While Alibaba (BABA) is the biggest e-commerce player in China, and often directly compared to Amazon (AMZN), its business model is remarkably different from that of Amazon (AMZN). Alibaba (BABA) generates majority of its revenue from third-party sellers that use its online marketplace to connect with customers. Unlike Amazon (AMZN), Alibaba (BABA) does not own majority of the merchandise sold on its platform. Amazon (AMZN)’s business model involves high-quality logistics and fulfillment networks with bases in the US, UK and Japan. Alibaba (BABA) is making efforts to shift its business model towards that of Amazon (AMZN) by building it its own logistics and fulfillment networks. However, this will need huge investments and cash flow. While Alibaba (BABA) certainly has the potential and resources for this using its growing stream of cash flows, Amazon (AMZN)’s cash flow stream is just as strong. Amazon (AMZN)’s great leverage over Alibaba (BABA) is that it already has developed such networks and marketplaces in US, UK and Japan. Amazon (AMZN)’s strategy for growing into the Chinese market started with offering Chinese consumers Prime membership since 2016, and gives Chinese consumers the ability to order from its overseas marketplaces with free, cross-border shipping. Demand for international goods among Chinese consumers is strong, and Amazon (AMZN) is well positioned to fulfill these demands, putting it in a strong position to compete with Alibaba (BABA). While Amazon (AMZN) still holds a relatively minor market share regardless of these efforts, one of Alibaba (BABA)’s greatest weaknesses is one of Amazon (AMZN)’s greatest strength thanks to its business model, and that is counterfeit goods. Alibaba (BABA)’s current core business is acting as an intermediary between third-party sellers and customers. While this business model is very profitable, it also allows for many fraudulent retailers to use Alibaba (BABA)’s marketplace to sell counterfeit goods, and this has greatly damaged the company’s image over the past years. Undoubtedly, Amazon (AMZN) has also been dealing with counterfeit goods, but given that third-party transactions are a much smaller part of Amazon (AMZN)’s revenue base compared to Alibaba (BABA), Amazon (AMZN)’s brand image triumphs over that of Alibaba (BABA). Therefore, deteriorating trust in Alibaba (BABA)’s marketplace among Chinese consumers will play into Amazon (AMZN)’s favor, as consumers turn to Amazon (AMZN) to buy goods from international brands and take advantage of the free shipping incentives.

In India, Amazon (AMZN) is in a stronger position, controlling about 31% of the market share as of March 2018.

India Market Share

Source: Forrester/ Bloomberg

Realizing that Amazon (AMZN) had fallen behind in acquiring market share in China, CEO Jeff Bezos has strongly committed to invest $5 billion in India to build out its infrastructure. As a result, Amazon (AMZN) has become a heavyweight player in the market, with 42 fulfillment centers across the country, to be able to effectively deliver and fulfill the growing needs of Indian online shoppers. While these heavy investments have dragged down profitability for Amazon (AMZN)’s international segment, I believe Bezos has wisely targeted the fastest growing e-commerce market in the world. India has a population of 1.3 billion, out of which only 480 million are using the Internet. As a result, the nation has a high Internet usage penetration growth rate of 25% annually. Considering Amazon (AMZN)’s large-scale infrastructure establishment already present in the country, it is well positioned to capitalize on this high growth market and generate future streams of revenue.

Flipkart is presently the leader in the Indian e-commerce market. One huge leverage that Amazon (AMZN) has over Flipkart, is that Amazon (AMZN) is a profitable corporation, with deep pockets and a healthy cash flow. On the other hand, Flipkart is unprofitable and burning through cash to spend aggressively on advertising and offering discounts to consumers to support and grow revenues. Amazon (AMZN) is in a much stronger financial position to engage in price wars and large-scale marketing to grow its market share over that of Flipkart’s. Consequently, India offers many factors to support Amazon (AMZN)’s future revenue-generating potential.

Subscription Services

Amazon (AMZN) Subscription Services revenue mainly refers to its Prime membership fees. This revenue segment showed strong YoY growth rate of 45.70% in Q3. While some analysts argue that growth in prime membership is decelerating, it is undoubtedly still a high-growth revenue source for the company. Nevertheless, the slowing growth rate has put off investors and is building up bearish sentiment for the stock.

However, the Consumer Intelligence Research Partners have discovered an interesting trend in the spending habits of Prime members and non-Prime members. Prime members spend about $1400 on average per year buying merchandise on the website. On the other hand, non-members spend about $600 per year. They found that the gap in spending habits had actually widened from the year before as Prime members are spending more and more to take advantage of the subscription service. So while subscription growth is slowing, spending by existing subscribers is also growing, demonstrating that Amazon (AMZN) has been successfully encouraging Prime members to spend more time and money on the website. Consequently, as subscribers spend more and more, this continues to add to the ‘Online Stores’ revenue stream (which is on top of the subscription services revenue stream).

It is also worth noting that there is no competitor in the market that is able to match up to what Amazon (AMZN) has to offer to its Prime subscribers. Prime membership not only offers subscribers two-day free delivery service on various products sold on Amazon (AMZN), but also includes access to a wide choice of e-books, audiobooks, digital videos and music. The lack of alternatives to Amazon (AMZN) Prime helps the company secure a relatively stable revenue stream, which allowed it to raise its Prime subscription fees this year from $99 to $119 annually. This in my view was a clever move to capitalize on Prime members’ loyalty to the service. Now that Amazon (AMZN) is starting the reach a point where subscriber growth is slowing down, and existing customers are becoming increasingly devoted, I believe this was the right strategic move to increase its stream of top-line revenues from its subscription services segment.

Amazon Web Services (AWS)

AWS is Amazon (AMZN)’s cloud computing unit, which grew 45.7% YoY. This segment is a growing cash cow for the company, as it accounted for 56% of Amazon (AMZN)’s total operating income in Q3. The cloud market is forecast to double in size to $302.5 billion by 2021, and AWS is presently a market leader with over 30% market share. While some investors are fretting about the fact that AWS is growing at a slower rate than its biggest competitors, such as Microsoft Azure growing at 76% in Q3, Amazon (AMZN) is still holding on strong to its market share.

Addressing the increased competition in the market, Amazon (AMZN) cut prices for its Lightsail server by 50%. This had investors worried as this would hit Amazon (AMZN)’s AWS revenue stream, one of Amazon (AMZN)’s fastest growing units. However, strategically I believe this was a necessary and sensible move. Unlike its Prime subscription segment, the cloud sector is a highly competitive market. Hence to retain and continue to grow its market share, AWS needs to be more price competitive. While price cuts lower revenue, I believe this will be compensated for by growth in the overall cloud market. As long as AWS is able to maintain (or even further grow) its market share as the cloud market grows, revenues will continue to increase.

Other (Advertising)

The ‘Other’ revenue segment in Amazon (AMZN)’s 10-Q filings is mainly composed of advertising income. This segment has experienced immense growth, increasing 122% YoY to almost $2.5 billion. Amazon (AMZN) owns a treasure of data and analytics related to consumer shopping habits, allowing for more effective ad placements in front of the right users to increase the click rate. As a result, the company’s advertising revenue is growing strongly as a threat to Google (GOOG) and Facebook (FB).

Facebook (FB) is a social media website, where consumers may, but do not necessarily, come to buy things. Facebook (FB) is a pure ad revenue play, which has faced data scandal issues, such as the Cambridge Analytica scandal earlier this year. As a result, Facebook (FB) is working on self-regulations and giving users more choice and control over their data. There is a genuine threat that advertisers will be less willing to spend ad dollars on Facebook (FB)’s platform. The company had also lowered its revenue guidance in its Q2 earnings report as a result of these developments earlier this year.

Amazon (AMZN) on the other hand is not a pure ad revenue play, but still a genuine threat to Facebook (FB). Amazon (AMZN), as an e-commerce site, is a website where consumers mostly come to buy things. Hence, in view, advertisers will more likely want to spend ad dollars to gain space on Amazon (AMZN), where there is a better chance of consumers adding the items advertised to their carts if they end up liking it. Don’t get me wrong, Facebook (FB) is still a solid company and doing right by their users by focusing on data regulations, but it is not the best time to hold Facebook (FB) when there are other competitors like Amazon (AMZN) that are well-positioned to take away their ad dollars and the genuine possibility of Facebook (FB)’s future revenue streams being compromised by the data scandal and new regulations.

I see a real possibility that Amazon (AMZN) will continue to increase its market share in the $88 billion advertising market, making it another growing source of revenue on top of the company’s existing, well-established revenue-generating units.

Valuation

While Amazon (AMZN) clearly holds strong, multiple streams of revenue income, its rich valuation is an aspect that easily puts off many investors. The stock has corrected by around 20% from its all-time high, and following its recent earnings report, the stock is trading at about 86.2x trailing earnings, and 55.2x forward earnings (at time of writing), according to data from Morningstar. While these numbers are admittedly high in comparison the overall market, it is worth noting that it is certainly not unusual for high growth stocks to trade at high earnings multiples. In fact, in 2015 the stock was trading at levels as high as 909.10x earnings. Compared to those levels, paying for the stock at 92x earnings seems more reasonable. Moreover, the Price/Sales (P/S) ratio for the stock presently stands at 3.5. While this is definitely not a low ratio, it is also certainly not an atrocious level to buy the stock at, especially considering that one of its biggest competitors on a global scale, Alibaba (BABA), is trading at a P/S ratio of 8.6.

Furthermore, Amazon (AMZN) is currently trading at 28.8x its cash flow, which admittedly is very expensive, especially given that the industry average is only 6.9x. However, one should note that Amazon (AMZN) is also in a stronger position to generate and grow free cash flow compared to the rest of the industry, thanks to the monthly/annual fees it receives from its Prime subscription service. This strength became especially apparent when earlier this year it was able to raise the annual price of its Prime service by $20, and still continue growing its Prime membership subscription base. This additional income will continue to foster its free cash flow going forward, which makes me more willing to pay a higher multiple for its current cash flow, given its incredibly strong future cash flow generating potential.

Expecting and/or waiting for Amazon (AMZN) stock to come down to trading at dirt cheap multiples before entering, is not something I would recommend. My personal strategy is, when a correction like this comes along, long-term investors should definitely start taking positions in the stock. What if the stock goes even lower from here? In that case, investors should stay ready to buy more stocks, and gradually build up exposure overtime. How you choose to go about it obviously depends on your personal budget, risk appetite and patience.

Bottom Line

Amazon (AMZN) stock has come down 25% from its all-time high. This correction comes amid record earnings, but slowing revenues. I believe that over the long-term, the company has multiple, strong sources of revenue to drive future growth. The company is also making strategically wise decisions by raising prices in segments where it holds competitive strength (Prime Subscription Services), and cutting prices in more competitive markets to hold on to its market share (AWS/Cloud). Investors that are looking to get in for the long-term should take advantage of the recent pullback in the price.

Disclosure: I am/we are long AMZN.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Facebook Sketches a Future With a Diminished News Feed

For most of the past year, Mark Zuckerberg has been trying to convince the world that Facebook was fast becoming a very different company—one that accepted its enormous role shaping public opinion worldwide and would spend what it took to exercise its power responsibly. Many still have trouble believing him, and it’s easy to understand why.

Every time it seems as if Facebook is making progress against the hackers, spammers, and trolls hell bent on turning it into a cesspool of hate speech and fake news, new problems surface. It’s gone to huge lengths, for example, to tout its work to bring more transparency and reduced fraud to political ads. But Tuesday, just before Facebook released its results, Vice News reported that it had attempted to place ads on Facebook while posing as each of the 100 US senators. Facebook approved them all.

Screwups like this have felt like a twice a month event for the past year, seemingly unending. Zuckerberg and his executives and engineers at Facebook are some of the smartest, most experienced and well-funded talent in the world tackling these problems. Yet they keep looking like villagers who are using their fingers to keep their dam from leaking.

Holding Facebook accountable is critical. But that discussion obscures an equally important transformation going on at the company: For most of its existence, users associated Facebook with News Feed—that scrolling list of stories and ads that appears when you first visit the site. That’s changing, and fast, Zuckerberg said as the company reported third-quarter financial results on Tuesday.

He said traffic to new platforms like Stories on both Facebook and Instagram, which Facebook owns, and its messaging platforms WhatsApp and Messenger, is growing so fast that they are diluting News Feed’s cultural force and may eventually challenge it as the company’s dominant revenue generator. “People feel more comfortable being themselves when their content is seen by smaller groups, and (the posts) don’t stick around forever, ” Zuckerberg said, referring to two Stories features he said users like.

Facebook is still a financial juggernaut. It reported profit of $5.1 billion in the third quarter on revenue of $13.7 billion. But as it telegraphed when it reported earnings three months ago, its growth has slowed precipitously. Investors had gotten used to double-digit percentage growth in everything at Facebook every quarter. But in the third quarter, Facebook’s profit increased 9 percent over the same quarter a year earlier, the slowest rate of increase in more than three years; moreover, third-quarter profit increased a scant 1 percent from the second quarter.

Why is this happening? In addition to the billions it is spending to better police its platforms, more of its users’ time is being spent outside of News Feed. Facebook doesn’t yet show as many ads on those newer platforms, so those eyeballs generate less money. Investors seemed prepared for, and willing to accept, the explanation: Facebook shares rose 3 percent in after-hours trading.

Zuckerberg said the self-imposed splintering of Facebook’s audiences is as big as the shift the company underwent about six years ago when it realized users primarily wanted to interact with Facebook on a smartphone, not a laptop or desktop. “If the last 10 years at Facebook have been about connecting friends and family, the next 10 will be about building communities,” he said. He talked about how Facebook would soon be a bigger player in helping people find jobs, buy and sell things, create events, fund-raise and find a date. He said that the shift was happening so fast that in the coming months user engagement with Facebook Stories would surpass that of News Feed.

He also said now that users were gravitating to video on Facebook’s Watch platform, rather than News Feed, that he’d changed his position about video’s negative impacts on the Facebook user experience. In News Feed, he said too much video promoted passivity, and did not promote social behaviors. He said that when video is distributed in its own section—where users actively seek it out—it did not have that impact as much.

It all sounded positively prosaic coming from the man who previously sketched grand—now despised—visions like “making the world more open and connected” and “move fast and break things.” That’s a good thing, because the new Facebook won’t matter much if it can’t convince people that the old Facebook—the place where hackers, spammers and trolls run wild—is dead.


More Great WIRED Stories

Google CEO Sundar Pichai Plays Up U.S. Hiring During Earnings Call

During Google’s latest earnings call, CEO Sundar Pichai emphasized that the search giant is hiring U.S. workers.

“This year to date, we have added over 9,000 new employees in the U.S.,” Pichai said in a call with analysts on Thursday coinciding with fiscal third quarter earnings report for Google parent company Alphabet.

Pichai’s comments come amid President Donald Trump’s criticism of U.S. companies hiring workers and conducting major operations overseas. In September, Trump said that the prices of Apple products could increase because of increased tariffs on China and urged the company to “make your products in the United States instead of China.” The Trump administration then exempted some Apple products from being affected by the tariffs.

The Google CEO spent time discussing how the search giant is “investing closer to home,” reporting that Google spent over 80% of its total capital expenditures for the third quarter on data center facilities and offices in the U.S. This means that of the roughly $5.3 billion Google spent on capital expenditures in the third quarter, about $4.24 billion were dedicated to U.S. facilities.

“They have a strong, positive impact on the communities around them, supporting thousands of jobs,” Pichai said of the company’s spending on U.S. data centers and offices.

Pichai’s comments come after U.S. lawmakers criticized and demanded more information from Google regarding the existence of a censored search engine for China, dubbed Project Dragonfly. Pichai confirmed earlier in October that Google was testing a search engine for China, but said it was only “exploratory” in nature.

When an analyst asked Pichai about a possible Chinese search product during the earnings call, the executive did not reply specifically about Project Dragonfly, saying that Google is “constantly looking for ways to better service Chinese users.”

“That is where we are today,” he added.

Overall, Google said its third quarter revenue increased 21% year-over-year to $33.74 billion in the third quarter. Analysts, however, were expecting $34.05 billion in third-quarter sales.

Google shares were down 3.8% in after-hours trading $1,054.

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The search giant’s third-quarter earnings coincided with the publication of a major New York Times investigation that detailed how Google paid the creator of the Android operating system, Andy Rubin, $90 million to resign quietly after the company found credible allegations by a female employee that the executive had forced her into a sexual act. Google later released a memo on Thursday signed by Pichai and the company’s HR chief, in which the two executives said the report was a “troubling read,” and that the company had fired 48 employees for issues related to sexual harassment over the past two years.

Pichai did not mention Rubin or the Times story during earnings call, nor did any Wall Street analyst ask him to comment on it.

Amazon's holiday season sales outlook misses views; shares sink

(Reuters) – Amazon.com Inc (AMZN.O) forecast holiday season sales and profit that missed Wall Street targets on Thursday, projecting revenue growth that would be the slowest in years, sending shares of the world’s largest online retailer down 8 percent in after-hours trade.

Amazon’s third-quarter sales lagged estimates as well. Analysts said international results were disappointing and online competition was increasing. The company blamed accounting changes and cautioned that it was being conservative with its outlook.

For years, Amazon has made expensive bets on new technology and programs, like its $13.7 billion acquisition of Whole Foods in 2017 to storm the U.S. grocery industry. That has resulted in rollercoaster profits in the past, but revenue has largely grown at a breakneck pace as consumers shifted shopping online and away from brick-and-mortar stores.

“Weak revenue growth stuck out like a sore thumb,” said George Salmon, analyst at Hargreaves Lansdown. “And when you’re trading on 70 times expected earnings, it doesn’t take much to jolt the share price.”

Amazon’s more subdued expectations for this year’s holiday shopping season, which runs from the U.S. Thanksgiving holiday in late November through New Year’s, was a particular surprise. It forecast that fourth-quarter sales will rise between 10 percent and 20 percent, or up to $72.5 billion, while analysts were expecting $73.9 billion, according to Refinitiv data.

That would be Amazon’s lowest quarterly sales growth since at least the start of 2016. In the last four quarters, sales increased between 29 percent and 43 percent.

Brian Olsavsky, Amazon’s chief financial officer, said no fundamentals had changed, just some holiday timing in India and accounting differences.

Packages go on an automated conveyor line to be scanned, weighed and labeled at the Amazon fulfillment center in Kent, Washington, U.S., October 24, 2018. REUTERS/Lindsey Wasson

“We’re expecting a strong holiday season, so there’s no message in our forward guidance against that,” he said on a conference call with media. “We have everything ready to roll.”

The company moved the recording of $300 million in Prime subscription revenue from the fourth quarter to earlier periods in the year, he said. In addition, Amazon faces a tougher year-over-year comparison because the Whole Foods deal closed in the third quarter of 2017, and the different timing of the holiday Diwali affected sales patterns, he said.

“Amazon saw a meaningful slowdown in their international division. They had been hitting on all cylinders so this is something investors weren’t ready for,” Chaim Siegel, analyst at Elazar Advisors, said.

Amazon forecast fourth-quarter operating income between $2.1 billion and $3.6 billion, below the $3.87 billion expected by analysts, according to FactSet.

Neil Saunders, managing director of GlobalData Retail, said the results reflected a shifting landscape with retailers holding their own against Amazon.

“Others are now getting better at nibbling away at its dominance,” he said, citing Walmart (WMT.N), Target TFT.N and Macy’s (M.N).

PROFITS AND THIRD-PARTY GOODS

Slideshow (7 Images)

Despite slower sales growth, Amazon has steadily become more profitable.

Third-quarter net income rose to $2.88 billion, or $5.75 per share, from $256 million, or 52 cents per share, a year earlier.

Up to 53 percent of goods sold on Amazon now come from third-party merchants, the company said on Thursday, marking a steady shift away from traditional retail where Amazon is the seller of a product.

That means the company is collecting less revenue but taking in a lucrative cut of others’ sales – all the more profitable when merchants pay Amazon to handle their shipping. Seller services grew 31 percent to $10.4 billion in the third quarter.

“They’re indifferent if they sell us their own merchandise or third-party merchandise, so they shouldn’t be punished for the latter,” said Michael Pachter, an analyst at Wedbush Securities.

More sellers are looking to Amazon to market their products, too – another highly profitable business. Amazon appeals to advertisers because individuals generally are using the site to shop, unlike users browsing Alphabet Inc’s (GOOGL.O) Google, the ads sales leader, to find general information or rival Facebook Inc (FB.O) to see updates from their friends.

Amazon said revenue from the category and some other items grew 122 percent to $2.5 billion in the third quarter. Analysts were expecting $2.4 billion, according to Refinitiv data.

Olsavsky, the CFO, also said the company is operating more efficiently, hiring less than in the past and adding less warehousing space.

“We’ve really been able to cut back in a number of key areas,” Olsavsky told reporters, citing cost improvements for cloud unit Amazon Web Services as well.

The world’s No.1 cloud business by revenue saw sales up 45.7 percent to $6.68 billion, narrowly edging past estimates of $6.67 billion.

Reporting by Jeffrey Dastin in San Francisco and Arjun Panchadar in Bengaluru; Editing by Leslie Adler

What It's Like to Fly the WWII-Era Plane That Crashed on LA's 101 Freeway

Watching the flames devour the wing of a World War II-era aircraft that crash-landed on the 101 Freeway in Los Angeles, a few questions come to mind. How did the pilot escape unharmed? How’d he manage not to whack any cars as he came down around 2 pm on Tuesday? Why was the plane, a T-6 Texan, dressed up like a German fighter aircraft (sans swastikas)? And, most pressing of all, what is anybody doing flying a 70-year-old plane over northwest LA?

That last one, at least, is easy enough to answer.

“The T-6, out of all the airplanes I’ve flown, is one of my favorite aircraft to fly. It’s a beautifully handling aircraft, it’s extremely well built, very powerful, and it’s just a lot of fun,” says Dave Whitcomb, a professional pilot who has logged about 500 hours in the T-6 while working with a group called History Flight, which takes members of the public out flying in old-timey planes.

The crashed plane, a North American T-6 Texan, currently belongs to Condor Squadron, KTLA reports. (The Van Nuys-based non-profit’s pilots fly the vintage aircraft for parades and other events, according to its website.) In its previous life, the aircraft saw some combat during World War II and the Korean War, but mostly served as a trainer for pilots preparing to climb into the cockpits of Mustangs and Corsairs. Like a driver’s ed car, the two tandem seats each have a full set of controls. Forty-two feet from wingtip to wingtip, the plane can hit 205 mph at 5,000 feet, thanks to its single engine.

The joy of flying a vintage aircraft is similar to that of driving an old race car, Whitcomb says. Without any of the automated systems that pilots now spend most of their time monitoring, operating the T-6 requires constant adjustments to the stick in your right hand, the throttle and propeller controls in your left.

“You’re always flying the airplane,” he says. “In a smaller aircraft like that, it feels like it’s a part of you. Whereas big heavy jets today, you’re not manipulating the controls as much, because they’re so stable.”

Throw in the joy of reliving history, and it’s easy to see why you’d want to climb into the T-6’s cockpit, slide open the canopy, and slide through the air like the pilots of old.

Most of the folks flying T-6’s today are very experienced, Whitcomb says, largely because insurance companies aren’t in the business of covering rookies who want to zip about in a relatively rare and expensive plane. (Someone in Italy’s selling one for $28,735.) Most of the aircraft now have GPS navigation systems; they all have modern radios.

And while the T-6 is generally reliable, it only has a single engine, meanings that if that one craps out, you’re gonna make like Icarus. (This is why Whitcomb avoided flying the T-6 over large bodies of water or unlandable terrain.) That’s where the experience comes in. When an engine failure turns your plane into a glider, it’s time to look for a long, smooth landing surface—like the 101— steadily drop altitude, float down gradually, and hope everybody in their 21st century car can get out of the way.


More Great WIRED Stories

Their Flight Wasn't Until the Next Morning. Passengers Slept on the Floor. Then Airport Security Prodded Them to Stay Awake

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

Have you ever noticed that there are never enough seats for passengers at airports?

Many are forced to mill around because, well, what else are you going to do?

You don’t expect, however, airport staff to instruct you on the milling-around rules. Nor, indeed, on the sleeping-at-the-airport rules.

Last weekend, though, passengers at Stansted Airport near London had a difficult time.

Some passengers flew in from elsewhere late at night and didn’t have a connecting flight until the next morning.

What are passengers supposed to do all night? Wouldn’t you try to get some sleep?

The UK’s Metro describes how passengers tried to find any perch they could to get a few winks.

But when there are only 50 seats and perhaps 500 passengers, there’s only one option: the floor.

I’ve done it before. Perhaps you have too. You try and find a corner, lie down, grip your valuables and hope no one bothers you.

At Stansted last weekend, however, airport security patrolled the scene.

As one passenger, Ricardo Gavioli, told Metro: 

I even saw a young couple sitting together on the ground and when the woman tried to rest her head on her boyfriend’s chest and stretch her legs security came up and prodded her into an upright position.

Gavioli likened it to “sleep deprivation torture.” He said: 

The security were passing every ten minutes to tell people to sit upright and not to lie down.

Why would the airport behave this way?

The airport offered a simple statement: 

We don’t allow people to sleep on the floor or come with sleeping equipment (camp beds, hammocks, sleeping bags etc), and people sleeping on the floor will be asked to sit up or move if necessary. 

There is a caveat, says the airport:

However, nobody is stopped from sleeping or woken up while sitting in a chair.

How very reasonable when there’s hardly a chair to be had.

Why, in fact, doesn’t the airport start charging for chairs? I’m sure U.S. airlines can offer them software for that.

I wonder how Stansted executives fall asleep in meetings. Does security prod them awake, too?

Stansted has banned sleeping on the floor between midnight and 2 a.m. This, it claims, is to accommodate renovation work and, as the airport told the Telegraph:

Feedback shows passengers don’t like arriving at the airport for an early flight to find lots of people blocking access and getting in the way of both staff and those traveling.

They also don’t like having nowhere to sit.

Still, perhaps many will find this approach reasonable. 

Is it also reasonable, though, to prod people awake when they have nowhere else to go and they’re not doing any harm?

Stansted says too many travelers deliberately decide to sleep on the floor, so they don’t have to pay for a hotel.

On the people’s foghorn, Twitter, passengers offered reasonable arguments. There’s just nowhere to go in that airport.

Of course, the airport says passengers should arrive at a time nearer their scheduled departure. 

Many know, however, that this can also provide a crush not worth tolerating.

This airport security’s prodding behavior isn’t exactly unique.

The airport insisted this was to allow cleaners to do their jobs.

Perhaps one idea for passengers is to avoid Stansted altogether.  

Until, that is, the renovations are done and the reception is gloriously welcoming. 

Should both things ever occur, that is.

Gadget Lab Podcast: Pinterest’s Evan Sharp on What Makes Good Software

Why did Apple’s Jony Ive name Pinterest co-founder Evan Sharp as one of the figures in technology who he believes will change the future?

If you were wondering about that, here’s a great chance to learn a little bit more about Sharp and make the call yourself. During the 25th anniversary festival for WIRED last week, the Gadget Lab team had the chance to interview Sharp on stage, among other high-profile technologists. Over the next few weeks we’ll be publishing these taped conversations as a part of the podcast.

In this particularly interview, Mike and Arielle ask Sharp what it’s like to receive praise from Ive, how machine learning is changing software design, and whether Pinterest can remain once of the internet’s last happy places.

Show notes: Click here to read more about Jony Ive’s nomination of Evan Sharp for our 25th anniversary issue. And here’s Lauren’s WIRED 25 interview with Kevin Systrom, which we mentioned in this week’s show.

Recommendations this week: Lauren recommends the Dakota backpack from Dagne Dover. Mike recommends these awesome smartphone accessory lenses made by Moment.

Send the Gadget Lab hosts feedback on their personal Twitter feeds. Arielle Pardes can be found at @pardesoteric. Lauren Goode is @laurengoode. Michael Calore can be found at @snackfight. Bling the main hotline at @GadgetLab. Our theme song is by Solar Keys.

How to Listen

You can always listen to this week’s podcast through the audio player on this page, but if you want to subscribe for free to get every episode, here’s how:

If you’re on an iPhone or iPad, open the app called Podcasts, or just tap this link. You can also download an app like Overcast or Pocket Casts, and search for Gadget Lab. And in case you really need it, here’s the RSS feed.

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Jack Dorsey Has Problems With Twitter, Too

It contributes to filter bubbles, he said. It risks silencing people, he said. And when it’s not silencing them, it might be incentivizing them to behave badly, or basely, he said. His biggest criticism of the social media site he runs was that it could be nudging its users in the wrong directions.

“What does the service currently incentivize?” asked Twitter CEO Jack Dorsey on stage at the WIRED25 summit today. It’s the question he and his whole team are asking themselves right now—about every aspect of the site “Right now we have a big Like button with a heart on it and we’re incentivizing people to want it to go up” and to get more followers, he pointed out. “Is that the right thing? Versus contributing to the public conversation or a healthy conversation? How do we incentive healthy conversation?”

When he co-founded the website 12 years ago, it was meant as a place for friends to share pictures of their lunch. “Now it’s become a place to launch nuclear war,” said Wired editor in chief Nick Thompson. That evolution, from innocuous late-night destination for cryptic jokes to lubricator of social movements to a cesspool of outrage and the platform for geopolitical discourse was not a result of Twitter’s code, Dorsey’s argued. But it was inevitable.

From the second it launched, Twitter was a free app with which anyone could text message the entire world. “Once the world saw that, there was no taking it back,” Dorsey said. “Once they saw it, they needed it. Our job now is to make sure we are actually serving that need.” By which he means the need for a global public square, a place for a global conversation to discuss the most important topics—he cited climate change and poverty as topics that can only be tackled in a global discussion—which he feels it is Twitter’s responsibility to facilitate.

If that means not being an absolutist about free speech, so be it. “We can only stand for freedom of expression if people feel safe to express themselves in the first place,” he said, adding, “A lot of people come to Twitter and they don’t see a service. They see what looks like a public square and they have the same expectation as they have of a public square, and that is what we have to get right.”

Twitter CEO Jack Dorsey (right) on stage with WIRED editor in chief Nick Thompson.

Amy Lombard

To get it right, Dorsey indicated everything was on the table. Twitter, he indicated, may need to be radically changed. He noted right now the service only allows you to follow accounts, not topics. It only allows you to like or retweet. What should it allow you to do instead? He’s not sure, but he’s considering every option.

And he’s open to your ideas. “When we started the company, we weren’t thinking about [any of] this at all,” he said. “One of the interesting things about Twitter has been this amazing experiment in creating with others—the hashtag, the thread, the retweet—have all been invented by the people using our service, not us.” So if you have ideas for how to fix Twitter, make it known. Dorsey is listening.


More Great WIRED Stories

Robert Mueller Has Already Told You Everything You Need To Know

With the exception of President Trump’s legal team, no one has been watching the Mueller investigation more closely than Garrett Graff. Graff, a historian and journalist, wrote the book on Robert Mueller (literally), has interviewed him probably more than any other journalist, and covers the investigation for WIRED. He sat down with WIRED features editor Mark Robinson at the four-day WIRED25 anniversary event in San Francisco to decode the Russia probe and answer the question: What happens next?

A lot. As even a casual follower of the Russia investigation knows, questions have swirled over whether Donald Trump and his campaign colluded with Russia to influence the 2016 election by hacking the DNC and launching a massive disinformation campaign. Though numerous indictments of Trump associates have already come out of the investigation, Mueller has yet to finish it, or release a conclusive report.

A more hotly anticipated government report there may never have been. As Trump’s legal teams prepare their defenses—arguing as recently as last week that it was perfectly legal for the campaign to use materials stolen by Russia to further Trump’s chances—the nation waits.

“Everyone is so focused on ‘When is Mueller going to release the Mueller Report?’, and I think that what people miss is that Robert Mueller has been writing the Mueller Report in public through all of these court filings,” Graff said.

In the short year and a half that Mueller has been investigating Russia’s attack on the 2016 election and the Trump campaign’s ties to it, he has indicted some of Trump’s most senior campaign officials. In each of those court filings he has included far more information than he needed to, notes Graff. For example, when Mueller indicted officers of Russia’s military intelligence GRU agency for hacking, he noted in the criminal filing that the night that Donald Trump went on live TV and invited Russia to hack Hillary Clinton and find her missing emails, the GRU “returned to the office and attacked Hillary Clinton’s personal email server for the first time,” Graff says, emphasizing that last phrase.

“Mueller uses that phrase ‘for the first time’ in the indictment, which is totally unnecessary, unless Muller wants us to know that further down the road,” he says. “Mueller is making claims that I think point to breadcrumbs he is leaving us for where this going to go.”

Graff says that once you factor in the information hidden in plain sight in the indictments, as well as what is pointedly left out of them, you begin to see that Mueller is carving out the negative space where the heart of investigation lies. “He is staying very, very focused,” Graff explains, “And anything that he’s finding that is not directly related to Russia he is handing off to other prosecutors in a really interesting way because it gives us almost a negative relief of how to view Mueller’s investigation.”

That blank space can tell us where the investigation is going. And where is that? Straight toward Roger Stone, Graff surmises, pointing out that no one is more implicated by the information in the indictments that have already come out of the investigation. Short of that, Graff is hesitant to make predictions.

Garrett Graff is the author of The Threat Matrix: Inside Robert Mueller’s FBI and the War on Global Terror.

Amy Lombard

Normally, he says, as a reporter you always expect a story to end up being less weird than you are originally told. “You get these weird tips as a reporter, and it’s never that good. It ends up being like 75 to 80 percent as weird as the tip. That’s not true about any part of this story. Every single thing ends up being about 140 percent as weird as original reporting,” he says.

A few weird things he thinks Mueller is particularly interested in, that linger in that negative space carved out by the public indictments so far: A Trump campaign meeting with Betsy Devos’ brother Erik Prince in the Seychelles in 2016, the role of the nation of Qatar in Russia’s disinformation campaign, the Trump tower meeting, the Trump money trail, and “weirder questions about money,” says Graff.

“I think almost certainly the bombshell—if there is a bombshell—is about money,” he says.


More Great WIRED Stories

This Survey of 1,300 Harvard Business School Alumni Reveals the 5 Skills You Need to Succeed as an Entrepreneur

Do you admire leaders like Steve Jobs and Bill Gates who have turned their ideas into world-leading public companies? I certainly do. But it is one thing to admire such leaders and another thing to have the skills needed to become a successful entrepreneur.

Which raises an important question: What skills do successful founders have that other business leaders lack? Thanks to a survey of 1,300 Harvard Business School alumni, here are the five key skills — out of 11 examined by the researchers — at which entrepreneurial leaders distinguish themselves compared to non-founders.

1. Identification of Opportunities

Founders excel in skills and behaviors associated with the ability to identify and seek out high-potential business opportunities, according to the research. This should come as no surprise. But what makes for a great business opportunity? 

My interviews with hundreds of entrepreneurs reveal four tests:

  • Does the product relieve deeply-felt customer pain that other companies are ignoring?
  • Does the founder have a passion for doing a market-beating job of solving that problem?
  • Does the startup’s founding team have the critical skills to build that solution?
  • Is the market opportunity large enough — e.g., at least $1 billion? 

2. Vision and Influence

Founders have strong abilities to influence all internal and external stakeholders that must work together to turn a strategy into action and results.

Harvard researchers found that entrepreneurial leaders have more confidence of their abilities to provide vision and influence than the average leader — and that leaders working within established firms actually rated themselves much lower.

As I wrote in my 2012 book, Hungry Start-up Strategy, a successful entrepreneur is able to attract and motivate talent by creating what I called emotional currency — rather than paying people more money than Google does, they offer a powerful mission which gives work at the startup much more meaning.

3. Comfort with Uncertainty

Entrepreneurial leaders are better able to “move a business agenda forward in the face of uncertain and ambiguous circumstances,” according to the researchers.

You’ll know whether you share this skill if you are willing to start a company even though you have no money, no product, and no customers — but you do have a clear idea of what problem you are trying to solve and what your solution will look like.

Starting there, successful entrepreneurs are far more comfortable living with the uncertainty needed to go from there to building a large company. 

4. Building Networks

One reason for founders’ comfort with uncertainty is that they are good at assembling the resources the startup needs because they can create professional and business networks that will help them realize their vision.

Indeed, many of the CEOs I’ve interviewed have told me that they often find themselves not knowing how to solve problems — but they are able to get advice from CEOs who have been there before.

5. Finance and Financial Management

Being able to raise capital and control cash flow are essential to a successful startup. The founders HBS surveyed were “much more confident in their skills at managing cash flow, raising capital, and board governance — than were non-founder alumni.”

My interviews this year with CEOs for my forthcoming book on scaling startups highlights that successful entrepreneurs are great at persuading investors to write them checks.

The most successful sales pitches for money emphasize the size of the market the company is targeting, the value that the company’s product provides for customers, and the rapid rate at which the company is winning new customers and retaining old ones who spend more on the company’s products.

Not surprisingly, there is one area where founders are not as good as non-founders — preference for established structure.

Entrepreneurial leaders have a lower preference for operating in more established and structured business environments and would rather “adapt to an uncertain and rapidly changing business context and strategy,” according to the HBS researchers.

If you are great in these five skill areas, you may just have what it takes to be a successful entrepreneur.

7 Strategies to Maximize Your Productivity While Traveling

Whether you hate the idea of traveling or you actually look forward to it, it’s hard to deny that travel can sabotage your productivity–at least temporarily. It takes hours of planning and coordination to prepare for some trips, and hours to navigate airports, not to mention the actual time you spend traveling.

It can make a full day of responsibilities feel like a waste, and put you behind on achieving your goals. Fortunately, there are some helpful strategies that can make you more productive–no matter how you’re traveling.

Try using these tactics to get more done when you’re setting course on a major trip:

1. Get used to a different sleep cycle.

One of the biggest sources of productivity disturbance while traveling is the disruption in your sleep cycle. Depending on where you travel to, you could be dealing with timezone changes and jet lag, and you may not be able to get a comfortable eight hours of sleep when you’re used to getting it.

Instead, you can try a biphasic cycle or an everyman cycle, which rely on split patterns to break up your time sleeping; that way, travel may not have as big of an impact on you. The caveat here is that it takes time to get used to a new sleep cycle, so it’s best for frequent travelers only.

2. Take a private jet.

One of the biggest sources of time delay while traveling is navigating the airport; going through customs, waiting to board the plane, dealing with delays, etc., can add several unnecessary hours to your trip.

Taking a private jet allows you to circumvent most of these problems–and it’s cheaper than you think. If a few hundred dollars can save you literally hours of time, and afford you a better workspace when you’re flying, it’s likely worth the extra money.

3. Look for coworking spaces when you arrive.

Coworking spaces are popping up everywhere, so you shouldn’t have trouble finding one at your destination. Instead of going straight to a hotel or meeting, check into one of these productivity hubs; you’ll be able to get coffee, work in a peaceful environment, and if you’re up for it, socialize with other people who may be in similar situations. It’s a great way to both decompress and get more work done, so take advantage of it.

4. Rely on audio.

While you’re driving, navigating the airport, or dealing with a lack of lighting or Wi-Fi, you won’t be able to work on your most important heads-down tasks–but that doesn’t mean you can’t be productive.

Try focusing on audio-specific tasks when you can, listening to recordings of old meetings to prepare for the future, catching up on your favorite industry podcasts, and listening to audiobooks that can improve your skills or expand your professional horizons. There’s no shortage of audio content to plunder, so make good use of it.

5. Prepare travel-specific tasks.

While traveling, you won’t be able to do tasks that require multiple monitors, or meet with your teammates in person. You’ll have limited space, and in some cases, limited Wi-Fi connectivity.

Prepare tasks that you can work on under these conditions, so you don’t run out of things to do. As long as you have a few days’ heads-up, you can handle your least travel-friendly tasks in advance, and set yourself up to work offline for the next several hours.

6. Say “no” and delegate.

New things are going to come to your attention before and during your travel; for example, you might get a client email requesting a change to a piece of work you submitted. If this is the type of work that can’t be done efficiently when traveling, don’t bend over backwards trying to do it; instead, tell them you’re traveling, and not able to do it right now.

If it’s an emergency, or if you won’t be able to get to it for a while, consider delegating it to someone who can handle it.

7. Rest (if you can).

To some people, sleeping may seem like the opposite of productivity. But in reality, sleeping is one of the best things you can do for your mental energy and cognitive capacity. It can even reduce your susceptibility to illness and improve your overall physical health.

Accordingly, if it’s possible for you to take a nap during a long flight or car ride, take advantage of the opportunity. Use a face mask, a neck pillow, or some comforting white noise from your headphones–whatever you need to get some extra shuteye when you’re between destinations. You’ll thank yourself later.

Finding Your Own Style

Not everyone is going to travel the same way. For example, some people may not be able to read while in a vehicle, and some may have trouble sleeping on airplanes. The goal isn’t to fall in line with a series of productive habits, but rather to craft your own habits to maximize your personal productivity. Learn which strategies and actions suit you best, and customize your own set of approaches.

The Cars of the Paris Auto Show Reveal a Quirky, Urban, Electric Future

The Renault Ez-Ultimo brings the high-end glitz to the show this year. Just because cities of the future may prioritize ride sharing over private cars doesn’t mean you should have to slum it on the way to opening night at the Opéra national de Paris.

This rounded bronze box is about as far from a production car as a concept can be (could those wheels even turn? where’s the ground clearance for cobbled streets?) but Renault says it shows a vision of an autonomous future, where passengers demand more from vehicles. In particular, the interior “reflects French elegance” with wood, leather, and marble.

Citroën went the opposite direction, unveiling a very real, very modest EV. The DS3 Crossback E-Tense is a fashionable crossover SUV, and an update on Citroen’s tres popular DS3 supermini car. The electric version comes with a 50-kWh battery—about half that of a high-end Tesla—a range of 186 miles on the generous European test cycle, and a 0-60 time of 8.7 seconds. None of those specs are going to blow buyers away, but at the right (to be revealed) price, the quirky car, with sharp angles and odd window cutouts, could rival the Nissan Leaf or Renault Zoe, as a city runabout.

Europe has taken styling cues from the US for the Peugeot E-Legend concept, albeit with a little added flair. There are plenty of muscle car hints in the styling, with a side profile reminiscent of the modern Dodge Challenger, and a Mustang-like front squint. Of course it’s a concept, so it’s electric and autonomous, and supposed to show that those things don’t have to be boring or bland.

The retro theme continues inside with velvet upholstery and fake wood screensavers for the displays when they aren’t in use. It’ll apparently have a 100-kWh battery pack and all-wheel drive, but it’s so concept-y that wise money should be on all that potentially changing, if and when the E-Legend makes it to production.

It wouldn’t be a European auto show without a city car, and Smart is the brand synonymous with cars so small they can be parked end-on to a curb. The Smart Forease moves that theme into an electric age. The rather optimistic concept banks on the future always being sunny, given that it doesn’t have a roof. Not even an optional one. (Have these people been to Europe?)

Smart has already stopped the sales of all internal combustion engined cars in the US, and if this car makes it across the Atlantic (and to reality) it could find a place in some Californian garages. The Golden State has good EV electric rebates, and as close to a guarantee of good weather as you’re going to find.

Infiniti is keeping it real with its Project Black S hybrid, based on a Q60 coupe and its V6 engine. Infiniti engineers turned to electrification, and lessons from partner Renault’s Formula 1 team (there’s the French connection) to give the machine an e-boost.

It’s a hybrid, but one that delivers performance rather than economy. The three motors add 213 horsepower to bring the total to 563, and drop the 0-60 mph time to under four seconds.

Toyota didn’t use the Paris show to unveil radical new concepts, but did introduce a term that will be new to most buyers: self-charging hybrids. This is no magical perpetual motion-type technology: Self-charging hybrids are just cars that can run on battery power, but can’t be plugged in. The type Toyota has been selling for years with the Prius, when they used to be just called “hybrids.” As they’ve gone from being radical, to commonplace, to somewhat lame given the influx of more robust electric options, Toyota is looking to rebrand to remind people that the tech is still quite clever, and does save fuel.

DHS says no reason to doubt firms' China hack denials

WASHINGTON (Reuters) – The U.S. Department of Homeland Security said on Saturday it currently had no reason to doubt statements from companies that have denied a Bloomberg report that their supply chains were compromised by malicious computer chips inserted by Chinese intelligence services.

FILE PHOTO: A U.S. Department of Homeland Security employee stands inside the National Cybersecurity and Communications Integration Center as part of a guided media tour in Arlington, Virginia June 26, 2014. REUTERS/Kevin Lamarque/File Photo

“The Department of Homeland Security is aware of the media reports of a technology supply chain compromise,” DHS said in a statement.

“Like our partners in the UK, the National Cyber Security Centre, at this time we have no reason to doubt the statements from the companies named in the story,” it said.

Bloomberg Businessweek on Thursday cited 17 unidentified intelligence and company sources as saying that Chinese spies had placed computer chips inside equipment used by around 30 companies, as well as multiple U.S. government agencies, which would give Beijing secret access to internal networks.

Britain’s national cyber security agency said on Friday it had no reason to doubt the assessments made by Apple Inc (AAPL.O) and Amazon.com Inc (AMZN.O) challenging the report.

Apple contested the Bloomberg report on Thursday, saying its own internal investigations found no evidence to support the story’s claims and that neither the company, nor its contacts in law enforcement, were aware of any investigation by the FBI on the matter.

Apple’s recently retired general counsel, Bruce Sewell, told Reuters he called the FBI’s then-general counsel, James Baker, last year after being told by Bloomberg of an open investigation of Super Micro Computer Inc (SMCI.PK), a hardware maker whose products Bloomberg said were implanted with malicious Chinese chips.

“I got on the phone with him personally and said, ‘Do you know anything about this?,” Sewell said of his conversation with Baker. “He said, ‘I’ve never heard of this, but give me 24 hours to make sure.’ He called me back 24 hours later and said ‘Nobody here knows what this story is about.’”

Baker and the FBI declined to comment on Friday.

Reporting by David Brunnstrom; Editing by Dan Grebler

Oracle Says Thomas Kurian, Who Oversaw the Company’s Cloud Efforts, Is Stepping Down

Oracle confirmed late Friday the departure of a top product executive from its ranks. Thomas Kurian, a 22-year veteran of the company who most recently served as president of Oracle’s product development, is stepping down from the company.

Kurian’s bio on Oracle’s corporate site credits him with overseeing Oracle’s transition to cloud-based enterprise software. Prior to Oracle, Kurian worked as a consultant at McKinsey & Co. Last week, Oracle’s stock stumbled after the company’s second-quarter earnings showed revenue from its cloud services came in below analyst expectations.

In a filing with the U.S. Securities and Exchange Commission, Oracle said that Kurian notified the company that he was leaving to pursue other opportunities. “Kurian’s duties and responsibilities have been reassigned to other senior executives in Oracle’s development organization,” Oracle’s filing said.

The announcement comes a few weeks after several news organizations reported on a clash between Kurian and Oracle founder and executive chairman Larry Ellison. According to CNBC, Kurian took a leave of absence from Oracle earlier this month, notifying the company’s staff of his plans in an email. At the time, an Oracle spokesperson said the company expected Kurian to “return soon.”

Kurian has battled with Ellison over the role that cloud-based software will play in Oracle’s future. The two executives faced “growing strife” over the appropriate cloud strategy for Oracle, Bloomberg reported, with Kurian wanting Oracle to make “more of its software available to run on public clouds from chief rivals Amazon and Microsoft as a way to diversify from its own struggling infrastructure.” Ellison reportedly disagreed.

Oracle’s stock was little changed in aftermarket trading, declining 0.3% to $51.40. In official trading Friday before Kurian’s departure was announced, Oracle shares were down 0.3% at $51.56.