Facebook is working on a new platform specifically for meme-obsessed teens that's already being described as 'cringey' (FB)

Posted: 18 Jan 2019 01:31 PM PST

best memes 2017

  • Facebook is quietly building a platform for discovering memes, TechCrunch reports.
  • The platform is called LOL, and will consist of "funny videos and GIF-like clips" that users can vote on and share.
  • However, LOL was described as "cringey" to TechCrunch, and the platform is said to be out of touch with the wants of meme-obsessed teens.

In its latest effort to stave off the steady flow of teens leaving its platform, Facebook has been building a dedicated space for users to discover memes and viral content.

The new platform, called LOL, is designed as a "special feed of funny videos and GIF-like clips" using content "pulled from News Feed posts by top meme Pages on Facebook," according to a new report from TechCrunch. Under each meme that appears in LOL, users can choose three reactions for the post: "Funny," "Alright," or "Not Funny."

LOL is currently in private beta and is being tested out by 100 high school students who got parental consent to participate and also signed non-disclosure agreements with Facebook, according to TechCrunch.

A Facebook spokesperson confirmed in an email to Business Insider that it is working on the platform, saying: "We are running a small scale test and the concept is in the early stages right now." 

However, those who have seen LOL told TechCrunch the design is "cringey" and misses the mark. LOL is apparently featuring content that is weeks old, and that has surely already been seen before by the meme-obsessed users who would actually use the platform.

Read more: An internal email shows how Facebook learned of a 'psychological trick' to get teens to try a new product

From TechCrunch's screen grabs, LOL's design and features draw comparisons to Snapchat's Discover feed. Facebook's LOL includes section for themed content collections called "Dailies," which look pretty similar to curated clips Snapchat compiles for Discover. LOL also lets you filter your feed by category, including "Fails," "Pranks," "Savage," "Wait for It," "Celebs," and a personalized "For You" tab.

As it stands, LOL reportedly acts as a replacement for Facebook's Watch tab. But Facebook has yet to decide whether LOL will exist as a standalone app, or as a feature within the existing app, TechCrunch reports. 

Facebook's increasing unpopularity among Generation Z has been well-documented, and experts say Facebook has been taken over by parents. Only 5% of teens chose Facebook as their preferred social media platform in a Piper Jaffray survey from Fall 2018, and almost 80% of surveyed teens chose either Instagram or Snapchat instead. 

In response to its dwindling presence in teens' lives, Facebook has attempted to grow several features and spinoff apps. Facebook launched a standalone app in November called Lasso that's drawn comparisons to TikTok (and the late video app Vine), but the app has yet to take off like its competitors. Facebook also acquired the anonymous app tbh, which was popular among teens in late 2017, but closed down the app just eight months later. Other ventures include Hello, Slingshot, and Poke, but all have either shuttered or faded into virtual non-existence.

SEE ALSO: Instagram influencers are so overwhelmed by hackers, they're hiring hackers of their own to get their accounts back

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A Florida man arrested on charges of child porn and unlawful sex with a minor allegedly used 'Fortnite' to find his victim, and authorities are worried there could be up to 20 others

Posted: 18 Jan 2019 01:09 PM PST

Fortnite_missile_face building

  • A 41-year-old Florida man has been arrested and faces charges of unlawful sex with a minor and 22 counts of child pornography, among other charges.
  • Florida Attorney General Ashley Moody said the suspect, Anthony Gene Thomas, allegedly used the video game "Fortnite" to meet the 17-year-old victim.
  • Moody said that a search of Thomas's phone uncovered multiple images and videos of the underage girl, and investigators believe there could be more victims.

A Florida man arrested and facing charges of unlawful sex with a minor and 22 counts of child pornography allegedly used "Fortnite" and an accomplice to meet the victim, prompting a response from Florida Attorney General Ashley Moody.

In a statement posted to the Florida Office of the Attorney General website, Moody said that Anthony Gene Thomas, 41, of Broward County, used the video game "Fortnite" to meet a 17-year-old girl and have sex with her. Moody said pictures and video of the sexual encounter were discovered when police executed a search warrant on Thomas's phone. 

“This case is disturbing not only because it involves child pornography, but also because a popular online game was used to communicate with the victim," Moody said in the statement. "We have reason to believe there could be additional victims, and I am asking anyone with information about the recruiting of minors for child pornography, or any other type of sexual exploitation, to call law enforcement immediately."

Read more: Microsoft's Bing search engine reportedly had a child porn problem

Moody's statement did not specify whether images of other underage victims were found on Thomas's phone, but there's been a call for any victims to come forward, and she wrote that "authorities believe there could be as many as 20 additional victims."

The Attorney General's office says a co-conspirator first met the victim on "Fortnite" and eventually introduced her to Thomas. Moody alleges that Thomas "manipulated" the 17-year-old by offering her gifts, credit cards, and a cell phone after she told him she was having a hard time at home.

Eventually, Thomas and his co-conspirator allegedly coordinated an in-person meeting with the victim on Aug. 25, 2018. Moody says the pair picked the victim up and drove back to Thomas's home, where he allegedly had sex with her. The 17-year-old's parents reported her missing the same day; police located her at Thomas's residence and brought her home on August 26th. Moody says that Thomas stayed in contact with the teen after the encounter, and the search warrant that would uncover the child pornography was eventually executed on October 11th.

Thomas faces charges of soliciting a child for unlawful sexual conduct using computers, traveling to meet a minor for unlawful sexual activity, possession with intention to promote sexual performance of a child, 22 counts of child pornography, and unlawful sexual activity with a minor. Police have not identified the name or age of the co-conspirator, or whether they will be facing criminal charges.

Like popular social networks, games like "Fortnite" put young players shoulder to shoulder with adults with few barriers to communication. As Moody suggests, parents should be monitoring their children's online activities to ensure they're not being exposed to physical and emotional violence. 

"Parents need to know that predators will use any means possible to target and exploit a child," Moody's statement reads. "I am asking parents and guardians to please make sure you know who your children meet online, and talk to them about sexual predators.”

SEE ALSO: Microsoft's Bing search engine reportedly had a child porn problem

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A Red Hat-backed open source project warns that a controversial new plan to take on Amazon and other tech titans is only causing 'Fear, Uncertainty, and Doubt' (MDB, RHT)

Posted: 18 Jan 2019 01:08 PM PST

Jim Whitehurst

  • Fedora, a popular open source operating system sponsored by Red Hat, has rejected MongoDB support.
  • MongoDB recently changed its license in a defensive move against having its code monetized by cloud titans like Amazon Web Services — but Fedora says that the new license just causes "Fear, Uncertainty and Doubt" for users.
  • Red Hat itself has dropped MongoDB support in its flagship Red Hat Enterprise Linux operating system, saying that the new license places an unreasonable burden on customers in order to stay in compliance.
  • This episode highlights a larger debate taking place in the free software community: Are these new licenses antithetical to the whole idea of open source? 

Open source software companies like MongoDB are making drastic moves to protect their intellectual property from cloud giants like Amazon or Alibaba — but a clash between MongoDB and $31 billion software giant Red Hat highlights the potential pitfalls of that strategy. 

Fedora, a Red Hat-sponsored open source operating system, has dropped support for the very popular MongoDB database. Although Fedora is sponsored by Red Hat, and has project leaders who work at Red Hat, it's technically a separately-run open source project. Fedora cited concerns over the company's controversial new licensing agreement, and indeed, Fedora has tacked MongoDB's SSPL onto its "bad license" list.

This comes months after Red Hat, which is on the cusp of being acquired by IBM, removed MongoDB support from its Red Hat Enterprise Linux OS in November. 

Late last year, MongoDB announced the Server Side Public License, or SSPL. Under the terms of the SSPL, any cloud provider who wants to take the free MongoDB database and package it up as service for their own customers has to also release their code as open source, free for anybody to see and use...or else pay MongoDB for a license. It's intended to make it harder for cloud providers to make money from MongoDB without paying up. 

The problem, in Red Hat's view, is that the SSPL violates a core principle of open source, which states that anybody should be able to use this free software any way that they want to, without restrictions, even if they're using it to turn a profit — a line of thinking that echoes many critics of MongoDB's SSPL and licenses like it. 

"It is the belief of Fedora that the SSPL is intentionally crafted to be aggressively discriminatory towards a specific class of users," Tom Callaway, a technical and community outreach program manager at Red Hat, wrote in a blog post. "Additionally, it seems clear that the intent of the license author is to cause Fear, Uncertainty, and Doubt towards commercial users of software under that license."

For its part, MongoDB has disputed the characterization that the SSPL disqualifies the platform as open source. Indeed, MongoDB has submitted a redrafted second version of the SSPL to the Open Source Initiative, an industry body, to win the right to call it an open source license.

Read more: Two software companies, fed up with Amazon, Alibaba and other big cloud players, have a controversial new plan to fight back

"We continue to work with the OSI as they deliberate on the SSPL and we still strongly believe that the SSPL meets the tenets of open source," Eliot Horowitz, CTO and co-founder of MongoDB, said in a statement.

However, Red Hat itself isn't so bullish about MongoDB's chances, here. Richard Fontana, senior commercial counsel at Red Hat and himself a member of the OSI board, calls SSPL the "most controversial license the OSI has received in years," and admonished MongoDB for breaking from the open source community.

"Here's a major community project that looks carefully at the license and says, 'look it doesn't need community standards on what a free software license is,'" Fontana said. "It's a strong statement and that may have an impact on the debate as it goes forward."

Bradley M. Kuhn, the president of the Software Freedom Conservancy, says that he consulted with Red Hat on this situation, and isn't surprised that the company is moving away from MongoDB. 

"MongoDB released this license with no discussion with the community. This frustrated all of us, and I sense that frustration with Red Hat as well," says Kuhn. 

'A burdensome requirement'

Beyond Fedora and Red Hat Enterprise Linux, Red Hat is looking at other places where it might have to take action over MongoDB's move towards the SSPL, says Fontana. 

The general feeling at Red Hat, says Fontana, is that the SSPL adds a potential legal headache for customers and users of its products. There's no precedent for something like the SSPL, and that could make problems for any company who wanted to ensure they were in full legal compliance while using MongoDB, he says. 

"Our customers really appreciate the fact that we are very careful about the licenses that we say are open source products. They look to us for guidance. If they found this unusual license with an unprecedented restriction, I think some customers might be legitimately concerned," says Fontana. 

Read more: Startups are taking on Amazon's cloud with a controversial new plan, but experts warn it could undermine the foundations of open source

More than anything, SSPL essentially requires users that are offering MongoDB's database server as a service to make much of their own, potentially proprietary code, available for free. Fontana says this goes far beyond what any other free software license requires.

"That's actually such a burdensome requirement that I would say it's impossible to comply with," Fontana said.

Moving forward with the license

While MongoDB awaits a verdict on the second version of the SSPL, it's still using the first. Other companies, like Confluent and Redis Labs have also made similar license changes, for similar ends, though they haven't submitted them to the OSI. 

Ultimately, the SSPL didn't stop Amazon Web Services from creating its own MongoDB-compatible database service called DocumentDB, though MongoDB has said that the two aren't directly competitive. Eliot Horowitz

While Fontana gives MongoDB credit for going through the approval process, and calls MongoDB's issues with cloud providers "a legitimate concern," he believes MongoDB should not have started using SSPL before it was vetted by the open source community.

"I would encourage MongoDB to go back to using an accepted and approved license for an open source license. They should wait for OSI to make a decision about SSPL," Fontana said. "That would be a preferable way to proceed."

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Everyone who's telling you that Tesla is influencing the rest of the auto industry is completely wrong (TSLA)

Posted: 18 Jan 2019 12:27 PM PST

Tesla Model 3 Review

  • Tesla is routinely considered to be influencing the traditional auto industry.
  • Tesla has exerted some influence, but it has been relatively modest in the grand scheme of things.
  • Auto executives are too busy dealing with real business problems to worry about Tesla — and if Tesla did become truly influential, the traditional industry could quickly develop and sell millions of electric vehicles.

If you follow Tesla and the company's endless flurry of news, non-news, rumor, innuendo, and Twitterific chatter, you might think that the entire auto industry is furiously chasing a relatively tiny upstart California company that will do well to have sold 250,000 vehicles last year.

Such is Tesla's reality-distortion field. You can't really blame it on CEO Elon Musk; Tesla's fans are, as a group, given to dramatic overstatement.

Read more: Cadillac revealed a futuristic electric SUV concept that will rival Tesla's Model X — and it looks awesome

I just got back from the Detroit Auto Show, and in my conversations with various auto executives, the word "Tesla" came up not once. Tesla wasn't at the event, but that's because Tesla doesn't really do car shows. Why bother? It's selling only three vehicles. Nearly 50% of what it could put on display — a new Roadster sports car, a Semi truck, and a pickup — are still in the preproduction or concept stages.

No time to worry about Tesla

Cadillac EV 2019 Detroit Auto Show

Overall, the auto industry is doing fine without worrying about what Tesla is up to, and it has plenty of bigger problems to contend with.

Sales in the US again came in at near-record levels in 2018, and the most popular vehicles among consumers — SUVs and pickup trucks — are also the most profitable.

But General Motors is continuing to manage its business aggressively, idling underperforming factories and expanding its investment in autonomous and electric mobility. Ford is engaged in a deep restructuring. Fiat Chrysler Automobiles is dealing with an unexpected leadership transition after the sudden death last year of CEO Sergio Marchionne. And Nissan's former chairman, the onetime industry legend Carlos Ghosn, continues to reside in a Tokyo jail on charges of financial impropriety.

Outsize belief in Tesla's influence isn't yet a serious affliction. But it's getting worse, and at some point it will be serious. The truth is that there isn't much that Tesla is doing that the traditional industry needs or wants to copy. So far, the biggest shift possibly inspired by Tesla was GM's and Ford's decision to report quarterly rather than monthly US sales data — essentially an accounting tweak.

Electric cars are easier than you think

Chevy Chevrolet Bolt

Electric vehicles aren't that complicated from an engineering standpoint. GM proved rather decisively that it could design, build, and launch a long-range mass-market EV, the Chevy Bolt, in about a year. The car has been on sale since late 2016. EVs are a battery and motor, maybe two.

Tesla's software and infotainment systems capture a lot of attention, but those aren't core elements of an automobile. Tesla obviously learned this in 2018, as it struggled mightily with the basics of modern mass production, something other automakers perfected in the 1980s.

Detroit has been doing a good job of pitching an electrified future. Two of the biggest news stories to come out of the Detroit Auto Show were GM's decision to make Cadillac its lead electric brand and Ford's announcement that it's developing an all-electric version of its top-selling F-150 pickup truck.

What Tesla boosters seem to miss is that electrification is trivially easy for big car companies. It's hard for Tesla because the company is just 15 years old and has been building its own vehicles in serious volumes for only about three years. The learning curve is quite steep in the type of complicated supply-chain-and-capital-intensive manufacturing that gives consumers many millions of new and widely varied vehicles each year to choose from.

Tesla's strength, like Apple's, is the refinement of existing ideas. Over a decade ago, Tesla developed a better battery. The company has pioneered over-the-air software updates for its cars, set a standard for luxury EV design and performance, and proved that substantial EV sales are aided by developing a widespread network of fast-charging stations.

Make no mistake: Tesla is a great company

elon musk

Of these, the one that the traditional industry has latched onto is the charging piece. But otherwise, Tesla isn't causing anyone in the world's automaking capitals to lose sleep. They have President Donald Trump for that, not to mention numerous factors beyond their control, such as gas prices, credit conditions, exchange rates, and unpredictable geopolitics.

If Tesla did eventually cause auto executives to toss and turn, then those execs would simply ... make some more electric cars. This is, after all, what they do and have been doing for over a century: making cars.

They aren't even all that enthusiastic about competing with Tesla, despite what various short-sellers might believe. Competition costs money. Sure, Ford and Chevy compete for pickup-truck buyers. But they also each sell a staggering number of moneymaking pickups each year, and they can expect to keep doing that, year after year. They have a pretty good sense of what that game is all about.

Meanwhile, overdoing it on what could be too many low-profit, low-sales EVs would be throwing money away. On the environmental side, it would be far better for the planet if the traditional industry sold hybrid gas-electric versions of all the vehicles it manufactures. But unfortunately, if Tesla has had one striking influence, it's been to undermine the once robust hybrid market and push those customers toward far more expensive all-electric vehicles.

Make no mistake: Tesla is a great company. It makes great cars. It has done something nobody in the industry thought was possible by creating a vibrant all-electric brand. But is it exerting a radical influence on the car business? Hardly.

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NOW WATCH: What would happen if Elon Musk left Tesla

The FTC is reportedly considering hitting Facebook with a 'record-setting' fine over privacy issues (FB)

Posted: 18 Jan 2019 11:48 AM PST

Mark Zuckerberg pours glass of water

  • The Federal Trade Commission (FTC) is reportedly considering hitting Facebook with a record-breaking fine over privacy violations.
  • According to The Washington Post, the US regulatory body is considering taking action after opening an investigation in 2018. 
  • The FTC discussion about fines comes after the Cambridge Analytica scandal and other crises have made Facebook the subject of heavy scrutiny.

Facebook's privacy nightmare may soon get worse.

According to a new report from The Washington Post published Friday, regulators at the US Federal Trade Commission (FTC) are considering hitting Facebook with a "record-setting" fine over user-privacy concerns. 

There's no word yet on exactly how big this record-breaking fine might be, but The Washington Post reported that it is "expected to be much larger" than the record $22.5 million penalty against Google. In theory, the FTC allows for fines of up to $40,000 per violation — violations which, in Facebook's case, could be counted by user. But it's by no means clear if that's what will happen.

Facebook spokesperson Sally Aldous declined to comment to Business Insider. The FTC was not available for comment because of the ongoing partial government shutdown.

The report is indicative of how regulators and legislators are closely scrutinizing Facebook, and how the social network's scandals may do more than just tarnish the social network's public reputation — they could do real damage to its bottom line.

In March 2018, the FTC confirmed that it was investigating Facebook's privacy practices in the wake of the Cambridge Analytica scandal, in which tens of millions of users' data were misappropriated by a political-research firm. 

The FTC in 2011 slapped Facebook with a consent decree, which is a legally binding promise to uphold certain privacy standards. Facebook may face the fines if it has been found to have violated this decree.

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A 'super blood wolf moon' this weekend will be the last total lunar eclipse until 2021 — here's how to catch it

Posted: 18 Jan 2019 11:42 AM PST

Super blood blue moon

  • A total lunar eclipse will occur on Sunday, January 20. 
  • This "super blood wolf moon" gets its name because the eclipse will occur when the moon is full (called a wolf moon in January) and closer to Earth than normal (a super-moon). The Earth's shadow will make it appear reddish.
  • The lunar eclipse is slated to last one hour and two minutes.

On Sunday, January 20, the Earth will pass between the sun and moon, block light from the sun and casting a shadow on the moon.

This is a total lunar eclipse, and it will be the last one we see until May 2021 (though there will be partial lunar eclipses before then). 

Total lunar eclipses are not that rare — the last one occurred in July 2018 — but this one stands out as a "super blood wolf moon." 

That name is based on the eclipse's timing and the moon's position relative to Earth. Total lunar eclipses make the moon look orange-red because of the effect that Earth's atmosphere has on the sunlight that passes through it, which is why they are often called blood moons. Full moons that occur in in January are known as "wolf moons" (each month gets its own full-moon name), and this one will appear especially bright and big because the moon will be a little closer to Earth than normal — hence the label "super."

The total lunar eclipse will be fully visible to people in North America, South America, Greenland, Iceland, western Europe, and Africa. People in other parts of the world will see a partial eclipse.

According to NASA, the total lunar eclipse will last one hour and two minutes. For those on the US East Coast, the total eclipse will begin around 11:41 p.m. local time with a peak at 12:16 a.m.  

During a lunar eclipse, the moon first touches Earth's outer shadow, called a penumbra, then moves into the full shadow, called the umbra. It then goes back into the penumbra.

how total lunar eclipse works blood moon umbra penumbra earth shadow refraction diagram physics nasa shayanne gal business insider graphics

About 80% of Earth's atmosphere is nitrogen gas, and the rest is mostly oxygen. After our atmosphere takes in white sunlight, that gas mixture scatters around blue and purple colors, which is why the sky appears blue to our eyes during the day. 

During a lunar eclipse, Earth's atmosphere scatters blue light and refracts the red — a process similar to what we see during sunrise and sunset. That's why the moon appears to turn red when in Earth's umbra.

Watching a total lunar eclipse is not dangerous — unlike looking at a solar eclipse without protection — so you don't need any special glasses.


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Thousands of current and former HP sales people will receive over $5,000 thanks to a $25 million lawsuit over messed up pay (HPQ, HPE)

Posted: 18 Jan 2019 11:04 AM PST

hewlett packard hp logo

  • Business Insider continues to obtain more details on the settlement by HP and HPE to salespeople after a nine-year lawsuit battle.
  • We have now learned that 2,189 current and former California HP employees will be receiving settlement payments, with an average payment of $5,430.06. Some will be receiving much more and some less.
  • The case involved former salespeople first launching a lawsuit nine years ago claiming that HP's computer systems weren't tracking commissions properly and they weren't getting paid in a timely manner.

HP and Hewlett-Packard Enterprise will pay 2,189 of its current and former California sales employees settlement fees, with an average payment of $5,430.06, after it settled their lawsuit for $25 million, court officials say.

Some will be receiving much more and some far less.

The case involved former salespeople alleging that HP's computer systems weren't tracking commissions properly and they weren't getting paid in a timely manner. They filed suit some nine years ago.

However, in 2016 Business Insider reported that sales people were still complaining about messed up pay, after HP had split into two companies. The sources that we talked to at the time were not aware that other salespeople were suing.

Read: CEO Satya Nadella says that Microsoft is embracing Amazon's Alexa instead of fighting it — and he wants to be friends with Google, too

Those sources told us in 2016 that the wacky pay situation had gotten so bad that some people were behind on their mortgages and facing foreclosure, others were late on their alimony. One salesperson was even told that he actually owed his employer money, over $130,000, after the first quarter of 2016, sources told us.

Business Insider again reported on these issues in 2017, after an HP executive sent an email to the troops apologizing. (That executive has since left the company.)

Several months after Business Insider's second report, HP and HPE agreed to the $25 million settlement deal. And it took another year for the legal volley to officially end and for the court to approve the deal. That happened earlier this week.

In addition to the $25 million penalty fee, HP and HPE said they are currently overhauling their sales and commission-tracking computer systems. The companies told the court that they have already spent or budgeted between $60 million and $70 million through their fiscal 2018 on the new systems and expect to pay another $5 million in fiscal 2019, according to legal documents.

The new system is known as the Incentive Compensation Environment or "ICE", according to court documents. And it integrates with cloud financial software from startup Anaplan, with inventory-tracking software from startup Zyme and with Salesforce (although HP Inc., the PC and printer HP company, has since ditched Salesforce for Microsoft Dynamics).

Penalties, not back pay

The settlement wasn't backpay, but a penalty, and each person's share depended on their wages, Jonathan Parrott tells us. Parrott is an attorney at the Franklin Azar law office working for the plaintiffs.

Of the $25 million that HP and HPE agreed to pay, nearly half went to the lawyers and legal fees. And a few million went to state agency penalty fees as well. The named plaintiff, Jeffery Wall — the one who sued before the suit was turned into class action status for thousands of people — was paid an additional $25,000, settlement documents show.

HP Enterprise, Hewlett PackardWhen the settlement was originally agreed to, back in December, 2017, there were some 1,323 people as plaintiffs in the class action suit and payments to people ranged from the lowest of $144 to the highest of $81,237.

However the final payments wound up quite a bit lower because the court agreed to add another 866 salespeople as plaintiffs to the case. All of them split a kitty of about $11.5 million, out of the $25 million. (The rest went to lawyers fees and government agency penalty fees).

So the total number of salespeople who went to court over pay issues at HP and HPE was nearly 2,200 people. 

Parrott told us another interesting fact about this settlement as well: Although plaintiffs included both former and current HP/HPE sales employees, only the ones who left the company received significant cash. Most the money for current employees is being paid as a per-employee penalty fee to the state, he said.

Even so, many class action suits representing this many people result in only a small token payment to the plaintiffs, Parrott says, as would be expected whenever legal fees take a big chunk of the award and everyone else shares the rest.

A spokesperson for HPE did not respond for an immediate request for comment on the payment amount but previously told Business Insider: "HPE is pleased that the mediated resolution in this dispute that was reached by the parties in 2017 has been approved by the Court."

SEE ALSO: Hewlett Packard Enterprise has frustrated its salespeople with issues about their pay — again

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A Silicon Valley company just launched 'smart' cancer pills that track you with tiny sensors stamped into your medications

Posted: 18 Jan 2019 10:57 AM PST


  • A digital medicine company called Proteus makes 'smart pills' embedded with sensors that tell your doctor when you've taken your medication. The pills also track activity levels.
  • Backed by big name investors like Novartis, Proteus debuted the first medication made with the technology — a form of the depression and schizophrenia drug Abilify — in 2017.
  • Now, Proteus is expanding into cancer.
  • Still, the research on whether the pills actually help patients take their medications when they should remains somewhat unclear.

Would a notification from your doctor as soon as you forget to take your medication help keep you on track?

A digital medicine company called Proteus is betting the answer is yes.

The Silicon Valley-based company makes what have been called "smart pills": essentially, versions of regular medications embedded with a tiny sensor that can be tracked by a patch worn on a patient's stomach.

Since debuting the first medication made with the technology — a form of the depression and schizophrenia drug Abilify — in 2017, the company has put its hardware into 40 different medications ranging from drugs for infectious disease and mental illness to diabetes. Valued at $1.5 billion, Proteus has raised $487 million with backing from big name investors like Novartis.

And now, the company is expanding into cancer.

On Thursday, Proteus announced the launch of the first clinical trial of its technology in oncology. As part of the trial, seven patients with advanced colorectal cancer are now taking a sensor-embedded version of the common chemotherapy drug capecitabine in place of their regular medicine. The company hopes to enroll as many as 750 patients in the trial — which is taking place in partnership with the nonprofit Minneapolis-based health system Fairview Health Services and the University of Minnesota — within the next two years.

The goal is to determine if "smart pills" are truly smart: that is, if they help patients take their medications when they should. That's an important goal for conditions like depression, schizophrenia, and cancer, where patients often struggle to take medications. Timing those medications and ensuring that patients always take the correct dose is a key part of treatment.

"In cancer, the difference between too much of a medication and too little of a medication is very narrow," Edward Greeno, a practicing oncologist who is overseeing the trial and is the director of the University of Minnesota Health's oncology service line, told Business Insider.

Pills that tell your doctor when you've taken them — and how much exercise you're getting

Proteus Patch Pill and AppProteus' digital pills work by way of a tiny sensor roughly the size of a period. The sensor can either be stamped into a pill or included alongside a traditional medication and then encased in a translucent shell that breaks down when a patient swallows it. Then, patients attach a credit card-sized adhesive sensor anywhere on their stomach. The sensor tracks when the pill is ingested.

The company was founded in 2001 and got approval from the Food and Drug Administration for its technology in 2012. So far, the company said there have been 177,000 ingestions of Proteus sensors in various medications ranging from drugs for tuberculosis to those for HIV. 

Proteus Digital Medicine clear pill case

In addition to alerting clinicians as to when patients take their medications, Proteus' digital pills also keep track of patients' activity levels — telling them where and how often they move around.

That could be a tough pill to swallow for patients who don't like the idea of being monitored remotely, but Greeno said the patients he's working with currently actually feel better having a physician involved in this way.

Greeno said he's observed some other surprising things, too, like seeing how little activity some of his patients get. That's already motivating him to think about ways to better incorporate exercise into treatment.

"It's a nice surprise to start thinking about things we hadn't thought about before," Greeno said.

Should all your medications be digital?

Proteus' cancer trial is ambitious. Although only seven patients have been enrolled so far, the company aims to have 750 sign up within the next two years. Fairview Health System is covering the cost of the treatment.

Beyond making a digital version of the chemotherapy drug capecitabine, Proteus aims to eventually digitize all of the medications a cancer patient is taking, George Savage, Proteus' cofounder and chief medical officer, told Business Insider. Those would include everything from anti-nausea drugs to pain medications like opioids.

All of that rests on the idea that digital pills offer a significant benefit over regular ones. However, the scientific evidence of this remains somewhat unclear.

A Proteus-sponsored study of roughly 100 patients with hypertension and type 2 diabetes suggested that its digital pills might be an improvement on regular pills, but the results were somewhat mixed. Researchers behind the study, published in the Journal of Medical Internet Research in 2017, concluded that patients using Proteus' digital pills had slightly better measures of blood pressure, but rates of medication adherence — or whether or not patients took their pills when they were supposed to — was not measured as part of the study. 

Several other researchers have attempted to study whether other means of reminding patients to take their medications could help, but they've also come up with subpar results.

Scientists behind a clinical trial of roughly 50,000 patients published in JAMA Internal Medicine in 2017 concluded that none of three devices designed to remind patients to take their pills significantly improved medication adherence rates. The reminders included an elaborate toggle system that people engaged each time they took a pill; a bottle cap with a digital timer; and a pill container with distinct compartments for the days of the week.

It remains to be seen whether Proteus' digital cancer pills will help patients take their medications when they should. Results from their clinical trial are expected by 2021.

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Netflix says its new price hike won't kill growth, but data suggests $15 per month could be a much bigger problem (NFLX)

Posted: 18 Jan 2019 10:34 AM PST

Bird Box Netflix

  • Netflix rolled out its biggest price hike ever this week, raising its most popular US plan from $11 to $13 per month.
  • Wall Street is bullish that the streamer will be able to effectively manage the price increase, and Netflix's projections for Q1 subscriber growth suggest it won't have a huge negative effect.
  • New survey data suggests, however, that Netflix might start to run into trouble at $15 per month.

In general, customers begin threatening to cancel a service because of increasing prices long before they actually do.

Netflix's 2016 price hike is a perfect example. At the time, analysts at UBS surveyed customers and 41% said they would accept no price increase for Netflix. None. But UBS estimated that roughly 3% to 4% would actually cancel.

"41% of respondents in our survey were not willing to accept any price increase for Netflix, which is actually very positive when compared to 68% for pay TV," the analysts wrote at the time. "Consider pay TV costs have been rising 3-5% annually and the industry is now losing only ~1% of customers each year, relative to 68% of pay TV customers in our survey indicating no tolerance for price increases."

People simply don't like the idea of price increases, but often tolerate them when they happen.

Now Netflix has raised prices again, introducing its biggest price hike ever this week, which raised the cost of its most popular US plan from $11 to $13. Its lowest tier is now $9, while its highest is $16.

Wall Street isn't worried people will cancel.

"We are bullish on the company’s ability to execute the pricing increase," Stifel analysts wrote last week.

Compared to its competitors, "Netflix still offers the best value, even at these higher price points," RBC analysts argued.

The RBC analysts elaborated:

"There is the basic point that Netflix offers a flat-out compelling value proposition – a massive content catalog with an increasingly large amount of original content at a very low price. You and a date want to go out to the movies Gonna cost you $17.66 at your local U.S. movie theater (average price per tick of $8.83). Or you could Netflix and chill and watch Bird Box for ... effectively way under a dollar (depending on how much time you spend on Netflix during a typical month). And you can use the $16 in savings and buy a nice Chianti ... So yes, we believe the price increase will stick."

This view seems to be backed up by Netflix's own projections for subscriber growth in the first quarter. Netflix estimated that it would add 8.9 million paid subscribers this quarter, topping Wall Street estimates that it would give guidance of 8.5 million.

But Netflix can't raise prices indefinitely without any effect. There is some price at which customers will actually start to revolt. And new survey data suggests Netflix will face its next big challenge at $15 per month.

Business Insider used SurveyMonkey Audience to ask at what price Americans would consider canceling their Netflix account.

Here is a chart of what we found:

Netflix price & canceling

As you can see in the chart, there is a big jump when you hit $15, from 22% considering canceling at $14 (or below), to 52% at $15. (Currently, Netflix's highest tier price is $16 per month, but it's much less popular.)

Just because these Netflix subscribers are considering canceling doesn't mean they will. But it does demonstrate that there seems to be a psychological jump at $15. That's perhaps a reason why HBO's standalone service, HBO Now, is priced at $14.99.

And for Netflix, a similar jump also happens between $19 (64% would consider canceling) and $20 (85% would consider canceling).

Netflix has indicated that it will periodically raise prices, but hasn't said whether there will be a price ceiling. The company did say on its earnings call that it hopes to one day be able to self fund without relying heavily on debt.

To get there, Netflix will have to balance subscriber growth and price hikes. And these survey results suggest that certain price points might be more difficult for customers to stomach than others.

But Wall Street sees a path. At least 15 firms raised their price targets following Netflix's Q4 earnings.

Here is more detailed info about how the survey was conducted:

"SurveyMonkey Audience polls from a national sample balanced by census data of age and gender. Respondents are incentivized to complete surveys through charitable contributions. Generally speaking, digital polling tends to skew toward people with access to the internet. SurveyMonkey Audience doesn't try to weight its sample based on race or income. Total 1,095 respondents, a margin of error plus or minus 3.11 percentage points with a 95% confidence level."

SEE ALSO: Netflix falls after slight Q4 revenue miss and solid subscriber-growth numbers

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Lyft just poached another Google engineering executive as it continues to siphon off talent from the search giant (GOOGL)

Posted: 18 Jan 2019 10:00 AM PST

Eisar Lipkovitz Lyft LinkedIN

  • Lyft has hired former Google VP of engineering Eisar Lipkovitz to lead its engineering team. 
  • His move is the latest in a string of hires by Lyft from the search-engine giant. 
  • Alphabet, Google's parent company, has invested in Lyft through its VC arm, CapitalG.

Lyft has been quickly scaling up its engineering team as it continues to expand into things like bikes, scooters, and more.

To keep up with the growth and manage its team of engineers that is now more than 1,000-strong, the ride-hailing company has poached Eisar Lipkovitz, Google's former vice president of engineering, the company announced Friday. 

"It's clear that Lyft is tackling one of the most interesting and world-changing engineering challenges of our lifetime, and the team has done an exceptional job innovating through dispatch, matching, pricing, and mapping to create the overall experience," Lipkovitz said in a statement provided by Lyft.

"The work Lyft is doing intersects with my passion of operating extremely complex systems efficiently while developing strong leaders in tech, and I couldn't be more excited to join the team."

Read more: 2 dealmakers named David: Uber and Lyft's expected IPOs will trigger competition at Google's in-house VC firms

And he's far from the first Googler to move to Lyft, the latest in a long-running drain of talent from the search giant that's owned by Alphabet. A cursory LinkedIn search shows nearly 300 current Lyft employees formerly worked for Google, including other engineering manager Tom Lewkowitz, director of sustainability Sam Arons, and CTO Chris Lambert.

Notably, Alphabet has also invested in two of Lyft's late-stage funding rounds, as Business Insider's Becky Peterson notes. CapitalG, formerly known as Google Capital, led the company's Series H funding round last year, when the company raised $1.7 billion at a $10 billion valuation. David Lawee, who led that investment, plays an active role on Lyft's board.

Lyft in December said it had confidentially filed for an initial public offering, or IPO. After doubling its engineering team in 2018, according to a spokesperson, investors will likely see Lipkovitz's taking of the helm as another signal the company is primed for more growth going forward.

Do you work for Lyft or CapitalG? Have a news tip? Get in touch with this reporter at grapier@businessinsider.com.

SEE ALSO: Lyft could be worth $5 billion more than its most recent private valuation — here's how to price the ride-hailing company on public markets

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One of the most negative Netflix analysts on Wall Street explains what would make him change his tune (NFLX)

Posted: 18 Jan 2019 09:58 AM PST

Reed Hastings

  • Wedbush has one of the most bearish outlooks on Netflix of any Wall Street shop.
  • But after the company's earnings on Thursday, the firm's analysts lifted their price target and said they would reconsider their "underperform" rating should Netflix's cash burn stabilize.
  • One of those analysts told Business Insider he would reconsider his rating and price target if Netflix were to aggressively reverse its cash burn.
  • "That would get me to a $256 price target, and I'd reconsider upgrading to Neutral then," he said in an email.
  • Watch trade Netflix live here.

Wall Street analysts on Friday were heaping praise onto Netflix following the streaming giant's quarterly earnings report, raising their price targets and recommending investors buy up the name. They cited strong content slates and solid subscriber-growth momentum.

One of the most negative firms on the name even bumped up its target, though it said the company's cash burn was still a massive concern.

Netflix reported quarterly earnings-per-share estimates on Thursday that exceeded analysts' expectations, but it fell slightly short of revenue expectations. The company reiterated its expectation for its 2019 cash burn to be similar to that of 2018, implying negative free cash flow of about $3 billion despite its roughly $1.5 billion in incremental revenue that should result from the price hike it announced earlier this week.

Now read: 'Take off the blindfold': Here's what Wall Street is saying about Netflix earnings

Michael Pachter and his team at Wedbush wrote that they expected Netflix's content spending to "trigger substantial cash burn for many years" and said future price hikes could cause a slowdown in subscriber growth. They maintained their "underperform" rating and raised their 12-month price target to $165 a share from $150. Still, the higher number is more than 50% below where shares were trading Friday.

Their new target reflects the impact of Netflix's recently announced price increase and new subscriber-growth outlook. Pachter told Business Insider what he'd need to see from the company to view the streaming platform more positively.

"I'll reconsider my rating and price target if they reverse faster," he wrote in an email. "If they go from $(3) billion in 2018 to $(1) billion in 2019 and to $1 billion positive in 2020, I will give them credit for that."

Pachter said with $2 billion of annual free-cash-flow growth, Netflix would have to pay back $11 billion and finish that by 2023, with a $7 billion free-cash-flow rate.

"20x $7 billion = $140 billion, and I would only have to discount that back for four years," he wrote. "That would get me to a $256 price target, and I'd reconsider upgrading to Neutral then."

To be sure, this outlook is the exception, not the rule, on Wall Street. Analysts surveyed by Bloomberg overwhelmingly rate the stock a "buy," with a price target of $395 a share on average — about 16% higher than where the stock was trading Friday.

Netflix was up 33% this year through Thursday. 

Read more about Netflix:

Netflix shares.

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Tesla was right to lay off 7% of its employees as big expenses loom, experts say (TSLA)

Posted: 18 Jan 2019 09:44 AM PST

elon musk

  • Tesla is laying off 7% of its employees, CEO Elon Musk said on Friday in an email to employees, the second round of cuts the automaker has made in less than a year.
  • The layoffs were the right move for a company that has major expenses ahead as it prepares to build a new factory and introduce a range of new vehicles, said David Whiston, an automotive analyst at Morningstar, and Michael Ramsey, an automotive analyst at Gartner.
  • "I think that this shows that finally, the company or Elon … recognizes that they cannot continue burning cash at the rate that they had been, or the money faucet will turn off," Ramsey said.

Tesla is laying off 7% of its employees, CEO Elon Musk said on Friday in an email to employees, the second round of cuts the automaker has made in less than a year.

Tesla had expanded its workforce by 30% in 2018 as it ramped up production of its Model 3 sedan, Musk said, even as it laid off 9% of its employees in June. Musk suggested the most recent cuts were necessary as Tesla seeks to become consistently profitable while introducing lower-priced vehicles like the long-awaited $35,000 version of the Model 3.

Read more: Tesla's layoffs mean the company's lead on electric vehicles could be ending, one Wall Street analyst says

"We face an extremely difficult challenge: making our cars, batteries and solar products cost-competitive with fossil fuels. While we have made great progress, our products are still too expensive for most people," Musk said in the email, which was posted on Tesla's website.

Tesla has big expenses ahead

The layoffs were the right move for a company that has major expenses ahead as it prepares to build a new factory and introduce a range of new vehicles, said David Whiston, an automotive analyst at Morningstar, and Michael Ramsey, an automotive analyst at Gartner.

"They're still a young company, and they have a lot of growing pains," Whiston said. "Sometimes, unfortunately, you have to make adjustments and people lose their jobs."

[Were you affected by the Tesla layoffs? Have a Tesla news tip? Contact this reporter at mmatousek@businessinsider.com.]

To finance the factory, which will be located in Shanghai, and upcoming vehicles like a semi-truck, pickup truck, and a new version of its Roadster sports car, Tesla needs to make profits, raise money from Wall Street, or use a combination of the two. If Tesla relies at all on debt, it will have to show Wall Street it is making an effort to control its expenses, Ramsey said.

"I think that this shows that finally, the company or Elon … recognizes that they cannot continue burning cash at the rate that they had been, or the money faucet will turn off."

Elon Musk expects a small profit in Q1

Tesla surprised Wall Street analysts by posting a $312 million profit in the third quarter of 2018, just the third quarterly profit in the automaker's 16-year history. But the year preceding the quarter had been marked by widening losses as Tesla struggled to ramp up Model 3 production.

Musk said it appears the automaker will report a profit for the fourth quarter of 2018, and he predicted a "tiny" profit for the first quarter of this year that will depend in part on luck.

But the layoffs are not an act of desperation, Ramsey said, pointing out that General Motors announced in November that it would cut 15% of its salaried North American workforce despite later saying that it expects its 2018 profit to beat Wall Stree projections.

"I don't think it's desperation. I think it's something that had to happen," he said of the Tesla layoffs.

SEE ALSO: Almost half of the Model 3s registered in the US during the first 10 months of 2018 came from California, but experts say it won't hurt Tesla's future

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Microsoft is finally killing the last of Windows phone, and wants you to switch to Android or iPhone instead

Posted: 18 Jan 2019 09:38 AM PST

nokia lumia 920

  • Microsoft will no longer deliver security updates to phones running the Windows 10 Mobile operating system starting on December 10, 2019. 
  • The company suggests Windows 10 Mobile users should switch to Android or iOS devices. 
  • Windows 10 Mobile users who stick to their Windows phone will be at a higher risk of security threats if they keep using their phone after Microsoft's cut-off date, but they'll still be functional.

Microsoft will stop issuing security updates to smartphones running Windows 10 Mobile on December 10, 2019, and it officially recommends you switch to Android or iOS devices by that time. 

The company updated its device operating system life cycle FAQ on January 14 with the new information, saying:

"The end of support date applies to all Windows 10 Mobile products, including Windows 10 Mobile and Windows 10 Mobile Enterprise. Windows 10 Mobile users will no longer be eligible to receive new security updates, non-security hotfixes, free assisted support options or online technical content updates from Microsoft for free."

Under the "What should Windows 10 Mobile customers do now?" section of the FAQ, Microsoft now recommends "that customers move to a supported Android or iOS device."

Steve Ballmer Lumia

Windows 10 Mobile users stopped getting new features and non-security related updates in October 2017 with version 1709. The company kept issuing security updates for those staunch Windows 10 Mobile users for over a year, but the time has finally come even for the Windows 10 Mobile enthusiast to make the switch. 

Without security updates, Windows 10 Mobile users who continue to use Windows mobile devices will put themselves at a higher risk to security threats, whether it be a hack or a malware attack that can leave your sensitive and personal information exposed. 

For Windows 10 Mobile users now looking to make the switch to Android or iOS devices, we'd recommend the OnePlus 6T, Samsung Galaxy S9, or Google Pixel 3 for Android phones. As for iPhones, you have your pick of the litter between the  iPhone 7, iPhone 8, iPhone XR, and iPhone XS.

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A survey found that Amazon Prime membership is soaring to new heights — but one trend should worry the company (AMZN)

Posted: 18 Jan 2019 09:34 AM PST


  • More than 100 million people have access to Amazon Prime benefits as of December 31, according to a Consumer Intelligence Research Partners survey.
  • The survey found that membership growth has been slowing over the last year, however, and more customers are opting for monthly payments over annual.

Amazon's Prime membership program continues to reach a larger percentage of the US population.

More than 100 million people have access to Amazon Prime benefits as of December 31, according to a Consumer Intelligence Research Partners survey of 500 Amazon customers. That translates to 62% of Amazon customers getting access to perks like free two-day shipping, Prime Video streaming, and more.

Amazon did not immediately respond to Business Insider's request for comment on the survey.

Outside of major milestones, Amazon does not typically share Prime subscriber numbers. The last such milestone was in April 2018, when Bezos said in his yearly investor letter that Amazon had more than 100 million paying subscribers globally as of 2017.

Read more: Jeff Bezos finally revealed how many people pay for Amazon Prime

CIRP did not make a distinction between paying subscribers and those who access their service through a housemate's account or a free trial.

CIRP also said Prime membership grew 10% in the last year, which was "slower than before, but still significant on a huge base and after years of rapid growth," Josh Lowitz, partner and co-founder of CIRP, said in a statement.

The slower growth combines with the membership's nature changing, as the survey found that the annual membership has become a less dominant option. 

"As Prime membership growth flattens, the nature of the membership changes somewhat," Mike Levin, partner and co-founder of CIRP, said in a statement. "One-third of members pay a monthly fee, and can basically leave and rejoin Prime at any time. They do this even though the annual cost of $119 costs less than the sum of twelve monthly payments on the monthly plan, or $156."

Levin said there is concern that these members who dip in and out of their Prime benefits won't add as much value to Amazon's bottom line.

Read more: Prime members spend way more on Amazon than other customers — and the difference is growing

"These more transient members obviously don't have the same commitment to Amazon shopping and the suite of Prime member services," he said. "Presumably, they don't typically use the breadth of benefits to the same extent as annual members."

While Prime members buy an average of $1,400 in products from the website each year, regular, non-Prime customers only spend $600. That's a wider gulf than was reported by CIRP in 2017, when Prime customers spent an average of $1,300 and other customers spent $700.

Prime is increasingly a jewel in Amazon's crown, and the company takes great pains to ensure that its members perceive the service as a good value by frequently adding more features.

In fact, analysis by JPMorgan pegged the value of Prime at $785 a year when all benefits are combined — nearly 6.5 times the actual cost of a yearly Prime subscription ($119).

"Prime delivers such massive scale and features that we believe it would be very difficult for any company to replicate and compete against, and Amazon continues to expand and add more value to Prime by adding new benefits and growing existing offerings," the analysts wrote.

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Netflix says it's more worried about competition from video games like 'Fortnite' than other streaming services (NFLX)

Posted: 18 Jan 2019 09:15 AM PST

Bird Box Netflix

  • Netflix said it's more worried about "Fortnite" and other types of entertainment than it is about competing streaming services like HBO, Hulu, and Amazon Prime Video.
  • A letter to shareholders reported that the company had 139 million subscribers at the close of 2018, and that Netflix accounts for about 10% of all television screen time in the U.S.
  • "Fortnite," the world's most popular video game, reportedly generated $2.4 billion in 2018, and more than 200 million people have played the free game.

As more and more streaming services crop up, Netflix said it's not concerned with comparing itself to the competition. Instead, Netflix is more worried about keeping members watching instead of choosing another type of entertainment entirely — such as video games.

In its fourth-quarter earnings report on Thursday, Netflix said it accounts for roughly 10% of all television screen time, with viewers streaming 100 million hours of content per day. By the close of 2018, the company had 139 million subscribers and had raised revenue by 35%, but still fell short of their earnings expectations for the fourth quarter. And in an increasingly diverse entertainment landscape, Netflix is now facing stiff competition from the likes of "Fortnite." 

"We earn consumer screen time, both mobile and television, away from a very broad set of competitors," the quarterly earnings statement read. "We compete with (and lose to) 'Fortnite' more than HBO."

Read more: Netflix falls after slight Q4 revenue miss and solid subscriber-growth numbers

"Fortnite," the world's most popular video game, has had 200 million registered players since launching in June 2017, and generated more than $2.4 billion in revenue as a free-to-play game last year. News outlets like The Wall Street Journal and Axios have noted that "Fortnite" has become akin to a social network for young gamers, with the average player spending six to 10 hours a week online.

While Netflix may not be able to match the interactive allure of video games, the company plans to continue improving the user experience so that existing members are happy to carve out more time in their day.

"Our growth is based on how good our experience is, compared to all the other screen time experiences from which consumers choose," the earnings report reads. "Our focus is not on Disney+, Amazon or others, but on how we can improve our experience for our members."

Those improvements will come at a cost though, as the company recently announced that the subscription price will be increased by up to 18%.

Netflix has made comments in the past regarding competition and its drive to capture more time from viewers. During a 2017 earnings call, CEO Reed Hastings said one of Netflix's biggest competitors is sleep.

"You know, think about it, when you watch a show from Netflix and you get addicted to it, you stay up late at night," Hastings said on the call. "We’re competing with sleep, on the margin. And so, it's a very large pool of time."

With multiple digital streaming services on the horizon, Netflix will still have to compete for content, but the battle for customer attention may be just as important.

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The smartphone camera could become the new way consumers find products online

Posted: 18 Jan 2019 09:10 AM PST

bii importance of smartphone cameraThis is a preview of a research report from BI Intelligence, Business Insider's premium research service. To learn more about BI Intelligence, click here.

The smartphone is getting smarter as tech and internet companies inject increasingly sophisticated computer vision and object recognition functions into their hardware and software. The ability to “understand” what the user is pointing their mobile camera at and “read” the image has opened the door for visual search.

Foreseeing the potential for mobile visual search to create new revenue opportunities, brands are attempting to harness the smartphone camera’s increasing sophistication to engage with consumers and drive sales.

In this report, Business Insider Intelligence analyzes the developing technologies behind mobile visual search and its value to businesses and brands. The report also assesses risks and opportunities inherent in developing a visual search strategy, provides a list of companies that are working in the space, and discusses what they've accomplished so far.

Here are some of the key takeaways from the report:

  • There is strong evidence that mobile visual search technology will take off in the near future, including growing access to technology, strong usage rates of camera-related apps, and early indication of potential revenue growth. 
  • In some instances, visual search is faster and more accurate than text or voice, as it cuts through consumer-introduced ambiguities. 
  • The mobile visual search ecosystem is growing, with a slew of enabling platforms, native apps, and internet companies all broadening their expertise in the field.  
  • Leading internet search companies, including Google and Baidu, are in a race to capture the mobile visual search market as it begins to eat into traditional forms of search.   
  • The smartphone is the perfect launchpad for visual search technology, but new form factors, like smartglasses, hold great potential.

 In full, the report:

  • Provides an argument for the potential uptake of mobile visual search technology by tech companies, brands, and consumers. 
  • Outlines the current mobile visual search landscape.
  • Explains how startups and tech companies with mobile visual search products are evolving their business strategies. 
  • Provides an outlook for the future of the mobile visual search industry. 

Interested in getting the full report? Here are two ways to access it:

  1. Subscribe to an All-Access pass to BI Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now
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Here's how Main Street retailers can use technology to save their businesses

Posted: 18 Jan 2019 08:56 AM PST

Bildschirmfoto 2019 01 18 um 10.40.42

  • When it comes to brick-and-mortar retailers using technology to improve their businesses, the US lags far behind the rest of the world.
  • Outlined below are several examples of how those retailers can implement technology in order to stay afloat.

The U.S. maintains its leading edge in many industries of the future. But when it comes to tech-infused retail, the rest of the world is outpacing the U.S., digitalizing stores in huge swaths while America stands still.

Why it matters: Wealthy retail chains everywhere are surging ahead in digitalization, luring shoppers with custom applications. But how they are doing it has divided the world of retail between the haves of new tech and the have-nots.

  • Outside the U.S., top companies are selling their tech know-how in the form of digitalization-in-a-box. They're selling off-the-shelf software and equipment that make it easy to upgrade mom and pop stores with tech tools like digital payment systems and inventory tracking.
  • In the United States, mom and pops are — at least so far — still stuck in the past. All the digitalization is proprietary, concentrated in the hands of wealthy companies like Amazon and Walmart. And even their progress is more of a stumble than a leap — comparatively narrow in the form of a few stores.

"It's about giving a brick and mortar store the kind of data that an e-commerce company might have," says Mark Cook, VP of product at Trax, an Israeli company that makes retail tech.

Driving the news: The challenge of saving Main Street — of driving customer traffic into brick and mortar stores — may be one of modernization: sprucing up stores inside and out, freshening up and more selectively choosing inventory, and using tech to know and keep up with customers.

  • Why tech is so important for Main Street: Brick and mortar is not going anywhere — it still commands 90 cents of every dollar spent in retail. But stores are being turned into hybrids that include a heavy e-commerce element.
  • But the most prominent U.S. example of its deployment isn't Main Street, but Amazon. After grabbing a whopping 50% of online shopping, it has added nearly 500 physical locations, including its cashierless Go stores, its bookstores and Whole Foods.

Abroad, the trend is to save Main Street.

China's Alibaba and Israel's Trax are following the digitalization-in-a-box model.

  • As of September, Alibaba had installed heat sensors, digital payment systems, and inventory tracking in some 1 million mom and pop stores across China. In our dispatch last July from Shanghai, a convenience store owner told us that his profits jumped 30% after Alibaba installed its tech.
  • Trax's image recognition tech tracks what is and isn't flying off the shelves and feeds storekeepers data on how to most profitably restock aisles. The company said it has already modernized four supermarket chains in Israel, Singapore and the U.K., along with a number of mom and pops.

There are the first inklings of the revolution reaching U.S. shores.

Last year, Kroger spun out Sunrise Technologies, its in-house innovation lab, which debuted wireless shelves and sensors at two Kroger stores this month. Now, Sunrise — partnering with Microsoft — has plans to sell its tech to other stores, including mom and pops.

  • Kroger, although it is the second-largest grocery chain in the country, is a tiny slice of retail and does not amount to a digital revolution in the U.S.
  • Yet Sunrise's tech can be installed in any store, regardless of size, and controlled by someone with zero tech chops, says product manager Kevin Fessenden, who was showing the designs at the National Retail Federation conference in New York this week. And the company has intentions of shaking up the industry.
“We are actually very committed to becoming a disruptor, and also helping others be positioned to succeed and win by leveraging some of the technology that we’ve built for ourselves."
— Annette Franke, COO of Sunrise Technologies, speaking in Las Vegas last year

Two upstarts, Standard Cognition and Zippin, are focusing on another piece of the puzzle: developing cashierless-in-a-box for small physical stores.

  • While some bigger chains put 100 to 200 cameras in ceilings and along aisles to make cashierless work, Standard Cognition has a more digestible approach for mom and pops and does it with just 27, says co-founder Michael Suswal.

At last year's National Retail Federation conference, Cook, the Trax executive, says he spent the majority of his time explaining to American retailers why digitalizing physical stores is vital. But this week in New York, discounters, supermarket chains, and even a three-store kosher grocery chain from New York approached Trax wanting to join the revolution, Cook tells me.

"Twelve months made a big difference."

SEE ALSO: Forget FANG — a $135 billion investor says a new group of stocks is poised to dominate the market going forward

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Human rights protesters are standing outside Google offices recruiting employees to help kill off its China search engine

Posted: 18 Jan 2019 08:54 AM PST

Google protest_London

  • Tibetan human rights groups protested outside Google offices around the world on Friday to demand the company scrap its China search engine plans.
  • The groups fear a censored search engine would be used to further propaganda and oppress dissent.
  • They are approaching Googlers directly and asking for support to kill off the plans, known as Project Dragonfly.
  • Reports emerged in December that Google had all-but killed Dragonfly, but the advocacy groups are unconvinced.

Tibetan human rights groups protested outside Google offices around the world on Friday to demand the search giant official scrap its plans to launch a censored search engine in China, known as Project Dragonfly.

Dragonfly was first revealed by a report published by the Intercept in August. The news prompted outrage both from human rights groups and Google employees, and CEO Sundar Pichai was grilled about the project by Congress in December.

Tibetan advocacy groups, including Free Tibet and the International Tibet Network, protested the project outside Google offices across Europe, the US, India, Australia, and the Americas.

They fear that a censored search engine would lead to the further oppression of Tibetans, as filtered searches would erase terms such as "Tibet" and "Tiananmen Square" in line with the official narrative of the Chinese Communist Party.

Their other concern Google could be used to monitor dissent in China.

"Any new internet search engine will have to capture the data of the people making the searches; take their name, their address, their phone number, and if necessary hand them over to the security services," John Jones, Free Tibet's advocacy and campaigns manager, told Business Insider.

Read more: It looks as if China just laid out how it wants Google to help it persecute its Muslim minority

"So there's a very real possibility that anybody making a search that disagrees with the Chinese government could end up arrested and sent to long term imprisonment."

The same concerns would apply to all Chinese citizens, including other oppressed minorities such as Uighur Muslims and Southern Mongolian people.

Google action in Gurugram, India

A few days after Pichai appeared before the House Judiciary Committee, media reports claimed that Google had "effectively ended" Project Dragonfly. However, advocacy groups including Free Tibet are not convinced that the project has been laid to rest.

The advocacy groups said Pichai's answers to Congress were too evasive to be sure the project is truly dead. "Every time Dragonfly was brought up it was said that the company was not currently developing 'at present' or 'right now'... so what that led us to believe is that they've temporarily put the talks on hold but they haven't cancelled the project," said the UK Director of the Tibet Society, Gloria Montgomery.

Protestor Google dragonfly

The protestors' main aim is to engage with Google employees leaving the offices, rather than passing members of the public, to try and stir up some grassroots action amongst Googlers. Google employees have been instrumental in killing what they view as unethical projects in the past, such its military drone project Maven.

When contacted by Business Insider about the protest, a Google spokesman said: "We've been investing for many years to help Chinese users, from developing Android, through mobile apps such as Google Translate and Files Go, and our developer tools. But our work on search has been exploratory, and we are not close to launching a search product in China."

SEE ALSO: China gave foreign countries and journalists seminars on how to restrict online speech and unflattering news reports

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It's a fintech frenzy — top venture pros spill why the $11 billion party won't end anytime soon

Posted: 18 Jan 2019 08:21 AM PST

Coinbase CEO Brian Armstrong

  • Venture-capital firms invested $11 billion into fintech companies in 2018, the highest figure in eight years.
  • Venture investors don't expect the fintech frenzy to slow down anytime soon, despite stock-market volatility and economic uncertainty in the US.

It's never been a hotter time to be a fintech company looking to raise cash.

Venture-capital firms in the US poured $11 billion into fintech firms in 2018, the most in eight years, according to a combined report by PwC and CB Insights. Funding surged 38% from a year prior, with big deals including crypto exchange Coinbase's latest $300 million round and payments firm Stripe raising funds at a $20 billion valuation. In total, 627 deals were completed, up from 571 in 2017.

And even with a volatile stock market, a trade war with China, and a US government shutdown, venture investors don't expect a fintech slowdown anytime soon.

"I'm actually bullish that it might even speed up," said Angela Strange, a general partner at Andreessen Horowitz who spearheads fintech investments.

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Why is Strange so bullish? First off, there are plenty somewhat-niche industries ripe for disruption, such as the loan-servicing industry. She says that's a space with a large number of incumbents but very few fintech underdogs who can really transform the industry.

"When you start digging into financial services, you start seeing just more and more of large pockets that have potential for new entrance," she said.

In addition, there's a new crop of companies trying to use financial technologies in their business, and they're in turn looking for the right type of infrastructures to support these firms.

"For fintech there's still a lot of heavy lifting that needs to be done in terms of finding a sponsor or setting up with a payment processor," she said. "They'll be a trend of companies that are going to make that easier."

Mark Goldberg, a general partner at Index Ventures, agrees that 2019 will be a blockbuster year, particularly as areas of the financial-services sector, such as the insurance industry, move from offline to online.

"Huge year last year, but I think this year is going to be bigger," he said. "The environment now is more exciting than it was last year."

Others disagree. Chris Sugden, a managing director at Edison Partners, says there's too much money going into fintech and some startups are overvalued. Sugden believes this is because venture firms have certain amounts of capital that they need to invest in companies, and they may be driven to dangle huge checks in front of entrepreneurs who might not need that much cash.

"I saw that fund sizes were decided by general partners dictating how much they asked the companies to take rather than entrepreneurs coming out to market," he said. "So I think there's a little bit of the tail wagging the dog."

But that doesn't mean venture funding in the fintech space will slow down by any means, Sugden said. The only two factors that might hurt these companies would be either an economic recession or a blowup from a highly valued tech company.

Goldberg holds the opposite view. He thinks the fintech space is growing so quickly that some of these companies need even more money.

"Some of the early winners from the last five to 10 years are starting to build such large and loyal user bases that they are going to start launching new products and services," he said. "We will absolutely see some mega rounds."

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Tesla's layoffs mean the company's lead on electric vehicles could be ending, one Wall Street analyst says (TSLA)

Posted: 18 Jan 2019 08:20 AM PST

Tesla Factory

  • Tesla is laying off about 3,000 workers, the company announced Friday morning.
  • Shares dropped as much as 7% following the news as investors questioned what the restructuring meant for the stock.
  • Morgan Stanley said the move could be a sign Tesla's US market-share lead could be peaking, while an analyst at Wedbush said investors had "more questions than answers."

News on Friday that Tesla planned to lay off about 3,000 workers seemed to heighten investor worries that demand could be shrinking for the company's Model 3 sedan.

In an email to employees, CEO Elon Musk said the layoffs were part of an initiative to bring down the cost of producing the sedan, which has been complicated by the halving of a US federal tax credit previously available to buyers.

Adam Jonas, an analyst at Morgan Stanley, says factors like that — including Musk's announcement that Tesla’s customer-referral program would end February 1 — could be a sign the company is nearing a peak.

"During 2019, we expect to see Tesla's share of the US EV market continue to rise before the competition gradually starts chipping away," he said in a note to clients Friday morning. "Tesla's gap-to-competition in terms of market share maybe approaching a peak."

Indeed, as Tesla races to produce its long-awaited base-model Model 3, an increasing number of electric vehicles are set to hit the market soon. In Detroit last week, Cadillac revealed a new electric concept vehicle, the Chinese automaker Geely announced a new electric model intended for sale in the US, and Nissan unveiled an electric concept featuring all-wheel drive and full autonomous capability.

Even Ford announced an all-electric F-series truck. Meanwhile, Nissan Leaf sales grew 95% last year.

Read more: Elon Musk is pulling out the oldest trick in the executive playbook by laying off 3,000 Tesla workers

To be sure, Tesla accounted for 80% of electric-vehicle sales in the US last year, according to data from Inside EVs — and that market is still quickly growing. So until Tesla reports its fourth-quarter results, investors will have more questions than answers.

That's what's behind the stock's 7% drop Friday morning, according to another analyst.

"The knee jerk reaction to this morning's blog post will clearly be negative from the Street's perspective as there will be more questions than answers until the company formally reports earnings/guidance in early February," said Dan Ives, an analyst at Wedbush. He's much more bullish on the company than Jonas, with a $440 price target compared with Morgan Stanley's $291.

"While headwinds are abound on a number of different fronts," Ives continued, "we continue to believe Tesla will be able to emerge from the next 12 to 18 months a stronger, profitable more product diversified (geographically and price points) EV company helping lay the groundwork for Model 3 as a linchpin of growth going forward into 2020 and beyond."

SEE ALSO: Almost half of the Model 3s registered in the US during the first 10 months of 2018 came from California, but experts say it won't hurt Tesla's future

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