Enjoy the ride, folks:
"Wall Street chafes as it waits for Google’s projects to pay off" by Conor DoughertyNew York Times February 16, 2015
SAN FRANCISCO — Google Inc.’s research arm, Google X, is called the company’s Moonshot Factory. One reason the company picked the word “moonshot” was to remind people to tackle big problems that may well blow up in their faces.
Last month, after years of promotion, Google ended a test of its Internet-connected glasses, called Glass. While the device seemed to have promising commercial applications in hospitals and on factory floors, its first pass at the consumer world was unsuccessful.
The very public failure points to a bigger question. After patiently abiding a steep increase in research and development spending on efforts that range from biology to space exploration, Wall Street is starting to wonder when — and if — Google’s science projects will pay off.
“We want companies to continue to push the envelope, but there has to be some financial responsibility around that,” said Ben Schachter, an analyst at Macquarie Securities. “We have no real insight into what’s going on.”
So investors are left to guess. Two years ago, analysts estimated that Glass sales would be $3 billion to $11 billion by 2018. Google’s self-driving car project, which faces huge technological and regulatory hurdles, has been called a $200 billion opportunity by Gene Munster, an analyst at Piper Jaffray.
“These are guesses at best,” he said. “Our price target is based on things that are tangible, but we say on top of that there are wild cards.”
The wisdom of financing wild cards would not be under question if Google’s core advertising business — which accounts for about 90 percent of its revenue — were roaring. But its growth, while still up about 20 percent from a year ago, has slowed.
Now, the focus is on more mundane issues like costs and profit margins.
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Google X’s best-known projects are Glass and the self-driving car, but inside there is much more, like an effort to make wind power with kites, or a project to deliver packages with drone aircraft.
That's a SILLI idea.
And all across the Southern Hemisphere, the company has stratospheric balloons that aim to connect people to the Internet.
Add this to the list of things Google X has tinkered with — jet packs, hovering skateboards — and it is easy to see why investors are getting antsy.
For Google, as for any company, innovation is no guarantee of success.
But for shareholders, whose patience is not usually as long as that of researchers, nothing is quite as reassuring as a shiny new product whose profits they can measure with each passing quarter. And if they cannot have that now, they would at least like to know when to expect it.
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Want to go for a ride?
"Google says self-driving vehicles were involved in 11 accidents" by Justin Pritchard Associated Press May 11, 2015
LOS ANGELES — Google Inc. revealed Monday that its self-driving cars have been in 11 minor traffic accidents since it began experimenting with the technology six years ago.
The company released the number after the Associated Press reported that Google had notified California of three collisions involving its self-driving cars since September, when reporting all accidents became a legal requirement as part of the permits for the tests on public roads.
The director of Google’s self-driving car project wrote in a Web post that all 11 accidents were minor — ‘‘light damage, no injuries’’ — and happened over 1.7 million miles of testing, including nearly 1 million miles in self-driving mode.
‘‘Not once was the self-driving car the cause of the accident,’’ wrote Google’s Chris Urmson.
Google, however, has not made public any records, so both enthusiasts and critics of the emerging technology have only the company’s word on what happened. The California Department of Motor Vehicles said it could not release details from accident reports.
This lack of transparency troubles critics who want the public to be able to monitor the rollout of a technology that its own developers acknowledge remains imperfect.
John Simpson, privacy project director of the nonprofit Consumer Watchdog, notes that Google’s ultimate goal is a car without a steering wheel or pedals. This could prevent a person from taking over if a car loses control, making it ‘‘even more important that the details of any accidents be made public — so people know what the heck’s going on.’’
***************
A chief selling point for self-driving cars is safety.
Their cameras, radar, and laser sensors provide a far more detailed understanding of their surroundings than humans have. Reaction times should be faster....
The top priority so far is not avoiding fender benders but rather staying away from a serious accident, which could set back acceptance of the technology for years, said Raj Rajkumar, a pioneer of the technology with Carnegie Mellon University.
The national rate for reported ‘‘property-damage-only crashes’’ is about 0.3 per 100,000 miles driven, according to the National Highway Traffic Safety Administration.
Google’s 11 accidents over 1.7 million miles would work out to 0.6 per 100,000, but as company officials noted, as many as 5 million minor accidents are not reported to authorities each year — so it is hard to gauge how typical this is.
‘‘Even when our software and sensors can detect a sticky situation and take action earlier and faster than an alert human driver, sometimes we won’t be able to overcome the realities of speed and distance,’’ Google’s Urmson wrote. ‘‘Sometimes we’ll get hit just waiting for a light to change.’’
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Related:
Nissan says self-driving cars due in 2020
Driverless Cars May Cut US Auto Sales by 40%, Barclays Says
Light is green now.
"Uber valuation highlights speedy pace of investments; Startup financing spins into fast gear" by Mike Isaac and Michael J. de la Merced New York Times May 11, 2015
NEW YORK — Uber raised a total of more than $2 billion from investors in June and December last year — and now it’s back for another round. The anonymous messaging startup Yik Yak collected $73.5 million in three financing rounds in seven months, and Zenefits, a human resources startup, raised more than $580 million in less than two years, with the latest deal done last week.
The pace of technological change has long been happening at the lightning-fast speed of the Internet. Now, startup financing is increasingly taking place at that speed, as well.
Uber is just one example of the quickening tempo. The ride-hailing company is in discussions to raise around $1.5 billion in financing that could value it at $50 billion. Just five months ago, the company collected $1.2 billion for its war chest, an amount that later swelled with the addition of a strategic investor.
And the rate of fund-raising by Uber — and across the startup landscape — has little precedent, driven by money pouring in from hedge funds, strategic investors, and more, and by the willingness of entrepreneurs to embrace the cash.
“When capital markets are this loose, people tap them, whether it’s right to or not,” said Mark Suster, a partner at venture capital firm Upfront Ventures. “Companies are raising rapid rounds of capital for only one reason: They can.”
The frequency of the fund-raising by many startups — now multiple rounds in months rather than years — is “otherwise unheard-of,” said Anand Sanwal, chief executive of CB Insights, a research firm that studies venture capital.
The shrinking time between funding rounds shows how Silicon Valley’s current boom is not just about startups reaching a high valuation but how fast they can pull that off. The tempo is in marked contrast to the pace of startup fund-raising last decade, when many companies would typically leave a year or two between financing rounds. When LinkedIn, the professional social networking company, raised money as a startup in the mid-2000s, it took more than three years for its first three rounds of financing.
Since the beginning of 2013, however, more than 20 tech startups have held three rounds of funding within a year and a half, according to CB Insights, which called the group the “18-month sprint” companies. Last year, nearly 500 tech startups did financing rounds less than one year apart, CB Insights estimated, more than any other year since at least 2011.
Among the companies that completed numerous financings in tight time frames was the fitness membership startup ClassPass, which completed three rounds in 9½ months, CB Insights said. Slack, the collaboration software startup, last month took in $160 million; just six months earlier, it had received $120 million from investors.
Snapchat in December raised nearly half a billion dollars from a bevy of financiers. Just three months later, the Chinese e-commerce company Alibaba poured $200 million into the messaging startup.
Spurring the more frequent fund-raising is the desire of investors — including hedge funds, mutual funds, and strategic investors — to put up money more often for fear of missing out on the next big thing. One reason Uber is in talks to raise money again just a few months after a prior round is because of an overwhelming amount of investor interest, said a person with knowledge of the company who spoke on the condition of anonymity because the process is confidential.
Uber did not immediately respond to a request for comment.
Many institutional funds and international companies have leapt into startup investing as the number of initial public offerings has slowed, prompting investors to wade into private companies to find growth, according to Mark A. Siegel, managing director at the venture capital firm Menlo Ventures, which has invested in Uber.
“I don’t blame entrepreneurs,” Siegel said. “This is something where investors are absolutely complicit in this, and in some ways are driving this.”
He added that the phenomenon of fast fund-raising appears largely limited to the club of “unicorns,” or the elite companies that are worth at least $1 billion. Investments in the later financing rounds for companies jumped to $4.2 billion in the first quarter, up 50 percent from a year earlier, according to data from the National Venture Capital Association, making it the biggest quarter for such investments since late 2000.
Entrepreneurs are often happy to take up eager investors on their offers. Stewart Butterfield, chief executive of Slack, recently said that his startup had more than enough money in the bank — just before collecting $160 million more.
“This is the best time to raise money ever,” he said last month. “It might be the best time for any kind of business, in any industry, to raise money for all of history, like since the time of the ancient Egyptians.”
Wow.
Butterfield said Slack had “no immediate use” for the new money it had just raised. Still, the capital “reinforces the perception for our larger customers that we’ll be around for the long haul,” he said.
Parker Conrad, chief executive of Zenefits, said rapid-fire fund-raising is necessary to quickly build up a company so it is large enough to take on competitors. With the money, Zenefits has been able to persuade more than 10,000 small and mid-size businesses to use its service.
“We want to grow really big, really fast,” Conrad said in an interview last week for the company’s third round of fund-raising since early 2014. “That requires a lot of capital.”
Even if the numerous rounds of new cash are not put to immediate use, the money may come in handy one day if — or when — the free-flowing capital faucets are shut off. Investors like Bill Gurley, a partner at venture capital firm Benchmark, have warned of a time when money is not as easy to come by.
When the Fed stops printing it.
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There sure is plenty of money sloshing around in the land of massive wealth inequality.
Related:
"David Plouffe, Uber’s head of communications, is shifting to an advisory role and joining the company’s board. Plouffe, a former adviser to President Obama, joined Uber Technologies Inc. less than a year ago as senior vice president of policy and strategy. A Google Inc. executive, Rachel Whetstone, will become senior vice president of policy and communications at San Francisco-based Uber, which plans to raise $1.5 billion in a new funding round that would boost its valuation to $50 billion, a person with knowledge of the matter says. Uber’s mobile app allows users to hail rides by connecting to the company’s network of drivers."
Also see: Globe Giving You a Lyft
Not so fast:
"Even as Uber, Lyft gain riders, drivers face $500 city fines; Drivers lack city permit" by Nicole Dungca Globe Staff May 27, 2015
Next time an Uber driver picks you up in Boston, don’t be surprised if a police officer pulls over the car.
The violation?
Being an Uber driver.
As popular as ride-hailing services have become, and despite efforts by Governor Charlie Baker to legitimize them, companies like Uber and Lyft still operate in a legal gray area because their drivers have not been licensed locally as taxi or livery drivers.
In Boston, driving without that license incurs a $500 fine.
From 2011 to 2014, the number of tickets given to drivers for operating “illegal vehicles for hire” more than doubled, according to data from the Boston Police Department.
In 2011, the department ticketed 305 drivers for the violation, according to the data.
The numbers rose each year, eventually climbing to 749 in 2014. So far this year, Boston police officers have handed out tickets to 225 drivers, a lower rate compared to last year, but still higher than before the advent of ride-hailing services.
Lieutenant Michael McCarthy, a police spokesman, said the department does not differentiate between drivers for companies such as Uber and Lyft, or any other drivers who are caught illegally charging people for rides.
The $500 ticket, he added, is also given to anyone who is not a licensed cab driver who stops for someone hailing a ride on the street.
But he attributed much of the overall increase to the rise of ride-hailing companies such as Uber and Lyft, which have become wildly popular because they allow riders to summon a driver, give directions, and pay, all with a few clicks on their smartphone.
McCarthy defended handing out the tickets to ride-hailing vehicles.
“It has nothing to do with punishment,” he said. “It’s making sure that the public has a place to go and gets home safely, with a taxicab that we can regulate.”
“We don’t specifically go out and target for that, but if it happens to occur within eyeshot of an officer, we reactively go out and enforce it,” he said.
You have insurance and a license, right?
Maybe we can bribe the guy instead.
But behind the tickets lies the larger debate over ride-hailing services as they cut into the market of traditional taxis.
Taxi or livery drivers invest much more money into driving for hire, compared to Lyft and Uber drivers.
Most drivers of ride-hailing services do not need special license plates or commercial insurance to operate.
Massachusetts allows each municipality to make its own rules to regulate vehicles for hire, and in Boston, taxi drivers must go through background checks and vehicle inspections to get the proper licenses and plates to operate as taxis or livery vehicles.
They need to pay for more expensive commercial insurance and purchase taxi medallions, which can cost hundreds of thousands of dollars.
People who support stringent taxicab regulations say they make the industry safer. Taxis are clearly identifiable and livery vehicles have special license plates, so passengers know which cars have been approved by the police, McCarthy said.
“As an outsider, I don’t want to get in the car with someone who has an atrocious driving history,” McCarthy said. “That could be the case for these companies that are coming in unregulated.”
You are taking your chances with anyone but yourself.
Stephen Regan, a spokesman for the Massachusetts Regional Taxi Advocacy Group, applauded the government for issuing tickets to drivers from ride-hailing companies.
“Right now, you have an illegal entity competing with a legal entity,” he said. “In our estimate, the operations of Uber and Lyft are against the law in Boston.”
Tim Buckley, a spokesman for Baker, said the governor is working to create a “permanent solution” for ride-hailing vehicles.
But Buckley said Baker looked forward to the Legislature acting on the bill he proposed in April that would require an annual tax for the companies, and require drivers to mark their vehicles if they’re picking up passengers.
In February, Baker had issued a notice that would allow ride-hailing companies to continue operating in the state until legislation finally ironed out more specific rules.
That followed instructions issued in January by the administration of Governor Deval Patrick that would require companies like Lyft and Uber to get certificates from the state, conduct background checks, and require drivers to have proof of insurance.
Both Uber and Lyft say they are open to such regulations, and that they already conduct their own background checks and require insurance.
Taylor Bennett, an Uber spokesman, said the company also urged the Legislature to “move quickly” and pass the governor’s proposed regulations that would govern ride-sharing companies.
Chelsea Wilson, a spokeswoman for Lyft, said the company is eager to work with regulators to craft new rules. “We’re very supportive of a statewide framework,” she said.
But Baker’s legislation would still leave much of the regulation up to municipalities.
For example, Braintree recently required ride-hailing services to follow taxi regulations if they want to operate in the town.
Those regulations would incur costs to drivers that would essentially push companies such as Uber and Lyft out of that market.
The city of Boston hasn’t gone that far yet.
“It’s encouraging that people should have the option to use Uber or Lyft,” McCarthy said. “I think they’re a great service, and if you balance that with some oversight, we can make sure people are safe.”
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Let me check my phone:
"Google riles Silicon Valley by exposing others’ security flaws" by Chris Strohm and Jordan Robertson, Bloomberg News February 12, 2015
WASHINGTON — Google Inc. has given fellow tech companies an ultimatum: Patch your software vulnerabilities within 90 days or we’ll make them public.
An elite team of Google hackers and programmers scrub their own and competitors’ software for security flaws, giving companies a deadline to issue a fix. Google says it wants software makers to move fast because cybercriminals act with lightning speed when they spot bugs.
It’s a sensitive topic: Microsoft Corp. and Apple Inc. declined to talk about the tactic. Others in the industry say the help isn’t always welcome, usurps a role best left to government, and can jeopardize security.
“I’m not sure who made Google the official referee of the marketplace for vulnerability notification,” said John Dickson, a principal with the software security company Denim Group in San Antonio. He said pressuring companies to fix flaws is a good idea, but “what noble motives they had in mind could be called into question given the fact that they essentially outed vulnerabilities for two of their biggest rivals.”
Google established the team in July, calling it Project Zero after the much-feared “zero day” security flaws that are exploited before developers learn of them. It says it is trying to help everyone as well as protect its own products that run on others’ devices and software.
That’s an activity some experts say is more appropriate for government. The roles of the private and public sectors is on the agenda at a cybersecurity summit Friday in Palo Alto, Calif., at which President Obama will call on technology leaders to improve cooperation and share more information.
Apple declined to comment about Google’s move, while Microsoft would only refer to a previous statement in which it said Google’s tactics felt like a game of “gotcha.”
“If these companies can’t even get along, that’s just bad for security for the whole ecosystem,” said Jake Kouns, at Risk Based Security Inc. in Richmond.
Opponents of Google’s practice say it puts online security at risk by revealing gaps before they can be plugged.
In January, Apple pleaded with Google to wait about a week before going public so it could fix three flaws in the Mac OS X operating system, said a person familiar with the request who wasn’t authorized to speak publicly. Google knew the fix was coming and had possession of the updated software because it serves as a developer for Apple, the person said. Google refused and released details of the flaws.
Microsoft, meanwhile, requested two days to fix a flaw in Windows. Google refused and publicized the bug.
Microsoft asks that researchers privately disclose flaws to software providers, working with them until a fix is made available, said Chris Betz, senior director of Microsoft’s Security Response Center.
Google supporters say the hard-line approach may fundamentally alter software industry practices in which companies can take months or years to patch bugs.
According to an analysis by Risk Based Security, Project Zero has identified 39 vulnerabilities in Apple products, 20 in Microsoft products, 37 in Adobe Systems software, and 22 in the FreeType software development library for rendering fonts.
Google’s “strict policy is good for the industry,” and the company should be praised because they “stuck to their guns,” said Tom Gorup, a manager with Rook Security Inc. in Indianapolis.
“A regular Joe on the street doesn’t have the clout that Google does,” Gorup said. “If we have huge companies like Microsoft, Apple, and Google going at each other and pushing for better security, it’s a win across the board.”
But a 90-day deadline might not be practical for large companies that have to search through thousands of lines of code and make sure patches don’t negatively affect other software, said Craig Young, a senior security researcher with Tripwire Inc. in Portland, Ore.
Other times, however, a company may be negligent. “We’ve had a lot of experiences where vendors will seemingly not care about something unless it’s in the headlines or unless there’s something out there that people see as an immediate threat,” Young said.
I can hardly keep my eyes open.
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Rides over; you're home.
Maybe you would be better off driving one of these.
NDUs: You get a quote yet?
Maybe you should try again.
UPDATE: Uber, Lyft push back against proposed N.Y. regulations
