By Peter Ward April 1, 2016
Prison Phone Calls Make Profit from Poor
Alcatraz prison cells. © By Pfnatic (Own work) [CC BY-SA 3.0], via Wikimedia Commons
The reason these calls are so expensive is the local sheriff’s office takes a large cut of the proceeds. Documents obtained by International Business Times show that Marion County received almost $550,000 last year from Securus, the private company given an exclusive contract to operate phone and video visitations at the jail.
The Federal Communications Commission voted in October to cap the fees companies were allowed to charge the families and friends of inmates for calls and videos, but the prison telecommunications providers have fought back against the ruling. The companies filed a lawsuit against the FCC to block the regulation late last year, and since then several states led by Oklahoma have joined the telecom providers and filed a joint lawsuit challenging the statutory authority of the FCC, which is ongoing.
Microsoft Pushes on With AI Shift
Artificial intelligence stirs all kinds of anxieties-about robots taking jobs, or turning against their human creators. But this week, another anxiety came to the fore: can robots learn to be racist? On March 23, Microsoft launched Tay, an AI machine capable of talking to humans, on instant messaging apps and Twitter. A day after the launch, the company shut Tay down, after internet trolls taught the bot to tweet things that were racist and offensive.
The incident leads a feature in Bloomberg Businessweek, published on Wednesday, about Microsoft’s big AI push. Tay is just one piece of a larger strategic shift at the company, which aims to infuse AI into a wide range of products, including Outlook and Skype, and design new ways for customers to interact with its technology. The AI push is also the first initiative launched by the new CEO Satya Nadella, who took the position in February 2014.
Amazon, Google, Slack, Facebook and many other technology giants have already begun to integrate artificial intelligence into their product lines, so Microsoft is just catching up.
Nadella tells Bloomberg Businessweek that using AI should help to us manage the information age. “The complexity is too much,” he says. “We need to tame it. We need to be able to make it much more natural for people to get things done, vs. this thing about let me remember the 20 apps I need to get anything done.” For example, AI might allow you to simply ask a bot via chat to order a pizza on your behalf, rather than sifting through different food delivery apps to get the task done.
Microsoft has struggled to make an impact on the apps and smartphone businesses, and hopes to get ahead on AI products that are able to use these types of human conversations with software to provide information and services.
Top iPhone Maker’s $3.5bn Gamble
Foxconn factory in the Czech Republic. © Nadkachna, own work, Creative Commons attribution 3.0
How much should a company risk to hold onto its biggest customer? Taiwan’s Hon Hai Precision Industry Co., which trades as Foxconn Technology Group, one of the major manufacturers of iPhones, made a big bet this week that it can win greater leverage with Apple by purchasing another Apple iPhone supplier. The company announced a deal to acquire a 66% stake in Japanese screen maker Sharp, which provides roughly 25% of iPhone screens, for $3.5 billion.
Foxconn used to enjoy a monopoly on iphone manufacturing, but in 2013 Apple began diversifying its supply chain, doling out contracts to other component makers. Foxconn made big headlines in 2010 when an estimated 14 employees committed suicide, with some blaming abusive labor practices.
Foxconn’s recent acquisition is a big gamble. Sharp doesn’t make a profit, and may face heavy competition for its core offering in the coming years. Apple is reportedly set to switch to OLED screens in its iPhones starting next year, and while Sharp owns the technologies necessary to manufacture OLED displays, it has never commercially produced them. In the time it takes Foxconn to ramp up production at Sharp, Chinese display makers could catch up. Samsung Display, a unit of Samsung Electronics currently holds a near monopoly on OLED screen production, and LG Display, which manufacturers OLED screen for televisions, is to move into smartphone display production in the first half of 2018.
Apple currently uses LCD screens for its iPhones, but OLED offers higher resolution, flexibility, brightness and quick response time. The switch from LCD to OLED will require the supply chain to spend around $9 billion just for iPhones, according to research from Cowen and Co.
Foxconn’s acquisition goes some way to demonstrate the power Apple can have over its supply chain, and how much influence the hardware developer has across the globe in every decision it makes.
Startup Valuations Tracked
Mark Zuckerberg speaks at Startup School. © Robert Scoble
Valuations of startups can be hard to track. Private company valuations rely on the estimates of mutual funds. The Wall Street Journal’s Startup Stock Tracker attempts to give a clearer picture of the changing valuations of some of the biggest startups in the world. This week the tracker was updated to include data from the first quarter of 2016.
The interactive gives a wealth of information on each of the companies, which are organized by valuation. Uber tops the list, with a private valuation of $51 billion in Q1 2016, up more than 48% from Q1 2015 but no change from the previous quarter.
The graph shows that there have been significant drops in value among the biggest startups in the past 12 months. One example is the fantasy sports company DraftKing, which has seen a 31.65% drop in value between Q2 2015 and the first quarter of this year. Health insurance benefits company Zenefits has also seen its value plummet, down 65.1% over the same period.
The average change from first investment column shows how much share value has shifted since the first investment was made in the company. Uber shareholders who were in from the start are enjoying a 214% increase in value. But Snapchat investors have seen the value of their shares drop 16%.
The Week’s Top Headlines
China Rating Outlook Cut at S&P on Risk of Slower Rebalancing – Malcolm Scott, Bloomberg News
US used tactic from Apple encryption fight in 60 other phone-unlocking cases – Danny Yadron, The Guardian
U.S. women’s team files wage-discrimination action vs. U.S. Soccer – ESPN
Argentina lawmakers win approval for debt deal – BBC
GE Capital asks U.S. government to lift ‘too big to fail’ designation – Lisa Lambert, Reuters
Emerging Markets: Improvement Arrives, but for How Long? – Carolyn Cui, The Wall Street Journal
California reaches deal on $15 minimum wage – Paul Davidson, USA Today
Subway Sales Kept Falling In 2015 – Venessa Wong, Buzzfeed News
GlaxoSmithKline promises reduced drug patents to help world’s poor – Ben Hirschler, Reuters
Energy price slump keeps eurozone in deflation – BBC
This entry was posted on Friday, April 1st, 2016 at 3:54 pm. It is filed under Week in Review and tagged with Peter Ward. You can follow any responses to this entry through the RSS 2.0 feed.
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