Feb 14, 2019

Axios Future

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Anything you'd like to see us cover? Hit reply to this email or message me at steve@axios.com. Kaveh Waddell is at kaveh@axios.com and Erica Pandey at erica@axios.com.

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1 big thing: Walmart — the anti-Amazon

Sam Walton’s original five-and-dime, Bentonville, Arkansas. Photo: Erica Pandey/Axios

In the 1980s, Walmart was the archvillain of capitalism: the ruthless killer of main streets and mom-and-pops, outrageously profitable and, by all appearances, unstoppable.

Now, the 57-year-old retailer has a new role in American society: the anti-Amazon.

Erica reports from Bentonville, Arkansas: Amid a decade-long era of heady corporate profits, vast numbers of workers feel untethered, distrustful and without a sense of belonging and dignity. Amazon, like the rest of Big Tech, is being swept up in this crisis of faith, villainized for its very bigness.

  • In many ways, Amazon is quickly become the new Walmart — demonized for killing malls, bookstores and toy shops, and feared by industry after industry for the off chance it may decide to swallow up yet another business.
  • In New York, as we reported yesterday, Amazon is the target of a massive campaign accusing it of greed for the $3 billion in breaks it has received to build a new headquarters employing some 50,000 high-paid workers.

Walmart — at least in rhetoric — is attempting to move into the breach. Out of sheer necessity to survive the Amazon juggernaut's retail onslaught, it is casting itself as the foil.

The rebrand has its skeptics: Louis Hyman, a historian of capitalism at Cornell University, tells Axios: “I’m sure Walmart wants to position itself as a small-town business, but that’s just not true. Walmart is still a 500-pound gorilla.”

  • With $500 billion in revenue last year, Walmart remains by far the biggest company by sales in the U.S., and is no less ruthless than it ever was, Hyman said.
  • Its own e-commerce business is ballooning every quarter.

Yet Walmart's rebranding appears to have traction: With a network of some 4,700 stores that are within 10 miles of 90% of Americans, Walmart is perhaps better positioned than any government agency, think tank or company to take the economic pulse of the U.S. It is using that on-the-ground presence to position itself as a champion of distressed and alienated America.

On stage at a conference in Bentonville today, Walmart CEO Doug McMillon sat across from New York Times columnist Thomas Friedman, who asked him the ultimate question: How will you stay relevant?

McMillon said: "There’s a strong and heavy dose of humanity in it. ... A differentiating characteristic of our company will be that we still care about people, and they know it."

  • Walmart, McMillon said, wants to be the most trusted company in the U.S.
  • When people walk into a Walmart, he wants them to feel, "I belong here."
  • His themes squarely attack weaknesses that economists have criticized in the current U.S. system: that Americans feel less and less a sense of esteem and belonging, whether it's to a job or community.
2. A certificate of authenticity against deepfakes

Photo: Felix Hörhager/picture alliance/Getty

Every weapon is on the table in the war against democracy-disrupting deepfakes — from technology to detect the AI-altered videos and audio to legislation that would punish creating and distributing them.

Kaveh reports: The big problem is that these solutions don't work yet. So a third approach is gaining traction: developing a way to verify that a video hasn't been altered.

The big picture: The bet is that authenticating videos — tracing them back to their source, like an expensive diamond — is a better solution than trying to sniff out forgeries after they've already been made, which is extremely hard.

  • Amber Video, a San Francisco startup, creates a breadcrumb trail that begins the moment a video is recorded.
  • It uploads a unique fingerprint corresponding to each video and saves it on a blockchain, so that viewers can later check to make sure it hasn't been tampered with.
  • We've also reported on Truepic, a startup that takes a similar approach.

What's going on: On Monday, Amber CEO Shamir Allibhai presented his company's technology during a meeting of the foremost deepfake warriors at the Defense Advanced Research Projects Agency. There, he pitched video authentication for body cameras.

  • Amber Video recently brought on security researcher Josh Mitchell, who demonstrated last summer that that some bodycams can be hacked and their video altered.
  • To prevent this, Amber software — if installed on a camera — continuously uploads information called a "hash" to a blockchain. The hash can later be used to make sure that what's being played back is the very same video that was recorded.

The big challenge is getting bodycam manufacturers to install this software on their equipment. Allibhai says he's in talks with several companies, but none have committed as yet.

The bottom line: For now, deepfakes aren't the biggest worry for bodycams. They still take a while to make, and they're not quite good enough to escape close scrutiny. But nearly every expert agrees that's not going to be the case for long.

"We'll see a [police] video that's highly controversial in some way … and it's going to take 10 minutes before people start raising questions about whether it's been manipulated."
— Jay Stanley, ACLU
3. Dirty data and predictive policing

An LAPD officer holding predictive policing zone maps. Photo: Patrick T. Fallon for The Washington Post via Getty Images

Nine U.S. police departments have relied on possibly faulty data in their predictive policing systems, which look for patterns to forecast where crimes will occur or who will commit them, according to a new report from the AI Now Institute.

Kaveh writes: This is a huge problem because the accuracy of these systems' predictions relies entirely on the accuracy of data.

  • These nine departments, including Chicago, New Orleans and Maricopa County, Arizona, have been found to engage in skewed policing that can result in what the AI Now researchers call "dirty data."
  • One outcome is that past biases — like over-policing black neighborhoods — will be perpetuated with predictive software.
4. Worthy of your time

Illustration: Rebecca Zisser/Axios

A crucial step for avoiding AI disasters (Sue Shellenbarger — WSJ)

Cratering corporate profits (Courtenay Brown, Felix Salmon — Axios)

A fortune to call from a U.S. jail (Hanna Kozlowska — Quartz)

Mars Rover out (Kenneth Chang — NYT)

Google to build $13B in data centers and offices (Gerrit De Vynck — Bloomberg)

5. 1 '60s thing: How we once bought

At the Walmart Museum, Bentonville, Arkansas. Photo: Erica Pandey

While in Bentonville, Arkansas, this week, Erica spent some time at the Walmart museum. The above display caught her eye — how some of today's products were merchandised in the 1960s.

Erica's thought bubble: I loved the juxtaposition within this smattering of products. There’s Crest and Sensodyne, two brands I have in my house, right next to Pace lotion for hair perms, something I heard about for the first time today.