August 08, 2019
Breaking: my ability to come up with clever intros.
Today's Login is 1,447 words, <6-minute read.
1 big thing: Report blasts Palantir for ICE work, Trump ties
Palantir has more than $1.5 billion in federal government contracts and deep ties to the Trump administration, yet few people know the company or how its products work, according to a new report from nonprofit Mijente, a hub for organizing Latinx and Chincanx organizations.
The big picture: Mijente's report comes a day after ICE arrested 680 people in the largest-yet roundup of undocumented immigrants under the Trump administration.
Between the lines: The goal of the report is to give the public a better understanding of the company, its work and its origins, senior campaign organizer Jacinta Gonzalez told Axios.
By the numbers: According to Mijente, Palantir's federal government work includes:
- $1 billion worth of work with the Defense Department.
- Upward of $175 million in business with the Justice Department.
- $94 million in active contracts with the Department of Homeland Security, consisting largely of the work for ICE.
The report highlights that a key $53 million ICE contract is scheduled for renewal in September. For that, Palantir provides software known as Investigative Case Management, or ICM, which Mijente says was used to target family members of unaccompanied minors.
A second tool used by ICE, known as FALCON, is worth $42 million and is eligible for renewal as early as November 2019, but could potentially be used through 2021 under the current deal.
The report calls out Palantir for both the volume of data it collects and the fact that it often results in the arrest of as many "collaterals" as "targets."
"Palantir sells itself as a precision tool for the targeting of migrants and enemy combatants, but the mass data collection that supports Palantir's ICM and FALCON lends itself to dragnet operations."— Mijente report
Behind the curtain: In addition to the business relationships between Palantir and various government entities, Mijente also points to the intertwining personal relationships between co-founder Peter Thiel, various Thiel-run companies, Palantir and the Trump administration.
Notably, the report points to:
- U.S. CTO Michael Kratsios left his position as chief of staff at Thiel Capital to join the White House, first as deputy assistant to the president for tech policy then, more recently, as CTO.
- Kevin Harrington, a former principal and managing director at Thiel Macro, is deputy assistant to the president for strategic planning and was also part of the Trump transition "landing team" at the Department of Commerce. Palantir, the report says, has a contract to provide economic data to the Census Bureau.
- Trae Stephens, an early Palantir executive and co-founder of Palmer Luckey's Anduril Industries, was on the Department for Defense transition team.
- Several aides to former Defense Secretary Jim Mattis had Palantir ties, including Justin Mikolay, who was a lobbyist before joining the administration. After leaving the government, he returned to Palantir from October 2017 to August 2018.
"You see this revolving door starting to form," Gonzalez said.
Yes, but: The report doesn't suggest Palantir is doing anything that breaks the law, and Palantir defends its government work.
- "We’re proud that we’re working with the U.S. government,” CEO Alex Karp told the New York Times.
2. After IPO, Lyft hits the brakes on price war
Since going public in March, Lyft is now easing off its price-cut war with rival Uber, instead competing on “brand and experience," Axios' Kia Kokalitcheva reports.
The big picture: As part of its Q2 earnings, the company revealed that its sales and marketing expenses for incentives — meaning ride "coupons" — have dropped by 40% from the first quarter. It also quietly raised some prices at the end of June to improve its margins.
- “More specifically, we began to adjust prices on select routes and in select cities based on costs and demand elasticities,” said finance chief Brian Roberts of the select fare increases.
- “We expect that these changes will accelerate Lyft's path to profitability, and further, we believe these price adjustments reflect an industry trend,” he added, hinting that we should expect Uber to be doing the same.
And while Lyft previously expected to generate its “peak losses” in 2019, its revised outlook for the rest of the year means it now believes its biggest losses were last year.
The bottom line: Lyft attempted to paint a picture of its “path to profitability” for investors on Thursday, emphasizing that it’s adjusting its margins by cutting costs, increasing revenue per active rider, and increasing more profitable rides like those to and from airports, in premium cars, for medical providers and corporate transportation.
Yes, but: Lyft is far from being out of the woods. It’s still much smaller than rival Uber and has very large losses. Kia has more on Lyft's financial report here.
Meanwhile: A new study suggests that while Lyft is slowly growing its share of rides among startup employees, Uber still has 75% of the market, according to data from Brex, which supplies credit cards to startup companies.
Why it matters: Business riders are an important — and lucrative — category of customers for ride-hailing companies. Workers often need transportation when they travel and can be less price conscious since convenience is a high priority.
Kia has more on that study here.
3. AMD sees EPYC gain in the data center
AMD is still the underdog to longtime rival Intel, but it's being taken increasingly seriously by even the largest business customers. That was in evidence Wednesday as AMD launched its second-generation EPYC server processors at an event in San Francisco.
For more than 2 hours, AMD executives showed its server chips outperforming Intel's fastest processors in various benchmarks and trotted out some of the biggest names in tech to talk about their use of AMD chips. AMD also announced that Google Cloud is joining Amazon's AWS and Microsoft's Azure in offering AMD as an option.
The bottom line: The point was an important one, even if AMD spent a bit too long making it. Intel has some serious competition throughout the computing landscape, including the data center.
What they're saying: In an interview with Axios, CEO Lisa Su said that the first generation of EPYC was good and a lot of people tried it. "But you could tell they weren’t 110% sure 'Are we all in? Are we going to deliver?'"
With the new generation of chips, "now they actually trust us, and they trust us to talk about their long-term needs."
In addition to new customers like Google and Twitter, Su pointed to Hewlett Packard Enterprise and Microsoft, who are offering a wider array of AMD-based options.
What's next: In tomorrow's Login, I'll have more from my interview with Su about AMD more broadly as well as the challenging dynamic of U.S.-China tech tensions.
4. Some notes on Samsung's smartphone launch
While nearly all of the specifications of Samsung's Galaxy Note 10 had leaked ahead of Wednesday's launch in New York, there are a couple of things worth highlighting.
- Small-screen option: While the Galaxy Note has always been known for its large size, this year marked the debut of a smaller-screen model.
- My thought bubble: Large screens have become ubiquitous across flagship smartphones, and some people want all the power in a somewhat smaller size.
- Microsoft partnership: Samsung has been including Microsoft services on its phone for several years, but this year's work was deeper, including new Windows software to more easily connect to Samsung phones as well as the ability to remotely stream Windows games onto a Note 10.
- Samsung also used the event to debut the Galaxy Book S, a new Windows laptop that has an always-on cell connection and Qualcomm's 8cx chip.
The bottom line: It's still tough to stand out in the smartphone market. A bunch of the Note's headline features, such as pen-based gestures and AR doodles, seem like "nice-to-haves" rather than compelling reasons to upgrade a device.
5. Take note
- David Shing, better known as Shingy, is leaving his role as "digital prophet" at Verizon Media/AOL.
- Salesforce is buying ClickSoftware for $1.35 billion. (CNBC)
- After talks to buy all of Symantec broke down, Broadcom is reportedly close to a deal to buy the software maker's enterprise business. (WSJ)
- Microsoft, Nintendo and Sony, along with a number of game makers, committed to disclosing more information on what to expect inside "loot boxes." (The Verge)
- An issue with Instagram allowed a partner to track and save a variety of images and location data in violation of Facebook's rules. (Business Insider)
- Instagram is rebuilding its direct messaging to use Messenger, the first step in Facebook's strategy to integrate its messaging apps. (Bloomberg)
- President Trump issued an executive order banning federal purchases from Huawei, ZTE and two other Chinese companies. (TechCrunch)
- Google released a final beta of Android Q with a final release expected in weeks. (The Verge)
6. After you Login
One of Airbnb's new "experiences" in Seattle lets you simulate an interview with Amazon, complete with getting to be a fly-on-the-wall for your post-interview debrief.
The 5-hour event might not appeal broadly to the tourist set, but its organizers note that it offers a number of benefits for those actually considering a job with Amazon, especially since the company doesn't give official feedback to interviewees and prefers candidates wait 6–12 months before interviewing a second time.