Oct 29, 2018

Axios Login

By Ina Fried
Ina Fried
1 big thing: Social media still spreading hate

Pittsburgh mourners after the synagogue shooting. Photo: Aaron Jackendoff/SOPA Images/LightRocket via Getty Images

The last week proved that hate still abounds in America, and also that social media continues to fuel it.

Case #1: Twitter and the mail-bombs

The letter-bomb campaign suspect had been reported to Twitter for having made a direct threat against a political commentator two weeks ago, but Twitter responded that he hadn't violated the company's terms of service.

Twitter took down the account after the accused bomber was in custody and eventually apologized for not taking action on that initial report.

"We made a mistake when Rochelle Ritchie first alerted us to the threat made against her. The Tweet clearly violated our rules and should have been removed. We are deeply sorry for that error."
— Twitter statement

Case #2: Gab and the Pittsburgh shooting

The Pittsburgh synagogue shooting suspect had been a frequent poster on Gab, a less widely known social media platform that dubs itself as a "free speech" advocate. Gab, which was started as an alternative for extremists who found that Twitter was beginning to banish them, tends to allow violent hate speech as long as there aren't specific attacks directed at particular individuals.

The tech industry took some more concrete steps here. Microsoft had quietly cut ties with Gab a month ago, forcing it to find a new hosting provider. After the shooting, PayPal cut ties with Gab, followed by Stripe. Hosting providers Joyent and BackBlaze also cut services to Gab, pushing the site offline by Sunday evening.

Meanwhile: Twitter critics noted just how much hate speech has remained up on the site.

  • Communications professor Jennifer Grygiel pointed out a number of hate-filled screeds that had been on the site for years. While a number of the text-based ones were taken down, some image-based memes remained, indicating that Twitter may have a tougher time screening text that is part of an image, vs. plain-text tweets.
  • BuzzFeed's Charlie Warzel noted the spread of a false meme on Twitter suggesting George Soros — a Holocaust survivor — was a Nazi.
  • Plus, for a time on Sunday, typing the hashtag symbol and B was leading to auto-complete suggestions that included #burnthejews. (That changed later Sunday, following an inquiry from Axios.)

Advocates of free speech online long argued that it's good to keep extremists' activities out in the open, and sunlight is the best disinfectant. But too often social networks have turned out to be toxic environments where the fumes blot out the light instead.

The bottom line: On social media today, false narratives spread, bigotry intensifies, and sometimes entire plots are hatched. Tech's platforms have become hate-speech amplifiers, and their owners, especially Twitter, haven't shown they have a handle on the problem.

Go deeper:

  • On Gab, an extremist-friendly site, Pittsburgh shooting suspect aired his hatred in full (New York Times)
  • Hate, at scale (Axios)
  • Social media's role in spreading hate (CNN)
  • The conspiratorial hate we see online is increasingly appearing in real life (BuzzFeed News)
2. IBM buying Red Hat for $34 billion

Photo: Alvin Chan/SOPA Images/LightRocket via Getty Images

IBM announced Sunday it would acquire Linux specialist Red Hat in a deal valued at a staggering $34 billion in cash and debt. That works out to $190 per share, a hefty premium to where the software maker has been trading,

It's IBM's biggest ever acquisition, and among the four largest tech deals ever, per CNBC's Steve Kopack.

Why it matters: IBM has been shifting for years away from mainframes and servers to selling software and services that bring recurring revenue. Red Hat, which charges corporate clients for custom-built Linux offerings, fits into that strategy.

The move comes as others are also doubling down on Linux, including longtime rival Microsoft, which just completed its $7.5 billion GitHub purchase and recently joined an effort that helps protect open source by sharing patent rights.


  • The deal is expected to close in the second half of 2019.
  • Red Hat will become a standalone unit in IBM's cloud unit and keep its existing leaders and location.
  • IBM said it should add to free cash flow and profit margins within 12 months.

What they're saying:

  • N.Y. Times tech reporter Steve Lohr: "IBM makes a big move to attract software developers and position itself as the "Switzerland" of the cloud world."
  • Tech journalist Simon Le Gros Bisson: "The only upside I can see to an IBM/RHAT deal is if IBM lets Red Hat run it like a reverse takeover. Otherwise it's going to be 'How many Global Services consultants do you want with that OpenShift install?' "
  • Red Hat engineer Dan Sneddon: "I’m having trouble picking my jaw up off the floor. This probably won’t be a bad thing in the long run, but calling this a surprise is an understatement."

The bottom line: IBM pitched this as a deal to lead the hybrid cloud of the future, while critics said it was buying yesterday's big technology. The truth is probably somewhere in the middle.

3. Billions are pouring into autonomous vehicle tech

Illustration: Rebecca Zisser/Axios

Global investors have pumped $4.2 billion into autonomous driving-related companies in the first three quarters of 2018, according to data from CB Insights.

The big picture: The $4.2 billion figure doesn't include all the funds automakers are investing into developing their own new tech, notes Axios' Kia Kokalitcheva. A Brookings Institution report last year estimated that from August 2014 to June 2017, a total of nearly $80 billion was invested in the area by the auto industry and venture capitalists.

The bottom line: The promise of autonomous driving has led investors — and automakers — to open their checkbooks wide to ensure they’re part of the future of transportation.

The big funding tends to go to companies building a full car or close to it. Developing a brand new car model usually costs companies at least $1 billion, and up to $6 billion.

  • Zoox: The company, which is building a fully self-driving car from scratch, has raised $790 million in funding to date despite still being in the private testing phase of its development.
  • Cruise: As a startup building an autonomous driving system that could be installed in a car, Cruise raised less than $20 million before General Motors acquired it for nearly $1 billion. Since then, it’s expanded to building cars that are natively built to drive themselves (in partnership with GM), and has attracted a $2.25 billion investment from SoftBank ($900 million upfront), and more recently a $2.75 billion investment from Honda ($750 million upfront).

What's next: "Venture investors have begun to target early-stage startups working on specific AV use cases, such as managing a logistics AV fleet or enabling last-mile deliveries, rather than the technology underpinning autonomous mobility," Synapse Partners founder Evangelos Simoudis writes for Axios Expert Voices.

  • "As large-scale AV fleets are deployed, these early-stage startups will become likely targets of the next acquisition wave."

Go deeper: Q&A with Trucks Venture Capital partner Reilly Brennan about the self-driving startup market

4. Two Latin American scooter startups merge

Two Latin American scooter rental startups, Grin in Mexico and Ride in Brazil, have merged and will operate under the Grin brand, Axios' Kia Kokalitcheva reports.

Why it matters: Just as happened in the ride-hailing industry, scooter (and bike) rental companies will likely consolidate as the global competition keeps intensifying.

  • This merger comes on the heels of Grin's closing $45 million in new funding, led by Delivery Hero founder Lukasz Gadowski, with Shasta Ventures, DCM Ventures and existing investors also participating.
  • Grin recently also inked a partnership with Rappi, a Latin American on-demand delivery service. Rappi users will be able to rent Grin scooters via the former's app.
  • Still, Grin will have to compete with other local rivals. Brazil's Yellow, for example, recently raised $63 million in new funding. American companies Lime and Bird also have ambitions in the region.
5. Take Note

On Tap

  • Google hosts a cloud computing event in Sunnyvale, Calif.
  • Phone maker OnePlus is holding its twice rescheduled 6T launch event in New York. (It most recently moved the event a day earlier to avoid being up against Apple's event, which takes place Tuesday in Brooklyn.)

Trading Places

  • After nine years at Google (and five more at Microsoft before that), developer advocate Don Dodge said he is leaving tech to start a new venture with his sons outside of the industry.


  • California agreed to not to enforce a new net neutrality law while a legal challenge to the FCC's efforts proceeds in court. (Washington Post)
  • China’s first effort to get to space orbit via a private space company didn't work out as hoped. (The Verge)
  • Ashlee Clark Thompson has a powerful essay on what it's like to enter Amazon's cashierless Go store after a lifetime of being under the gaze of store clerks. (CNET)
6. After you Login

For those who aren't into the World Series, it's more fun when you use computer graphics to transform the baseball into a beach ball.

Ina Fried