Sep 7, 2018

Axios Login

Hi from Palm Springs, Calif., where David McCabe and I are braving the heat (OK, cowering in the air conditioning) to take part in the annual gathering of NLGJA, the Association of LGBTQ Journalists.

Situational awareness: Two Tesla executives announced they are resigning this morning: Gabrielle Toledano, chief people officer, and Dave Morton, chief accounting officer. The news sent Tesla's stock sharply down in early trading.

1 big thing: Amazon's treasure trove of data

Illustration: Lazaro Gamio/Axios

When Amazon invited cities to compete for its second global headquarters a year ago today, it got reams of data from the 238 entrants. That, Axios' Erica Pandey reports, is enough to learn details of the cities' future plans that a lot of their residents don't even know about.

Why it matters: The information effectively provided Amazon with a database chock full of granular details about the economic development prospects of every major metropolitan area in the U.S. (and some in Canada).

For a rapidly-expanding tech behemoth like Amazon, that database could help it make expansion decisions that go way beyond the new headquarters.

Companies have conducted site searches in the past, but none have come close to the scale of the Amazon HQ2 search.

That's because Amazon is "not just looking for HQ2," says Joe Parilla of the Brookings Institution. "They're looking for where they're going to put the next data center, the next logistics center, the next R&D facility."

Amazon's warehouses are within 20 miles of 31% of the U.S. population, while Walmart — its competitor — owns stores within 20 miles of 98% of the population, says Cooper Smith, an industry analyst at Gartner L2.

"Given they are siting new facilities like mad, this is a huge gift provided by taxpayers," Richard Florida, a professor at the University of Toronto, tells Axios.

Much of the quantitative data that Amazon picked up from cities is publicly available, Parilla says. What matters is the qualitative data cities offered up — they let Amazon in on their wildest dreams.

  • The sort of details that might be in a typical application could include plans for new train stations or shopping complexes — information the city's own residents wouldn't have, he says.

After an initial wave of glowing publicity around Amazon's plan to bring 50,000 jobs to the winning city through HQ2, the search has been criticized for lack of transparency around what exactly cities are offering the company to win.

  • Montgomery County, Md., one of the 20 finalists Amazon is considering, responded to a FOIA request by sending the New York Times a 10-page document of the financial incentives it offered — with every single line of text redacted.
  • City council members in Indianapolis and Austin, two other finalists, told NYT that their Amazon bids were put together by local chambers of commerce and many city leaders don't even know what incentives are on the table.
  • That's another perk of soliciting hundreds of applications, Florida says. He adds that Amazon "now knows what these communities are willing to dish out in terms of taxpayer funded incentives."
2. After Equifax's mega-breach, nothing changed

Former Equifax CEO Richard Smith is grilled before the Senate banking committee in 2017. Photo: Mark Wilson/Getty

The Equifax data breach was supposed to change everything about cybersecurity regulation on Capitol Hill. But it's one year later today and it's not clear much of anything has changed, Axios' Joe Uchill reports.

Why it matters: Equifax — one of the major credit reporting agencies — announced a year ago that 145.5 million U.S. adults had their social security numbers stolen in an easily preventable breach. If any data breach was going to be able to shock Washington into enacting sweeping privacy reforms, this should have been it.

What was supposed to happen: After the first of several hearings involving Equifax, Sen. Chuck Grassley (R-Iowa), chair of the Judiciary Committee, said it was "long past time” for federal standards for how companies like Equifax secure data.

  • Data security wasn't the only anticipated reform. Congress appeared poised to create a national breach notification law governing how and how quickly companies must notify anybody whose personal information is stolen in a breach. Currently, to the chagrin of national retailers, those laws vary state to state.
  • Several investigations were supposed to penalize the credit bureau for lax cybersecurity, including failing to patch the vulnerability hackers exploited despite government warnings.

What actually happened: The bills petered out. "The initial interest that was implied by congressional actions didn't pan out," said Michelle Richardson, director of the Privacy and Data Project at the Center for Democracy and Technology (CDT).

What went wrong:

  • "A lot of issues fall through cracks in the early days of an administration, especially one with so much controversy," Richardson said.
  • Congress often has difficulty focusing on more than one cybersecurity-related topic at a time, tech policy experts say. And, Russia and election security are now in the spotlight.
  • "Regulation is tough in this political climate," said Tom Gann, chief public policy officer at McAfee.
  • The cybersecurity field averages one "this-changes-everything" event a year, none of which actually changes everything. A year before Equifax, there were attacks on the election. In 2015, China hit the Office of Personnel Management. In 2014, North Korea hit Sony.
  • "For people who think of themselves as privacy experts, they keep waiting for the straw that will break the camel's back," said Steven Weber, director of UC-Berkeley's Center for Long Term Cybersecurity. "The fact is these don't change the public's view."

Go deeper: Joe has more here.

3. Google confirms Oct. 9 hardware launch

Google confirmed its hardware unit will hold a launch event in New York on Oct. 9. There the company is expected to roll out the widely leaked Pixel 3, among other devices. 

With the Pixel's specifications and design already out there, the big question is whether Google will secure broader distribution or otherwise find a way for its device to grab more of the market.

Why it matters: While Google is still not a giant player in hardware, it's a growing force via the Pixel phone, Google Home and its line of Chromebooks.

4. Academia tired of AI talent going to tech

Illustration: Rebecca Zisser/Axios

The shortage of AI talent is getting a lot of the humans in the field hot under the collar, Axios' Kaveh Waddell reports.

The problem, some say, is that what was once an important academic field is being stunted by the fact that all of the experts are heading off for industry.

The context: Demand for AI experts is through the roof, and supply can’t keep up.

  • Just 90,000 people worldwide have AI research skills, according to a February study from Element AI, making for intense demand for those who do possess the needed skills.
  • More than half of new AI-focused Ph.D.s take lucrative industry jobs after graduation, according to the Computing Research Association.
  • Top faculty members are being recruited by companies, too. University of Washington professor Ed Lazowska calls this a tragedy of the commons, because it chokes the supply of new AI experts, hurting academia and industry.

The bottom line: While far from a new conflict, the challenge is nonetheless an important one for a field that needs long-term thinking as much or more than incremental advances.

Go deeper: Kaveh has more here.

5. Take Note

On Tap

  • TechCrunch Disrupt wraps up in San Francisco.

Trading Places

  • Former AT&T Mobility CEO Ralph de la Vega is joining the board of smart cities startup Ubicquia as its vice chairman.


6. After you Login

What's old is new and what tried to be new is old news.