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November 02, 2018

Be sure to check out Axios on HBO, which debuts this Sunday evening at 6:30pm.

1 big thing: Tech's battle over SF homelessness

An illustration of shadows pointing fingers and struggling to deal with a homeless person

Illustration: Sarah Grillo/Axios

An upcoming ballot measure that would tax large businesses is pitting San Francisco tech leaders against one another. It's also highlighting differences among the industry’s leaders over how business principles should shape civic spending, Axios Kia Kokalitcheva reports.

Details: Proposition C would add a tax of between 0.175% and 0.690% on San Francisco businesses with at least $50 million in gross receipts or more. The proceeds would exclusively be used towards combating homelessness.

  • If passed, the measure is expected to raise about $300 million in 2019, roughly doubling the city’s current spending on homelessness.

Proponents say San Francisco’s homelessness crisis is dire and the city needs more funds and resources — and rich businesses should help more.

  • “This is a crisis of inequality — we have over 70 billionaires in San Francisco,” Salesforce CEO Marc Benioff told Axios’ Dan Primack on Wednesday. “We’re fighting over pennies,” added Benioff, whose company is the largest private employer in San Francisco.
  • Benioff also told the Guardian that the mayor recently ask him to personally donate $8 million for a shelter, illustrating the city's need for more money to help the homeless.
  • Some also say that large tech companies — like Square — have not paid their fair share to the city after receiving advantageous tax breaks that helped them hire aggressively, aggravating the city's housing crisis.

Opponents say San Francisco already spends a lot on the issue — and since the problem persists, the city should get a better plan instead of throwing more money at it.

  • Opponents of the measure point to what they see as already significant amounts the city spends on homelessness, but supporters say much of its existing budget on the issue goes to housing subsidies and helping people keep their homes (such as fighting evictions), rather than to services for the homeless.
  • The San Francisco Chamber of Commerce argues passage of Prop C will result in job loss (city economist Ted Egan had predicted a loss of 725 to 875 jobs annually). Others, like Square and Twitter CEO Jack Dorsey along with Stripe’s co-founders, point to the mayor’s opposition to the measure.
  • Dorsey has pointed out that financial services companies like Square and Stripe would get taxed more ($20 million for Square) than software companies like Salesforce (about $10 million), even though Salesforce is much larger.

Go deeper:

2. Intel looking to score with VR sports

A producer edits one of Intel's TrueView 360-degree immersive highlights

A producer edits a 360-degree highlight. Photo: Ina Fried/Axios

As 49ers quarterback Nick Mullens threw for his first NFL touchdown Thursday night, a 2-man video crew from Intel was scrambling to create a 360-degree highlight so that Fox could broadcast it minutes later.

The immersive highlight is the latest evolution of technology Intel has been working on for the past couple of years, beginning with its 2016 purchase of Israel's Replay Technologies.

Since then, Intel has sped up the time it takes to make its clips. It's also added a new option to show a highlight from any player's point of view, in addition to the signature view, which freezes the action and rotates 360 degrees for a panoramic image.

  • Fun note: For the second 49ers touchdown, minutes later, the crew decided to go with Mullens' point-of-view as he scanned the receivers before throwing to his eventual target.

Details: Intel's cameras are in 13 NFL stadiums (up from 10 last year), and it serves up highlights to broadcasters and teams as well as a dedicated page on

  • The company is also pushing ahead with another technology, TrueVR, that enables sports to be viewed in virtual reality, though the company has slowed its ambitions a bit as VR headset use has failed to live up expectations.

Why it matters: Intel has bet big on sports, with then-CEO Brian Krzanich telling Axios last year that he saw it as a potential billion dollar business in the coming years.

Yes, but: It's far from that point yet, with Intel and its rivals, as well as teams and leagues, still trying to find the right experiences that can either significantly complement, or be a viable alternative to, traditional TV broadcasts.

James Carwana, VP of Intel Sports, likens where the current state of his business to the early days of Netflix, when it was sending out DVDs through the mail, rather than streaming original content.

"I would argue we are in a similar phase," Carwana tells Axios.

3. Apple plans to be less specific in the future

Apple CEO Tim Cook this week at a product launch event in Brooklyn.

Apple CEO Tim Cook this week at a product launch event in Brooklyn. Photo: Stephanie Keith/Getty Images

The most shocking thing in Apple's earnings report wasn't the numbers it reported, or even its holiday outlook, but rather a coming change in how detailed Apple gets in its report.

Why it matters: The company has long avoided going into too much detail about which models are most popular, but at least it said how many Macs, iPhones and iPads were sold each quarter. Starting next quarter, it won't even give that level of detail.

What they're saying:

  • BTIG Research analyst Walter Piecyk (per Reuters): “Companies typically stop reporting metrics when the metrics are about to turn. This is not a good look for Apple.”
  • Loup Ventures' Gene Munster: "The new reporting methodology is Apple's attempt to get investors to think of their entire business as a service (including hardware). ... Unit metrics have made it easier to model Apple's traditional hardware business, but Apple is no longer a traditional hardware business."
  • CNET's Shara Tibken: Apple "won't detail unit sales for its iPhones and other devices anymore. This is likely because units are falling while revenue is rising. It's raising prices on all devices but not selling as many units of them."

The bottom line: Apple's actual results showed strong sales and earnings, though the number of iPhone units was lower than some analysts were forecasting. As for the holiday quarter, Apple forecast sales of between $89 billion and $93 billion, somewhat lower than what some analysts had been anticipating.

By the numbers (with year-over-year change):

  • iPhone units 46.9 million (flat)
  • iPhone revenue $37.2 billion (up 29%)
  • iPad units 9.7 million (down 6%)
  • iPad revenue $4.1 billion (down 15%)
  • Mac units 5.3 million (down 2%)
  • Mac revenue $7.4 billion (up 3%)

4. Google employees walk out

Google employees stage a walkout Thursday over handling of sexual harassment issues

Photo: Niall Carson/PA Images via Getty Images

Google employees at offices around the globe walked out on Thursday in protest of how the company has handled sexual harassment and other issues.

What's happening: Organizers, who estimate 17,000 workers took part in the job action, listed 5 main goals for the walkout:

  1. An end to forced arbitration in cases of harassment and discrimination for all current and future employees.
  2. A commitment to end pay and opportunity inequity.
  3. A publicly disclosed sexual harassment transparency report.
  4. A clear, uniform, globally inclusive process for reporting sexual misconduct safely and anonymously.
  5. An elevation of the chief diversity officer so that person reports directly to the CEO and make recommendations directly to the board of directors. Plus, the appointment of an employee rep to the board.

The context: The protest comes in the wake of an explosive New York Times story detailing several instances where executives continued to work for Google or were given large exit packages despite credible evidence of sexual harassment or assault.

5. Opposition to merger of T-Mobile and Sprint

T-Mobile US CEO John Legere and Sprint Executive Chairman Marcelo Claure.

T-Mobile CEO John Legere and Sprint executive chairman Marcelo Claure. Photo: Alex Wong/Getty Images

Outside lobbying groups and competitors are ramping up their attacks on T-Mobile's proposed acquisition of Sprint, Axios' David McCabe reports.

The big picture: Wednesday marked a key deadline for comments at the Federal Communications Commission about the merger, which would bring the number of major U.S. wireless carriers from four to three.

  • The Communication Workers of America, the union that represents many wireless industry employees, launched a website arguing that the merger will cost jobs.
  • A non-profit group called Consumer Choice Alliance is launching a digital campaign arguing that the deal "could give countries like Saudi Arabia, China, Germany, and Japan direct access to our networks through the use of foreign-made networking equipment and billions of foreign money." Sprint is owned by Japanese powerhouse SoftBank, which has extensive connections to Saudi Arabia.
  • Yes, but: Consumer Choice Alliance wouldn't tell Axios who is providing its funding.

Go deeper: David has more here.

6. Take Note

On Tap

Trading Places

  • Doreen Bogdan-Martin was elected director of the telecommunication development bureau of International Telecommunications Union, making her the first female to serve as one of the standards-setting body's top elected officials.
  • Sonos co-founder John MacFarlane, who has been teaching high school computer science for the past year, said he is permanently leaving the music hardware company and will continue teaching.


7. After you Login

We at Login spend a lot of time talking about the downsides of social media. But in yesterday's Pro Rata podcast, my colleague Dan Primack highlighted an example of something good on Twitter.