Schlagwort-Archive: amazon

Microsoft wants regulation of facial recognition technology to limit ‚abuse‘

Facial recognition put to the test
Facial recognition put to the test

Microsoft has helped innovate facial recognition software. Now it’s urging the US government to enact regulation to control the use of the technology.

In a blog post, Microsoft (MSFT)President Brad Smith said new laws are necessary given the technology’s „broad societal ramifications and potential for abuse.“

He urged lawmakers to form „a government initiative to regulate the proper use of facial recognition technology, informed first by a bipartisan and expert commission.“

Facial recognition — a computer’s ability to identify or verify people’s faces from a photo or through a camera — has been developing rapidly. Apple (AAPL), Google (GOOG), Amazon and Microsoft are among the big tech companies developing and selling such systems. The technology is being used across a range of industries, from private businesses like hotels and casinos, to social media and law enforcement.

Supporters say facial recognition software improves safety for companies and customers and can help police track police down criminals or find missing children. Civil rights groups warn it can infringe on privacy and allow for illegal surveillance and monitoring. There is also room for error, they argue, since the still-emerging technology can result in false identifications.

The accuracy of facial recognition technologies varies, with women and people of color being identified with less accuracy, according to MIT research.

„Facial recognition raises a critical question: what role do we want this type of technology to play in everyday society?“ Smith wrote on Friday.

Smith’s call for a regulatory framework to control the technology comes as tech companies face criticism over how they’ve handled and shared customer data, as well as their cooperation with government agencies.

Last month, Microsoft was scrutinized for its working relationship with US Immigration and Customs Enforcement. ICE had been enforcing the Trump administration’s „zero tolerance“ immigration policy that separated children from their parents when they crossed the US border illegally. The administration has since abandoned the policy.

Microsoft urges Trump administration to change its policy separating families at border

Microsoft wrote a blog post in January about ICE’s use of its cloud technology Azure, saying it could help it „accelerate facial recognition and identification.“

After questions arose about whether Microsoft’s technology had been used by ICE agents to carry out the controversial border separations, the company released a statement calling the policy „cruel“ and „abusive.“

In his post, Smith reiterated Microsoft’s opposition to the policy and said he had confirmed its contract with ICE does not include facial recognition technology.

Amazon(AMZN) has also come under fire from its own shareholders and civil rights groups over local police forces using its face identifying software Rekognition, which can identify up to 100 people in a single photo.

Some Amazon shareholders coauthored a letter pressuring Amazon to stop selling the technology to the government, saying it was aiding in mass surveillance and posed a threat to privacy rights.

Amazon asked to stop selling facial recognition technology to police

And Facebook (FB) is embroiled in a class-action lawsuit that alleges the social media giant used facial recognition on photos without user permission. Its facial recognition tool scans your photos and suggests you tag friends.

Neither Amazon nor Facebook immediately responded to a request for comment about Smith’s call for new regulations on face ID technology.

Smith said companies have a responsibility to police their own innovations, control how they are deployed and ensure that they are used in a „a manner consistent with broadly held societal values.“

„It may seem unusual for a company to ask for government regulation of its products, but there are many markets where thoughtful regulation contributes to a healthier dynamic for consumers and producers alike,“ he said.

https://money.cnn.com/2018/07/14/technology/microsoft-facial-recognition-letter-government/index.html

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June 2018 Tech News & Trends to Watch

1. Companies Worldwide Strive for GDPR Compliance

By now, everyone with an email address has seen a slew of emails announcing privacy policy updates. You have Europe’s GDPR legislation to thank for your overcrowded inbox. GDPR creates rules around how much data companies are allowed to collect, how they’re able to use that data, and how clear they have to be with consumers about it all.

Companies around the world are scrambling to get their business and its practices into compliance – a significant task for many of them. While technically, the deadline to get everything in order passed on May 25, for many companies the process will continue well into June and possibly beyond. Some companies are even shutting down in Europe for good, or for as long as it takes them to get in compliance.

Even with the deadline behind us, the GDPR continues to be a top story for the tech world and may remain so for some time to come.

 

2. Amazon Provides Facial Recognition Tech to Law Enforcement

Amazon can’t seem to go a whole month without showing up in a tech news roundup. This month it’s for a controversial story: selling use of Rekognition, their facial recognition software, to law enforcement agencies on the cheap.

Civil rights groups have called for the company to stop allowing law enforcement access to the tech out of concerns that increased government surveillance can pose a threat to vulnerable communities in the country. In spite of the public criticism, Amazon hasn’t backed off on providing the tech to authorities, at least as of this time.

 

3. Apple Looks Into Self-Driving Employee Shuttles

Of the many problems facing our world, the frustrating work commute is one that many of the brightest minds in tech deal with just like the rest of us. Which makes it a problem the biggest tech companies have a strong incentive to try to solve.

Apple is one of many companies that’s invested in developing self-driving cars as a possible solution, but while that goal is still (probably) years away, they’ve narrowed their focus to teaming up with VW to create self-driving shuttles just for their employees.  Even that project is moving slower than the company had hoped, but they’re aiming to have some shuttles ready by the end of the year.

 

4. Court Weighs in on President’s Tendency to Block Critics on Twitter

Three years ago no one would have imagined that Twitter would be a president’s go-to source for making announcements, but today it’s used to that effect more frequently than official press conferences or briefings.

In a court battle that may sound surreal to many of us, a judge just found that the president can no longer legally block other users on Twitter.  The court asserted that blocking users on a public forum like Twitter amounts to a violation of their First Amendment rights. The judgment does still allow for the president and other public officials to mute users they don’t agree with, though.

 

5. YouTube Launches Music Streaming Service

YouTube joined the ranks of Spotify, Pandora, and Amazon this past month with their own streaming music service. Consumers can use a free version of the service that includes ads, or can pay $9.99 for the ad-free version.

youtube music service

With so many similar services already on the market, people weren’t exactly clamoring for another music streaming option. But since YouTube is likely to remain the reigning source for videos, it doesn’t necessarily need to unseat Spotify to still be okay. And with access to Google’s extensive user data, it may be able to provide more useful recommendations than its main competitors in the space, which is one way the service could differentiate itself.

 

6. Facebook Institutes Political Ad Rules

Facebook hasn’t yet left behind the controversies of the last election. The company is still working to proactively respond to criticism of its role in the spread of political propaganda many believe influenced election results. One of the solutions they’re trying is a new set of rules for any political ads run on the platform.

Any campaign that intends to run Facebook ads is now required to verify their identity with a card Facebook mails to their address that has a verification code. While Facebook has been promoting these new rules for a few weeks to politicians active on the platform, some felt blindsided when they realized, right before their primaries no less, that they could no longer place ads without waiting 12 to 15 days for a verification code to come in the mail. Politicians in this position blame the company for making a change that could affect their chances in the upcoming election.

Even in their efforts to avoid swaying elections, Facebook has found themselves criticized for doing just that. They’re probably feeling at this point like they just can’t win.

 

7. Another Big Month for Tech IPOs

This year has seen one tech IPO after another and this month is no different. Chinese smartphone company Xiaomi has a particularly large IPO in the works. The company seeks to join the Hong Kong stock exchange on June 7 with an initial public offering that experts anticipate could reach $10 billion.

The online lending platform Greensky started trading on the New York Stock Exchange on May 23 and sold 38 million shares in its first day, 4 million more than expected. This month continues 2018’s trend of tech companies going public, largely to great success.

 

8. StumbleUpon Shuts Down

In the internet’s ongoing evolution, there will always be tech companies that win and those that fall by the wayside. StumbleUpon, a content discovery platform that had its heyday in the early aughts, is officially shutting down on June 30.

Since its 2002 launch, the service has helped over 40 million users “stumble upon” 60 billion new websites and pieces of content. The company behind StumbleUpon plans to create a new platform that serves a similar purpose that may be more useful to former StumbleUpon users called Mix.

 

9. Uber and Lyft Invest in Driver Benefits

In spite of their ongoing success, the popular ridesharing platforms Uber and Lyft have faced their share of criticism since they came onto the scene. One of the common complaints critics have made is that the companies don’t provide proper benefits to their drivers. And in fact, the companies have fought to keep drivers classified legally as contractors so they’re off the hook for covering the cost of employee taxes and benefits.

Recently both companies have taken steps to make driving for them a little more attractive. Uber has begun offering Partner Protection to its drivers in Europe, which includes health insurance, sick pay, and parental leave ­ ­– so far nothing similar in the U.S. though. For its part, Lyft is investing $100 million in building driver support centers where their drivers can stop to get discounted car maintenance, tax help, and customer support help in person from Lyft staff. It’s not the same as getting full employee benefits (in the U.S. at least), but it’s something.

Source: https://www.hostgator.com/blog/june-tech-trends-to-watch/

Alibaba and Amazon hit India

Source: https://www.economist.com/news/special-report/21730539-e-commerce-giants-are-trying-export-their-success-alibaba-and-amazon-look-go-global

IN SEPTEMBER 2014 Jeff Bezos announced his first big investment in India, hopping aboard a colourful bus in Bangalore. It was the start of a rapid $5bn investment in India, part of Mr Bezos’s plans to take Amazon global. Two months later Alibaba’s Jack Ma appeared in Delhi. “We will invest more in India,” he declared. The following year Alibaba put $500m into Paytm, an Indian digital-payments company. This year it led a fundraising round for Paytm’s e-commerce arm. The two giants seem set for an epic clash in India.

But in their home markets they have so far stayed out of each other’s way. Amazon has only a tiny business in China. Alibaba’s strategy in the United States has been to help American businesses sell in China and vice versa. “People always ask me, when will you go to the US?” says Alibaba’s CEO, Mr Zhang. “And I say, why the US? Amazon did a fantastic job.” The two firms have mostly invested in different foreign markets: Alibaba across South-East Asia and Amazon across Europe. But much of the rest of the world is still up for grabs.

The biggest tussles will probably be over growing economies and cross-border commerce. Alibaba aspires to serve 2bn customers around the world within 20 years—a benevolent empire that supports businesses. In some cases it has begun with digital payments, as in India with Paytm. In others it has invested in e-commerce sites, as with Lazada, in South-East Asia. But it intends to build a broad range of services within each market, including payments, e-commerce and travel services, and then link local platforms with Alibaba’s in China.

Mr Ma wants to enable small firms to operate just as nimbly as big ones on the global stage. Alibaba helps Chinese companies sell in places such as Brazil and Russia, and assists foreign firms with marketing, logistics and customs in China. Eventually it hopes to use its technology to link logistics networks around the world so that any product can reach any buyer anywhere within 72 hours. That is still a long way off, but it gives a glimpse of the company’s staggering ambition.

Amazon already earns more than one-third of its revenue from e-commerce outside North America. Germany is its second-biggest market, followed by Japan and Britain. This year it bought Souq, an e-commerce firm in the Middle East. Its criteria for expansion elsewhere include the size of the population and the economy and the density of internet use, says Russ Grandinetti, head of Amazon’s international business. India has been one of its main testing grounds.

Amazon, like Alibaba, also wants to help suppliers in any country to sell their products abroad. An Amazon shopper in Mexico, for instance, can buy goods from America. Mr Grandinetti sees such cross-border sales as an increasingly important component of Amazon’s value to consumers and sellers alike.

Yet both companies run the risk that strategies which did well in their home countries may not succeed elsewhere. In China, for instance, the popularity of e-commerce relied on a number of special factors. China’s manufacturers often found themselves with excess supplies of clothes and shoes; Alibaba provided a place to sell them. Alipay thrived because few consumers had credit cards. China has also benefited from having cheap labour and lots of big cities—more than 100 of them with over 1m people—creating a density of demand that made it worthwhile for logistics firms to build distribution networks.

As they expand, however, Amazon’s and Alibaba’s business models may shift and, in some markets, start to converge. So far the companies have differed in important ways. Amazon owns inventory and warehouses; Alibaba does not. But Alibaba has a broader reach than Amazon, particularly with Ant Financial’s giant payments business. As Amazon grows, it may become more like Alibaba. In India, for instance, regulations prevent it from owning inventory directly. And Amazon recently won a licence from the Reserve Bank of India for a digital wallet. Alibaba, for its part, may become more like Amazon. As the Chinese firm set its sights on South-East Asia, it invested in SingPost, Singapore’s state postal system. In September it became the majority owner in Cainiao, a Chinese logistics network, and said it plans to spend $15bn on logistics in the next five years.

Their advances may be slowed by other rivals. Smaller firms can flourish in niches. Flipkart, whose backers include Naspers and SoftBank, is competing fiercely with Amazon in India; the two companies routinely bicker over which has the bigger market share. Yoox Net-a-Porter, an online luxury-goods seller, is also expanding around the world.

Among the questions facing the two giants are whether other technology firms will pour more money into e-commerce, and what partnerships might emerge. Tencent’s WeChat Pay is already challenging Alipay in China. About one-third of WeChat’s users in China shop on that platform. Tencent is trying to recruit shops to accept its payment app in other countries, too, and recently took a stake in Flipkart. In deploying its services abroad, Tencent might get a helping hand from Naspers. The South African company owns about one-third of Tencent and has backed e-commerce firms around the world. Facebook is now muscling in on this business by making it easier for its users to buy goods through its messaging service as well as its other platforms, WhatsApp and Instagram.

The A-list still stands

For now, however, Amazon and Alibaba remain each other’s most formidable international rivals. Success in e-commerce requires scale, which needs lots of capital. Local e-commerce firms in India have come under pressure from investors to boost profitability. Amazon has no problems on that score. As Amit Agarwal, head of Amazon India, puts it: “We will invest whatever it takes to make sure we provide a great customer experience.”

Big firms also have a natural advantage as they expand, because technologies developed for one market can be introduced across many. “It’s like a Lego set,” says Lazada’s chief executive, Maximilian Bittner. He can use pieces of Alibaba’s model, such as algorithms for product recommendations, to improve Lazada’s operations. Amazon’s investments in machine learning have myriad applications anywhere in the world.

That does not mean that Amazon and Alibaba will dominate every country around the world, nor that they will crush every competitor. Bob Van Dijk, chief executive of Naspers, maintains there is room for many operators: “I don’t believe in absolute hegemony.” But given the two giants’ ambitions and the benefits of scale, they are bound to become more powerful and compete directly in more places. That has implications for all sorts of industries, but particularly the retail sector.

Amazon will continue to invest heavily in India

Amazon.com     Inc.     will     continue      investing  heavily  in  India,  the  chief   of its local operations said, dispelling  concerns of slower spending by the  US  e-commerce  company  after  its   chief financial officer Brian Olsavsky  said that while the India investments  were  starting  to  show  results,  they   had   hit   margins,   contributing   to    lower-than-expected  results  in  the   third quarter. “Not   at   all,”   Amazon’s   India   chief    Amit  Agarwal  said  in  an  interview   on   Monday   when   asked   whether    Amazon       would       slow       down        investments     in     India.     Amazon,      which  initially  said  it  would  invest   $2  billion  in  India,  had  said  in  June   that it would invest an additional $3  billion in the country. That investment is on track, Agarwal  said,  adding  that  the  company  is   “excited  about  the  momentum  that   we see in India”. “India is very early in its e-commerce  trajectory. Amazon is very early in its  e-commerce  trajectory  in  India.  To   transform how India buys is going  to take a long time; it will take a lot  of investment and… for many years.  This is just the beginning.” Amazon is betting big on its Prime  service in India and expects the  loyalty programme to dominate  sales in the coming months. “Prime continued to be the top seller  in all of October, not just for wave  one (of the Great Indian Festival).  Prime membership continues to  be a top seller and it is going to be  so going forward every month. My  belief is that Prime membership will  be the top seller every month based  on the trends that we are seeing,”  said Agarwal. On Monday, Amazon also said that  it witnessed record numbers during  its month-long Diwali sale event,  the Great Indian Festival, with sales  jumping 2.7 times from last year. This year’s Diwali sale has proven  to be the biggest showdown in the  history of Indian e-commerce, with  Amazon India and rival Flipkart  going all out to woo shoppers. While Flipkart claimed to outsell  Amazon India during the first leg of  the sale season, Amazon claims it  came back strongly during the latter  half of the sale season, with bigger  discounts in key categories such as  smartphones and large appliances. “October this year for us was 2.7  times of last year’s October—which  is incredible because last year was  4 times the October before,” said  Agarwal, adding that this growth  came even as “conversations”  suggested growth in India’s  e-commerce business was going to  be flat. Agarwal said that October could be  an inflection point for e-commerce  in India. “We had categories from  phones to Amazon Fashion to  appliances growing three to 11  times; even newer categories such  as luxury and beauty grew 46 times;  grocery and everyday consumables,  7.1 times; furniture, 11.8 times; gold  jewellery, eight times—so a lot of  these categories are showing robust  growth.” Agarwal said that 70% of the  company’s new customers in  October came from tier-II and tier-III  cities, adding that it was confident  of carrying the momentum from its  Diwali sale well into November and  December. Mint couldn’t independently verify  the numbers, but, in general,  all e-commerce marketplaces  (including Snapdeal, Amazon and  Flipkart’s smaller rival) did well in  October, carrying forward their  momentum from their annual sales. “When I look at the gaps between  the waves, our growth rates in those  gaps continued to the same extent.  We’re growing at 150% year-over- year. At peacetime, the growth rate  is still what I’m telling you. And as  we exit out of wave three (the third  sale event in October), we don’t see  a slowdown,” Agarwal said. “The broader e-commerce story is  not just a Flipkart-Amazon battle. Of  course, both Flipkart and Amazon  are trying to get a fair share of the pie  in key categories such as electronics,  fashion and large appliances. And  despite drags on margins, nobody is  going to reduce investments in India.  What you will see, however, is that  they will focus on innovation. For  example, during the festive season,  smartphone sales shot up and a lot  of the sales jumped due to things  like product exchanges. Another  new innovation was something like  Amazon Prime. So, you’ll see a lot of  that going forward,” said Sreedhar  Prasad, partner-e-commerce at  KPMG

Amazon has a secret plan to replace FedEx and UPS called ‚Consume the City‘

Amazon has been quietlybeefing up its own shipping logistics network lately.

Amazon CEO Jeff BezosAmazon CEO Jeff Bezos

Although Amazon publicly says it’s meant to complement existing delivery partners like FedEx and UPS, a new report by The Wall Street Journal’s Greg Bensinger and Laura Stevens says Amazon has broader ambitions.

Eventually, Amazon aims to build a full-scale shipping and logistics network that will not only ship products ordered from Amazon, but also will ship products for other retailers and consumers.

In other words, Amazon is looking to compete against delivery services like FedEx and UPS, the report says. Internally, some Amazon execs call the plan „Consume the City.“

Here are other new details around Amazon’s logistics plan, according to the report:

  • Amazon recently hired former Uber VP Tim Collins as VP of global logistics.
  • It recruited dozens of UPS and FedEx executives and hundreds of UPS employees in recent years.
  • Test trials for last-mile deliveries are running in big cities like Los Angeles, Chicago, and Miami.
  • The company also experimented with a program called „I Have Space“ to store Amazon’s inventory in warehouses owned by other companies.

On top of that, InternetRetailer.com recently reported that Amazon has hired Ed Feitzinger, the former CEO of UTi Worldwide, one of the largest supply chain management companies, as VP of global logistics. Add that to the fact that Amazon has now built facilities within 20 miles of 44% of the US population, and Amazon is starting to look like a real threat to existing logistics networks.

According to Baird Equity Research, Amazon is looking at a $400 billion market opportunity by launching all these initiatives. They could also help Amazon reduce some of its shipping costs, which have been increasing every year.

People in the industry are starting to take notice, too, according to Zvi Schreiber, the CEO of Freightos, an online marketplace for international freight.

„After dominating e-commerce and warehousing, Amazon is moving farther up the supply chain and eyeing the logistics sector from all angles, particularly looking to leverage technology, capital, and manpower to make logistics more efficient,“ Schreiber told Business Insider.

„Given their track record of disrupting industries — from retail to warehousing and e-commerce fulfillment to cloud computing — the trillion-dollar freight industry is certainly tracking Amazon nervously.“

http://www.businessinsider.de/amazon-secret-plan-replace-fedex-ups-called-consume-the-city-2016-9

Facebook Is Not a Technology Company

At the close of trading this Monday, the top five global companies by market capitalization were all U.S. tech companies: Apple, Alphabet (formerly Google), Microsoft, Amazon, and Facebook.

Bloomberg, which reported on the apparent milestone, insisted that this “tech sweep” is unprecedented, even during the dot-com boom. Back in 2011, for example, Exxon and Shell held two of the top spots, and Apple was the only tech company in the top five. In 2006, Microsoft held the only slot—the others were in energy, banking, and manufacture. But things have changed. “Your new tech overlords,” Bloomberg christened the five.

But what makes a company a technology company, anyway? In their discussion of overlords, Bloomberg’s Shira Ovide and Rani Molla explain that “Non-tech titans like Exxon and GE have slipped a bit” in top valuations. Think about that claim for a minute, and reflect on its absurdity: Exxon uses enormous machinery to extract the remains of living creatures from geological antiquity from deep beneath the earth. Then it uses other enormous machinery to refine and distribute that material globally. For its part, GE makes almost everything—from light bulbs to medical imaging devices to wind turbines to locomotives to jet engines.

Isn’t it strange to call Facebook, a company that makes websites and mobile apps a “technology” company, but to deny that moniker to firms that make diesel trains, oil-drilling platforms, and airplane engines?

Part of the problem has to do with the private language of finance. Markets segment companies by industry, and analysts track specific sectors and subsectors. Exxon is an energy industry stock, while GE straddles energy, transportation, public utility, healthcare, and finance. The “technology” in the technology sector is really synecdoche for “computer technology.” Companies in that sector deal in software, semiconductors, hardware manufacturing, peripherals, data processing services, digital advertising, and so forth.

“Technology” has become so overused … that the term has lost all meaning.

For the NASDAQ exchange, where most so-called technology companies are traded, those industries are based on the Industry Classification Benchmark (ICB), a classification system developed by the London Stock Exchange’s FTSE Group. The ICB breaks the market down into 10 industries, each of which is broken down further into supersectors, sectors, and subsectors. The ICB technology industry counts “Internet” as a subsector of “Software & Computer Services,” for example. Companies are assigned to sectors and subsectors based on the (largest) source of their revenue (thus, GE is considered an energy company).

A company like Microsoft fits squarely into Technology, Software & Computer Services, because that’s where the majority of its revenue derives. Likewise, Apple is a traditional ICB “technology” company, in the sense that it makes most of its money from selling computer hardware. But the other companies in Bloomberg’s Monday top five are technology companies in a mostly vestigial way.

Almost all of Google’s and Facebook’s revenue, for example, comes from advertising; by that measure, there’s an argument that those firms are really Media industry companies, with a focus on Broadcasting and Entertainment. Of course, Alphabet is a lot like GE, or at least it aspires to be, with its investments in automotive (Self-Driving Car Project), health care (Calico), consumer goods (Nest), utilities (Fiber). But the vast majority of its revenue comes from Google’s ad business.

Amazon generates a lot of revenue from its Amazon Web Services (AWS) business—perhaps as much as $10 billion this year. It also derives revenue from manufacturing and selling computer hardware, like the Fire and Kindle. But thevast majority of Amazon’s revenue comes from international sales of consumer goods. Amazon is sort of a tech company, but really it’s a retailer.

A day later, at the close of the markets Tuesday, August 2, the tech sweep was already history. Exxon Mobil had pushed Facebook out of position five, topping the, uh, online broadcast media company’s $352 billion market cap by $8 billion, or 2 percent. Warren Buffett’s conglomerate Berkshire Hathaway also closed Tuesday at $354 billion in total value. Among Berkshire Hathaway’s top revenue drivers are insurance, manufacturing, and the obscure but ubiquitous McClane Company, which provides supply-chain management and logistics services for the grocery industry. It brought in $28 billion in revenue last year, or about $10 billion more than Facebook. Johnson & Johnson, which sells consumer and industrial health products from Actifed to Zyrtec, wasn’t far behind, with a $345 billion market capitalization at the close of business Tuesday.

Every industry uses computers, software, and internet services. If that’s what “technology” means, then every company is in the technology business—a useless distinction. But it’s more likely that “technology” has become so overused, and so carelessly associated with Silicon Valley-style computer software and hardware startups, that the term has lost all meaning. Perhaps finance has exacerbated the problem by insisting on the generic industrial term “technology” as a synonym for computing.

There are companies that are firmly planted in the computing sector. Microsoft and Apple are two. Intel is another—it makes computer parts for other computer makers. But it’s also time to recognize that some companies—Alphabet, Amazon, and Facebook among them—aren’t primarily in the computing business anyway. And that’s no slight, either. The most interesting thing about companies like Alphabet, Amazon, and Facebook is that they are not (computing) technology companies. Instead, they are using computing infrastructure to build new—and enormous—businesses in other sectors. If anything, that’s a fair take on what “technology” might mean as a generic term: manipulating one set of basic materials to realize goals that exceed those materials.

http://www.theatlantic.com/technology/archive/2016/08/facebook-is-not-a-technology-company/494183

lower-cost gadgetry that lasts a lot longer could be a dire omen for high-margin hardware companies like Apple

This week, Intel CEO Brian Krzanich announced that people are keeping their PCs a lot longer before upgrading: The average has increased from four years to as many as six.

The tablet-refresh cycle isn’t much shorter than that, to Apple’s eternal chagrin. Even iPhone sales have started to taper off, partly because people are keeping their phones longer or choosing cheaper Android phones.

What’s happening is pretty simple. The hardware and the software running on any device itself have become way less interesting than the web apps and services, like the ones that Google and Amazon have made the core of their business.

Why buy a $700 iPhone when a $200 Android phone can access the same YouTube or Amazon Music as everyone else? All you need to do to get new Facebook features is refresh your browser or update your app. You don’t need a high-performance device to participate in the 21st century.

It’s a stark contrast with the traditional model for consumer electronics, where you’re expected to upgrade the hardware to keep pace with the new features they release.

And it could be a dire omen for high-margin hardware companies like Apple.

Meanwhile, web-first companies like Amazon and Google are more than happy to exploit this, even as our notions of what a computer actually is continue to shift. Just look at devices like Google Chromecast and the Amazon Echo.

Chromecast, Echo, case in point

Since 2013, Google has sold 25 million Chromecast devices — the completely amazing $35 dongles that turn any TV into a smart TV. That’s right, $35.

The real brilliance of the Chromecast lies in what it isn’t, rather than what it is. It doesn’t have an interface of its own. You just push a button on your phone and have whatever YouTube video you’re watching or Spotify album you’re listening to appear on your TV screen.

A nice side effect: It’s relatively simple to take an existing smartphone app and add Chromecast streaming capabilities, and literally tens of thousands of apps have done that integration.

You don’t have to think about it or learn a new interface; you just click and go.Mike George Amazon VP of EchoGettyAmazon VP of Echo Mike George.

It means that every single day, I get more return on the initial $35 investment in the Chromecast I bought in 2014. But since all of the good stuff is happening in the apps, not the Chromecast itself, it’s extremely unlikely that I will ever have to replace this Chromecast, barring a hardware malfunction.

You could probably say the same thing about the Amazon Echo home voice assistant. Developers have released almost 1,000 „skills“ for the Amazon Echo’s Alexa platform, including the ability to call an Uber, play Spotify music, or order a Domino’s pizza.

These gadgets are getting better, not worse, the longer they stay on shelves. And while there may be periodic minor hardware improvements, they’re way more minor than the gap between an iPhone 5 and an iPhone 6, and far less necessary to keep getting maximum value from the device.

The pressure is on

This move is going to keep putting pressure on hardware-first manufacturers — especially those who rely on high margins, like Apple.

The Chromecast and the Echo are relatively cheap gadgets — because all the important, useful stuff about them lives in the cloud, they’re optimized to be small, efficient, and unobtrusive.

Tesla autopilotTeslaTesla’s autopilot mode scanning the road.

Amazon doesn’t need to make money on the Echo itself, as long as it drives more commerce to its retail business. Same with Google: as long as the Chromecast gets more people to watch YouTube videos and download more stuff from Google Play, they don’t have to make money from the gadget itself.

And you’re seeing more of this all over, like when Tesla made thousands of its electric cars partially self-driving with an overnight software update. The gadget Tesla drivers already owned — in this case a car — suddenly got way more useful.

This trend isn’t going to kill off the smartphone, or the PC, or the tablet. But it means lower-cost gadgetry that lasts a lot longer. We’re only seeing the early stages of this shift now, but it has a lot of potential to shake up how we think about and how we buy our devices.

www.businessinsider.de/apple-iphone-vs-web-services-2016-6