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Silicon Valley shelters in place
Good morning! This Tuesday, the Bay Area heads into weeks-long isolation, Apple gets slapped with a huge fine, and startups pitch investors in a whole new way.
Don't forget to register for our first Virtual Meetup this Thursday! I'll be chatting with Protocol's Lauren Hepler and others about the future of work — for tech execs, gig workers, and everyone else. Hope to see you there!
Today In Coronavirus
Let's talk about this first, in light of the announcement that six Bay Area counties have been asked to shelter in place for the next three weeks.
Here's what happened today: Tesla's staying open, in defiance of the lockdown. Uber suspended pooled rides in the U.S. and Canada. Uber Eats waived delivery fees for restaurants suddenly reliant on delivery and takeout — and started delivering free meals to health care workers and first responders. Peloton is offering 90-day free trials to people who need a new way to work out. Amazon's planning to hire 100,000 people to help keep up with demand. YouTube is leaning into AI moderation, and warning creators that it won't go perfectly. NBCUniversal is going to start releasing some movies on demand the same day they go into theaters. China has given its internet police more authority to censor coronavirus speech. Israel will now track the phones of people with the virus. School shutdowns are exposing a huge internet inequality among American students. Workday promised employees a bonus worth two weeks' pay to help during the lockdown. The FDA approved the first commercial tests for the virus. And that Google website we've been talking about? Still coming, just … later.
We're all self-isolating for a few weeks, and hope you are, too, if you're able. Stay safe out there.
People Are Talking
Big tech is working together to combat coronavirus. Here's what Facebook, Google, LinkedIn, Microsoft, Reddit, Twitter and YouTube say they're doing together:
- "We are working closely together on COVID-19 response efforts. We're helping millions of people stay connected while also jointly combating fraud and misinformation about the virus, elevating authoritative content on our platforms, and sharing critical updates in coordination with government healthcare agencies around the world. We invite other companies to join us as we work to keep our communities healthy and safe."
Coronavirus gives remote employees a chance for a different kind of work, said Nreal's lead product manager Wei Lyu:
- "You have more time to think about something. We encourage a lot of research, a lot of thinking to take advantage of the phase of the coronavirus."
- Don't miss Janko Roettgers' story on Nreal, which is taking on Magic Leap — with a lot less funding and a much cheaper device.
Nobody knows what's going to happen next, Sheryl Sandberg said:
- "This is not going to [be] business as usual, and the marketing industry is certainly going to see a real impact. I don't think anyone knows how big. So we're going to watch and look."
It's easier for Facebook to moderate content when it's pandemics and not politics, Mark Zuckerberg believes:
- "When you're dealing with a pandemic, a lot of the stuff we're seeing just crossed the threshold. So it's easier to set policies that are a little more black and white and take a much harder line."
The Big Story
Keeping America online
The FCC — which has spent the last several years deregulating the internet industry as hard and fast as it possibly can — is now pushing wireless carriers and ISPs to help keep users online.
The FCC recently rolled out the Keep Americans Connected Pledge amid the coronavirus pandemic, which requires any company that signed on to take several steps to get more people more internet.
- Companies promise to not terminate anyone's service, to waive late fees, and to open Wi-Fi hot spots to "any American who needs them," all for at least the next 60 days."
- A huge number of companies signed on immediately. Comcast, one of the early sign-ups, told me it was already working on a number of these initiatives, and has been glad to see the FCC try to establish a level playing field across markets and carriers.
- Another 116 companies made the pledge on Monday, bringing the total to 185.
- Waiving data caps wasn't part of the pledge — though FCC commissioner Jessica Rosenworcel and others said it should be. A number of ISPs are doing it anyway.
Alongside the pledge, a handful of companies have made specific efforts to provide internet access for low-income and rural users. T-Mobile, Comcast, Spectrum and others have all made their inexpensive internet services faster and more accessible.
- Comcast is offering 60 free days of service to new customers of its Internet Essentials package for low-income users. It's also increasing the speed of the service.
- Meanwhile, any household with a student can get 60 days of free service from Spectrum or Altice. The companies are also partnering with schools to help get connectivity to those who need it.
There are some interesting long-term questions here, like whether we need to revisit the question of internet as a public utility and how long these changes will last. But so far, ISPs seem to be doing the right thing to make sure the internet stays up and people stay on it.
JOIN US ON THURSDAY
Our job is to help you — tech and business executives — do your job. Join our weekly Protocol Virtual Meetup on what we are seeing across the tech landscape. The first will be this Thursday at noon Pacific/3 p.m. Eastern.
What a $1.2 billion fine means to Apple
It was a rough Monday for Apple. Its stock dropped nearly 13% amid the latest coronavirus selloff — and France's competition authority, the Autorité de la Concurrence, also picked the day to hit the company with a $1.2 billion fine for antitrust violations.
That's the highest penalty ever imposed by the French regulator, not to mention the second fine it's levied against Apple in the last two months. Though the 25 million euros for Apple allegedly slowing down older iPhones pales in comparison to this one.
The French investigation has been running nearly a decade, and its findings are pretty damning:
- The Competition Authority alleges Apple and two wholesalers agreed to fix prices on Macs and iPads. (But not iPhones, oddly enough.) That meant resellers couldn't compete with each other, or with Apple.
- The ruling also contends that Apple abused its power over "premium" sellers, restricting their ability to run sales or promotions, and limiting their supply of products. In doing so, Apple was able to keep prices nearly the same in these shops as in the Apple Store.
- "The cartel also led to the elimination of competition between the two wholesalers themselves, as well as between the wholesalers and Apple," the investigation found. "It also limited competition between final retailers by preventing them from taking advantage of competition among wholesalers upstream."
Apple says it plans to appeal the decision, and blamed it all on old practices.
But does it matter? In the past, fines like this one have done little to dent any tech companies' profits, when they've even been paid at all. Qualcomm and Google have also been hit recently with fines from European regulators; while the U.S. antitrust investigation drags on, Europe continues to press harder.
A new spin on the startup pitch
Y Combinator held its famous Demo Day on Monday — but this one was totally unlike any other. Rather than have teams hop on stage and spend two minutes presenting their company to investors and strangers, the whole system went digital in a really clever way:
- On Monday morning, an invitation-only website went live with a list of all the current YC startups. Each list item included a name, brief bios of the founders, and a single slide with information about the company. Potential investors could sort by category and location, or just breeze through the list — there were even keyboard shortcuts for quick triaging.
- If an investor was interested in a startup, they clicked "Like" and were automatically connected to the founders by email. Ultimately, Demo Day has always just been speed dating for startups and investors — this just turned the whole concept up to 11.
Switch Ventures founder Paul Arnold told Protocol's Biz Carson he missed the social interaction — both with founders and other VCs — but found it a more efficient process, particularly for those investors who research startups ahead of time. "It's not clear that sitting through the presentations does a lot of value if you've already done your homework anyways," he said.
Even in these uncertain times, there was also a bit of sticker shock. Arnold found the deal terms "jarring" given the backdrop of a plunging market. Some companies he spoke to were asking for $10 million valuations out of the gate. "That's tough in a great market," Arnold told Biz. "And when the sky is falling, it's hard to make sense of that."
Are you an investor or startup founder? What'd you think of the new Demo Day? Let me know: email@example.com.
Number Of The Day
That's how many coronavirus-related articles are in a new dataset compiled by a number of groups and given to the White House Office of Science and Technology Policy. The OSTP's goal: to create a huge, machine-readable dataset that AI experts and companies can use to answer all manner of questions about the virus. The idea is to figure out what we already know about the virus, so we can figure out how to move forward more quickly. And there are cash prizes for those who answer key questions.
In Other News
- A study says Tesla is way behind in self-driving. Navigant Research's latest report says Waymo is leading the race to autonomy, followed closely by Ford, Cruise, and Baidu. (Big win for Detroit automakers to be included on this list!) Tesla came in dead last, by a wide margin. "The performance of its systems remains inconsistent and its products do not match its proposed mobility business model," Navigant said.
- In better Tesla news: The Model Y is being delivered to customers ahead of schedule.
- Impossible Foods raised a massive $500 million round of funding, which it'll use to expand manufacturing and distribution. Impossible has been saying for a while that its biggest challenge is expanding to meet demand — now it has a serious war chest to do so.
- Service, a travel startup, is shutting down this week. CEO Michael Schneider said the company was in talks to be acquired, but that fell apart on Friday due to coronavirus.
- A bunch of tech execs got on a conference call last week to talk about how to spend their money and resources fighting coronavirus, CNBC reported. They discussed everything from projects they could fund to how they could repurpose their buildings to help.
One More Thing
Smells like … computer chips
We still don't understand much about how the human brain works. But we do know a bit about how it processes smells — and we're getting closer to replicating that. Researchers at Cornell and Intel have created a new kind of neuromorphic chip, modeled on the structure of the human brain, that was able to distinguish between 10 different smells. This is a big deal both for this type of chip in general, and for the idea that we might actually be able to use electronic devices to better sniff out danger — like bombs or noxious fumes.
Thoughts, questions, tips? Send them to me, firstname.lastname@example.org, or our tips line, email@example.com. Enjoy your day, see you tomorrow.