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Biden takes on the chip shortage

Chips

Good morning! This Thursday, GameStop's going nuts again, but we're not going to talk about that. Instead, a look at the Biden administration's early plan to fix the chip shortage, how Facebook is learning to plan for the worst, and the tech world's sad farewell to Fry's.

Also, listen to the latest Source Code podcast, with Citizen CEO Andrew Frame. We talked about privacy, security, fighting COVID-19 and what it means to keep people safe online. It was a fun one.

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The Big Story

America goes on a chip run

The last 12 months have made terrifyingly clear how fragile the global supply chain really is, and the U.S. wants more of it on its own shores.

Joe Biden signed an executive order yesterday "to help create more resilient and secure supply chains for critical and essential goods," the White House said in a statement.

  • It kicks off a 100-day review of the supply chains for health care APIs, "critical minerals," semiconductors and advanced packaging, and large capacity batteries.
  • It also starts a year-long investigation into supply chains across six sectors: defense, public health, communications technology, energy, transportation and food production.

The chip shortage seems to have really set alarms off inside the government. This isn't just a problem for wannabe F-150 owners; it's a sign of things to come, and a wake-up call to countries that now know exactly how dependent they are on foreign manufacturing for everything from laptops to cars to mission-critical infrastructure.

  • "Right now, semiconductor manufacturing is a dangerous weak spot in our economy and in our national security," Sen. Chuck Schumer said this week. "That has to change. We cannot rely on foreign processors."
  • Biden held up a chip during his press conference, explaining how many billions of transistors it had. (It was one "aluminum" away from feeling like an Apple keynote.) And he said that "we need to stop playing catch-up … we need to prevent the supply chain crisis from hitting in the first place."
  • Things are moving quickly: The director of America's de facto embassy in Taiwan reportedly met dozens of Taiwanese chip executives today to encourage closer partnerships and investment in the U.S.

Biden never said "this is about China," but he may as well have. Here's what he did say: "We shouldn't have to rely on a foreign country, especially one that doesn't share our interests or our values, in order to protect and provide for our people during a national emergency."

  • One law you're about to hear a lot about is the CHIPS for America Act, which includes billions of dollars in federal funding for semiconductor and advanced packaging research. It was eventually appended to the defense bill that passed last year. And it would be one way for the Biden administration to quickly start the wheels turning on this front.

Leadership

What's the worst that could happen?

The optimists always win. At least, that's what you hear in tech circles. But if the last few years have taught the industry anything, it's that even optimists should spend more time asking what could go wrong.

  • "We haven't really always done the homework upfront" and thought about what "bad actors" might do with new tech, Facebook CTO Mike Schroepfer said during an interview with the Oxford Union this week. (Facebook told CNBC he was talking about the tech industry as a whole, not just Facebook. Which, OK, sure.)
  • Doing better requires changing the way you build and run your team, he said. "We've learned that technologists need to anticipate the harms, misuses and consequences of the things we're building, while they're being built, not after. That requires much closer collaboration with diverse sets of experts in fields far beyond science and engineering."
  • It's the classic internet conundrum, really: Giving everyone tools and access means giving bad guys tools and access. Is the upside worth the downside? The only way to know is to understand both.

Planning for the worst is crucial at the beginning of the development of any product. But that's hard when you're scrambling to keep the lights on. "In the first five years or so at Facebook, honestly a lot of our focus was just trying to keep up with scaling the site," Schroepfer said. But there's a balance to be struck between worst-case thinking and pushing things forward.

  • "There would be no innovation if people were just fixated on worst-case scenarios," Andrew Frame, the CEO of Citizen, said on this week's Source Code podcast. "On any product, we can think about worst-case scenarios. And of course, there are valid reasons. But it's not going to stop you from building something great."
  • Schroepfer said the same: "It's important for us all to be real about the risks, but still be optimistic about the better future we can build."

RIP

Fry's is done

Anna Kramer writes: Fry's Electronics has finally passed on from this world, and oh, how Silicon Valley will miss thee. If there's an afterworld for dead businesses, Fry's will have a place of honor there.

Fry's was yet another victim of COVID-19 and the resulting economic crisis, and was forced to close its doors for good because it just couldn't see a path forward. Some of its stores were so random I'm honestly surprised it lasted this long. (If you never knew Fry's, the one in Burbank was sci-fi themed and had a faux UFO crashing into the front.)

  • GitHub's Erica Joy Baker recalled how much the place used to meet the most random of needs. "No more 'I have an unexpected yet urgent need for a switch and four 100' cat6 cables and also a giant pack of haribo golden bears,' runs," she wrote.
  • One engineer called it "THE PLACE to get electronics you couldn't find anywhere else." Another remembered how he used to spend all of his savings there in his 20s.

Ironically, some of the people who loved the place the most are probably also the ones who helped kill it. All that wonderful technological innovation means we can buy all of our hardware online, making Fry's just another casualty to ecommerce. Thanks a lot, internet.

A MESSAGE FROM AMAZON

Amazon

In 2018, Amazon established a $15/hr start wage for all their U.S. employees, which is more than double the federal minimum wage of $7.25/hr. They've seen the positive impact on their employees and their families. That's why they're calling on Congress to pass the Raise the Wage Act.

People Are Talking

When the Turkish government asked Facebook to block a Syrian group it didn't like, Sheryl Sandberg sent one of those one-line emails people are going to remember:

  • "I am fine with this."

On Protocol | Enterprise: Salesforce manager Vivianne Castillo quit, telling colleagues it was down to the company's culture:

  • "I'm leaving because I can no longer subject myself to the level of self-neglect required to endure a culture of rampant microaggressions and gaslighting that lead to the lack of psychological & emotional safety that I feel and experience as a Black woman at Salesforce."

Want to build a remote company? Stop your execs from going to the office, Brian Armstrong said:

  • "Even after people can safely return to offices, the executive team has no plans to be 'in-office' on a regular basis, and none of them currently live in San Francisco. This is one of the most powerful things we can do to keep Coinbase from inadvertently returning to an in-office culture."

On Protocol | Enterprise: Companies coming to cloud now need a bit more help than the early adopters, Microsoft's Alysa Taylor said:

  • "When you talk about digital transformation, it's an iterative process. It's not one [where] you're going to rip and replace all your back-end systems."

The Bitcoin-promoting Twitterverse is a big problem, Klarna's Sebastian Siemiatkowski said:

  • "If I would take Klarna stock and advertise it with similar writing I would get a fine or I would even be put to jail. I am very surprised why regulators aren't chasing these elements."

Making Moves

HP is buying HyperX for $425 million. The gaming-accessory market is nuts right now.

Fidji Simo and Barry McCarthy are both joining Instacart's board, as it beefs up ahead of a likely IPO.

Rick Klau is California's new chief technology innovation officer, after leaving Google last year.

Rajeev Suri is the new CEO of Inmarsat. He previously ran Nokia for more than a decade.

Mike Hanley is GitHub's new (and first) chief security officer. He was previously Cisco's CISO.

Zhu Wenjia is TikTok's new global head of R&D, Reuters reported. Zhu, who was previously head of ByteDance's Jinri Toutiao news app, will report directly to ByteDance CEO Zhang Yiming.

Jerry Bruckheimer is joining the board at esports company Skillz. The esports business continues to look less like professional sports and more like entertainment, and this is some serious Hollywood firepower.

In Other News

  • On Protocol | Policy: A Bloomberg-backed company is building campaign tools for the left and right. Tech co. is backed by Mike Bloomberg's daughter, Emma, and has been quietly buying political tech firms and going on a hiring spree.
  • Australia passed its News Media Bargaining Code, meaning Facebook and Google will now have to pay for news in the region. Facebook's Nick Clegg wrote a blog post aiming to answer "what on Earth was all that about?"
  • Facebook banned the Myanmar military, and blocked its commercial and media entities from advertising on the platform. "The risks of allowing the Tatmadaw on Facebook and Instagram are too great," Facebook's Rafael Frankel said.
  • On Protocol: Dispo is the hottest app in the world right now, and it might have a real shot at becoming huge — it's already raised at a reported $200 million valuation.
  • Adam Neumann might leave WeWork's board for a year as part of his legal settlement with SoftBank, Bloomberg reported. It's not all bad for Adam, though: SoftBank will reportedly pay him $50 million more than other shareholders, and extend his $430 million loan by five years.
  • Facebook and Twitter will have to take down unlawful content more quickly, India's government said. New content rules will also be imposed on streaming services.

One More Thing

Zoom fatigue: it's science

It's not just you. Spending all day on Zoom turns out to be legitimately tiring. A Stanford study found four reasons why video chats are more exhausting than face-to-face meetings: too much eye contact, too much seeing yourself, too little movement and too much mental work keeping up with a bunch of boxes on the screen. Can we all just agree to do audio-only meetings by default from now on? Please?

A MESSAGE FROM AMAZON

Amazon

In 2018, Amazon established a $15/hr start wage for all their U.S. employees, which is more than double the federal minimum wage of $7.25/hr. They've seen the positive impact on their employees and their families. That's why they're calling on Congress to pass the Raise the Wage Act.

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Today's Source Code was written by David Pierce, with help from Anna Kramer and Shakeel Hashim. Thoughts, questions, tips? Send them to david@protocol.com, or our tips line, tips@protocol.com. Enjoy your day; see you tomorrow.

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