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Tech tries changing from within

Image: Luke Hodde / Crossley / Protocol
Inside a PC

Good morning! This Friday, the tech industry tries to handle its issues in-house, a debate over the value of a tech chief of staff, and another big change within IBM.

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The Big Story

Rewriting the rules (before the government can)

Over the next few months, amid an election and crazy regulatory questions, you have a few options: Assume nothing will change and operate as usual, say "we look forward to regulation" and accept whatever comes, or create a vision for the future and try to make it happen.

The most popular options at Apple, Amazon, Google and Facebook have been numbers 1 and 2. But others are increasingly picking the third way:

  • The Coalition for App Fairness set out 10 principles like "No developer should be required to use an app store exclusively" and "A developer's data should not be used to compete with the developer."
  • This week, the Global Privacy Control standard — a group including DuckDuckGo, Automattic and Mozilla — said it would make a browser extension that applies your chosen privacy settings to every website. It's Do Not Track, remade for 2020.
  • And Thursday, Microsoft published 10 app store principles, largely matching the CAF. Here's number 1, which should please Epic: "Developers will have the freedom to choose whether to distribute their apps for Windows through our app store. We will not block competing app stores on Windows."

There's a long history of products changing industry policies. Recently, Robinhood almost single-handedly killed trading fees and Apple's iOS 14 privacy notifications forced many developers to do business differently. (That's why I'm bullish on the GPC extension.)

  • But can Microsoft or the Coalition for App Fairness really guilt Apple and Google into changing their policies? Moral victories don't usually mean much to victors.

Much of this is in response to the increasingly apocalyptic threat of regulation, and business as usual seems to be going out the window. So next we'll see 10,000 slightly different versions of policy and value statements — though I get the feeling that the tech world will coalesce on this stuff quicker than you might expect. And a prediction: Microsoft will keep being the loudest voice in the room.

Are you and your company considering changes, or thinking about signing onto one of these groups and pledges? I'd love to hear what you're thinking: david@protocol.com.

Hiring

Everybody wants a Leo McGarry

Anna Kramer writes: Every tech exec seems to want a chief of staff, but does the role work in Silicon Valley? A Medium post from Lime's Adam Kovacevich critiquing the role has gotten lots of execs talking, so we dug in.

Former tech and corporate chiefs of staff are now everywhere in the industry, and most of them agreed that while the job might work in politics, it's trickier in tech.

  • "There's a lot of tech executives who are of the age and generation (I include myself in that) who grew up watching 'The West Wing.' Leo McGarry is still the archetype of what you think of as the chief of staff," said Dex Hunter-Torricke, former chief of staff to Brunswick Group's chairman and founder Sir Alan Parker and now comms leader for the Facebook Oversight Board. "The problem with that is, it's not a super detailed blueprint on how to actually make that role work."

When the role is left undefined (which it so often is), the person often becomes a glorified executive assistant, some former chiefs of staff told me.

  • "Please don't hire a CoS as a Band-Aid, especially if you're a fast-growing startup," said Amy Cheetham, a former CoS to an executive at Zuora.
  • Often, Hunter-Torricke said, "they don't become an extra brain, they just become an extra pair of arms and legs, and that's when you end up with the most overpriced executive assistant ever."

Only one person I spoke with seemed all-in. Formerly a chief of staff at Verisign, Mack McKelvey cited Sheryl Sandberg, who was a chief of staff early in her own career, as proof of the role's value. The key, she said, is to use the role to cultivate raw talent: Many women, people of color, and others from historically underrepresented groups could use the position to get onto the C-suite track.

Reorgs

IBM gets out of consulting

Tom Krazit writes: For years, IBM has been looking for anything to jumpstart its business, which has been languishing amid a shift toward cloud computing and modern infrastructure. It acquired Red Hat for $34 billion in 2018 in hopes of addressing that shift, but the company still had thousands of employees working on lines of businesses that are unlikely to grow at a strong clip in the future.

  • In that sense, Thursday's announcement — that it will spin off a new company (literally called "NewCo," for now anyway) focused on its managed infrastructure services so it can move on from an aging IT strategy based around outsourcing and data center management — seemed like a logical move.
  • Wall Street thought so: It sent IBM's stock price up more than 5%.

But the spin-off just looks like a way to cut costs, which has been one of Arvind Krishna's top priorities since he assumed the CEO job earlier this year.

Put another way: There aren't a lot of companies shopping for modern tech infrastructure services that looked at IBM and said, "I like you folks, but you seem too distracted by your consulting business." With this deal, IBM is keeping 75% of its annual revenue and shedding 25% of its workforce. Sometimes it's just that simple.

A MESSAGE FROM PHILIPS

Philips

Stronger care … from more efficient operations

In a defining moment for healthcare, it's even more crucial to deliver patient-centered care efficiently. At Philips, we are committed to providing intelligent, automated workflows that seek to improve patient care. More efficient healthcare means stronger, more resilient healthcare.

Learn more.

People Are Talking

Square purchased 4,709 bitcoins at a price of $50 million, and wants to help others do the same:

  • "Given the rapid evolution of cryptocurrency and unprecedented uncertainty from a macroeconomic and currency regime perspective, we believe now is the right time for us to expand our largely USD-denominated balance sheet."

Waymo is opening up its robo-taxi program, but Elon Musk said Tesla's going bigger, faster:

  • "Waymo is impressive, but a highly specialized solution. The Tesla approach is a general solution. The latest build is capable of zero intervention drives. Will release limited beta in a few weeks."

Steve Case thinks the next phase of tech means new cities and countries can grow:

  • "In this third wave, when the internet meets everyday life, there's an opportunity for these cities to rise again."

ProtonMail CEO Andy Yen said Apple made his company add in-app purchases, and he isn't happy about it:

  • "As you start getting significant uptake in uploads and downloads, they start looking at your situation more carefully, and then as any good Mafia extortion goes, they come to shake you down for some money."

Making Moves

Satya Nadella was appointed chairman of The Business Council, which I think makes him The One True CEO. He's one of a handful of tech execs on the Council's new executive committee.

Jeremiah Brazeau is the new CTO at Twilio, joining from Salesforce.

60 people quit Coinbase after Brian Armstrong's note about being a "mission focused company." That number could go up, too, Armstrong said.

Instacart raised another $200 million, upping its valuation to $17.7 billion — more than twice what it was at the beginning of 2020!

Tracy McGraw is Twitter's new head of consumer communications. She joins from Tyler Perry Studios.

BitMEX's leadership team stepped down after the Commodity Futures Trading Commission and DOJ accused the company of operating illegally. Vivien Khoo is taking over as interim CEO.

In Other News

  • AMD is in advanced talks to buy Xilinx, The Wall Street Journal reports. The deal, which would likely be worth over $30 billion, could reportedly be agreed next week.
  • Political ads accounted for at least 3% of Facebook's estimated third-quarter revenue, with at least $264 million spent last quarter according to CNBC.
  • On Protocol: Google will give up direct control of the Knative open-source project. It's the latest twist in Google's complicated — and controversial — open-source strategy.
  • The NLRB accused a Google contractor of violating labor rights. The outsourcing giant HCL allegedly discouraged workers from unionizing, and moved jobs to Poland in retaliation.
  • Microsoft plans to release a browser-based version of Game Pass on iOS, Business Insider reports, following in Amazon Luna's footsteps. Phil Spencer reportedly told employees the company is targeting a 2021 release.
  • Lime is becoming a platform. Third-party transport providers can now offer their vehicles within the Lime app: Ebike company Wheels is the first partner.
  • Google released renders of its new San Jose campus, and it looks like a full-on Google city. The 80-acre project will have around 4,000 housing units, a hotel and an area for concerts.

One More Thing

A better traveling salesman

Normally, being 0.2 billionth of a trillionth of a trillionth of a percentage point better at something would be considered … being about the same. But when you're doing better at the Traveling Salesman Problem, and your teeny improvement comes on a decades-old solution that nobody thought could be improved, 0.2 billionth of a trillionth of a trillionth of a percent starts to sound like a pretty huge number.

A MESSAGE FROM PHILIPS

Philips

Stronger care … from more efficient operations

In a defining moment for healthcare, it's even more crucial to deliver patient-centered care efficiently. At Philips, we are committed to providing intelligent, automated workflows that seek to improve patient care. More efficient healthcare means stronger, more resilient healthcare.

Learn more.

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

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