Apple finds quality problems in some iPhone X and MacBook models

The new Apple iPhone X are seen on display at the Apple Store in Manhattan, New York, U.S., September 21, 2018. REUTERS/Shannon Stapleton

(Reuters) – Apple Inc said on Friday it had found some issues affecting some of its iPhone X and 13-inch MacBook pro products and said the company would fix them free of charge.

The repair offers are the latest in a string of product quality problems over the past year even as Apple has raised prices for most of its laptops, tablets and phones to new heights. Its top-end iPhones now sell for as much as $1,449 and its best iPad goes for as much as $1,899.

Apple said displays on iPhone X, which came out in 2017 with a starting price of $999, may experience touch issues due to a component failure, adding it would replace those parts for free. The company said it only affects the original iPhone X, which has been superseded by the iPhone XS and XR released this autumn.

The screens on affected phones may not respond correctly to touch or it could react even without being touched, the Cupertino, California-based company said.

For the 13-inch MacBook Pro computers, it said an issue may result in data loss and failure of the storage drive. Apple said it would service those affected drives.

Only a limited number of 128GB and 256GB solid-state drives in 13-inch MacBook Pro units sold between June 2017 and June 2018 were affected, Apple said on its website.

Last year, Apple began a massive battery replacement program after it conceded that a software update intended to help some iPhone models deal with aging batteries slowed down the performance of the phones. The battery imbroglio resulted in inquires from U.S. lawmakers.

In June, Apple said it would offer free replacements for the keyboards in some MacBook and MacBook Pro models. The keyboards, which Apple introduced in laptops starting in 2015, had generated complaints on social media for how much noise they made while typing and for malfunctioning unexpectedly. Apple changed the design of the keyboard this year, adding a layer of silicone underneath the keys.

Reporting by Ismail Shakil in Bengaluru and Stephen Nellis in San Francisco

Spin, E-Scooter Startup Born of a 2016 Trip to China, Sells to Ford in Multimillion-Dollar Deal

Poon and his co-founders Derrick Ko and Zaizhuang Cheng started Spin in San Francisco and first launched in Seattle’s pilot program in the summer of 2017. But within a year, the company would ditch its bikes and pivot to electric scooters. Spin is now available in approximately 12 cities, including Long Beach, California, Detroit, and Coral Gables, Florida.

Ford is investing about $200 million in Spin, a source close to the deal says. Since founding, the company raised $8 million from Grishin Robotics, Exponent, and others–a small sum compared to more formidable competitors in the red-hot e-scooter industry.

Spin is small fry compared to competitors Bird and Lime, which are both in more than 100 cities. Lime, which raised $467 million from the likes of Uber and Alphabet at more than a $1 billion valuation, and Bird, which raised $415 million and valued at more than $2 billion.

Spin markets itself as an e-scooter company that “asks for permission” before launching, but it is perhaps best known for taking part in what is referred to as “Scooter-geddon” in San Francisco. In March, Lime, Bird, and Spin deployed about 3,000 e-scooters on the streets and sidewalks and chaos ensued. Many people started riding the scooters on the sidewalks and breaking other traffic laws.

A community backlash led to public hearings, cease and desist letters, and eventually the city issued a temporary ban on e-scooters. This summer, the city issued permits for its e-scooter pilot program to lesser-known companies Skip and Scoot, but regulators denied Lime, Bird, and Spin. 

Ford confirmed the deal, via a blog post, on Thursday. Sunny Madra, vice president of Ford X, the car company’s startup incubator, wrote that the acquisition is a way to diversify its offerings and capture customers who do not want to own a car. 

“Spin adds an exciting new offering to Ford’s mobility portfolio as we try to help our customers get places more easily, more quickly and less expensively,” writes Madra.

Ford will eventually expand the e-scooter program to more than 100 cities, Madra told Reuters. Spin is Ford’s fourth investment in the micromobility space–the company also invested in Jelly, another e-scooter company, Chariot, a ride-sharing service, and bike-share company GoBikes. 

Alibaba's on-demand online services unit valued at $30 billion: sources

HONG KONG (Reuters) – Alibaba Group’s newly formed on-demand online services unit has rocketed in value to as much as $30 billion after raising $4 billion in fresh funds, people with knowledge of the situation told Reuters.

FILE PHOTO: People stand near a sign of Alibaba Group at its campus in Hangzhou, Zhejiang Province, China, May 27, 2016. REUTERS/John Ruwitch/File Photo

Alibaba (BABA.N) combined the operation of food delivery service and online restaurant guide business Koubei under a single management team and holding vehicle in October. It announced a fundraising plan for the vehicle in August.

In a deal in April where Alibaba bought the shares it did not already own, was valued at $9.5 billion. Koubei was worth $8 billion at the end of last year, according to a list of unicorns published in March by a unit under China’s science and technology ministry.

More than $3 billion of the new funds came from Alibaba itself and SoftBank’s (9984.T) Vision Fund, the people said. Primavera Capital Group and Alibaba affiliate Ant Financial, which have already invested in Koubei, also joined in the fundraising, they said. The company expects to close this financing round by the end of November, one source added.

Alibaba, SoftBank and Ant Financial declined to comment. Primavera did not immediately respond to a request for comment.

The people declined to be named because the information is confidential.

Alibaba said in August it had received commitments of more than $3 billion from investors including itself and SoftBank.

The fresh capital will give the unit ammunition in its intensifying battle with rival Meituan Dianping (3690.HK), backed by Tencent Holdings (0700.HK), for dominance of China’s booming online-to-offline (O2O) market where apps link smartphone users with bricks-and-mortar businesses to provide food delivery and other offerings.

Meituan Dianping in September raised $4.2 billion in the world’s biggest internet-focused initial public offering in four years, after pricing it near the top end of a marketed range at HK$69 per share.

However its shares are down 9 percent since its Sept. 20 debut, giving it a current market cap of $44 billion.

Meituan said in its half-year report that the number of its annual active users from the 12 months ending June 30 grew 30 percent to 357 million from the same period a year ago. The number of merchants active in the past year grew 52 percent to 5.1 million for the same period.

In comparison, served over 167 million active consumers in 676 cities in China for the 12 months ended June 30, Alibaba said in its latest quarterly report. Together, and Koubei served 3.5 million registered merchants as of June 30.

Before the April deal, the e-commerce giant and Ant Financial owned a 43 stake in the business, whose name roughly translates to “Hungry?”. also runs Baidu Inc’s (BIDU.O) former food delivery business, which it acquired a year ago.

Koubei was founded in 2015 as a 50-50 joint venture of Alibaba and Ant Financial. Silver Lake, CDH Investments, Yunfeng Capital, which is backed by Alibaba founder Jack Ma, and Primavera Capital joined as investors in a January 2017 funding round.

Reporting by Kane Wu and Julie Zhu; Editing by Stephen Coates

Midterm Elections 2018: What the Election Results Mean for Big Tech

It may not have been the tsunami some expected, but the Democrat’s long-promised blue wave was enough to carry the party to a majority in the House of Representatives on Tuesday. The Senate, meanwhile, remained firmly in Republican hands.

With control of the House, Democrats will be able to fulfill their promise to be a check on the Trump administration these next two years. And yet, the power split in the two chambers of Congress could make it harder than it already was to pass new legislation—even legislation with bipartisan backing. For the tech industry, that’s both good news and bad news.

The good news: As House Democrats spar with the Republicans in the Senate, the last thing either party will want to do is hand the other side a win. That means that until 2020, it will be much more difficult for Big Tech’s critics on Capitol Hill to push through much-threatened regulations on the industry’s ads or its monopolistic business practices.

The bad news: There are some regulations that the industry desperately wants to pass, namely, a federal privacy bill that would preempt a much tougher bill in California, set to go into effect in 2020. Tech giants and industry groups like the Internet Association have been lobbying hard for a federal bill, and senators on both sides of the aisle have expressed support for some federal legislation. It’s unclear at this stage whether a Democratic House would let President Trump be the one to sign off on such a historic law.

The tech industry also faces a notably less cozy environment in the Senate after Tuesday night. Marsha Blackburn, for one, won her race in Tennessee. As a House representative, Blackburn battled tech giants at nearly every turn. Backed by the telecom industry, she opposed net neutrality protections and voted to overturn an Obama-era rule that would have required broadband providers to get people’s permission before selling their browsing data. On the campaign trail, she took every opportunity to criticize the tech industry for alleged liberal bias. That’s been a rallying cry in the House that Blackburn may well amplify in the Senate.

If she does, she’ll have a friend in Senator Ted Cruz. The Texas senator defended his seat against Democratic insurgent Beto O’Rourke, whose campaign was heavily financed by the tech industry. Like Blackburn, Cruz has seized on the opportunity to accuse tech giants of partisan censorship and recently skewered Google over its experiments in building a censored search engine for China.

Former Missouri attorney general Josh Hawley, meanwhile, will replace Democrat Claire McCaskill in the Senate. Hawley, a Republican, took a tough stance on tech as attorney general, opening separate investigations into Google, Facebook, Uber, and Equifax over anti-trust and data privacy issues.

Tuesday’s race also alters the dynamics of the congressional committees tasked with holding these companies accountable. Senator Bill Nelson of Florida lost his re-election to governor Rick Scott on Tuesday. That means Nelson’s role as ranking member of the Senate Commerce Committee will likely fall to someone like Minnesota’s Amy Klobuchar or Connecticut’s Richard Blumenthal, both of whom have voted to crack down on the tech industry.

But the biggest shift will undoubtedly come in the House, where Democrats will take over control of the House Intelligence Committee, which was tasked with investigating foreign interference in American elections. Current ranking member Adam Schiff would likely take on the role of chair. He’s vowed to pick the Russia investigation back up. Given the continued covert actions taken by Russia on social media platforms, such a probe could land Facebook, Google, and Twitter back in the hot seat.

These new dynamics may not last long. In two years, Democrats will have to defend the House seats they won all over again. Thanks to a congressional map that’s been gerrymandered to favor Republicans in states across the country, that won’t be easy. On Tuesday, Democrats carved out a win by relying on states like Pennsylvania, where a badly gerrymandered map was recently replaced by a court-ordered one. And yet, the midterm elections also yielded wins for Democrats that could change the playing field in 2020 and beyond. A ballot initiative in Florida restored voting rights to more than 1 million former felons, who will now be eligible to vote in 2020. And anti-gerrymandering proposals passed in Colorado, Michigan, and Missouri, which would take redistricting power away from a single party and scuttle the maps all over again after 2020.

By the early hours of Wednesday morning, both Democrats and Republicans were claiming a victory. Time will tell if tech’s most powerful companies can do the same.

More Election Coverage from WIRED

Facebook boots 115 accounts after FBI tip on eve of U.S. election

FILE PHOTO: A man is silhouetted against a video screen with an Facebook logo as he poses with a laptop in this photo illustration taken in the central Bosnian town of Zenica, August 14, 2013. REUTERS/Dado Ruvic/File Photo

SAN FRANCISCO (Reuters) – Facebook Inc blocked about 115 user accounts after U.S. authorities tipped it off to suspicious behavior that may be linked to a foreign entity, the company said in a blog post on Monday, hours before U.S. voters head to the polls.

The social network said it needed to do further analysis to decide if the accounts are linked to Russia’s Internet Research Agency or another group. The U.S. has accused the Russian government body of meddling in U.S. politics with social media posts meant to spread misinformation and sow discord.

Eighty-five of the removed accounts were posting in English on Facebook’s Instagram service, and 30 more were on Facebook and associated with pages in French and Russian, the post said.

Some accounts “were focused on celebrities” and others on “political debate,” it added.

The tip came from the Federal Bureau of Investigation on Sunday night, Nathaniel Gleicher, Facebook’s head of cybersecurity policy, wrote in the post.

The company announced its actions earlier in its investigation than typical “given that we are only one day away from important elections in the U.S.,” he added.

This year’s contest has been portrayed as crucial by both Republicans and Democrats because both chambers of Congress, and the accompanying ability to pass or reject President Donald Trump’s agenda, are up for grabs.

“Americans should be aware that foreign actors, and Russia in particular, continue to try to influence public sentiment and voter perceptions through actions intended to sow discord,” including through social media, federal authorities said in a statement on Monday.

Social media companies say they are now more vigilant against foreign and other potential election interference after finding themselves unprepared to tackle such activity in the U.S. presidential election two years ago.

Reporting by Philip George in Bengaluru and Paresh Dave in San Francisco; Editing by Gopakumar Warrier and Clarence Fernandez

Kyocera BrandVoice: Can The Right Office Equipment Improve Our Legal Culture?

By Amanda Reaume 

The legal industry is ripe for tech disruption.

That’s partly because the field is rife with paperwork, whether it’s the records that first-year attorneys and other staffers need to search for discovery or the hard copies of legal documents that many firms are legally required, or think it’s critical, to keep. All that paperwork represents costs—the cost of the work hours needed to search through, organize and file all that documentation, as well as the cost of physical storage space itself. If you’re paying, say, $10 per square foot to rent space and need an extra 200 square feet for paper storage, that will set you back $24,000 per year.

It’s critical to start looking for the technological solutions that will help your office keep up with the times—whether that’s getting a new Kyocera MFP or investing in a better eDiscovery provider.

It’s critical to start looking for the technological solutions that will help your office keep up with the times—whether that’s getting a new Kyocera MFP or investing in a better eDiscovery provider. Getty

An ocean of paperwork isn’t the only challenge that law firms, district attorneys’ offices and courts are facing. There are other process inefficiencies within the legal sector that the right office technologies, like multifunction printers and copiers and document solutions software, can improve.

In addition, artificial intelligence and machine learning can streamline case law searches or help to complete legal forms, reducing costs for firms and clients. Automated billing systems can also help simplify law firms’ complex accounts-receivable processes.

Here are some equipment-related steps you can take towards changing your law firm’s or legal department’s office culture.

 1. Get the right multi-functional printers and copiers. 

Law firms, courts and district attorneys’ offices can benefit from making the right choices when it comes to their multi-functional printers and copiers (MFPs). Equipment with faster page-per-minute outputs, longer-lasting toner cartridges, higher paper-storage capacity and fewer downtime-inducing technical issues will make your office more efficient.

The right machine for your office will also let you quickly scan documents. That MFP component will enable you to create legal files and connect scanned information with your existing document management software to improve workflow and reduce the need for paper copies. The best solutions are designed specifically for your industry and business and include built-in workflow automation, document management and security solutions—something that select MFP manufacturers like Kyocera provide.

Document management software that connects with your MFP can transform your law office by  facilitating digital document processing, letting you organize your files and automatically backing up and securing your client information.

 2. Use artificial intelligence. 

Artificial intelligence (AI) is the next big thing in the legal business. A survey from HBR Consulting showed that while only 6 percent of law firms have currently implemented an AI solution, 14 percent have identified an area of their business that could benefit from AI, and 26 percent recognize that they need to look into AI in order to stay competitive.

The main areas where artificial intelligence is making its presence felt include contract review, law searches and electronic discovery analytics. McKinsey & Company estimates that automation can do around 22 percent of the work lawyers do and 35 percent of the work that law assistants do—AI is the future of law firms.

If firms don’t take advantage of AI, they might find themselves losing business to legal startups like wevorce, which already provides automated divorce processes for a fraction of the cost of a typical divorce.

 3. Upgrade client billing and management systems. 

While many law firms already have some form of client billing and management system, it might be time to upgrade, as the options have improved.

You should be looking for a new system if you’re not already doing the following: automatically collecting monthly fees and retainers using recurring billing; sending email invoices to clients and accepting their payments electronically; and easily tracking client payment, billable hours and cash flow.

The best billing management systems allow you to use your data to look at past revenue and predict future earnings with easy-to-create reports. Some systems integrate additional functionalities. PracticePanther, for example, can create a “customer portal” for your clients that also helps you manage your calendar and book meetings with clients.

The right system will help save your firm hundreds of hours of work per year.

 4. Introduce practice management software. 

If your firm is using a generic accounting software solution to manage your finances or relying on expense forms that lawyers must print out to fill out, then you might be missing out on some process innovations that purpose-built practice management software provides.

Practice management software systems like Abacus were built with law firms in mind and you can customize them for your needs. They make expense reporting more efficient and give you real-time information about your business by connecting your accounting system with your corporate credit cards. That way you always have the most up-to-date understanding of where you stand financially.

 5. Get the best eDiscovery software. 

Electronic discovery software allows attorneys to more easily identify, collect, store and produce electronic information in the event of a legal request. Many document requests involve searching complex databases such as servers or email accounts; eDiscovery software allows you to data mine in order to more quickly find the documents that you need.

Even if you already have an eDiscovery provider, you might want to make sure that it is still the best option available. Many new offerings allow you to collect data remotely so that it doesn’t tie up an employee’s computer.

They also allow you to integrate your search with existing document management systems, use AI to automatically redact data such as social security numbers and credit card information, and leverage metadata details such as access time and file type.

 Innovate Or Fall Behind 

The legal industry is facing pressure to embrace technology. To stay competitive, it’s vital for your firm to embrace system automation, improve your workflow processes and reduce your costs.

This holds true for the public and private sectors alike. Just as law offices lose money when they don’t implement key advances, bottlenecks in courts and backlogs in legal aid and prosecutors’ offices often have outdated technologies and workplace strategies to blame.

The fact is, the entire industry could benefit from leveraging technologies for greater efficiency. That’s why it’s critical to start looking for the technological solutions that will help your office keep up with the times—whether that’s getting a new Kyocera MFP or investing in a better eDiscovery provider.

Amanda Reaume is a freelance writer and the creator of the blog Millennial Personal Finance. She is also the author of two personal finance books aimed at Millennials: Money Is Everything and The Complete Guide to a Debt-Free Education.

Chinese chipmaker's ambitions hit hurdle with U.S. indictment

HONG KONG/BEIJING (Reuters) – Chinese state-backed semiconductor maker Fujian Jinhua Integrated Circuit Co Ltd billed itself as a national leader in the tech industry. It planned to drive a shift towards locally made chips and end a heavy reliance on imports, especially from the United States.

“The era of Chinese chips has arrived,” it said in a recent promotional online pamphlet to attract chip industry talent. Underneath was a picture of a circuit board emblazoned with the Chinese flag.

“China once relied on chip imports, but the tireless work of untold numbers of chip experts has meant that from 90 percent imports we have been able to attain localized production,” it said, highlighting a high-skilled global workforce harking from the United States, Japan and South Korea.

“Jump with us into an chip era that belongs to China.”

That bold ambition now faces major hurdles.

The U.S. Justice Department on Thursday indicted Fujian Jinhua and Taiwan-based United Microelectronics Corp (UMC) (2303.TW) for industrial espionage.

The indictment said the companies conspired to steal trade secrets from U.S. semiconductor company Micron Technology Inc (MU.O) relating to its research and development of memory storage devices.

Under a technology cooperation agreement signed in 2016, UMC develops memory-related technologies for the Chinese firm.

The charges came after the U.S. Commerce Department banned U.S. companies from selling hardware and software components to the Chinese firm and UMC. The Taiwan firm said shortly afterwards that it will temporarily halt its research and development activities with Fujian.

The Commerce Department action could deal a significant blow to the Chinese semiconductor maker, given its reliance on U.S. supplies, and China’s technology ambitions.

On Saturday, Fujian Jinhua said in a statement posted on its website that it had not stolen any technology and that it “always attaches great importance to the protection of intellectual property rights.”

Chinese government officials have said privately that Fujian is of high strategic importance to China, which is looking to boost home-grown technology under its “Made in China 2025” plan, a bid to catch up technologically in key areas such as semiconductors, where it has long been reliant on imports – notably from America.

“You can’t build a fab (fabrication plant) without U.S. equipment companies. You just cannot do it,” said Risto Puhakka, a semiconductor industry expert at VLSI Research.

The world’s most important suppliers of the tools needed to make memory chips – Applied Materials Inc (AMAT.O), KLA-Tencor Corp (KLAC.O), and Lam Research Corp (LRCX.O) – all hail from the United States.


China imported $270 billion in semiconductors in 2017, more than its total imports of crude oil, highlighting the country’s lack of a true rival to U.S. chip making giants like Micron, Intel Corp (INTC.O) or Qualcomm Inc (QCOM.O).

To close the gap, analysts said earlier this year money was “raining down” from Beijing and state-backed funds, like the country’s state chip “Big Fund”, to support firms such as Fujian Jinhua.

The Chinese firm has been working to open a giant $5.7 billion chip factory in October to produce 60,000 semiconductor wafers per month in its first stage of production, and 120,000 in its second stage, according to domestic media.

Fujian is just one of a handful of Chinese semiconductor firms that have in recent years looked to crack the global chip industry. They are working on chips that can be used in smartphones to missile guidance systems.

Two officials at a state-linked semiconductor fund said Fujian Jinhua was working with highly specialised semiconductor materials to make circuits, a high priority for Beijing and the country’s chip fund.

“You could consider Fujian Jinhua a top three China chip company in terms of their research and development,” one of the people said. Both asked not to be identified because they were not authorized to speak publicly on the matter.


Fujian Jinhua was established in 2016 with funding from state-owned Fujian Electronics & Information Co and Jinjiang Energy Investment Co..

Other backers include municipal governments from the southern cities of Quanzhou and Jinjiang. Fujian Jinhua’s former board chairman served as a provincial-level party secretary.

The firm’s focus was to become a manufacturing leader in DRAM, or dynamic random access memory, a chip commonly used in personal computers, workstations and servers. The sector has been long dominated by U.S. firm Micron and South Korea’s SK Hynix Inc (000660.KS) and Samsung Electronics (005930.KS).

“Once completed, the project will fill the gap in the field of DRAM memory in China,” the company said in a news post last year. It added the factory had been included in a list of the country’s top engineering projects supported by the state.

“In the information age, integrated circuits have been a strategic basic industry for China,” it wrote. “Future prospects are bright.”

Reporting by Josh Horwitz and Cate Cadell; additional reporting by Shanghai newsroom; Editing by Adam Jourdan and Neil Fullick

The Next Billion Dollar Disruption. You Read About It Here First

If there’s anything true about high tech, it’s that the big fortunes are made when a new technology disrupts an existing industry. The money to be made is greatest when 1) the industry being disrupted is bureaucratic and inefficient, and 2) the new technology transcends, rather than merely automates, the previous processes.

Early in my career, I lived through and participated in, one of the biggest disruptions of all time: desktop publishing. Within ten years, photo-offset printing setups that cost millions of dollars each were replaced by PCs and laser printers. Entire job categories and companies disappeared. Millions lost their jobs but entrepreneurs made untold billions of dollars.

While I built my career riding that wave, I was too young and inexperienced to start my own company until the revolution was over. Now, as I see another, even more amazing technology about to massively disrupt another hidebound, inbred industry, I’m past the point where I want to start my own company. Too much damn work. (I’m a lazy S.O.B., truth be known.)

So I’m going to share with all you readers what I absolutely know is about to happen. I say “absolutely” because entirely by accident I’m uniquely positioned to see the disruption coming and uniquely qualified to explain how it’s going to happen. And, strangely perhaps, it has nothing whatsoever to do most of the stuff I write about in this column.

So let’s get started but, bear with me and be patient, because I’m going to explain this in my own way and without trying to package the concept with a nice, neat bow. Put on your thinking cap.

Rick and Morty

About two weeks ago, I attended a live interview with Bryan Newton, one of the animation directors of the hit cartoon series Rick and Morty. He’s been involved with the project since its inception and has become a bit of a legend among animators for pioneering some of the crazed look-and-feel of that style of animation.

Why was I at that interview? Well, it was presented by AniMAtic Boston, a group of student and professional animators, mostly graduates of local colleges, most of whom work in the fields of commercial and corporate animation but many of which are true artists in this field.

I belong to that group and support it because, in addition to all the business writing and experiences I’ve had over the years (and which I chronicle in this column), I’ve also been a hobbyist in the field of computer animation since the mid 1980s. I’ve animated using several programs; I also made a feature-length film that’s pretty well-known in some circles. (Let’s just say it gave me permanent nerd cred.)

From time to time, I’ve played around with the idea of changing careers and becoming a professional animator, probably in the field of cut-scene animation for computer games, which is a field I know pretty well. Anyway, I was interested in Newton’s perspectives about working in a big studio.

Well, I don’t know whether it was because he had had a long day and was tired, but he made it very clear that he was no fan of the studio system. As he ragged on all the inefficiencies and politics, I realized that I’d heard all this before. It seems like EVERY creative person in Hollywood hates the studios–especially the executives with their “notes.”

Anyway, it turns out that even shows like Rick and Morty–which involves relatively simple animation–must go through an insanely Byzantine process to move from conception to writing to animation to completion. Over a hundred people are involved and from what I can see a great deal of them aren’t adding much or any value.

And, don’t kid yourself, animated entertainment–TV, movies and Internet–is a multi-billion-dollar business. More important, it’s a business that’s weighed down by bureaucratic overhead and entrenched power-brokers who essentially drag down the creative process.

Revolution in Real-Time

At the end of the interview with Newton, he speculated about what animation technology might look like in the future. He said that writers could create characters by morphing standard characters, use libraries of animations to make them move, use motion capture to customize and add dialog. And then release it directly to the Internet.

Essentially he described an environment where creatives like himself would not require the infrastructure, investment, and meddlesome overhead of a studio to develop and release an entertainment product. As I heard him describe this, I considered pointing out that all of this was not just possible but day-to-day reality, at least in the real of 3D animation. 

The technology is called “Real-Time Animation” and it’s been flying under the radar for about a decade. So much under the radar that although I’ve brought up the subject with several people at AniMAtic Boston, I have yet to run into anyone who has even heard of the software-;even though they’re recent graduates of top animation college programs.

The reason I know about Real-Time is that I’ve been working with Real-Time animation software since 2004, probably because I have no formal training in animation. I suspect that most “real” animators have tended to ignore it because up until about two years ago real-time animations have been fairly crude.

However, as CPUs and GPUs (graphics cards) have gotten more powerful in order to handle ultra-realistic games, it’s become possible to create reasonably high-quality 3D animation using real-time tools. These tools are to traditional animation what desktop publishing was to typesetting and paste-up. You create animation on a WYSIWYG (What You See Is What You Get) environment.

A few (very few) traditional, high-end animation shops are getting wise to the incredible power and productivity of developing animation in Real-Time. One of these is UK-based Axis Animation, which created the computer graphics world for the excellent Netflix series Kiss Me First, and which does specialty work for several big name organizations.

I recently had a long conversation with Michael Zaman, who is the supervisor of Real-Time Computer Graphics at Axis. He noted that while in the past they used Real-Time primarily for prototyping, they’re now using it for actual project because the technology can now create quality that rivals the more laborious CG processes of the past.

Zaman had the same “knowing grin” that I’ve come to associate with the handful of people who “get” what’s coming; I have a feeling that he and Axis will end up being major players in the disruption that’s just around the corner. I’m going to save the best part of our conversation for the end of this post, so you’ll want to read the entire thing.

The Underlying Tech

There are four reasons that Real-Time animation has vastly increased in quality. (I’ll be giving some examples soon; bear with me.) 

  1. The first trend is the need to develop video games quickly; real-time animation more naturally emulates the environment in which computer games will be played.
  2. The second trend is the desire among consumers for video games that are more realistic and cinematic; to satisfy his desire, companies like NVidia have developed specialized hardware to process complex 3D graphics.
  3. The third trend is the commoditiziation of high-end technologies, like motion capture (mocap). Ten years ago, a full-body/facial mocap system cost a million dollars; a functionally identical system can be had today for $6,000.
  4. The fourth and final trend is a lively market in pre-created 3D models, including sets, props, and characters, along with the ability to very easily modify those models to suit individual projects.

The result is very much like the “next generation” environment that Bryan Newton described on stage–not just for simple 2D animation like Rick and Morty–but full-on 3D animation similar to major Disney releases.

More important, Real-Time technology makes it possible to do all of this without the overhead of the studio system; in fact, developing a short animated film is considerably less effort than writing a novel.

How do I know this? Because I’ve actually written a novel and have also been using the best (IMHO) Real-Time animation tool–iClone from Reallusion–to do exactly that over the past two years. Here are excerpts from my last three major projects, showing the incredibly rapid development of this technology (very short video):

[embedded content]

I’m not saying any of the above is great art (although the first project did get selected for several film festivals and won two awards.) What’s important here is that they were created by a single person (me) who has NO formal training in animation and with a very limited budget (less than $1,000 total for each project).

The total cost for this kind of Real-Time animation, excluding my labor, comes out to about $500 per minute. For perspective, a typical Disney feature, done with traditional animation tools in a studio setting, costs upwards of $50,000 per second which comes to $3,000,000 per minute. 

I’d say that a cost reduction from $3,000,000 to $500 definitely qualifies as disruptive technology. And that’s just for creating animated cartoons, which although a multi-billion dollar business is only the tiniest tip of the proverbial iceberg.

What’s Next Is Insane

Real-time animation technology is developing so quickly that even people inside the industry are struggling to catch their breath.  However, what all the insiders see very clearly is that the studio technology that Disney uses to insert deceased actors (like Carrie Fisher) into the Star Wars movies will rapidly become available to individuals.

We’re already seeing this kind of thing with the so-called “deep fake” technology where AI pastes a celebrity’s head onto a video with another actor’s body on it. But the real power happens when you combine mocap with ultra-realistic real-time rendering.

And that’s happening already. Real-Time is currently experiencing is a quantum leap in quality from a technology called iRay, which is being built into the newest graphics cards. Here’s a very short video showing how iRay radically increases realism inside Reallusion’s Character Creator tool:

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To understand where this is all going, here’s a demonstration of a high-end system (it uses the Unreal gaming engine) being used to create ultra-realistic animation in Real-Time–so realistic that it’s hard to tell that it’s not a real person:

[embedded content]

While the setup used above is more expensive than most independent film-makers are likely to be able to afford, it’s still geometrically less expensive–and insanely faster–than the systems used inside the studios.

The point here is that the technology shown in the video above will soon drop in price so that it will be widely available to anybody who can spend, say, $5,000 or $10,000. And that’s what’s going to completely change not just animation but the entire filmmaking industry.

Here’s what’s going to happen, based on my conversations with insiders like Michael Zaman from Axis Animation. Within five to ten years, it will be possible for a single person or a small group of people to make entire movies in virtual worlds, without ANY of the overhead of a traditional studio.

And I’m not just talking about animated cartoons. I’m talking about actual feature films with massive special effects. People like you and me will be able to create, with very little investment, content that resembles high-end cinematic work that today costs hundreds of millions of dollars.

So here’s what we’ve got: rapidly developing technology that will upend a massively inefficient and bureaucracy bloated studio system. This revolution will be more disruptive than Amazon was to the book business, or than Netflix was to the TV business. We are about to experience the kind of massive market disruption that happens only once or twice in anybody’s lifetime.

And almost nobody sees it coming. But now YOU do, because you read about it here first. The question is: are you going to start a business that surfs the tsunami? Or are you going to sit back and watch it happen?

Your move.

Trump’s ‘Game of Thrones’ Tweet Is Odd, but Trademark-Infringing? Probably Not

Of all the apparatuses presidents have at their disposal for making pronouncements—press secretaries, official statements, televised addresses from the Oval Office—the one President Trump used to trumpet forthcoming sanctions on Iran is by far the strangest: a Game of Thrones meme.

On Friday morning the president posted the image below on Twitter. It’s a picture of himself emblazoned with the phrase “Sanctions Are Coming” in a typeface not that dissimilar from the one used in the Game of Thrones logo along with the date “November 5.” Subtle, it was not.

As soon as it went up, and as soon as it was clarified by the White House that the sanctions in question were indeed the ones that had been relaxed during the Obama administration and which Trump had been seeking to reimpose, Twitter went nuts. Folks began responding with memes of their own—”Indictments Are Coming” etc.—and even the show’s cast got involved. Sophie Turner, who plays Sansa Stark, replied “Ew,” and Maisie Williams (Arya Stark), in perhaps the best Twitter drag of the day, retweeted the president and just added “Not today.” (“Not today,” for those who don’t remember, is what Arya Stark’s swordfighting instructor, Syrio Forel, told her is what she should say to the god of death.)

Then HBO got in on the action, sending out a tweet reading, “How do you say trademark misuse in Dothraki?” Reached for comment the network added, “We were not aware of this messaging and would prefer our trademark not be misappropriated for political purposes.” Trump evoking the show’s logo and slogan, it seems, doesn’t sit very well with the people who actually make the show.

But could the network or creators successfully sue? Probably not. First off, it doesn’t seem likely that HBO actually wants to make a legal claim of trademark infringement. At most, the network is playing along. Trump referenced the show; they responded. Simple as that. But the response, and subsequent online chatter, did raise some questions about whether or not the president went too far.

Most likely, he didn’t.

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If HBO were to bring a claim, it would probably be for what’s known as trademark dilution, says Daniel Nazer, a staff attorney for the Electronic Frontier Foundation’s intellectual property team. Typically, these are the kinds of claims companies make when they feel their very-famous trademarks are being used in ways that deplete the uniqueness, or dilute, their intended message. A company can’t, say, put something that looks like the Nike “swoosh” logo on the side of a commercial plane or use “Just do it.” to sell condoms.

A dilution claim also generally requires that the entity claiming infringement be able to prove the public was genuinely confused. Because Trump’s tweet wasn’t being used in commerce, and because it’s unlikely anyone thought he was legit affiliated with Game of Thrones, dilution would be a hard argument to make. “I think this would be a tough, a tough case,” Nazer says. “No one is likely to be confused that HBO is endorsing this tweet or sponsoring sanctions against Iran. My view is that this shouldn’t be a viable suit.”

Instead, Nazer says, Trump’s tweet would be treated more like a parody—legally speaking. If, for example, Saturday Night Live did a sketch about waiting for a train in New York titled “The G Train Is Coming” that pokes fun at MTA tardiness and references Game of Thrones, that’s not an infringing use. (It’s also a funny idea, SNL. Please make that sketch and credit Nazer.) As for Trump’s use of the Thrones font, the files used in typefaces can be protected, as is (presumably) the actual logo, but because Trump just uses a script that looks like the GoT emblem, the image the president tweeted is likely not infringing. It’s ironic, but the bottom line is that the man who likes to take shots at the media is protected here by the First Amendment.

The parody aspect, though, is compelling, because the metaphor doesn’t quite align. In Game of Thrones, “winter is coming” is a call to remain vigilant, and a warning that White Walkers could come and threaten the living when winter arrives. Yet winter has been coming on the show since the pilot; it’s a slow march that’s taken seven years. Trump’s “November 5” warning promises something he intends to do in a matter of days. Also, one presumes, Trump thinks the sanctions are a good idea, but the coming of winter in Game of Thrones is something most sane people in Westeros fear. It’s possible Trump wants Iran to be afraid of the sanctions, but the wordplay still doesn’t quite land.

“It’s kind of riffing on it, but it’s hard to know what the satirical or parodic intent is here,” Nazer says. “Winter in the Game of Thrones universe is kind of terrible, so I’m not sure if they really thought it through. There’s probably nothing much beyond it looks cool.”

Half an idea without any sense of its viability? Sounds about right.

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US Accuses Chinese Company of Stealing Micron Trade Secrets

The Chinese government has made manufacturing computer chips that store data—memory—a major priority of its centralized science and technology strategy. According to the US Department of Justice, China plans to do it not just through research and development, but through old-fashioned espionage.

In an indictment unsealed Thursday, DOJ accused China’s Fujian Jinhua Integrated Circuit, Taiwan’s United Microelectronics Corporation, and employees including Jinhua’s president, of economic espionage—of stealing proprietary technology from US-based Micron Technology to make dynamic random access memory chips, which are found in just about every gadget. It’s not clear how the companies will respond, nor whether the individuals accused of espionage could ever be extradited to the US. So think of this as a virtual shot in the cold-but-warming trade war between China and the US. “Chinese espionage against the United States has been increasing—and it has been increasing rapidly,” US Attorney General Jeff Sessions said in a statement. “I am here to say that enough is enough.”

How much was enough? In 2013, Micron bought a Taiwanese chipmaker and formed Micron Memory Taiwan, where it planned to build DRAM, the mostly commoditized “short-term memory” in computers and related things that go beep. The DOJ indictment alleges that the president of MMT, Stephen Chen, quit and moved to UMC, set up a $700 million joint agreement with Jinhua (owned by the Chinese government), and then hired two more MMT employees, who starting in roughly 2016 began to bring over Micron trade secrets.

Micron is one of just a handful of companies making DRAM, and the only American one—it’s worth $45 billion and has a fifth of the global market. The technology is essentially a commodity; Micron and its two competitors, both Korean, differentiate themselves through being able to construct smaller and smaller features on their chips and the facility with which those chips talk among themselves and to other components. Jinhua, says the indictment, acquired the processes to build a range of chips, including those that use Micron’s “1x-nm” technology. Over the past year, Micron management has been touting that advance as a major piece of its business.

Until Jinhua started cranking them out, China didn’t have the technology to make tiny-featured DRAM, even though factories there make and assemble a wide swath of the planet’s gadgetry. But China’s government had tabbed developing the capacity as a priority in its most recent Five-Year Plan … which, in retrospect, looks to the US government as an invitation to stochastic espionage. Their ears were open, in other words, if DRAM technology should happen to fall off the back of a truck.

That may well be what happened. It’s possible that Chen, JT Ho, and Kenny Wang realized that their access to Micron’s proprietary technology meant a financial windfall if they took it to the government-owned chipmaker. But the US government hasn’t laid out that part of their case; Chinese economic espionage on the US mainland has typically involved a more elaborate process of spotting and recruitment of assets in advance of their access to information.

In this case, Micron complained; In August 2017, Taiwan filed criminal charges against UMC, and in December, Micron sued UMC and Jinhua. So in January, Jinhua turned around and sued Micron—for infringing on Jinhua’s DRAM patent. Meanwhile, the Taiwanese Ministry of Justice had pinged the San Francisco Division of the FBI, which has made something of a franchise of handling technology-related economic espionage.

That tripped another breaker; in late September, after two years of investigation, the FBI indicted the companies and the employees. (The indictment was only unsealed Thursday.) And last week the Department of Commerce added Jinhua to its “Entity List” of companies presumed to pose a national security threat to the United States (on the grounds that like everyone else in the world, the US military uses a lot of DRAM). That means US companies need a license, which they probably won’t get, for all “exports, re-exports, and transfers of commodities, software and technology” to Jinhua—including components and materials crucial to making DRAM.

From the US perspective, that’s about as tough a move as it can make, because redress through the courts is unlikely. “I don’t want to say we can never extradite people. We’ve seen time and again where somebody goes on vacation and they forget this country has extradition,” says John Bennett, special agent in charge of the FBI’s San Francisco division. “We’re not saying these people are guilty of anything but we’ve been able to provide enough evidence to a court to indict them. If they would like to argue that point, that’s what the American justice system is designed to do.”

In a release, UMC representatives say that the company “takes seriously any allegation that it may have violated any laws and fully intends to respond to these allegations.” The company said it “regrets that the US Attorney’s Office brought these charges without first notifying UMC and giving it an opportunity to discuss the matter.” Jinhua’s website is offline, and the Chinese Consulate General in San Francisco did not return a call asking for comment.

Whether any of this action will protect Micron’s position in the global market is an open question. The US government is operating under the assumption that, since Jinhua is owned by the state, the technologies for making DRAM may well find their way to other companies in China. It’s possible that the resulting chips will be recognizable as Micron-derived. “We appreciate the US Department of Justice’s decision to prosecute the criminal theft of our intellectual property,” said Joel Poppen, Micron’s general counsel in a press release. “Micron has invested billions of dollars over decades to develop its intellectual property. The actions announced today reinforce that criminal misappropriation will be appropriately addressed.” But company representatives did not answer questions about what impact increased Chinese DRAM production might have.

Whatever effects the indictments have on DRAM and the companies that make it, they might make broader geopolitical noise. An agreement between China and the US to not engage in trade-secret theft seems to have mostly collapsed under the Trump administration (even though the president tweeted Thursday morning that trade talks with China are going swell), so it makes sense that its agents are talking tougher. And the FBI’s San Francisco division hopes to further solidify relationships with Silicon Valley, a frequent victim of Chinese economic espionage. “A lot of times, they have this close hold [on information] because they don’t want to impact stock prices,” Bennett says. But he hopes that the fact that his office was able to investigate the alleged Micron theft for two years with no leaks will help show that his office is trustworthy. “Whether that’s being used as [political] chips or not, we don’t see that in the FBI. This is cases for us. We have economic loss,” Bennett says. “They broke American law, and we’re going to bring them to justice.”

Here is the indictment in the case:

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