Data Sheet—Friday, January 8, 2016

The summit calls to mind the saying about what happens when an unstoppable force (the tech industry) meets an immovable object (the United States government). Law-enforcement, national security, and intelligence officials are increasingly annoyed with tech concerns for not doing their part in what once was called the “war on terror.” Social-media platforms have become prime distribution channels for propaganda and recruitment for organizations like the Islamic State. The feds think Silicon Valley should do more; the tech companies are fearful of being seen as collaborating with Washington in a post-Snowden environment.

Students of history might take note that it’s rare to beat the U.S. government, which knows a thing or two about defending its turf. Still, several issues are at play. Social media is one. Another that may present common ground is the government’s desire to tap the Valley’s expertise in developing terrorism-fighting technology.

Reuters reported Thursday that encryption is not on the agenda for Friday’s meeting. If so, it could be that Washington understands an intramural quarrel is brewing over encryption and the use of customer data. The battle lines there find Apple and Microsoft, privacy purists who make their money selling hardware to consumers and software to businesses, respectively, on one side. On the other are Google and Amazon, whose businesses are built on mining their customers’ data in the name of serving them up valuable information.

The very notion of a powerful delegation of federal political appointees descending on Silicon Valley must be jarring for an industry built on leave-us-alone libertarian political ideals. Technology types at times come off as woefully ignorant of how much they benefit from the largesse and firm hand of the U.S. government. Representatives of their government undoubtedly plan to remind them on Friday.

BITS AND BYTES

Samsung sounds warning on 2016 growth. The South Korean electronics company anticipates a 15% increase in operating profit for its fourth quarter, which is below expectations. What's more, it predicts "tepid" global economic growth will weigh on smartphone and semiconductor sales this year. That outlook jibes with reports about Apple's iPhone production woes, which have been debated ad nauseum this week. (Reuters, Wall Street Journal)

Apple can now detect your emotions. The tech giant is buying Emotient, which was one of several companies focused on enabling computers to recognize human emotions. It's characteristically mum about the motivation, but facial recognition is drawing plenty of attention. Emotient's software is often used to help marketers gauge reactions to advertisements and messaging. (Wall Street Journal)

Kodak jumps into 360-degree camera fray. As virtual reality enters mainstream consciousness thanks to experiments, such as the New York Times using Google Cardboard to disseminate short stories, the need for optimized, 360-degree video is growing. Kodak jumped into the fray at CES with a $500 camera, available immediately. That's notable, since most cameras capable of capturing that content—such as ones planned by GoPro and Vuze—won't be available until later this year at higher price point. (Fortune)

Panasonic: High hopes for Tesla relationship. The Japanese electronics company will spend $1.6 billion on the Nevada battery factory it's building in collaboration with the electric vehicle maker. The site won't be operational for several years. It's just one component of Panasonic's strategy to become a major automotive tech supplier. The company expects its sales from this segment—around $11 billion annually—to double over the next four years. (Wall Street Journal)

What's behind IBM's brain drain? Apparently Steve Mills, the 43-year veteran who ran the company's software strategy, wasn't the only senior executive to leave last month. Danny Sabbah, who was general manager for its cloud unit, and Brendan Hannigan, in charge of security, also left in December. Perhaps another reorg is in the works. (Fortune)

San Francisco's struggles illustrate 'sharing economy' growing pains. The city's biggest traditional taxi company has filed for bankruptcy, and some of the blame goes to competition from Uber and Lyft. Meanwhile, the municipal government wants Airbnb's help in fighting illegal rentals. (Fortune)

U.S. fails annual broadband access checkup. Almost 34 million Americans, which is about 10% of the country, don't have access to high-speed, fixed Internet services offered at the agency's minimum required speeds. The disconnect is most pronounced in rural regions. (Ars Technica)

THE DOWNLOAD

Ford CEO Mark Fields: How to be innovative even after 113 years. Startup companies, while typically cash-poor, have a lot of freedom to experiment with ideas and products, and pivot into new areas if those fail. Meanwhile, execs at large mature companies might have large pools of capital to play with, but lack the independence, or mental fortitude to tinker with their lucrative business models.

Ford Motor Co. demonstrated at CES this year that even at 113 years of age the business can still experiment and evolve. While the markets seem to favor new entrants unburdened by the past, the future likely belongs to those who can somehow figure out how to embrace the new while preserving the best of the old. In an interview with Brainstorm Tech chair Adam Lashinsky, Fields argues that’s what Ford is doing. Here's how.

IN CASE YOU MISSED IT

How much does Apple pay Jony Ive? by Philip Elmer-DeWitt

Here's what it's like to use HTC's VR headset by John Gaudiosi

Bosch makes a case for the connected factory by Alan Murray

IBM's Ginni Rometty finds more work for Watson at CES
by Stacey Higginbotham

Startup funding fell off a cliff last quarter by Erin Griffith

Panasonic relaunches an iconic turntable—but is the vinyl boom a bubble? by David Z. Morris

6 new wearables that promise to make you healthier by Chris Morris

ONE MORE THING

This drone can actually carry a human. The fully electric, tablet-steered EHang 184 is the first unmanned aerial vehicle capable of transporting someone weighing less than 220 pounds. Its wing arms fold up, for easier storage or parking. (Fortune)

MARK YOUR CALENDAR

Google Ubiquitous Computing Summit: Platforms and protocols for wearables, home automation, and the Internet of things. (Jan. 11 - 12; San Francisco area)

Connect 2016: Mobile Internet trends. (Jan. 14; San Francisco)

Connect: IBM's social business and digital experience event. (Jan. 31 - Feb. 3; Orlando, Florida)

IBM InterConnect: Cloud and mobile issues. (Feb. 21 - 25; Las Vegas)

Enterprise Connect: Communications and collaboration trends. (March 7 - 10; Orlando, Florida)

Pure//Accelerate: The future of the modern data center. (March 14 - 15; San Francisco)

Next 2016: Google's cloud platform strategy. (March 23 - 24; San Francisco)

Microsoft Build: Microsoft's premier developer conference. (March 30 - April 1; San Francisco)

Microsoft Convergence: Where business meets possibility. (April 4 - 7; New Orleans)

EMC World: What's next for digital business. (May 2 - 5; Las Vegas)

The Marketing Nation Summit. Marketo's annual conference. (May 9 - 12; Las Vegas)

Salesforce Connections. Cloud marketing trends. (May 10 - 12; Atlanta)

Knowledge 16: ServiceNow's annual service management conference. (May 15 - 20; Las Vegas)

Fortune Brainstorm E: The intersection of technology, energy, and sustainable business. (May 16 - 17; Carlsbad, California)

SAPPHIRE Now: SAP's annual conference. (May 17 - 19; Orlando, Florida)

Fortune Brainstorm Tech: The world's top tech and media thinkers, operators, entrepreneurs, innovators, and influencers. (July 11 - 13; Aspen, Colorado)

Sage Summit. For fast-growth businesses. (July 25 - 28; Chicago)

Microsoft Ignite: Product roadmaps and innovation. (Sept. 26 - 30; Atlanta)

OracleWorld. The future of the cloud is now. (Sept. 18 - 22, San Francisco)

Dreamforce: The Salesforce ecosystem gathers. (Oct. 4 - 7; San Francisco)

This edition of Data Sheet was curated by Heather Clancy: