Data Sheet—Friday, June 23, 2017

Creativity takes all sorts of forms, including creativity in business. There’s a fine line, of course, between creatively dreaming up new approaches to making a product (and a buck) on the one hand, and pushing the envelope beyond its limit on the other. The unfolding drama of Travis Kalanick’s fall from grace at Uber is the perfect example.

There is great tension of a different kind this week at the Cannes Lions International Festival of Creativity. The event began as an awards ceremony for creative work in advertising, much like the more famous film festival at the same venue. The awards continue, but to the consternation of ad-industry purists the event has been overrun by “ad-tech” companies like Google and many lesser known tech vendors as well as media and other business executives doing deals. It bears a strong resemblance, now, to CES or Davos, but in a vastly more gorgeous and warmer location, respectively, and with an audience size between the two.

I found plenty of business creativity this week in the people I interviewed at a chat-by-the-sea series hosted by Time Inc., Fortune’s parent, called Stirrers and Shakers. Lovers of art in advertising may not be appeased. But this was a group of networkers also thinking about the future of the media and advertising industries.

I wrote earlier in the week about Calvin Klein CEO Steve Schiffman, who disclosed plans to bring back iconic pitchwoman Brooke Shields. Rich Battista, CEO of Time Inc., appeared with Peter Naylor, head of sales for Hulu. Battista is attempting to reposition America’s biggest magazine company as a video producer. He mentioned that half the company’s employees have been around for fewer than three years. That group would include him (just over two years), but not me (15). The stat is sobering and telling of a company in transition. Naylor described a Hulu that has innovated in how it shows advertising to viewers, even as it aims to keep the ad footprint as light as possible.

A highlight of the week for me was meeting Alex Grant, better known as the solo artist and music producer Alex Da Kid. Grant is simultaneously a passionate music craftsmen—stars like Bono and Eminem hire him to help get to “the truth” in their songs, he says—and a unapologetic businessman. His marketing agency KIDinaKORNER, supported by ad giant WPP, works with brands like IBM to incorporate music and events into their branding strategies.

Finally, I spoke to Lisa Clunie, who with business partner Jamie Robinson has started an independent, woman-owned ad agency called Joan Creative. The duo thought about “fiercely rebellious” Joans like Joan of Arc, Joan Rivers, Joan Didion, and Joan Armatrading when they named their firm. Their perspective is a breath of fresh air from their financial model (they charge for work they do, not by the hour) and the work itself, including “experiential” exhibits for clients.

After all that creativity—and a hectic several weeks in general—it’s time for a break. I’ll be off next week, returning after the Fourth of July. Happy summer, everyone.

NEWSWORTHY

If you don't ask. After meeting with tech CEO bigwigs on Monday, President Donald Trump had business leaders from telecommunications and drone companies over to the White House on Thursday. AT&T CEO Randall Stephenson pressed for deregulation of rules slowing the deployment of new, smaller cell sites. Drone companies sought a weakening of rules limiting where their remote-piloted gadgets can fly.

If you don't ask, Part II. Electric carmaker Tesla reached out to the big record labels about getting the rights to start its own streaming music service, Recode reported. The possible service would compete with all of the established music apps already available while driving, from Apple Music and Spotify to Pandora and Sirius XM radio.

Better not to ask. Blackberry's ongoing shift to selling software instead of hardware hit a rough patch, as the former king of smartphones reported fiscal first quarter revenue dropped 41% to $235 million, even less than Wall Street had expected. Blackberry's stock, which has been a tear gaining 61% this year, was down 6% in pre-market trading.

They asked for it. Before leaving office, President Barack Obama approved a plan to plant covert cyber weapons in Russia's infrastructure, the Washington Post reported (subscription required). Now President Trump must make the decision when, if ever, to use the attack.

Ask and you shall receive. London cryptocurrency startup Blockchain raised $40 million from backers, including the venture capital arm of Google's parent, Alphabet. Customers using the company's wallet app for transacting in digital currencies like bitcoin are doing about $2.5 billion in transactions a month, CEO Peter Smith said. "Anybody with a reasonable ability to use a smartphone can use it. My grandmother uses our product today."

That's not what I asked for. The net neutrality fight is all about fair competition over the digital bits flowing across the Internet. But sometimes the competitive clashes are less digital and more physical. A tiny Internet service provider in Texas has sued Comcast, alleging that the cable giant actually cut its lines. Comcast denied wrongdoing.

IN CASE YOU MISSED IT

These Jobs Are Safer From Automation Than We Thought by Barb Darrow

Virtual Reality Needs to Fix Stomach-Churning Experiences by Jonathan Vanian

Mark Zuckerberg’s New Facebook Mission: ‘Bring the World Closer Together’ by Tom Huddleston, Jr.

Uber Staffers Are Signing a Petition to Reinstate Ex-CEO Travis Kalanick by Polina Marinova

Arianna Huffington as Uber’s Next CEO Isn’t as Crazy as It Sounds by Polina Marinova

Apple Is Quietly Scrubbing the App Store by Don Reisinger

Traders Get Burned in Ethereum Flash Crash by Jeff John Roberts

FOOD FOR THOUGHT

Have big tech companies changed the economy for better or worse? There's plenty of focus on that question as Apple, Facebook, and Google have come to dominate their respective fields and then expand into others.

This week a factoid about the three spread like wildfire: Their combined 2016 revenue of $336 billion almost equals the $376 billion of the big three automakers, GM, Ford, and Chrysler in 1990. But the tech companies employ only about one-tenth as many workers.

Adjusted for inflation, however, the carmakers are well out of reach with $547 billion of revenue. And looking at employee productivity, the tech companies pull ahead, with revenue per worker of well over $1 million.

FOR YOUR WEEKEND READING PLEASURE

A few interesting longer reads I came across this week, suitable for perusing over the weekend:

The Quantum Computer Factory That's Taking On Google and IBM
A few yards from the stockpile of La Croix in the warehouse space behind startup Rigetti Computing’s offices in Fremont, Calif. sits a machine like a steampunk illustration made real. Its steel chambers are studded with bolts, handles, and circular ports. But this monster is powered by electricity, not coal, and evaporates aluminum, not water—it makes superconducting electronics.

Google’s Elite Hacker SWAT Team vs. Everyone
Brash. Controversial. A guard against rising digital threats around the globe. Google’s Project Zero is securing the Internet on its own terms. Is that a problem?

When Cutting-Edge Science Meets Science Fiction, It Packs the House
“You never know how inspiration comes to people,” Green said. “It could be from a movie, or from talking to a teacher—or an astronaut. If it’s a movie that sparks an interest in finding out more about the Higgs Boson particle, that’s the start of a journey. It gives us an opportunity to dream, and without dreams, you’ll never be able to live them. Dreaming to go to Mars will become a reality."

The Razor Wars Have Begun and Somebody’s Going to Get Hurt
I’m standing in a darkened room wearing 3D glasses, surrounded by Portuguese-speaking women and a bald, bearded man. "Take the glasses off if you feel nauseous," says the man, Gillette’s "virtual reality technical integrator." (He declined to give his name.) We're in the razor maker’s virtual reality studio, a Winnebago-sized space inside Gillette World Shaving Headquarters off Dorchester Avenue, a place seldom open to the general public.

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