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May 22, 2018

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Incumbency has its advantages.

We at Fortune should know. We’ve been publishing the annual Fortune 500 list of largest companies in the U.S. since 1955. Others publish lists of bigness and profitability and market value. But only the Fortune 500, a ranking based on revenues, is synonymous with size and durability and prestige among America’s biggest enterprises.

That gorgeous issue (326 pages in print!) hits newsstands—and our website—this week. It’s a great opportunity to dig into some of the most important companies in the world’s (still) largest economy. Unsurprisingly, tech companies are more than well represented on the list, as well as in our deep-dive stories in the issue.

And the obstacles to challenging an incumbent shine through in Beth Kowitt’s penetrating story about Amazon’s notably tough slog in establishing itself as a powerhouse in the grocery business. Walmart steamrolled incumbents in the business a generation ago to become the nation’s biggest grocer. Amazon, which has boldly challenged Walmart in a retail slugfest, has had far less success in the grocery segment. The competitive beast from Seattle, it turns out, excels at selling non-perishable goods. When freshness is imperative and the merchandise can’t be warehoused, Amazon has struggled.

This explains Amazon’s purchase of Whole Foods. Kowitt has sparkling examples of how Whole Foods give Amazon a shot at grocery relevancy and doubles as a real-time laboratory for Amazon’s technology ideas.

Whether you’re a challenger or an incumbent yourself, this is a story that’s worth a read.

Adam Lashinsky
@adamlashinsky
adam_lashinsky@fortune.com

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NEWSWORTHY

Steve Ballmer is jealous. The Finnish startup run by former Nokia execs that makes Nokia-branded phones under license, HMD Global, was valued at over $1 billion in a $100 million fundraising round. The company had a net loss of $77 million on sales of $2.1 billion last year after shipping 70 million phones and plans to use the cash infusion to expand its device portfolio and retail reach. "We aim to be among the top smartphone players globally," CEO Florian Seiche said.

Joe Biden is jealous. The rumors were true and Netflix announced on Monday a wide-ranging deal with Former President Barack Obama and former First Lady Michelle Obama. The multi-year agreement covers "scripted series, unscripted series, docu-series, documentaries, and features," Netflix said.

The SEC is jealous. The Commodity Futures Trading Commission issued guidance on Monday instructing trading exchanges how they can list derivative contracts likes options and futures on digital currencies like bitcoin. Two of the largest exchanges, the CME and the CBOE, have already started trading bitcoin futures.

PUGB players are jealous. Game publisher Epic Games put up $100 million as a prize pool for players of its monster hit title Fortnite. Epic's $100 million pot is bigger than the 10 most popular e-sports tournaments combined according to numbers taken from esportsearnings.com.

Facebook users are jealous. A security flaw in a Comcast web site allowed security researchers to find customers' Wi-Fi network names and passwords, ZDNet reports. Comcast closed the loophole after the article was published.

Robocallers are jealous. The new European privacy law known as the General Data Protection Regulation has prompted a wave of emails from web sites and online services notifying users about updated privacy policies. The aim is to ensure users have given consent for data sharing. But EU officials say the email are likely unnecessary, The Guardian reports. "Think about whether you actually need to refresh consent before you send that email, and don't forget to put in place mechanisms for people to withdraw their consent easily," Steve Wood, the deputy information commissioner, noted in guidance for companies.

Sheryl Sandberg is probably not jealous. Speaking of European laws, Facebook CEO Mark Zuckerberg is in Brussels on Tuesday to answer questions from European Parliament members about his company's recent scandals. The testimony is being live streamed.

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FOOD FOR THOUGHT

Hackers stealing credit numbers, Facebook oversharing personal data, Russian bots spreading propaganda. Sometimes it's hard to pick which scandal is the worst. But Slate's Will Oremus wants us to focus on the wireless carriers selling real time location data about all of their customers. Securus, one site that sells the data, has already been hacked and a flaw at another site called LocationSmart accidentally allowed anyone to view anyone else's tracking feed. Why doesn't the public seem to care? Oremus has a theory:

Privacy abuses and slip-ups by major tech companies have become so numerous, and the prospect of containing them seems so hopeless, that the public and much of the media have become nearly numb to them. My data was hacked? So it goes. It may have been used in unauthorized ways by unspecified parties? C'est la vie. But the idea that my data was hacked to help elect Donald Trump? That was what elevated the Cambridge Analytica story and got people to care about things, like privacy policies and developer permissions, that they had long taken for granted.

What the LocationSmart scandal lacks is not import, nor the potential for serious harm, but a link to some divisive political issue or societal outrage sufficient enough to generate visceral anger from people who aren't privacy wonks.

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IN CASE YOU MISSED IT

Japan's Biggest Bank to Switch on Blockchain Payments in 2020 By Robert Hackett

Trump Vowed to Save ZTE's Chinese Workers. Now China and the U.S. Have a Plan By David Meyer

Three Techniques for Building Stronger Teams From Facebook's Jen Dulski By Jennifer Dulski

Walmart and Dunkin' Donuts Gaining on Apple Pay and Samsung Pay, But Starbucks Is Tops By Aaron Pressman

Donald Trump Is Using a 'Twitter' Phone Without a Critical Security Measure. Here's What Could Go Wrong By David Meyer

Meet Facebook's Fix-It Team By Michal Lev-Ram

Adobe to Buy Magento Commerce for $1.68 Billion By Jonathan Vanian

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BEFORE YOU GO

Although some prior Tesla models have gotten top marks from reviewers, the new Model 3 isn't faring as well. Consumer Reports says it found "big flaws" with the cheapest Tesla's ride quality, excessive reliance on touch screen controls and braking distance. "These performance and ergonomic problems were serious downsides to an otherwise impressive performance sedan," the magazine said, concluding it could not recommend the car.

This edition of Data Sheet was curated by Aaron Pressman. Find past issues, and sign up for other Fortune newsletters.
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