Data Sheet—Monday, January 5, 2015

A belated Happy New Year, Data Sheet readers! Ridiculous crowds and endless taxi lines aren’t my thing, so I’ll be sharing tidbits from the Consumer Electronics Show desk-side from New Jersey. Speaking of gadgets, though, Intel just made another significant investment in wearable technology.

If you find this newsletter useful, forward it to your colleagues and business partners, and tell them to sign up! Did you miss one? Here’s an archive of past editions. Enjoy the first “real” workday of 2015.

IBM’s dubious distinction. The company’s stock sagged 12% during 2014 (ending around $160.44 per share). It’s the second straight year the company has led the list of worst Dow performers. Contrast that with the performance of Intel (a Nasdaq stock), which was up about 46%. Hey, no place to go but up, right? That must be what Warren Buffett is counting on. Wall Street Journal, Motley Fool

RadiumOne founder wants his company back. Former CEO Gurbaksh Chahal, who was fired over his conviction for battery and domestic abuse, is apparently proposing a “nine-figure” buyout of the ad-tech company. Re/code

Does Athenahealth need an infusion? Pretty much everyone agrees small physician offices and medical clinics need to automate records and billing processes. But the high-flying digital healthcare company is about to post its slowest annual growth since becoming a public company in 2007 (just 24.3% for the year). And hedge funds like David Einhorn’s Greenlight Capital have become very vocal short-sellers. Fortune

Computer Sciences fined $190 million. The penalty stems from a U.S. Securities and Exchange Commission accounting investigation. Reuters

Christmas Eve surprise: IRS sues Ballmer, other execs. The federal agency wants to force former CEO Steve Ballmer and nine other former and current executives to testify for an ongoing investigation into the software developer’s international tax practices. The Seattle Times

RESEARCH & PREDICTIONS

Don’t expect super strong tablet sales. A new forecast projects worldwide shipments of 233 million units in 2015, which represents an 8% growth rate in 2015. That’s far slower than double-digital expansions from the past several years. Gartner

High-tech’s 20-something myth. Contrary to popular perception, the median age for some of the best-known and biggest technology companies is over 30. Hewlett-Packard had the highest median age of the bunch considered as part of a PayScale analysis (39 years old), while Salesforce had one of the youngest (29). VentureBeat

Why email will be slow to die. Newfangled collaboration applications such as Slack are appealing, but 61% of U.S. workers surveyed by Pew Research Center say their digital inbox is their most important software tool. Wall Street Journal

POLICY & STRATEGY

Anatomy of a corporate cyberattack. It started with macabre images on an internal computer network just before Thanksgiving and led to the delay of a major motion picture release. Seven weeks later, Sony Pictures Entertainment still hasn’t recovered—executives have been relying on old BlackBerrys to communicate. (Hey, they're secure!) As experts debate whether an insider or North Korea is to blame, there’s one thing upon which they agree: every business needs more employee training on security policies. New York Times, Fortune

STARTUPS & DISRUPTORS

Predictive analytics, a potent prescription for health care

Just before the New Year, predictive analytics company Inovalon Holdings—which specializes in healthcare applications—filed plans to raise up to $500 million in an initial public stock offering.

“We believe that the opportunity before us is substantial as data increasingly becomes the lynchpin in health care—from clinical quality outcomes and financial performance, to the consumer experience and drug discovery,” the Bowie, Md.-based company notes in its papers.

Indeed, of all the potential applications for big data and emerging 3D simulation technologies (and there are many) those centered on speeding medical diagnostics or clinical trials could be the most life-altering. Literally.

That’s one reason this is a major early focus for IBM’s WatsonAnalytics service. So much so that the company is customizing its technology for the Mayo Clinic to speed up cancer research, and encourage higher patient participation. “With shorter times from initiation to completion of trials, our research teams will have the capacity for deeper more complete investigations,” said Nicholas LaRusso, the Mayo Clinic doctor leading the project. “Coupled with increased accuracy, we will be able to develop, refine, and improve new and better techniques in medicine at a higher level.”

DataStax, which sells distributed database management software used by the likes of eBay, Intercontinental Hotel Group, and Netflix, is also finding a following among businesses seeking to disrupt health care. Its technology underpins a service from Amara Health Analytics that uses real-time predictive analytics to identify sepsis, a notoriously difficult-to-diagnose infection that affects 1%-2% or all hospital patients. It also kills roughly half of who contract it. Amara’s application continuously monitors medical device data and alerts clinicians when a patient appears to be at risk.

“Amara can correlate symptoms and set probability assessments in real time, and they can do this in a way that is faster than a human observer. It helps clinicians intervene sooner. This is stuff that starts to impact quality of life,” said Billy Bosworth, CEO of DataStax, which raised a $106 million Series E funding round in September 2014.

Analytics plus 3-D simulation and modeling software are also at the heart (pun intended) of an ambitious research project led by French tech company Dassault Systèmes. The Living Heart Project, which includes researchers from the U.S. Food and Drug Administration, combines data about “physics of the human body” with information about materials used in medical devices such as pacemakers to anticipate how they will perform over time. “This is an expansion of our ability to predict how something will behave,” said Steven Levine, Chief Strategy Officer, Dassault Systèmes, SIMULIA, and director of the project.

The idea is to predict potential failures and speed innovation, while reducing the amount of money spent on client trials, Levine said. “If we can help the FDA and device manufacturers understand the failure mechanics so that they won’t place a risk on humans, they can improve reliability.”

Dassault Systèmes picked the heart as its first focus because cardiovascular disease remains the No. 1 cause of death globally and also because Levine has a personal interest in this research. His 20-something daughter, who was born with a rare congenital heart condition, is on her fourth pacemaker since the age of two. “The FDA has never really understood how strong the pacemaker leads should be. Now, we can simulate the motion that a person would go through. … Coupled with wearables technology, we are on the threshold of having an incredible amount of data about cardiovascular performance.”

MY FORTUNE.COM BOOKMARKS

Enterprise software in 2015: Bubbles, Box and Kim Jong-un By Roger Lee

Disney CEO Bob Iger’s empire of tech By Michal Lev-Ram

She’s an inventor. She’s 25. And she wants to make true wireless charging a reality By Daniel Roberts

7 CEOs who will be in the hotseat in 2015 By Claire Zillman

The smart car gets even smarter By Kirsten Korosec

15 fabulous Fortune reads from 2014 By Verne Kopytoff

With the Classic, BlackBerry looks back to the future By Jason Cipriani

A candid conversation with Pixar’s philosopher-king, Ed Catmull By Michal Lev-Ram

FOR YOUR INNER TECHNOPHILE

Could this be the biggest change in computing since the 1940s? Hewlett-Packard’s “Machine” vision reinvents the computing architecture for everything from mobile phones to notebooks to servers to supercomputers. The mission: handle ever-mushrooming data loads faster, while eating up less power. Here’s how HP Labs is applying 75 years of research and development to this ambitious project. Fortune

ONE MORE THING

First Oprah, now Zuck’s talking up books. Facebook’s founder and CEO Mark Zuckerberg is binge-reading as one of his 2015 resolutions. Up first is The End of Power, a tome by Moises Naim about realignments in the world’s power structure. You can read along, too! Re/code