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Data Sheet—Wednesday, January 6, 2016

January 6, 2016, 1:52 PM UTC

One comes to CES, the vast trade show in Las Vegas that peddles technology gadgets, to learn about shiny, new stuff.

My unexpected epiphany from an interview Tuesday night with the CEO of Ford and a panel of top corporate marketers was the importance of old stuff. Innovation is great and all, but it’s easy to forget that existing products have stubbornly persistent value too—sometimes greater value than the new things.

I interviewed Mark Fields, the CEO of Ford, who had come to CES to talk about some of the car company’s experiments using new technology. These include self-driving cars, systems to connect home-electronics to cars, and drones. Yet at a Fortune dinner attended by more than 100 people whose planes didn’t get cancelled trying to travel to rain-soaked Las Vegas, Fields made an impassioned plea for the importance of Ford’s core business.

Ford spends more than $5 billion on capital expenditures each year. Almost all of that goes into making cars and trucks. A tiny amount—Fields wouldn’t give a number or a percentage—goes to the new stuff. He also said it’s fine by him if Ford isn’t the first to commercialize a fully autonomous car. Having a good, safe, profitable self-driving car is better than being first, he said.

Following the Fields interview, Fortune’s Andrew Nusca moderated a panel of top marketers from Hyatt, the NBA, and Target. An audience member asked why, after all these years, marketers still send him so much paper he doesn’t want. Jeff Jones, chief marketing officer of Target, responded that for all the hoopla over digital marketing—and he’s a fan of it—old-fashioned techniques like coupons, Sunday inserts, and catalogs still deliver great value to marketers. Consumers, it turns out, like them.

Cars driven by robots and digital-first media strategies undoubtedly are the future. That doesn’t mean there’s no value in present technologies. The thrill of pressing the pedal to the metal and the joy of rustling a newspaper between your fingers persists, especially outside the urban oases where the technology elites live. The future is coming for sure, but not necessarily immediately.

Adam Lashinsky


Apple trims iPhone production. Smartphone component suppliers say the tech giant has cut back on orders for the current quarter ending in March, a development first reported by Japan's Nikkei news service. Nothing is official, but it was reported that Apple's primary contract manufacturer started idling workers at least one month before the holidays. Apple's stock has been pummeled in recent weeks. Its price is nearing $100, a level the company hasn't seen since October 2014. (Wall Street Journal, Fortune)

Activist investor advocates Yahoo management changes. In a letter to the Internet company’s board, Starboard Value reiterates its desire to see Yahoo sell or spin off its core search and advertising businesses. It suggests that won’t happen unless there’s a change in leadership. (Reuters)

Microsoft faces more questions from Chinese antitrust regulators. The software giant has already spent lots of time sharing information about its business practices in China, but officials say they need more data. The scrutiny began in 2014. Microsoft isn't alone: chipmaker Qualcomm was last year fined $975 million after a similar investigation. (New York Times)

Software will ignite tech spending turnaround. The amount of money spent on computer hardware, software, and services will grow 3.8% to $2.9 trillion this year—basically a return to 2014 levels, according to projections from Forrester Research. However, money dedicated to software as a service should expand at a fast-paced 24%. (Fortune)

Verizon wants $2.5 billion for its data centers. Like its rivals AT&T and CenturyLink, the telecommunications company will pare down to focus on its core services, reports Reuters. The sale involves 48 co-location facilities, which includes a portfolio of assets acquired four years ago through Verizon's $1.4 billion takeover of Terremark. (Reuters)

Twitter flirts with allowing 10,000-character messages. Right now, the social media platform forces people to express themselves in 140 characters or less. (Or, with a photo or video.) CEO Jack Dorsey publicly hinted at new features that would allow Tweets that are 100 times the current maximum. Or, at least, he's thinking about it. (Fortune)

Oracle buys digital ad-tracking company. The company is paying an undisclosed sum for AddThis, which collects data for more than 1.9 million unique monthly Website visitors and more than 15 million domains. The AddThis platform will become part of Oracle’s Data Cloud business, along with technology from the company’s recent acquisitions of data services companies BlueKai and Datalogix. (TechCrunch)

Quest to unionize IBM ends. A local branch of the Communications Workers of America, called Alliance@IBM, has been trying to organize IBM workers since 1999. The company's frequent reorganizations and layoffs complicated the process, and the group recently announced it was "suspending" its union efforts. (Computerworld)



This entire newsletter could be dedicated to visualizing the CES-related frenzy in Las Vegas, but we decided to only highlight a few things. Here are five developments you really need to know about today:

  1. Intel makes friends with Lady Gaga. Drones with crash-avoidance systems, data-gathering snowboards, and a mysterious relationship with the sultry singer (details TK next month) factored large in CEO Brian Krzanich's keynote. (Wall Street Journal)
  2. Samsung reasserts its electronics dominance. You were probably expecting the company to reveal its two new Galaxy smartphone models, but I'll bet you didn't anticipate that it would also announce that its smartwatches would run iPhone apps. Or that it would start selling Windows tablets again, including a credible rival to Microsoft Surface. Plus, you can now control your Samsung dishwasher through your Samsung smart TV, and reorder groceries with its smart refrigerator. (Fortune)
  3. Ford is turning your car into a remote control. Its new partnership with Amazon and home-automation company Wink will enable you to control lights, thermostats, and other smart gadgets from your dashboard. (Fortune)
  4. Fitbit reboots its smartwatch lineup. The company's Blaze smartwatch includes the same monitoring features you'd associate with a fitness band, plus includes extra apps—such as text messaging and calendars. So far, investors seem unimpressed. Fitbit's stock lost 18% of its value on Tuesday. (Fortune)
  5. Tesla shouldn't be worried. The much-hyped electric vehicle company Faraday Future showed off its futuristic concept car at the show. Many were underwhelmed. (Fortune)


Apple's bizarre valuation: Something's got to give by Philip Elmer-DeWitt

How Snapchat plans to supercharge its lackluster ad business
by Kif Leswing

You spent twice as much time on a smartphone or tablet in 2015
by Don Reisinger

New York is turning on its Google-owned free Wi-Fi network
by Kif Leswing

Virtual reality game industry to generate $5.1 billion in 2016
by John Gaudiosi

This wearable gadget alerts you if you're getting too much sun by John Kell

The guy who invented the hashtag now works for Uber by Michal Addady

This company can no longer claim its games prevent Alzheimer's
by Robert Hackett

Why your next vision exam could involve playing video games
by John Gaudiosi

Magic, the virtual assistant for everything, debuts a premium service
by Leena Rao

Oculus Kickstarter backers just got a great surprise by Andrew Zaleski

This software helps your employees pick the right health plan
by Heather Clancy


E-cigarette usage soars among minors. Children in middle school and high school now smoke more e-cigs than "real" cigarettes. (Reuters)

This edition of Data Sheet was curated by Heather Clancy: