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Data Sheet—Wednesday, February 3, 2016

What strikes me as most depressing about Yahoo is that roughly a billion people use it each month and yet it can’t grow, doesn’t make a ton of money, and is the doormat of Silicon Valley. If a pioneering media company that is beloved by many of its multitude of customers can’t make it, who can?

Two thoughts on that, in no particular order. First, that Yahoo is a media company very likely is its worst problem. Google and Facebook sell advertising extremely well. But they aren’t media companies. They create advertising products and platforms; they don’t create content. And despite some more or less honest efforts to throw revenues the way of those who do deal in the realm of ideas, information, and entertainment—Google’s YouTube is a genuine example—the two Internet behemoths succeed because they’re great with software and have found extremely profitable and clever ways of skimming the cream off of the creativity of others.

Yahoo, on the other hand, has stubbornly continued to be a media company with dollops of technology layered on top, though not nearly as well or as consistently as Google and Facebook. (Yahoo reported a dismal quarter Tuesday and said it would sell assets and reduce its workforce.) One of Marissa Mayer’s signature media moves in her three-year-plus year tenure as CEO was to buy the blogging platform Tumblr for $1 billion. Yahoo wrote down the value of Tumblr and other acquisitions for a total of $4.4 billion.

The second thought about Yahoo not having made it concerns the company’s own self-inflicted wounds. Mayer said Tuesday the company needed to simplify itself. But that’s after she took a hopelessly complicated company and made it more complicated with a blitz of acquisitions, product re-shuffling, and confusing acronyms. To her credit, she gave it the college try, and the board of directors wanted an Internet product expert, not a financial engineer, as CEO.

Mayer isn’t the first CEO to try and fail with Yahoo. And she’s not the first to fumble with media assets. News flash: This isn’t an easy business.

Adam Lashinsky
@adamlashinsky
adam_lashinsky@fortune.com

BITS AND BYTES

Arista faces import ban in Cisco patent case. A judge with the International Trade Commission found that the networking technology upstart infringed on three of Cisco’s software patents. A final determination isn’t expected until June, but this development could lead to an import ban on Arista’s network switching equipment. Arista still claims no wrongdoing, but plans modifications to its software by the second quarter. (Wall Street Journal)

Amazon may build hundreds of bookstores. After a successful experiment in Seattle, the e-commerce giant is planning 300 to 400 brick-and-mortar locations. That’s according to the CEO of General Growth Properties, which operates shopping malls. For perspective, Barnes & Nobles currently runs 640 stores. (Wall Street Journal)

Intel makes progress on diversity. The chipmaker paid male and female engineers equally last year, according to its ongoing analysis of hiring practices and compensation. That’s a big accomplishment, when you consider the average gender gap across the U.S. workforce is 23%. Intel’s staff also includes more women, but it isn’t doing as well with improving minority representation, especially among African-Americans. (Fortune, Wall Street Journal)

Microsoft buys artificial intelligence expertise. The software giant has disclosed its intention to acquire SwiftKey, which makes a mobile app that predicts which words you’re typing on your smartphone and automatically fills them in if you want. Microsoft has been on a mobile app buying binge, but SwiftKey’s predictive software is the real prize here. (Fortune)

Uber explains its bizarre new logo. Forget the ubiquitous “U” symbol. Brace for a rainbow of colors, instead of black and gray. The ride-sharing company is preparing many new services, and wants its transportation network to appear more “human” to customers. (Wired, Fortune)

 

THE DOWNLOAD

Data will keep flowing between the U.S. and E.U. after all. The European Union and United States have forged a last-minute deal to keep transatlantic data flowing—one that should mean tough new obligations for both American companies and intelligence services.

The new framework will be known as the EU-U.S. Privacy Shield. It replaces the previous agreement, known as Safe Harbor, which was overturned last October. According to the European Commission (the EU’s executive body), it will do what Safe Harbor failed to do: Keep European citizens’ personal data safe.

This really went down to the wire: An end-of-January deadline for agreeing on the successor to the struck-down Safe Harbor agreement passed with no deal, and EU privacy regulators are meeting today and tomorrow to discuss their crackdown on companies sending EU citizens’ data to the U.S. without legal backup.

There’s still a chance that the deal will hit some legal hurdles in the coming weeks as the precise wording is worked out. Read more about what it entails here. (Fortune)

IN CASE YOU MISSED IT

Mayer pitches a ‘simplified’ Yahoo, but everyone knows it’s a complicated mess by Erin Griffith

Apple’s big data center plans worry Amazon cloud watchers
by Barb Darrow

Salesforce promotes heir apparent Keith Block by Heather Clancy

Apple has wasted billions on buybacks by Shawn Tully

5 ways a firm can stop a data breach by Jeff John Roberts

BoardList wants to be the LinkedIn for female director candidates
by Kristen Bellstrom

This startup just got $10 million to predict politics with tech
by Jeff John Roberts

IBM buys another digital firm, this one in Europe by Heather Clancy

Salesforce gives its State of the Union address by Jonathan Vanian

ONE MORE THING

Would you invite HoloLens to your Super Bowl party? Realistically, Microsoft’s augmented-reality headset is months away from official release. Here’s a concept video anyway showing potential applications for football fans, including a brand new version of instant replay. (The Verge)

This edition of Data Sheet was curated by Heather Clancy:

@greentechlady
heather@heatherclancy.com