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Data Sheet—Monday, February 22, 2016

February 22, 2016, 1:36 PM UTC

Timing is everything, and mine was less than perfect in landing a relatively rare interview with Apple CEO Tim Cook a few days before the company’s kerfuffle with the United States government over encryption broke out. Regrettably, I didn’t raise the subject during our 23-minute dialogue.

Before addressing what I did discuss with Cook, whom I profiled in Fortune a year ago and six-plus years before that too, here are some thoughts on the great privacy debate. Two of the best overviews and arguments I’ve read come from the Wall Street Journal, a learned and clear-thinking editorial and a column from Holman Jenkins. My take: Apple undoubtedly believes it is standing on principle, yet its resistance to those who protect us borders on churlishness. Apple’s resistance also is futile: It will lose this skirmish, and life will go on.

Speaking of life, and business, going on, the two bits I encourage you to focus on in my interview with Cook involve Apple’s widely reported but still secretive car project. Apple is Fortune’s most-admired company, as judged by other business executives, for the ninth consecutive year. This is true in no small measure because the world admires Apple’s appetite for risk and willingness to act boldly. (To state the obvious: Its position on encryption furthers the argument.)

Cook told me that it’s unlikely Apple would spend gobs of money on a project and then abandon it. The critical bit came next. Investing in capital equipment such as tooling constitutes gobs of money, not hiring teams of several hundred to pursue ideas, which is what Apple purportedly has done. The mere existence of a large auto team proves nothing about Apple’s intentions. Not yet anyway.

I also asked Cook if he thought a contract manufacturer could build a car. This is a hot topic in the auto world, a decades-old, soup-to-nuts industry. Cook was demonstrative: A car could be built following the same model that Apple builds smartphones and computers.

To review, Apple hasn’t yet shown publicly it is building a car, but if it does it won’t have to build new factories to do so.

Could there be more exciting times?

Adam Lashinsky

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Apple calls for government commission on encryption debate. Tim Cook reaffirmed his company's opposition to a court order requiring his company to unlock the San Bernardino shooting suspect's iPhone for the FBI—calling for Congressional discussion of the privacy issues at stake. It has hired prominent lawyer Tim Olson to aid its cause. Apple support domestically is tenuous, but this fight is about more than one phone. Cook outlined his position in an email to employees, obtained by The Verge. (Wall Street Journal, Fortune, New York Times, The Verge)

Did Mark Zuckerberg upstage Samsung's smartphone launch? The South Korean electronics giant unveiled the latest edition of its flagship smartphone, Galaxy S7, but its virtual reality intentions stole the spotlight. The company launched a 360-degree camera slated to ship in the second quarter. Plus, Facebook CEO Mark Zuckberg showed up as a surprise and the company gave out a free VR headset to everyone in the audience. Samsung worked with Facebook's Oculus division to develop its $99 Gear headset. (Wall Street Journal, Fortune)

Get ready for mobile device proclamations galore. The usual suspects are in Barcelona this week for the Mobile World Congress. New and notable so far: LG's modular smartphone, Huawei's hybrid laptop-tablet computer, HP Inc.'s Windows 10 phablet, and Sony's smart earpiece. (Fortune, Wall Street Journal)

Yahoo sets meetings with potential bidders. The Internet company will officially begin negotiations to sell off core assets this week, reports Bloomberg. On the list of potential buyers are communications giants Verizon, Comcast, and AT&T, along with private equity firms Bain Capital, KKR & Co., and TPG, according to the report. (Bloomberg)

Facebook pushes open source networks. Facebook is teaming up with Nokia, Intel and other telecommunications industry players on the Telecom Infra Project (aka TIP). The idea is to create a modular approach to assembling communications networks. The model echoes the strategy behind Facebook's Open Compute Foundation, which it created five years ago to reduce its dependency on proprietary data center technologies. (Fortune)

China tightens restrictions on online publishing. The country has been strict for some time, but new regulations that take effect March 10 spell out the limits more explicitly. Companies with foreign ownership are banned from the activity, unless they get special permission. The rules also require that all content—including text, maps, games, cartoons, and video and audio files—be hosted on servers inside China. (Fortune)

Amazon, Ericsson ink cloud partnership. Under the agreement, the Swedish telecommunications infrastructure giant will help its traditional telco customers build bridges between their own data centers and those operated by Amazon Web Services. (Fortune)


Twitter wants to help your customer service team. Facebook is vocal about its strategy to turn its Messenger chat service into a conduit for customer service. Twitter supports a similar vision, one that advanced last week with two updates to its social media platform.

The first change comes in the form of software enabling customer service representatives to turn public support inquiries into private interactions. There, concerns could theoretically be resolved without the eyes of the Twittersphere watching. Twitter has also introduced an entirely new feature, called Customer Feedback, which encourages customers to share how they feel after specific support conversations. (Fortune)



Ford's new wearables lab is pioneering in-car health tech by Andrew Zaleski

World to miss Internet access targets 'by a mile' at current pace
by David Meyer

Here's Steve Jobs on what privacy means to Apple (video)
by Philip Elmer-DeWitt

Smart watches outship Swiss watches by Jonathan Vanian

Carnival sets sail with virtual reality vacations by John Gaudiosi

Trucking camera Lytx acquired for $500 million by David Z. Morris

Did Uber steal this startup's logo? by Jen Wieczner


Don't worry, you're still smarter than a computer. At least when it comes to identifying images. (Fortune)

This edition was curated by Heather Clancy.