Data Sheet—Like Webvan and Pets.com, Bitcoin and Digital Currencies Have Potential Value
I was asked recently to share my views on bitcoin, the virtual currency whose price—not value—recently crossed $10,000. I’ve tackled tough topics I needed to understand at least a little in my time: semiconductors, enterprise software, net neutrality. (Patience, people. Patience.) But cryptocurrencies, I conceded, is a subject that for the first time in my career has made me feel old. No matter how many times it is explained to me, I only get it a little better than the last time.
What to make of the tulip-like run-up in the price of bitcoin, then? It is clearly a speculative bubble, and not even one with a hint of value to the underlying asset. Indeed, bitcoins were supposed to be a payment mechanism, but their recent price explosion means holders keep holding rather than using as intended, as the estimable cryptocurrency expert Nathaniel Popper points out in The New York Times. (Porn and drug purveyors have found true utility in bitcoins.)
Yet just as Webvan, Ariba, and even Pets.com had some potential value, so do cryptocurrencies. Gold had a centuries-long run as a vessel for stored value, and so too could these confusing things that are “mined” by computers.
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But don’t confuse speculative price increases with valuable products. The latter will take time.
It turns out that Data Sheet readers aren’t only ones reacting passionately to proposed changes to the net neutrality rules. This NPR piece, presented as a “long view,” is in actuality a platform for “free and open Internet” advocate Tim Wu to espouse his views. Contrariwise, the one and only Ben Thompson has weighed in with “Why Ajit Pai Is Right,” where he also takes after Tim Wu.
Shrinking clouds. Design software maker Autodesk plans to cut 1,150 jobs, or 13% of its workforce, as it shifts focus to selling subscriptions instead of mostly charging upfront for its products. In addition to announcing the layoffs on Tuesday, the company reported 5% growth in third-quarter revenue to $515 million. Autodesk’s net loss narrowed to $120 million from $143 million.
Dark cloud. A major security flaw in the latest version of Apple’s desktop operating system makes it possible for anyone to log into a computer running macOS High Sierra. Apple computers can be logged into using the “root” username accompanied by a blank password. Apple said it was working on a fix but in the meantime users should set their own root password.
Cloudy outlook. TechCrunch founder Michael Arrington announced a new hedge fund on Tuesday that will invest in digital currencies, including so-called initial coin offerings, as well as the equity of crypto-related startups. The fund will be denominated in a crypto-currency called XRP, a rival to bitcoin that is closely tied to the software company Ripple. “Some people think this is crazy,” Arrington noted in a blog post.
A cloud hangs over. Android creator Andy Rubin has taken a leave of absence from his new company, Essential, after reports surfaced that he left Google in 2014 due to an “inappropriate” relationship. A spokesman for Rubin told The Verge that Rubin was not told by Google that he had engaged in any misconduct.
Cloud giants. Apple countersued Qualcomm for patent infringement, the latest volley in the year-long battle over royalty payments between the two companies. After Qualcomm said in July that Apple violated six of its patents, the iPhone maker fired back, alleging Qualcomm is infringing on eight patents related to battery life.
Storm clouds. In its latest leaked financials, Uber’s gross bookings hit $9.7 billion in the third quarter, up 11% from the previous quarter, Bloomberg reported. Uber’s net loss grew to $1.5 billion from $1.1 billion in the prior quarter. In its latest court battle, a judge delayed a trial over whether Uber stole trade secrets after a letter came to light revealing the company’s strategy of gathering trade secrets from competitors. “I can no longer trust the words of the lawyers for Uber in this case,” Judge William Alsup said.
Clouds parting. Slowly, perhaps even very slowly, sales of virtual reality gear are increasing. Worldwide shipments of VR headsets in the third quarter totaled more than 1 million, the first time they reached that level, market tracker Canalys said, without giving data for last year. About half the total was Sony’s PlayStation VR, with Oculus Rift in second place and HTC’s Vive in third. Meanwhile, the latest forecast out of IDC predicts zero growth in PCs through 2021 and a 7% decline in tablet sales. Ouch.
FOOD FOR THOUGHT
It’s turning into a great week for interactive graphical features. The Washington Post has one today that tries to give you perspective on how the world of entertainment has changed since your youth. Put in the year you were born and see how consumption of music and video has changed over your lifetime, plus how people connected to the Internet and how many owned cell phones. You’ll quick grasp what’s meant when someone says “digital native.”
IN CASE YOU MISSED IT
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Here’s What WeWork Gets Out of Acquiring Real-Life Social Network Meetup By Tom Huddleston Jr.
Commentary: Alexa! Give Us Back Our Freedom! By Vivek Wadhwa and Alex Salkever
BEFORE YOU GO
The Grammy award nominations are out and all you fans of Taylor Swift can rejoice that the singer garnered a couple, though not for her new album Reputation, which came out too late to be eligible. But no such luck for Katy Perry. She was shut out.