U.S. vies for leadership in quantum and A.I. with $1 billion bet

This is the web version of Data Sheet, a daily newsletter on the business of tech. Sign up to get it delivered free to your inbox. 

When the U.S. funded an experimental computer-networking project called Arpanet in 1969, it kicked off a technological revolution that would culminate in today’s Internet.

Now the U.S. is seeking to do the same for a “quantum Internet,” a vaguely defined complement to that marvel of info-engineering we know and love.

A quantum Internet would be based on a network of quantum computers, a buzzy class of calculating machines that offers advantages over classical computers, like the one you’re reading this article on. The technology could provide greater security, computing performance, economic output, and, of course, heaps of national pride.

Toward that end, the White House announced Wednesday that it is pouring $625 million into five new quantum research centers across the U.S. The institutes, which include participation from major research universities and tech companies, will be led by Department of Energy’s Argonne, Brookhaven, Fermi, Lawrence Berkeley, and Oak Ridge national laboratories.

The investment is part of $1.2 billion earmarked by the National Quantum Initiative, a bipartisan bill that was signed into law last year. The remaining funds, worth $300 million, are set to be supplied by partnering corporations such as IBM, Microsoft, Intel, and others.

The U.S. aims to keep ahead of the global competition to lead development of a hot emerging technology. Other parts of the world, such as Europe and especially China, have pushed ahead with scientific advances and billion-dollar research investments of their own.

U.S. officials believe the country’s economic and national security is at stake. “It’s absolutely imperative the United States continues to lead the world in A.I. and quantum,” said Michael Kratsios, the U.S. chief technology officer, during a press briefing call with reporters. “We know our adversaries around the world are pursuing their own advances.”

Earlier this year, Chinese scientists reported a breakthrough in transmitting so-called quantum messages across thousands of miles using a special satellite called Micius, named after an ancient Chinese philosopher. The experiment represents early progress toward the possible development of an ultra-secure communications network beamed from space.

While the competition with China heats up, private industry partners used the opportunity of the announcement to highlight the collaborative aspects of the new program. Dario Gil, director of IBM Research, said the cross-industry and government collaboration was “bringing together the best.” It “will be a team sport,” said James Clarke, Intel’s director of quantum hardware.

Time will tell who takes the lead.

Robert Hackett

Twitter: @rhhackett



Doomsday clock. The potential Microsoft-TikTok deal that's in talks started with Microsoft considering a small investment in the viral video app this summer, the New York Times reports. The negotiations then spiraled into a "big, messy political soap opera" after the White House got involved. TikTok and various investment bankers are attempting to gin up the best possible deal by approaching multiple possible acquirers, including Oracle and, perhaps less seriously, Twitter and Netflix. TikTok is also suing the Trump administration as it seeks to gain a better negotiating position and delay its sale past an arbitrary 45-day deadline, up on Sept. 15.

Use the force, Luke. Salesforce posted record quarterly sales and raised its full-year guidance on Tuesday, causing its share price to jump 13% in after-hours trading. The cloud computing giant is benefiting, like many tech peers, from a growing reliance on remote work and virtual services during the pandemic. Revenues ballooned 29% to $5.15 billion in the most recent quarter, besting Wall Street's expectations. The company said it expects sales through end of January to increase as much as $20.8 billion—more than the $20 billion guidance it issued last quarter, but not quite as high as the $21.1 billion it forecasted before then. As if that weren't cause enough to celebrate, Salesforce is replacing ExxonMobil in the Dow Jones Industrial Average on Aug. 31.

The Lord of Mordor sees all. Palantir CEO Alex Karp took a big swing at Silicon Valley in its filing to go public on Tuesday. “The engineering elite of Silicon Valley may know more than most about building software,” Karp wrote. “But they do not know more about how society should be organized or what justice requires." Without directly naming tech giants like Facebook and Google, Karp slammed advertising-based businesses which put "our thoughts and inclinations, behaviors and browsing habits" up for sale. Perhaps you'll recall Palantir is packing its bags and relocating its headquarters from Palo Alto to Denver. Nothing like a good parting shot as a farewell, buh-bye!

Tongue Thai-ed. Obeying an order from the Thai government, Facebook started blocking access within Thailand's borders to a particular Facebook group, called Royalist Marketplace, started by a self-exiled Thai academic living in Japan. Facebook said Tuesday that it is planning to challenge the issue in court. Freedom of speech is not a protected right in Thailand, where it is illegal to criticize the monarchy. But that hasn't stopped young people from recently taking to the streets to protest and call for political reform

Discontent in the subcontinent. More than 2,000 online sellers have banded together to file an antitrust case against Amazon, Reuters reports. The sellers allege that Amazon is unfairly offering sweet deals to big sellers, forcing smaller ones out of business. Antitrust regulators in India have been investigating the e-commerce titan and its Walmart-backed rival Flipkart since January. Amazon sees massive opportunity in India, the fastest-growing Internet market, and has signaled so by opening its largest ever office building in Hyderabad. Meanwhile, Apple is planning to open its first online store in India following the government's easing of restrictions for foreign retailers.

Love shack, baby, yeah.


Jaron Lanier is many things: A pioneer of virtual reality, a polymath in Microsoft's research arm, a dreadlocked cat-lover who moonlights in Stephen Colbert's house band. A new profile of Lanier in GQ declares he also "might be the last moral man in Silicon Valley" due to his prescient, trenchant criticisms of his techie peers. It's worth lending Lanier an ear, if only for the groovy flute tunes

Perverse incentives are what Lanier has spent his life railing against—the way that tech is co-opted and digital spaces colonized for the profit of people (or, perhaps eventually, robots) who do not care about your happiness.

“So,” he said, sighing. “My project is in a way more modest than you're making it out to be. It's more…it's more to not fuck the future over, you know?”


‘Deal of a decade’: How buying TikTok could transform Microsoft By Lance Lambert

A new place to WFH: Las Vegas by Michal Lev-Ram

This smartphone maker’s sales dropped the most due to COVID-19 By Jonathan Vanian

Why Apple let WordPress walk but continues to fight Fortnite’s Epic Games By Robert Hackett

Crypto soars again as traders embrace ‘DeFi’ and ‘yield farming’—but some see echoes of the 2017 bubble By Jeff John Roberts

Can an A.I. hedge fund beat the market? By Jeremy Kahn

(Some of these stories require a subscription to access.Thank you for supporting our journalism.)


If our progeny ends up having to ditch this planet when the robots inevitably take over, we may have the machines to thank for finding us another home. Researchers at the University of Warwick trained a machine-learning algorithm to pick out exoplanets in reams of telescope data from NASA. The A.I. program confirmed 50 foreign worlds, some as big as Neptune, for further exploration. Thank you, future computer overlords.

Subscribe to Well Adjusted, our newsletter full of simple strategies to work smarter and live better, from the Fortune Well team. Sign up today.

Read More

CEO DailyCFO DailyBroadsheetData SheetTerm Sheet