Tech Brief: SoftBank Considers U.S. Ride-Hailing Investment


Government Brief

  • The Pentagon released a report detailing plans to restructure the organizations that manage acquisition and technology research for the Department of Defense. The reorganization will break up the DoD’s office of Acquisition, Technology and Logistics into two separate organizations and also create a chief management officer position within the agency. (FCW)
  • States across the United States are working to upgrade the cyber readiness of their election databases ahead of the 2018 elections to safeguard against hacking and cyberattacks. The increased measures come in the wake of the Department of Homeland Security’s disclosure to lawmakers that 21 states’ election-related systems were targeted by hackers in the months leading to the 2016 presidential election. (The Hill)
  • A new report from the Government Accountability Office found that the Office of Personnel Management’s information security practices have improved since the federal agency’s 2015 data breach, but that more steps are needed to safeguard personal information. OPM completed 11 of the 19 security recommendations that were proposed in response to the breach that exposed data from 22.1 million people. (FedScoop)

Business Brief

  • SoftBank Group Corp.’s founder and CEO, Masayoshi Son, publicly expressed interest in branching out into the U.S. ride-hailing market by investing in Uber Technologies Inc. or Lyft Inc. SoftBank has funded Uber’s competitors in China, India and Southeast Asia, but last month reports came out that the company was looking at buying a stake in Uber. (Bloomberg)
  • Google Inc. is denouncing an engineer’s memo that circulated through the company this weekend asserting that gender inequality in the tech industry is a result of biological differences. The memo added to the tension in male-dominated Silicon Valley over the treatment and representation of women in the technology workforce. (Reuters)
  • Amazon.com Inc. recently filed patents to help streamline the online retailer’s ambitions for package delivery by drones. One patent filing would create a network of mobile workstations — based on boats, trains and vehicles — that would be directed to areas of high demand to act as hubs for its drone fleet. (The Verge)

Chart Review

Events Calendar (All Times Local)

Monday
NATOA seminar on compensation for public land use 2 p.m.
Tuesday
No events scheduled.
Wednesday
No events scheduled.
Thursday
D.C. Tech-Security Conference 8:15 a.m.
The Small Business and Entrepreneurship Council holds and event on the importance of modern infrastructure 11 a.m.
Friday
No events scheduled.

General

What DOD’s reorg means for tech and acquisition
Troy K. Schneider, FCW

The Pentagon has released its long-anticipated report detailing plans to restructure the organizations that manage acquisition and technology research for the Department of Defense. The so-called Section 901 report, officially titled “Restructuring the Department of Defense Acquisition, Technology and Logistics Organization and Chief Management Officer Organization,” was delivered to Congress on Aug. 1.

Dems introduce legislation to protect manned aircraft from drones
Ali Breland, The Hill

A pair of Rhode Island Democrats on Friday rolled out legislation that, if passed, would regulate drone use more tightly, with the intention of protecting manned aircraft. Rep. Jim Langevin and Sen. Sheldon Whitehouse’s legislation would make it illegal for individuals to fly drones near airport runways without permission from air traffic controllers and make it a criminal offense to fly a drone in a manner posing a safety risk to manned aircraft.

Amid opioid crisis, some patients turn to tech alternatives
Kaya Yurieff, CNN

David Nipple was riding his motorcycle on a highway in Tennessee when he was hit by a drunk driver. His left leg was severed above his knee.

Euro Shrugs Off German Data to Rise; Crude Drops: Markets Wrap
Robert Brand, Bloomberg 

The euro resumed gains against the dollar even as data showed German industrial production unexpectedly fell in June. Crude dropped as OPEC nations met with their allies.

Intellectual Property and Antitrust

Amazon wants to build a network of mobile drone maintenance and delivery platforms
Andrew Liptak, The Verge

Amazon has long had ambitions for autonomous package delivery, but before drone delivery can go into wider use, there’s some obstacles to overcome. Recently, the company has filed for numerous patents, from a drone beehive placed in populated areas to dropping packages with parachutes to a massive airship.

DraftKings, FanDuel Face Test of Their Business as They Go It Alone
Chris Kirkham, The Wall Street Journal

After scrapping plans to merge, rivals DraftKings Inc. and FanDuel Inc. must now separately determine whether daily fantasy sports is a viable business—and one that can sustain two major competitors, at that. The coming National Football League season presents an important test for the once highflying startups, which are working to court casual players—not just pros—amid scrutiny over whether their games constitute illegal gambling.

Telecom, Wireless and TV

Sprint, Looking to Get Bigger to Survive, Weighs Deal-Making
Michael de la Merced, The New York Times

Masayoshi Son, the Japanese telecommunications mogul, has always been known as an inveterate deal maker. But amid a breakneck spree of investing in start-ups, Mr. Son’s most anticipated moves will likely involve an old-line phone service provider: Sprint.

FCC to Spend Billions to Bring the Broadband to Rural America
Caitlin Fairchild, Nextgov

Twenty-three million Americans don’t have access to broadband internet, according to the Federal Communication Commission’s 2016 Broadband Progress Report. To help change these numbers, starting in 2018, the FCC plans to shell out $2 billion over the next decade to bring broadband access to more remote parts of the country.

U.S. cable firms embrace former foe Netflix as TV viewing shifts
Lisa Richwine and Anjali Athavaley, Reuters

A growing number of U.S. cable operators are forming alliances with Netflix Inc, a shift that is helping the streaming pioneer add customers as its largest single market matures. No. 3 distributor Charter Communications Inc is expected to make Netflix available through its set-top boxes, joining more than a dozen top U.S. pay television operators adopting a model first rolled out in Europe.

Mobile Technology and Social Media

Uber, Lyft Are Both the Object of Masayoshi Son’s Interest
Pavel Alpeyev, Bloomberg

SoftBank Group Corp.’s Masayoshi Son expressed interest in the U.S. ride-hailing market, saying that he would be willing to invest in Uber Technologies Inc. or rival Lyft Inc. It’s the clearest indication yet that Son is serious about putting cash on the table.

Google employee’s anti-diversity memo prompts company rebuke
Sam Forgione, Reuters

Google executives over the weekend rushed to denounce an engineer’s memo that ascribed gender inequality in the technology industry to biological differences, a view that sparked outrage at the internet giant and inflamed tensions over sexual harassment and discrimination in Silicon Valley. The unnamed engineer asserted in the 3,000-word document that circulated inside the company last week that “Google’s left bias has created a politically correct monoculture” which prevented honest discussion of the issue.

Tesla seeks to raise $1.5 billion to fund Model 3 production
Narottam Medhora and Laharee Chatterjee, Reuters

Tesla Inc (TSLA.O) said on Monday it intends to raise about $1.5 billion in a bond offering as the U.S. automaker seeks to ramp up production of its newest electric sedan, the Model 3. The debt offering comes as Tesla receives thousands of advance reservations for the Model 3, which were averaging at about 1,800 per day since the car’s launch in late July.

Samsung scion Lee fights back tears as prosecutors seek 12 years’ jail
Joyce Lee and Christine Kim, Reuters

Samsung Electronics Vice Chairman Jay Y. Lee fought back tears and denied wrongdoing on Monday as prosecutors sought a 12-year jail term on charges that include bribing the former president to help cement control of the South Korean tech giant. Lee, the de facto leader of one of Asia’s largest conglomerates, has been in detention since February on trial for charges ranging from embezzlement to perjury, in a scandal that gripped the country for months and led to the ouster of former president Park Geun-hye.

The Problem With Electric Cars? Not Enough Chargers
Christopher Mims, The Wall Street Journal

It’s the dawn of the age of the electric vehicle. For real, this time.

Cybersecurity and Privacy

Information security still lagging at OPM, report finds
Tajha Chappellet-Lanier, FedScoop

While the Office of Personnel Management’s information security practices have improved since the 2015 breach, OPM still has some work to do, a new Government Accountability Office report concludes. The report, released Thursday, looks at OPM’s progress on the 19 recommendations the United States Computer Emergency Readiness Team (US-CERT) made after the breach that exposed the data of 22.1 million people.

DJI drones banned by U.S. Army due to ‘cyber vulnerabilities’
Patrick Howell O’Neill, CyberScoop

The U.S. Army has banned the use of drones from the Chinese firm Daijiang Innovation Corporation (DJI) citing “increased awareness of cyber vulnerabilities” in DJI products, the drone blog sUAS News reports. DJI, whose products are widely used throughout the Pentagon, told CyberScoop they are “surprised and disappointed” to read the reports and are reaching out to the U.S. Army for confirmation and clarification.

States ramping up defenses against election hacks
Morgan Chalfant, The Hill

States across the nation are ramping up their digital defenses to prevent the hacking of election systems in 2018. The efforts come in the wake of Russia’s interference in the 2016 presidential election, which state officials say was a needed wake up call on cybersecurity threats to election systems and infrastructure.

UK government sets out tougher guidelines to protect smart cars from hackers
Kylie MacLellan, Reuters

The British government issued new guidelines on Sunday requiring manufacturers of internet-connected vehicles to put in place tougher cyber protections to ensure they are better shielded against hackers. The government said it was concerned that smart vehicles, which allow drivers to do things such as access maps and travel information, could be targeted by hackers to access personal data, steal cars that use keyless entry systems, or take control of technology for malicious reasons.

Judge Sets $30K Bail for UK Researcher in Malware Case
Regina Garcia Cano et al., The Associated Press

A Las Vegas federal judge set bail of $30,000 on Friday for a celebrated young British cybersecurity researcher accused by U.S. prosecutors of creating and distributing malicious software designed to steal banking passwords. The attorney for Marcus Hutchins, who has broad support in the information-security community, said the 23-year-old hacker would contest the charges.

A Message from the Electronic Payments Coalition:

The evidence is mounting: There are now at least a dozen studies that illustrate the failure of the Durbin amendment. In fact, a recent paper from Federal Reserve economists provides empirical evidence of harm to the consumer. Get the facts from the Electronic Payments Coalition.

Opinions, Editorials and Perspectives

Improving Patents Will Not Kill Innovation
Dana Rao, Morning Consult

Every patent holder is proud of their patent. As they should be.

On managing outrage in Silicon Valley
Connie Loizos, TechCrunch

I hate sexism; it can’t be eradicated fast enough. I’m also frustrated that there’s still far too little diversity in Silicon Valley.

When Will the Tech Bubble Burst?
Ruchir Sharma, The New York Times

At the height of a market mania in 1967, the author George Goodman captured the mood perfectly, comparing it to a surreal party that ends only when “black horsemen” burst through the doors and cut down all the revelers who remain. “Those who leave early are saved, but the ball is so splendid no one wants to leave while there is still time.”

A Message from the Electronic Payments Coalition:

In a new paper, Federal Reserve economists confirm what many industry experts have said before: The Durbin amendment harms consumers. There are now at least a dozen studies that illustrate why this failed policy must be repealed. Learn the truth from EPC.

Research Reports

Information Security: OPM Has Improved Controls, but Further Efforts Are Needed
Government Accountability Office 

Since the 2015 data breaches, the Office of Personnel Management (OPM) has taken actions to prevent, mitigate, and respond to data breaches involving sensitive personal and background investigation information, but actions are not complete. OPM implemented or made progress towards implementing 19 recommendations made by the United States Computer Emergency Readiness Team (US-CERT) to bolster OPM’s information security practices and controls in the wake of the 2015 breaches.

Briefings

Tech Brief: Lobbying Tech Groups Target NAFTA Renegotiations

According to data from the Center for Responsive Politics, the number of tech companies and trade associations registered to lobby U.S., Canadian and Mexican government officials has more than doubled in the last few months. Companies like Cisco Systems Inc. and Microsoft Corp. are looking to zero out tariffs for tech goods and remove restrictions on cloud storage as officials prepare to renegotiate the North American Free Trade Agreement.

Tech Brief: Intel CEO Leaves Trump’s Manufacturing Council

Brian Krzanich, Intel Corp.’s chief executive, joined the chief executives of Merck and Under Armour in announcing that he would leave Trump’s council on American manufacturing following the president’s response to violence during a white supremacist rally in Charlottesville, Va. Krzanich said he resigned “to call attention to the serious harm our divided political climate is causing to critical issues.” 

Tech Brief: Week in Review & What’s Ahead

The U.S. Court of Appeals for the 8th Circuit will not block the Federal Communications Commission’s April decision to eliminate price caps for much of the business broadband market. The FCC’s business data services ruling deems certain local markets as competitive, even when there is only one broadband service provider.

Tech Brief: Benchmark Capital Sues Former Uber CEO Kalanick

Benchmark Capital is suing Uber Technologies Inc.’s co-founder and former CEO Travis Kalanick for not honoring the terms of his resignation and allegedly trying to stack the company’s board with allies to prepare for a return as CEO. The Silicon Valley venture firm, one of Uber’s biggest shareholders, alleges that Kalanick is attempting to “entrench himself for his own selfish ends” — an accusation a Kalanick spokesman called “without merit.”

Tech Brief: Kaspersky Lab, Microsoft Reach Antitrust Resolution

Cybersecurity firm Kaspersky Lab plans to withdraw antitrust complaints it made in Europe against Microsoft Corp. after the U.S. tech company agreed to work with outside antivirus vendors on delivery of its security updates for Windows users. The Moscow-based security company in June accused Microsoft of abusing its dominance in the computer market by favoring its own antivirus software over those of independent security companies.

Tech Brief: Week in Review & What’s Ahead

Apple Inc. agreed to remove virtual private network applications from its app stores in China. The Chinese government has been bolstering its “great firewall,” which blocks access to many, mostly foreign, websites — a firewall that VPNs could circumvent. The company defended its actions, saying it complies with the law in every country, but is facing public backlash for giving into China’s censorship demands.

Tech Brief: WannaCry Hero Indicted for Kronos Malware

Marcus Hutchins, the security researcher credited with helping to stop the spread of the global WannaCry cyberattack in May, was indicted for his alleged involvement in creating, advertising and distributing Kronos malware between July 2014 and July 2015. Kronos steals victims’ banking credentials by directing them to malicious websites.

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