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Uncertainty is the new byword. Target CEO Brian Cornell put it well following the report of his company’s better-than-expected revenues and worse-than-expected profits. “We are still trying to understand what’s going to happen with children going back to school, what’s happening with colleges and universities and how guests will celebrate holidays,” he said, according to The Wall Street Journal. “There is just so much uncertainty.”
Mark Zuckerberg clarified things a bit Thursday by declaring that within a decade, half his company’s employees will be working remotely. Zuckerberg’s comments were just vague enough to give Facebook wiggle room in the execution and just specific enough to dispel any doubt that workplaces everywhere really will be changing when we finally emerge from the pandemic.
It has become cliché to observe the world won’t be the same. (Remember the hopes of a “v-shaped” recovery?) We’ve assumed commercial real estate would be reshaped, that consumption patterns would change, that cities wouldn’t look the same.
Now, with Facebook’s news, we can begin to understand how this epic event will have lasting effects. Zuckerberg said newly hired senior engineers will have the option of joining remotely. Then other employees who have positive performance reviews can request permission to work from outside the office. Some who work from home from less expensive locales may have their pay adjusted downward, as well.
Zuckerberg said a few different ways that Facebook will move in a measured manner and also that some employees will still need to come into the office. (Hardware engineers, for example.) For the rest of this year, Facebook’s offices will operate at 25% or less of their current capacity to maintain social distancing.
Offices aren’t going away. In-person collaboration will still count. So will hubs near cities with cultural and academic institutions.
But the old normal won’t be the new normal.
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We spend a lot of time scrutinizing the role of CEOs, and rightly so, but there are many other key players in tech. Aaron delved into the incredible career of chip designer Jim Keller, whose work is inside everything from iPhones to Xboxes to Teslas.
Have a restful weekend. We will see you back here on Tuesday.
Adam Lashinsky
This edition of Data Sheet was curated by Aaron Pressman.
NEWSWORTHY
Pink slip profusion. The job cutting in tech has moved from startups to long-established players. Hewlett Packard Enterprise CEO Antonio Neri said Thursday that the company is looking to save $1 billion this year through layoffs, salary reductions, and other measures. IBM is also quietly cutting several thousand workers.
Waves my wand. Speaking of job cutting startups, augmented reality startup Magic Leap cut half the jobs in the company last month. Now comes news it is raising $350 million of fresh backing. CEO Rony Abovitz says the money will keep the next-gen Magic Leap 2 system on track.
Mo money, mo problems. The little world of celebrity podcasting and videos is growing up fast. After Spotify had signed up Joe Rogan's super-popular podcast for exclusive distribution, Apple is now seeking to hire someone to oversee podcast development tied in part to its video service, Apple TV+. And in news I found a little like Charlie Bucket discovering Willy Wonka was a mean old man, John Krasinski sold the rights to his Some Good News YouTube show to ViacomCBS's Comedy Central.
Huzzah. The money just keeps pouring in for Indian wireless titan Reliance Jio. After collecting large sums from Facebook and private equity firms General Atlantic, Silver Lake, and Vista Equity Partners, Reliance is getting another $1.5 billion from the pioneer of the private equity industry, KKR.
This is our life now. Microsoft held its annual Build conference for developers this week (all virtually, of course). There were a ton of announcements, including a new Airtable competitor called Lists and Pinterest integration in the Edge browser.
All I do is win, win, win. On Wall Street, graphics chipmaker Nvidia said sales rose 39% to $3.1 billion, largely due to an 80% jump in its data center segment. Nvidia's stock, already up a blistering 49% in 2020, was about unchanged in pre-market trading on Friday.
FOOD FOR THOUGHT
AT&T, IBM, Xerox and many other longstanding tech giants used to have one thing in common: corporate research labs that could look into far-off technologies. Bell Labs invented the transistor and Xerox PARC gave us the mouse and windowed desktop software. Retired developer David Rosenthal lived through that era and blogs about a new study of what has been lost since the closing of the labs. Sometimes the developments led to whole new companies.
PARC had both spin-offs, in which Xerox had equity, and startups that built on their ideas and hired their alumni but in which they did not. Xerox didn't do spin-offs well...But Cisco is among the examples of how spin-offs can be done well, acting as an internal VC to incentivize a team by giving them equity in a startup. If it was successful, Cisco would later acquire it. Sun Microsystems is an example of exceptional fertility in external startups. Nvidia was started by a group of frustrated Sun engineers. It is currently worth almost 30 times what Oracle paid to acquire Sun. It is but one entry in a long list of such startups whose aggregate value dwarfs that of Sun at its peak.
FOR YOUR WEEKEND READING PLEASURE
A few long reads I came across this week:
The YouTuber Turning Black Men’s Hair Care into Video Gold (Level)
William Humphrey isn’t just entertaining his hundreds of thousands of subscribers — he’s showing that hair care can be self-care.
Can an artificial intelligence learn to beat the stock market? (Fast Company)
Jeff Glickman spent decades building an AI to rival the best minds on Wall Street. Is it possible that he's cracked the code?
How HBO took on the streaming wars (Financial Times)
Creating a rival to Netflix is more urgent than ever for WarnerMedia. Will the HBO Max moonshot succeed?
When SimCity got serious: the story of Maxis Business Simulations and SimRefinery (The Obscuritory)
SimCity wasn’t meant to be taken seriously. But that didn’t stop companies from believing Maxis could design realistic simulations. Will Wright didn’t believe that was even possible. “Many people come to us and say, ‘You should do the professional version,'” he continued. “That really scares me because I know how pathetic the simulations are, really, compared to reality.”
IN CASE YOU MISSED IT
How Best Buy’s new concierge service is making in-store shopping safer By Phil Wahba
Facebook Workplace just hit a big milestone By Jonathan Vanian
Shareholders dunked on CEO pay at CVS and Intel. Stock performance may be next By Aaron Pressman
Why Spotify’s Joe Rogan deal could change the podcast business forever By Aric Jenkins
What to do if your employer stops matching your 401(k) contributions By Anne Sraders
(Some of these stories require a subscription to access. There is a 50% discount for our loyal readers if you use this link to sign up. Thank you for supporting our journalism.)
BEFORE YOU GO
When I was a kid, one of the great big fun movies was The Cannonball Run starring Burt Reynolds about a secret, illegal car race across the United States from New York to L.A. Turns out, it's a real thing. And with so much less traffic on the roads, drivers have broken the record for the fastest ever time. Seven times. Apparently, a YouTube documentary is coming real soon. Have a great weekend and don't drive too fast.
Aaron Pressman
