Re/wind: Microsoft Sheds Workers, Airbnb’s Fresh Logo

Asa Mathat

In case you missed the big headlines this week, here's a roundup of the news that powered Re/code.

1. Microsoft disclosed this week that it may lay off up to 18,000 workers worldwide as part of a company-wide reorganization. This includes shutting down its Santa Monica-based Xbox Entertainment Studios, which has struggled as of late, and the tech giant will also be ending its brief run as a maker of Android-powered phones. Earlier in the week, Microsoft CEO Satya Nadella poked fun at Google, saying they “sure are great marketers.”
2. Airbnb unveiled a new logo this week, and many commented that it looked a lot like a, um, vagina. Airbnb co-founder Nathan Blecharczyk’s response? “Go ahead, laugh all you want.” Done!
3. Yahoo had a no-good, very-bad news kind of week as shares dropped by just over five percent on Wednesday. Just how exactly does Marissa Mayer plan on turning around the company after it sells its stake in Alibaba? And what about those pesky AOL acquisition rumors?
4. IBM and Apple announced a new partnership this week, aimed at bringing cloud-based data with business applications to your iPhones and iPads. In a joint Re/code interview with IBM CEO Ginni Rometty, Apple’s Tim Cook characterized the companies as “puzzle pieces that fit perfectly together.” And while we’re on the subject of Big Blue, if current trends hold, its cloud business may grow as big as its hardware business by the end of next year, while being roughly twice as profitable.
5. We all know that Siri, the iPhone’s voice-controlled assistant, is a lot of fun to mess with. But if you’re looking to get a bit more out of Siri than HAL 9000-inspired jokes and basic calling commands, here are 10 handy tips to using Siri. Also coming to an iPhone near you sometime this fall: Time-lapse videos.
6. Facebook’s new iPhone app, Mentions, actually looks pretty cool. Good for Facebook! Too bad you can’t use it unless you’re a celeb.
7. Though robots may soon be our overlords in the workplace, there hasn’t really been a robot designed for personal use worth buying. Until now, perhaps.
8. You may know NastyGal’s Sophia Amoruso as a vintage clothing icon with a brand to match. But did you know about her passion for personal finance?
9. On Monday, the anonymous sharing app Secret announced it had raised $25 million in its Series B funding round and added a new high profile board member, Index Ventures’ Danny Rimer.
10. This week, Re/code kicked off a new daily feature called #Mustreads From Other Sites, compiling what we think is some of the best stuff out there on the web. Look for it on weekday mornings!

Talking the Cloud Business with Amazon CTO Werner Vogels

Guido van Nispen / via WIkiepedia

In its relatively short eight-year life-span, there’s a lot we’ve come to know — and yet a lot more that we don’t — about Amazon Web Services.

When it launched in 2006, the idea of renting computing capacity on a pay-as-you-go basis was a new one. Fast-growing startup companies who might have struggled to keep their systems running if they launched a popular new Web service could suddenly have all the capacity they needed in minutes instead of months. AWS fundamentally changed how companies think about their computing infrastructure needs.

And while Amazon won’t say exactly how big a business it is as a percentage of its $74.5 billion in annual revenue, there have been many educated guesses. A new one out yesterday from Pacific Crest Securities — and noticed by Bloomberg Businessweek — estimates it’s a $5 billion business annually and on its way to approaching $7 billion next year.

If that estimate is accurate, and if we thought of AWS as a separate company, its growth rate after passing the $1 billion revenue mark would be second only to that of Google, and would have exceeded that of Microsoft, Oracle and Salesforce.com.

Against this backdrop, Re/code sat down recently with Amazon CTO Werner Vogels while he was visiting New York. Werner, along with Andy Jassy, is among the executives continuing the shakeup that AWS started in the enterprise IT world.

Another data point from the Businessweek story: If Amazon sold traditional hardware servers, it would rank number four by revenue behind Dell, IBM and Hewlett-Packard. In response at least two of those companies, IBM and HP have built up their own cloud computing services to try to take on Amazon.

IBM has been the most vocal about its response in recent months. Last year it spent $2 billion to acquire SoftLayer. It has since pledged to spend big to build out its data center footprint and is running most of its software applications. This week Big Blue said its combined public cloud services and cloud software business is on track to book $7 billion in revenue next year, which make it about as big as Amazon, though it’s an apples-to-oranges comparison.

When we spoke, Amazon had just announced Zocalo, a new document-sharing and collaboration service meant to complement its WorkSpace virtual desktop product and to compete with similar offerings from DropBox (notably an AWS customer) and IPO-bound Box.

Re/code: What do Zocalo and WorkSpaces say about the future of AWS? I’ve always thought of AWS as a replacement for infrastructure that only the IT department would care about. But here, we see you providing a more front-facing application that everyone in a company might use.

Vogels: We’re in the business of pain management for enterprises. Tell me what your pain points are and I’ll help you make them feel better. When we launched Redshift and Glacier, they both came from the same conversations with enterprises. Digital information is exploding; all the regulatory requirements say they need to keep it all. They were asking over and over again for us to build an archiving system. So that’s Glacier.

The other thing was data warehousing. The information explosion means that your mid-sized data warehouse probably doesn’t cut it anymore. You have to move to something larger. That’s not a linear increasing cost, it’s an exploding increasing cost.

And Redshift also has the analytics piece. Does that mean it’s essentially AWS’s answer to Hadoop?

I find that is slightly disappearing, actually. If you look at MapReduce by itself or Hadoop by itself, it’s just a distributed execution engine. You still have to write your own analytics programs, which turns out to be rather bothersome for businesses. … Among our customers like Netflix, they’re making heavy use of Elastic MapReduce. It drives their realtime operations; it drives their recommendation engine, their business dashboards. But we see quite a few other companies moving away from MapReduce and toward Redshift because you don’t need to write any analytics code anymore.

So, in the enterprise, what kind of pain won’t you cure?

I don’t know. There’s certainly a lot of pain points left. Some of our customers who have a cleaner roadmap can go all in, companies like the Kepminsky Hotel Chain, Condé Nast, Ocean Corp., which is a big bank, they’re teaching us a lot about things we could do a lot better. They’re telling us where the missing features are, and the things that we should be doing on our platforms. Customers teach us a lot. We have a platform that’s driven more by them than by us simply making stuff up.

How do you see the competitive situation in cloud services generally? IBM has been making a lot of noise comparing itself to AWS since it bought SoftLayer.

We’re really not that focused on competition. As a company, you can be competitor-focused. That works for some companies, but we’re just not like that. We’re just totally focused on the customer. Our customers set the roadmap. The only reason when we look at the competing services, is when we want to understand why someone might want to choose something other than AWS. So when our customers choose someone else, it’s really important because it indicates something that we might be doing differently. … One of the things that’s radically different now, in the new world of IT from the old, is that customers [used to] write you an $800,000 check and you could walk away. In our case, we only get paid if our customers use the platform. That means that we have to be on our toes every day to deliver the best service. Customers are not locked in with us and it creates a very different kind interaction.

It’s interesting that you say your customers aren’t locked in, because that’s one of the first things your competitors will complain about when they talk about you. That’s one of the main reasons behind the rise in OpenStack at companies like IBM and Hewlett-Packard. What do think of that argument?

I think we’ve worked really hard at not locking our customers in. … There’s no lock-in. Many of our services are really accessible from standard protocols. I’ve never gotten any feedback from our customers saying “please don’t build this.” They all say “please build more….” It’s the same story around standardization. I’ve yet to have a customer say they’re not going to use our stuff because it’s not standardized.

Do you feel any kind of competitive tension with the OpenStack vendors? Is it creating any kind of threat?

I don’t get any of that in feedback. Now in the data center world there’s lots of competing technologies. There’s quite a few enterprises that haven’t even reached the point of virtualization yet. … But from a public cloud point of view, we’re not hearing about OpenStack in any of our feedback.

When will we get a clear view of how big a business AWS is within Amazon?

I don’t know. You can probably answer that better than me. I’m not an economist or a lawyer so I don’t know when we’ll ever have to break it out. But our expectations are clear. This is a business that will be as big as our retail businesses if not bigger. … It took us six years, or until 2012, to get to 1 trillion objects stored. Then it took us one more year to get to 2 trillion. So that’s an indication of the speed of growth. To my eyes, that it only took a year to get to 2 trillion, it looks like the onset of a hockey stick.

What’s your priority for the rest of the year?

Talking to customers. … Lately I’ve been having a lot of fun talking to customers in the Internet of Things world, the connected devices world. We have so many customers doing so many interesting things. We have customers putting sensors at the bottom of the ocean pumping data into Amazon S3. For NASA, the Mars Rover does the same thing. The folks at Human have been doing something really interesting. They have an app that encourages you to move for 30 minutes a day. But when they realized all the data they had, they could create something interesting by visualizing how people are moving through cities. In 10 days they went from idea to production of these beautiful maps showing how people move around in New York and San Francisco and other cities. In the industrial world, GE has instrumented all its gas turbines and they collect all that data into Amazon S3 and look for ways to make it all more efficient. Even a one percent improvement in efficiency is a hard-core dollar improvement. There’s so much stuff happening in the world. We have no clue what it’s going to look like two or three years from now.

The Talk Show: ‘Cat Pictures’

New double-sided LP episode of The Talk Show, with special guest Marco Arment. (You can get through the whole thing in a hour if you’re using Smart Speed in Overcast.)

• Side 1
• Side 2

 ★ 

Oh, Dear!

We got accosted by a deer while on a walk this afternoon. Apparently deer will attack dogs. The deer obviously could not have cared less about me.

How The Big 5 Publishers Hobbled The Amazon Unlimited Launch

 Amazon Unlimited was dubbed the Netflix of books. That is correct as long as you imagine a Netflix consisting of an endless array of low-budget indie releases and some major small studio filks. In truth, Amazon’s new $9.99 all-you-can-read service features no books by “big 5″ trade publishers, an issue on which Amazon has remained mum. I’ve asked Amazon for… Read More

Immersive Infections

 Immersive technology will put the user into the digital shoes of their own avatars, experiencing video games, simulations, learning opportunities and even romance on new levels, so it goes without saying that while we can expect all that grandeur, there will be people who try to ruin it, for money. Read More

“Alive Inside” Film Explores Power of Music to Restore Memory

Projector Media

Audiences first encounter Henry hunched over in his wheelchair, head down, hands clasped firmly together, unresponsive to the world around him.

As soon as a pair of headphones are placed on his head, the 94-year-old dementia patient opens his eyes, sits up straight and begins swaying and humming along with the music. Henry speaks animatedly about his favorite band leader, Cab Calloway, and even begins to emulate the jazz artist’s style of scat singing — at one point launching into a rendition of “I’ll Be Home for Christmas.”

The dramatic transformation, which takes place against the bleak institutional setting of the nursing home where Henry has spent the last decade of his life, is a powerful set piece for the documentary film “Alive Inside,” which opens this weekend in New York.

“Alive Inside” follows social worker Dan Cohen, whose nonprofit Music & Memory organization works to bring iPods loaded with personalized playlists to elderly Alzheimer’s and dementia patients. So far, Cohen’s program has expanded from three nursing homes to 489 in 42 states — with the help of private donations spurred by the film.

Filmmaker Michael Rossato-Bennett said he was hired to create a video for Cohen’s website. The scope of the project changed as he witnessed Henry’s transformation when the music of his youth was returned to him.

“I had goosebumps over my whole body when he was waking up. I had tears in my eyes,” said Rossato-Bennett. “They say every artist only tells one story over and over again. If I had to tell my story, it's the finding of life where you think there is none.”

“Alive Inside: A Story of Music and Memory” is winning acclaim on the festival circuit, collecting the prestigious audience award for documentary film at the 2014 Sundance Film Festival and best documentary at the Milan International Film Festival.

Apple is lending the film a promotional nudge, as it opens to limited release in theaters throughout the U.S.

The documentary uses Henry’s story, and those of other patients, to illustrate music’s power to reach parts of the brain that remain intact, even late in the onset of Alzheimer’s, and evoke memories.

“Music therapists know all this. They practice it,” Cohen said. “But there are very few music therapists in the world of the elderly. It's knowledge that was siloed.”

Cohen, who has spent a career working in technology, viewed the problem as one of technical limitations, and he set out to solve it, one iPod and custom playlist at a time. His goal is an ambitious one: To bring personalized music to 16,000 long-term care facilities in the U.S.

“It’s not a cure for Alzheimer’s, but it does work most of the time,” Cohen said. “And there is no downside. The worst case scenario — you don’t get a benefit. Sometimes, it’s a dramatic change in someone's life.”

Here’s the trailer for the film:

Gillmor Gang: Yotifications

 The Gillmor Gang — Danny Sullivan, Alexia Tsotsis, Kevin Marks, Keith Teare, and Steve Gillmor — react with nervous jokes as all eyes turn to the success of Yo, the single-minded communication app that has one thing on its little mind. But wait a minute, what’s surreally going on here as BetaWorks’ John Borthwick leads an investment round on the love child union of… Read More

11 TechCrunch Stories You Don’t Want to Miss This Week

 The week of 7/12 – 7/18 was a busy one for TechCrunch. Here’s the best of the best from this week. Priya Haji was an inspirational and positive presence in the technology and business worlds, and she will be greatly missed. Chicago-based entrepreneur Cheryl Dahle established a crowdfunding campaign on Fundly to help support Haji’s young children. Read “Tech… Read More

With 1M Sold In The Last Quarter, Google’s Chromebooks Are A Hit With Schools

 During its earnings call this week, Google announced that it — and its partners — sold a million Chromebooks to schools in the last quarter. Overall PC sales worldwide were about 76 million in the last quarter, according to Gartner’s latest numbers, so a million Chromebook sales just to the education market is a pretty good number. Read More

Supposed iPhone 6 Display Cover Faces The Sandpaper Test

 The leaked component that’s being touted as the front screen of the upcoming iPhone 6 got a good workout in a video test by Youtube regular MKBHD (Marques Brownlee) when it first broke cover, and now Brownlee is back with a new video that takes the durability tests even further. This second round involves exposing the supposedly super-strong sapphire-based material to a true test of… Read More