AUTO

Daimler’s Wakeup Call

Yesterday, the German automaker Daimler briefed investors and the press in London. The $60 billion Mercedes parent, which makes cars, vans, and trucks, had a clear message: Electrification won't be easy. Let’s take 10 on autonomy.  

Bye, petrol

Mercedes plans to roll out over 20 new hybrids and EVs by 2022, per Bloomberg. 

• "The industry is in transformation...we have to do this," CEO Ola Källenius said. He's right: Automakers will spend an estimated $225 billion on EVs in the next four years, per AlixPartners. 
• The EU’s stringent emissions standards phase in next year. Carmakers face heavy penalties for noncompliance.

The catch: These changes require the kind of restructuring and upfront investment that spook balance sheets and shareholders. Källenius, who's led Daimler since May, said the transition will seriously squeeze profits until at least 2022. 

Another power downer

EVs have fewer moving parts than internal combustion engine cars—by about two orders of magnitude. That makes maintenance and upkeep less expensive, but it also requires smaller workforces. Källenius copped to this, saying Daimler will reduce $1.4 billion in personnel costs and lay off 10% of global managers at Mercedes's car division.  

European auto execs are worried about EV consumer demand. Källenius mentioned it yesterday and a BMW exec recently said the "overhyped" demand is driven by regulations. 

As for the other industry buzzword...

Daimler isn't bullish on autonomy. It's capping R&D spend and taking a "reality check" on self-driving cars, Källenius said. 

The why may ring a bell: Reaching autonomy is harder than the company thought. The economics of robotaxi ride-hailing are still unproven and safe urban self-driving is no sure thing, Källenius said. So Daimler’s focused autonomy investment on the trucking industry. In March, it acquired a majority stake in Torc Robotics, a U.S. autonomous trucking startup. 

Zoom out: Automakers are already struggling with dropping global demand and weak growth in the Chinese market. These headwinds won't make the early 2020's any easier for Daimler. 

HEALTH

An Apple App a Day...

Yesterday, Apple launched ambitious health-tracking projects on its new Research app. The company said it may eventually use the research to help create new medical products. 

The app will collect huge amounts of data from Apple's software and iPhone/Apple Watch hardware sensors. It'll begin with three multiyear tests to which users can opt in: 

• Women's Health will analyze menstrual cycle data for reproductive health research. Partners include Harvard’s public health school and the NIH.
• Heart and Movement will examine how movement affects a person's health. Partners include Brigham and Women’s Hospital and the American Heart Association. 
• Hearing will measure how your frequent attendance at Post Malone concerts affects stress levels and heart health. Partners include the University of Michigan. 

Apple doesn’t normally track this much data. But the company included its signature privacy guarantee—the app will only share data with user consent and will disclose what's being shared. 

Zoom out: Wednesday's newsletter covered the ambitions of Dr. Google. Now you've heard about Dr. Apple’s next project. Don't be surprised to hear something soon from Drs. Amazon, Microsoft, Salesforce, or Uber. 

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POLICY

Judge: Stop Sharing 3D-Printed Gun Designs Online

On Tuesday, a federal judge struck down a deal that allowed 3D-printed gun files to be legally shared online. Here's the story of how this multiyear drama unfolded: 

2013: Texas-based Defense Distributed, a nonprofit founded by a crypto anarchist, announces it's made the world's first fully 3D-printed gun. It plans to upload blueprints online. The Obama State Department says "uh, no, this violates arms export law" and demands the blueprints be removed from the web. 

2015: Defense Distributed and the Second Amendment Foundation sue the State Department and a few officials.

Last year: The Trump Department of Justice quietly settled with Defense Distributed, allowing it to put the blueprints online. 

This week: U.S. District Judge Robert Lasnik deems that deal illegal. 

Defense Distributed wants to democratize digital, personalized gunsmithing. A spokesperson told Bloomberg it will appeal on free speech grounds.

Bottom line: As I've written before, distributed technology poses new challenges for law enforcement. This includes decentralized manufacturing (3D printing) and distributed computing (the dark web and cryptocurrencies).

BITS & BYTES

Stat: In its Q2 and Q3 transparency report, Facebook showed that AI is proactively catching more problematic content. Screening algorithms for its eponymous platform automatically detected 97.3% of content the company took action on in Q3, up from 96.1% in Q2. Its proactive detection rate for hate speech, an AI pain point, climbed from 68% to 80% over the same time period.

Quote: "Controllable anonymity"—the Chinese central bank's term of art for its forthcoming digital currency's privacy features. 

Read: GitHub is storing backups of its code repository in a hardened vault in a northern Norwegian archipelago, just in case there's an apocalypse. Check out this smart Businessweek article about the ultimate Plan B for GitHub's code, as well as the story of the open-source movement more generally. 

WHAT ELSE IS BREWING

• Harry Shum, Microsoft's AI chief, is stepping down after 23 years at the company. Could Common replace him? 
• Oculus CTO John Carmack is also stepping down. VR wasn't otherworldly enough for Carmack, who will now focus on being a "Victorian gentleman scientist" and working on artificial general intelligence. 
• Two U.S. senators introduced a bill to place limits on the federal government's use of facial recognition. Reminder: There is currently no national law governing the technology. 
• DJI wants to offer a free app in 2020 that lets anyone identify and check registration of drones flying around them, Reuters reported.
• Strategy Analytics predicts that when Apple fields three 5G smartphones next year, it will quickly become top dog in market share.

GOING PHISHING

It's Friday, which means it's time to go phishing. Three of the following stories are real; one is deepfaked. Can you spot the odd one out?

1. Leaders of a South Korean crypto exchange were charged with running a $384 million Ponzi scheme. 
2. India built an all-electric moon lander. 
3. A startup raised $2 million to build a prototype of its flying motorcycle. 
4. China's military newspaper suggested the military should reward innovative soldiers with cryptocurrency. 

MARKET RESEARCH

Before we had TikTok and iPhones, we had AOL Instant Messenger and Razrs. AIM isn't coming back, but the Razr is.

On Wednesday night, Motorola officially announced it's reprising the iconic 15-year-old flip phone. Only now, it's a $1,500 foldable screen smartphone. Early reviews indicate that the hinge and foldable screen actually work. The Razr will be available through Verizon in January 2020.   

kk, g2g. mom needs comp. brb Monday, c u then—Ryan is away 

GOING PHISHING ANSWER

India hasn't made an electric moon lander.