Author: The New Economy

Alphabet to build futuristic district in Toronto as a model for smart cities

Posted on by The New Economy

On October 17, Google’s parent company, Alphabet, announced plans to build a futuristic city in Toronto’s waterfront area, with the ultimate aim of developing smart city technologies.

The smart neighbourhood project, named ‘Quayside’, will be carried out by Alphabet subsidiary Sidewalk Labs, which will work in collaboration with government-backed agency Waterfront Toronto. The former has committed $50m to the initial phase of the project, although The Wall Street Journal estimates the total spend is likely to reach $1bn.

The plan comes at a time when cities around the world are looking for solutions to challenges such as pollution, transportation and housing, and aims to make Toronto a “modern, connected and diverse global city”.

The Quayside plan comes at a time when cities around the world are looking for solutions to challenges such as pollution, transportation and housing

Speaking at the launch, Alphabet Chairman Eric Schmidt and Canadian Prime Minister Justin Trudeau revealed Quayside will occupy 325 hectares of underdeveloped land in the southeast of Downtown Toronto. In Trudeau’s words, the district will be “a thriving hub for innovation and create the good well-paying jobs Canadians need”.

As stated on Sidewalk Lab’s website, the city “will combine forward-thinking urban design and new digital technology to create people-centred neighbourhoods that achieve precedent-setting levels of sustainability, affordability, mobility and economic opportunity”. These new digital technologies will foster driverless vehicles, sustainable buildings and clean energy generation.

Naturally, the first company moving to Quayside will be Google, but the technology giant could soon be joined by Amazon, with Toronto among the cities vying to be the home of the company’s second North American headquarters.

 

Ford Lyfts AI efforts with autonomous vehicle partnership

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On September 27, Lyft and Ford announced they would combine their efforts to develop an autonomous vehicle offering. Although no set timeframe has been confirmed, the partnership will eventually see self-driven Ford vehicles deployed on the Lyft network.

In the meantime, the collaboration between Ford and Lyft will see the two companies develop their respective technology platforms with a view to greater integration. Software enabling Ford cars to communicate with the Lyft app is already under development, but these vehicles will continue to be driven by humans for the time being.

The move is viewed by many as an extension of Ford’s recent efforts to break into the burgeoning AI sector. Back in February, the company committed to investing $1bn in technology firm Argo AI over the next five years.

The partnership will eventually see self-driven Ford vehicles deployed on the Lyft network

Speaking of the announcement in a blog post, Ford’s Vice President of Autonomous Vehicles and Electrification, Sherif Marakby, said: “We expect that our partnership with Lyft will accelerate our efforts to build a profitable and viable self-driving vehicle business.

“With Lyft’s network and respected brand experience, we expect our ability to scale self-driving vehicles will play a critical role in safely bringing this technology – and its many benefits – to mainstream consumers.”

As well as working with Ford, Lyft is quietly building a portfolio of partners to bolster its ride-hailing service. Its Open Platform Initiative is aimed at building closer relationships with a number of automotive firms, with General Motors and start-up NuTonomy already on board.

If Lyft is to capture a significant stake of the self-driving car market it will need to counter the efforts of its best-known competitor, Uber, which is also investing heavily in autonomous vehicle technology. Uber’s recent regulatory issues in London, however, will no doubt have provided a welcome Lyft to its closest competitor.

Twitter algorithm detects terrorist accounts before they can tweet

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Twitter’s latest transparency report has revealed 299,649 accounts were suspended for promoting terrorism in the first six months of 2017. While users are invited to flag inappropriate content manually, Twitter is now relying on its own internal algorithm more than ever to identify cases where users are breaking the rules.

Of the 299,649 suspended accounts, 95 percent were flagged by the company’s internal algorithm. This is a dramatic improvement on the previous six months, which saw computers flag 74 percent of incidents. The figure is even more impressive when compared to the first half of 2016, in which computers caught just a third of suspended accounts.

Twitter’s use of artificial intelligence is also helping to catch accounts linked to terrorists before they tweet, with three quarters of the accounts suspended for terrorism-related issues shut down before any activity was registered.

Three quarters of the Twitter accounts suspended for terrorism-related issues were shut down before they could register a tweet

The tech giant has been under increasing pressure to clamp down on content relating to terrorism after facing suggestions its website has been used as a tool for violent online radicalisation and extremist recruitment.

Algorithms are not a perfect science, however, and training computers to understand something like terrorism is far from simple. “As many experts and other companies have noted, there is no ‘magic algorithm’ for identifying terrorist content on the internet, so global online platforms are forced to make challenging judgement calls based on very limited information and guidance,” read a blog post on Twitter’s website.

What’s more, by relying too heavily on algorithms, Twitter runs the risk of mistakenly shutting down or suppressing the platform for legitimate users. The company noted: “As an open platform for expression, we have always sought to strike a balance between the enforcement of our own Twitter rules covering prohibited behaviours, the legitimate needs of law enforcement and the ability of users to share their views freely – including views that some people may disagree with or find offensive.”

Linde ovecomes union pressure to begin acceptance period for $75bn Praxair merger

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German industrial gas company Linde has announced that the 10-week acceptance period for its proposed merger with US firm Praxair has begun. The exchange offer, which will create a $75bn industry leader under the Linde name, will be finalised on October 24 – pending approval.

In order for the deal to go ahead, it must first be approved by a majority of Praxair shareholders. Their Linde counterparts will not receive a vote on the merger, but will be required to tender 75 percent of the company’s shares before the deal can be completed.

The news that the acceptance period has begun is a positive step forward for the merger, which has faced criticism since being proposed in December. One of the move’s biggest stumbling blocks came from German trade union officials, who felt the deal was being imposed without establishing a consensus with the workers, going against usual practice in Germany.

If the merger is approved it will see the new company overtake France’s Air Liquide to become the biggest player in the industrial gas industry

A spokesperson for trade union group IG BCE told Reuters it was “regrettable” that members of the board did not take up the offer for further discussions with labour representatives. However, after receiving guarantees on the security of German jobs, the majority of representatives ultimately backed the deal.

If the merger is approved it will see the new company overtake France’s Air Liquide to become the biggest player in the industrial gas industry, with $30bn in revenue and 88,000 members of staff.

The merger, expected to complete in the second half of 2018, also promises significant financial benefits to the company and its shareholders. It is predicted new efficiencies will save the company $1.2bn within the first three years, as well as helping it achieve a market value of $100bn within five years.

Bitcoin achieves record high following cryptocurrency split

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The value of bitcoin reached an all-time high this weekend as it broke past the $4,000 mark for the first time. The cryptocurrency reached a peak of $4,225 on August 13, before experiencing a slight fall in value later in the day, eventually stabilising at around $4,000.

The recent surge comes less than two weeks after the currency experienced a ‘hard fork’, which saw it split into two separate entities. Although many feared the creation of the new cryptocurrency, called bitcoin cash, would lead to instability in the market, this does not seem to have been borne out, with the value of bitcoin having increased by more than 25 percent in the last week alone.

The decision to split the currency emerged following concerns bitcoin was struggling to cope with its increasing popularity, with developers harbouring differing opinions on how to increase the number of viable bitcoin transactions taking place each second. Instead of undermining the market, however, recent developments have actually increased confidence in the cryptocurrency.

Instead of undermining the market, bitcoin’s recent split has actually increased confidence in the cryptocurrency

“Up until now a lot of people didn’t really believe bitcoin could go any higher until the scaling issue is resolved,” explained Arthur Hayes, founder of bitcoin exchange BitMEX. “With this actually being implemented on protocol, theoretically the amount of transactions that can be processed at a reasonable speed is going to be much higher, so a lot of people are very bullish about bitcoin now.”

Bitcoin first hit the headlines back in 2013, after a price surge saw its value rise from $15 to more than $1,000 during the year. Despite concerns over its association with illegal activity and suggestions consumers would not trust decentralised transactions, the cryptocurrency has proved surprisingly resilient.

Bitcoin cash, meanwhile, has risen in value by more than 15 percent in its relatively short existence, currently trading at $305.

Facebook takes aim at TV with launch of new video platform Watch

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On August 9, Facebook revealed a new video tool that will provide its users with short, exclusive content from sports, entertainment and documentary producers, in a bid to increase its presence in the on-demand television market.

The product, named Watch, comes at a time when internet consumption is shifting towards mobile and video content, with tech companies rethinking products in order to meet users’ demands.

“As more and more people enjoy this experience, we’ve learned that people like the serendipity of discovering videos in News Feed, but they also want a dedicated place they can go to watch videos,” read a Facebook press release.

For now, the platform will only be available to a select group of users in the US. But figures released by Facebook in June suggest it could be scaled up to a mass of around two billion active monthly users.

Facebook has signed deals with content partners such as Vox Media, Buzzfeed and Major League Baseball

Users will be able to access Watch on mobile, desktop and laptop, as well as through Facebook’s TV app, with shows set to be delivered in episodes that can be contained in a ‘watchlist’.

According to Reuters, Facebook signed deals with content partners such as Vox Media and Buzzfeed three months ago. Other deals include A&E, Major League Baseball and National Geographic. Meanwhile, TechCrunch has revealed Facebook’s new partners will earn more than half of the service’s revenue, taking home 55 percent.

Facebook’s latest announcement illustrates the increasing competition in the digital video industry, where the largest players are moving fast to increase and retain their audiences.

For example, Netflix announced its first acquisition on August 7, while Disney pulled its content from Netflix the next day, announcing it would soon be launching its own streaming service.

Room for debate: tackling the sharing economy’s tax advantage

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In 2007, a shortage of hotel rooms in San Francisco inspired two roommates to create a webpage offering visitors to stay on air mattresses in their flat. Just 10 years on, Airbnb now operates in more than 65,000 cities across almost 200 countries, and has found more than 200 million guests a bed to stay in.

The flourishing peer-to-peer (P2P) sector is on the verge of profoundly disrupting the way the economy functions. Yet, for all its benefits, its dramatic expansion has left governments grappling with a fresh problem: how to craft tax rules that will enable them to squeeze revenue from this new brand of business.

The P2P economy often comes under fire for slipping through the net of taxation; Airbnb has roused frustrations from its competitors in the hospitality sector, which tend to face much higher taxes for essentially delivering the same product.

For example, in London, hotels must pay a 20 percent charge on all bookings, yet for the thousands of Airbnb transactions taking place in the very same city, the owner of the room will not be charged VAT. Instead, Airbnb is charged VAT on its own slice of the revenue.

Airbnb has roused frustrations from its competitors in the hospitality sector, which tend to face much higher taxes for essentially delivering the same product

A working paper published by the IMF, entitled Taxation and the Peer-to-Peer Economy, explores how governments can approach this quandary, and suggests the technology behind P2P platforms presents a “valuable opportunity” to narrow in on taxation.

The report said: “The critical role of the digital platform in facilitating and intermediating P2P transactions presents an important opportunity for tax administrators to authenticate both the incomes and expenses reported by P2P sellers. Many countries are now looking to cooperate with platforms to access this information.”

Yet, while such technology can give governments the tools to administer more targeted tax policies, the question remains as to whether they should choose to fully level the playing field.

“Some governments may wish to minimise tax policy differences between P2P sellers and traditional businesses,” read the report. “Others may instead see the rise of the P2P economy as positive and choose to provide tax incentives to encourage it.”

Ultimately, governments must decide where their priorities lie: with the incumbents or the disruptors.

GS Yuasa’s new battery set to double the range of electric vehicles by 2020

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On August 8, the Nikkei Asian Review reported Japan’s GS Yuasa is set to bring a new lithium-ion battery capable of doubling the range of small electric vehicles to mass market by 2020 – without pushing up manufacturing costs.

The batteries will be developed at the lithium energy plant in Shiga Prefecture by Lithium Energy Japan, a joint venture between GS Yuasa, Bosch and automotive manufacturer Mitsubishi. Carmakers from Japan – along with those from Europe – will be able to purchase the cells to include in their own vehicles once development is complete. It is believed the price of the new batteries will remain inline with those currently on the market.

The limited supply of fossil fuels has placed a strict time limit on the lifespan of gas and petrol powered vehicles

The limited supply of fossil fuels has placed a strict time limit on the lifespan of gas and petrol powered vehicles, with some reports even predicting the vast majority of vehicles will be electric within the next decade. A report released in May by Stanford economist Tony Seba, entitled Rethinking Transportation 2020-2030, estimated 95 percent of all miles travelled by passengers in the US would be made using self-driving electric vehicles by 2030.

Recently, the drive towards the mass-market adoption of electric vehicles has been given a boost by regulators seeking to cut pollution, with governments in the UK and France announcing legislation to ban the sale of new diesel and petrol vehicles by 2040.

However, for the road to large-scale ownership to run smoothly, electric vehicles must compete with petrol and diesel models in both journey range and cost. Cheap, long range lithium-ion batteries are crucial to this, with governments otherwise forced to redesign cities to facilitate a large network of charging stations – a task that is both difficult and extremely costly.

FMC set to buy home dialysis systems manufacturer NxStage for $2bn

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The world’s largest provider of dialysis products, Fresenius Medical Care (FMC), has agreed to buy US-based home dialysis systems manufacturer NxStage for $2bn. The deal, which pending regulatory approval is set to close in 2018, will see FMC North America acquire all outstanding shares of NxStage.

In a statement discussing the acquisition, Rice Powell, CEO of FMC, said: “Combining our two companies [will] strengthen and diversify our business in the US and help meet the evolving needs of our patients.”

Dialysis works as an artificial replacement for kidney function in people with severe kidney failure, and is increasingly prescribed across Europe and the US as the diagnosis rates for diseases such as end-stage renal disease (ESRD) soar.

By acquiring NxStage, FMC will be hoping to increase its share of the growing home care market

People with diabetes are at high risk of developing ESRD and, with diabetes more prevalent in later life, ageing populations in Europe and the US are driving demand for dialysis treatment. Ageing populations are also placing increasing pressure on hospitals, forcing more patients to seek care at home. By acquiring NxStage, FMC will be hoping to increase its share of the growing home care market.

FMC said in a statement: “This acquisition enables FMC to further leverage its manufacturing, supply chain and marketing competencies across the dialysis products, services and care coordination business in a less labour and capital intensive setting.”

FMC expects the acquisition to generate pre-tax operating cost savings of around $80m-$100m a year for the next three to five years. This will initially be offset by integration costs of around $150m, but the deal is expected to generate a net gain by 2021.

Toyota and Mazda enter joint venture to build $1.6bn US assembly plant

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On August 4, Toyota and Mazda announced plans to strengthen their ongoing partnership by investing $1.6bn in a new US assembly plant, as well as sharing research into electric vehicles. The planned investment may prove advantageous to US President Donald Trump, as it appears to bolster his mission to reinvigorate US manufacturing. Back in January, Trump threatened Toyota with hefty border taxes in response to its proposal to build a plant in Baja, Mexico.

The US-based manufacturing plant is set to begin operations in 2021, and is expected to produce around 300,000 vehicles per year, with the output divided between both firms. The location of the plant is yet to be revealed, but Toyota and Mazda have said it will create 4,000 new jobs.

Toyota already boasts a number of US-based factories, with a particularly strong presence in the southeast; Toyota has operations in Texas, Mississippi, Indiana, Alabama and West Virginia, while Kentucky is home to the firm’s largest manufacturing facility in the world.

Toyota and Mazda have said the US-based manufacturing plant will create 4,000 new jobs

Meanwhile, Mazda currently has no production facilities in the US, but has previously operated factories in Kansas and Michigan, one of the Midwestern, rustbelt states Trump promised to return to prosperity during his presidential campaign.

As part of the deal, Toyota will take a five percent stake in the more modest Mazda, with Mazda taking a 0.25 percent stake in Toyota in return. This represents a further union of the two companies, which entered into an agreement in May 2015 to form a committee and explore research-sharing avenues.

The plan to share research into electric car development comes at a crucial time, with industry leaders investing heavily in order to meet the global drive to toughen regulations on gas-powered vehicles.

In Europe, both France and the UK have stated plans to cease gas-vehicle production by 2040, with other countries likely to follow suit. Firms are also ramping up investment in lithium-ion batteries to gain ground on US firm Tesla, which is set to bring an affordable $35,000 electric car to market later this year.

German carmakers agree to cut emissions amid increasing political pressure

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On August 2, German authorities announced they had agreed a plan with major carmakers Daimler, BMW, Volkswagen and Opel, to overhaul the engine software of 5.3 million diesel cars. The deal represents an attempt to repair the industry’s damaged reputation following the Volkswagen emissions scandal in 2015, and will seek to cut the level of pollution currently produced by diesel cars.

The announcement coincides with the unveiling of Tesla’s long-anticipated Model 3, an electric car competitively priced between $35,000 and $44,000. The company’s latest model has already secured more than 455,000 reservations, and is set to be available to the public by the end of the year.

Chancellor Angela Merkel has faced criticism for not doing enough to curb Germany’s pollution levels, and is considered to be too close to the automotive industry

The software upgrade comes as part of wider campaign, launched by German Chancellor Angela Merkel, to tackle pollution. According to Reuters, Merkel has faced criticism for not doing enough to curb Germany’s pollution levels, and is considered to be too close to the automotive industry – the country’s biggest exporter.

Speaking to German newspaper Bild, Justice Minister Heiko Maas said the announcement represented the first step in the government’s plans for reform, and refused to rule out a blanket ban of diesel cars in the future.

Meanwhile, German executives are set to announce a new lithium-ion battery plant to rival the output of Tesla’s Gigafactory 1, which opened in the US earlier this year.

Bitcoin splits cryptocurrency community with launch of cash alternative

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An ideological rift in the bitcoin community has culminated in the launch of an alternative version of the cryptocurrency, which is being led by a splinter group of bitcoin users, developers and miners. The split is known as a ‘hard fork’ and will ultimately allow the new iteration to function as a separate cryptocurrency, like ripple or ethereum.

The new cryptocurrency, labelled ‘bitcoin cash’, was launched on August 1, and will act as direct competitor to the original bitcoin. Trading got off to a volatile start, with the value of bitcoin cash initially surging before experiencing a dramatic fall later in the day. In turn, the value of the original bitcoin dropped slightly, now standing at around $2,729.

The breakaway follows a series of bitter debates among bitcoin heavyweights, who have failed to agree on the best strategy to scale the system as its popularity continues to rise. The debates centre on bitcoin’s restricted processing speeds, which are currently running close to the technologies own inbuilt limits. Bitcoin cash was created as a rival configuration to expand the capacity for processing transactions.

Bitcoin cash has divided bitcoin users, with many believing the very concept of creating a new version of the coin goes against the ideology of a cryptocurrency

The introduction of bitcoin cash has divided bitcoin users, with many believing the very concept of creating a new version of the coin goes against the ideology of a cryptocurrency, which is inherently limited in its supply.

There is no guarantee bitcoin cash will gain enough traction to develop real value, but many in the bitcoin community have expressed support for the coin’s new guise.

However, bitcoin cash is currently trading at a fraction of the price of the original bitcoin, and certain online cryptocurrency wallets are refusing to support the new format.

Speaking of its decision to boycott bitcoin cash, crytocurrency wallet Coinbase said: “[It’s] hard to predict how long the alternative version of bitcoin will survive and if bitcoin cash will have future market value.”