IBM Hits a Single after Years at Bat

January 20, 2018

IBM reported revenue growth. The company’s news release may have been subject to a staff cutback. Here’s the message I saw when I tried to read the official news release:

image

I wonder if IBM’s cloud business offers the stability and reliability of offerings from Amazon, Google, or Microsoft.

The Poughkeepsie Journal was happy. I learned:

On Thursday, IBM reported fourth-quarter 2017 total revenue of $22.5 billion, up 4 percent from $21.8 billion the same quarter in 2016.

Growth is good. Better than a loss. However, where did the growth originate? From Harrod’s Creek, mainframes took a deep breath, put those ageing legs in motion, and managed to get on base.

Mainframes!

Strategic imperatives made a contribution, strike out king IBM Watson, which may be headed to the Louisville Bats, managed about three percent growth.

ZDNet observed:

IBM’s fourth quarter topped expectations and strategic imperative businesses were solid, but Big Blue’s annual revenue is down for the 7th consecutive year.

Back out money made from currency, and Big Blue’s fourth quarter sales were up one percent.

Ginni Rometty, IBM CEO, is quoted as saying:

IBM strengthened our position as the leading enterprise cloud provider and established IBM as the blockchain leader for business. Looking ahead, we are uniquely positioned to help clients use data and AI to build smarter businesses.

Presumably she did not have to access the company’s Web site for the quarterly news release.

The company’s shares went down. That’s confidence.

Stephen E Arnold, January 20, 2018

Out with the Old, in with the New at Google

January 17, 2018

It may have started with its finance app, but Google is making some drastic changes you might want to keep an eye on. We discovered the tip of the iceberg with Google Blog piece, “Stay on Top of Finance Information on Google.”

According to the story:

Now under a new search navigation tab called “Finance,” you’ll have easier access to finance information based on your interests, keeping you in the know about the latest market news and helping you get in-depth insights about companies. On this page, you can see performance information about stocks you’ve chosen to follow, recommendations on other stocks to follow based on your interests, related news, market indices, and currencies.

As part of this revamped experience, we’re retiring a few features of the original Google Finance, including the portfolio, the ability to download your portfolio, and historical tables. However, a list of the stocks from your portfolio will be accessible through Your Stocks in the search result, and you can get notifications when there are any notable changes on their performance.

Not a big shock, but a big part of Google trying to freshen things up. The company has been in hot water with a string of YouTube videos deemed too much. So, with moves like improving its algorithm to weed out fake news, changes to Google Home, and even Maps, Google is sending a message. The message is one of change and one we hope is for the better.

Patrick Roland, January 17, 2018

Quote to Note: Digital Currencies and Old School Swiss Bank Accounts

January 13, 2018

I noticed “Bitcoin Shouldn’t Become the New Swiss Bank Account: Mnuchin.” In my DarkCyber video program, I have mentioned the efforts of authorities to put a dog harness on digital currencies. Now I have a quote to note:

Dominant digital currency bitcoin should not be allowed to become the Swiss bank account of the modern era used to hide illicit activity, Treasury Secretary Steven Mnuchin said Friday.

One other factoid, assuming that the write up is accurate. Cooperative pressure on digital currencies is now a reality for fans of digital currencies. What countries are on Mr. Mnuchin’s team? The G20 countries. The list includes the European Union and others. I know this is almost 50 countries, but G20 has a bit of cachet.

That “follow the money” idea is tough for governments to shake.

Stephen E Arnold, January 13, 2018

Digital Currencies: A Bit of Push Back

January 11, 2018

The Beyond Search and Dark Cyber research teams have been watching the great “avoid regulated currency” movement. Our view is that when bad actors have access to something which makes their life easier, regular folks may want to look both ways before crossing the street. We noted this article today:

South Korea Plans to Ban Crypto currency Trading, Rattles Market

Our view is that this type of nation state action will pick up steam. There are tax implications, of course. But digital currencies are almost purpose built to make authorities nervous. Toss in the benefit of mostly untraceable use of digital currencies to buy contraband, and you have a cattle prod for government entities. Once these folks get rolling, it may be difficult to slow their regulatory and enforcement momentum. Just our view from Harrod’s Creek.

Stephen E Arnold,  January 11, 2018

Google Getting into More Trouble Because of Ads

December 26, 2017

It feels like Google is in the news every day lately. Usually, it’s not for anything good. Take, for instance, the recent Register piece about some fishy ad policies, in the article “Google Lies About Click-Fraud Refunds and Tried to Destroy Us –Ad Biz.”

In a complaint filed in a US district court in San Jose, California, on Wednesday, the ad biz claimed Google failed to refund almost $500,000 paid to place ads on websites that drove invalid traffic, in violation of Google rules

Claiming that this is a pattern of behavior, the complaint seeks recognition as a class action for Google’s alleged false promises to refund advertisers for ad impressions placed through Google’s DoubleClick Ad Exchange deemed to be invalid.

The lawsuit contends that a Google employee had warned the ad biz privately that Google’s Network Partner Managers like AdTrader ‘would mysteriously start getting into trouble with Google once they reached an annual revenue run rate of $4-5 million.’

It should be pointed out that Google has not been convicted of any of these claims, but they are troubling. It is easy to say that it is a busy time to be a member of the search giant’s legal team. Recently, the city of Seattle sent Google a letter stating that it is considered a commercial advertiser, like a radio or television station, and therefore had to turn over any information about political ads sold regarding city elections. We have no doubt Google will weather these storms, but they are concerning.

Patrick Roland, December 26, 2017

AI in China: Insiders and Outsiders

December 15, 2017

Google is trying to scramble in China’s artificial intelligence market. Several years ago, Google wanted China to “change.” Now it looks as if Google has figured out that it has to conform in order to catch up with other outfits in the Middle Kingdom.

Case in point: Navigate to “Li Ka-Shing Bets on Hong Kong AI Start-Up to Parse Chinese Call Centre Industry’s Tower of Babel.” Mr. Ka-Shing is an important figure and rumor has it that he is associated with some powerful government figures in China. He also has money, telecommunications, shipping, and other interests to help him pay his bills.

The funding of Fano Labs via Horizon Ventures is important in my opinion. For outfits like Google, the best and brightest of the Chinese AI experts may find their future in companies similar to those Mr. Ka-Shing finds “interesting.”

Outsiders? Nope, insiders. The difference is important when it comes to big deals in China in my experience.

Stephen E Arnold, December 14, 2017

Jaywing: Can the Company Outperform Tracer?

December 14, 2017

I am a person who gathers odd items of information. Not long ago, I learned about Thomson Reuters’ Tracer smart system for risk prediction assessment and other helpful services for those hungry for a data edge.

The idea is that wonks at Thomson Reuters figured out how to make sense of content in order to “predict” whether an investment poses a risk or a big trend will be, well, big.

From my point of view, a large outfit like Thomson Reuters suffers from size, management incentive programs which focus on specific financial goals, and technology lag. The term “technology lag” means that by the time a giant outfit decides a technology is important and useful, the technology is likely to be an old hat, a fedora from the 1950s perhaps?

I read about Jaywing, which is not a particularly easy thing to do. If you navigate to the Jaywing Web site, there are pictures and jargon which can be tough to decipher. For instance, the company is involved with “data science.” The company wants to delivery “strategy.” The company is “creative.” These are useful words, but I am not sure I can define them. I know that when Jaywing says, “Data science” and then explains it with by saying “It’s in our blood”, I think I understand, but I don’t really.

I did note an article in Global Banking and Finance which helps to explain what the company purports to do. “Jaywing Launches new AI Risk Technology Product Archetype.” I highlighted several statements about the interesting “AI risk technology” service; to wit:

Archetype uses deep neural networks, an advanced predictive modeling methodology and an intuitive user interface to create models that will radically improve the interpretability and predictability of the AI-driven scoring process.

Yep, easy model tweaking. When applied to fraud detection, Archetype works wonders.

I also noted this statement from the managing director of the firm:

Initial comparative tests of Archetype against an already strong fraud model have shown an uplift in the order of 10 points.

If I understand the statement, if a competitive product from one of the FinTech vendors delivers 85 percent accuracy, Jaywing pumps out an an interesting 95 percent accuracy. Now, if true, that is significantly better than outfits like Google can deliver. Most smart software chugs along with 80 to 85 percent accuracy. Quite a significant leap that 10 points makes. I can’t verify this performance, but it suggests that Jaywing knows how to catch one’s attention and financial fraudsters.

I circled this statement from Jaywing’s CEO (Rob Shaw) too:

We have now brought new algorithmic and expert knowledge on machine learning and AI to further optimize risk management, regulations and operational control while freeing resource to focus on other value-adding tasks.

Those blue chip, McKinsey like consultants may find themselves losing engagements to Jaywing if these assertions are on the money.

The big question is, “Is Jaywing able to deliver a significant boost in accuracy?”

Worth watching. I assume Thomson Reuters, among others in the smart software for risk analysis game, will be paying attention to the UK company. If the existing vendors can’t match Jaywing, I am 85 percent confident their marketing departments can deliver when explaining the benefits of their systems.

Jaywing’s intelligence unit states,

“We free marketers to think, not do.”

Competitors may want to note that Jaywing operates Epiphany and Bloom, two marketing companies. One of these firms asserts, “The marketing agency where artificial intelligence meets human creativity.”

When pitching high accuracy smart software outputs, marketing is important. Who wouldn’t like predictions that are 95 percent accurate?

Stephen E Arnold, December 14, 2017

Cloud Computing Resources: Cost Analysis for Machine Learning

December 8, 2017

Information about the cost of performing a specific task in a cloud computing set up can be tough to get. Reliable cross platform, apples-to-apples cost analyses are even more difficult to obtain.

A tip of the hat to the author of “Machine Learning Benchmarks: Hardware Providers.” The article includes some useful data about the costs of performing tasks on the cloud services available from Amazon, Google,  Hetzner, and IBM,

My suggestion is to make a copy of the article.

The big surprise: Amazon was the high-cost service. Google is less expensive.

One downside: No Microsoft costs.

Stephen E Arnold, December 8, 2017

Amazon Google Money Factoids

October 29, 2017

I noted the financial results of Amazon and Google. Amazon reported third quarter sales of $43 billion. Google tallied revenues of $27.7 billion. Amazon has multiple revenue streams; Google is making Steve Ballmer’s one-trick pony comment hold true. Will Google close the revenue gap? Will Amazon stumble?

Stephen E Arnold, October 29, 2017

Palantir Technologies: Valuation Doubts?

October 18, 2017

i read “Palantir Will Struggle to Hold On to $20 Billion Valuation, Study Says.” Interesting stuff because beating up on hapless Silicon Valley companies is becoming a mini-trend. Facebook is in the dog house because it sells ads. Google is in the kennel because Europe finds its business practices less than Euro-cool. Twitter. Poor Twitter. Its part time boss is going to improve controls on the Wild West of short messages.

Now it is Palantir, the software company which offers an alternative to the IBM Analyst Notebook system. I thought Palantir was in the cat bird seat to provide technology that would deliver certain functionality to various US government agencies, financial institutions, and other organizations wanting to make sense of data.

I learned from the Bloomberg write up:

If Palantir Technologies Inc. pursues plans for a public offering and follows through by 2019, it will need to rein in spending and woo corporate customers just to be able to hang on to a $20 billion valuation it was awarded two years ago, according to a new study. It could also be worth a lot less.

Bloomberg cites a “study” which reveals that Palantir technology needs some set up and configuration before the users can make sense of digital information processed by the system.

This apparently comes as a surprise to Bloomberg and the SharesPost research team.

The reality of next generation information access systems is different from an iPhone or Android app one downloads and uses immediately. I know this is a surprise to many “experts,” but next generation information access systems are complicated. I explain why in my 2015 CyberOSINT: Next Generation Information Access Systems.

What’s interesting is that instead of putting the Palantir systems in a meaningful context, the report and apparently Bloomberg want to make another Silicon Valley outfit look like a bent penny.

Valuation is in the eye of the beholder and the Excels generated by whiz kids who want to buy a new Porsche.

Bloomberg quotes the report as a way to wrap up the news story with a stomp on Palantir’s foot; to wit:

Palantir “is currently valued much higher than its peers in the big data and analytics space,” Kulkarni wrote, adding that he believes Palantir will maintain the rich valuation if it keeps adding corporate clients and expedites cost cutting. He wrote that Palantir remains an attractive acquisition target – Oracle weighed the option last year but demurred – and estimated Palantir’s low-end value in 2019 at $13.8 billion.

Is there another view of Palantir? Guess not.

Stephen E Arnold, October 18, 2017

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