Since its founding, TechCrunch has maintained (and enjoyed) a close relationship with the industry it covers. They’re rarely bothered by how this “looks,” as could be seen today, with their proud announcement that one of their new contributors will also continue to work for one of the largest technology companies in the world.
It's a promising day for humans! For one among us, New Jersey Rep. Rush Holt, has thwarted the march of the machines. That's right: Holt actually beat the IBM supercomputer Watson at Jeopardy! last night. So all that talk yesterday about how glad he was that his "humiliation" wouldn't be televised just served to lower expectations, knowing all along that he'd stomp that crappy robot. Hey IBM? It's time to throw Watson in the trash.
Did you see IBM's Jeopardy-playing computer, Watson, play against show champions Ken Jennings and Brad Rutter tonight? (You may have been thinking "What black magick is this, that a talking box should play at being human?" yet verily, I tell you, it is no black magick but a "Mechanical Turk" fastened of steel and copper wire.)
The cool thing about Watson, IBM's Jeopardy-crushing computer, is not that it is great at Jeopardy or a sign of the robacolypse. This machine is real world useful, and can give you something Google can't: One right answer. Video inside.
Unlike the complex game of chess, mastering Jeopardy with a computer would seem to be a simple matter of automating Wikipedia searches. But there's more to it than that:
• Wall Street retreated this morning after a four-week rally amid concern about the banking sector and after IBM's attempt to buy Sun unraveled. [WSJ, CNN]
• The latest Washington official facing questions about potential conflicts of interest: Larry Summers, who collected $5.2 million in 2008 working one day a week for D.E. Shaw before joining the administration. [NYT]
• Tim Geithner says that the Obama administration is prepared to oust top financial executives if their firms require more public aid. [FT, DB]
The company whose "Think" slogan became a generational buzzword isn't doing so well with the brand identity campaigns lately. A tipster points out that IBM's latest mouthful of a proverb, "A mandate for change is a mandate for smart," comes illustrated with what looks exactly like a 1981 Keith Haring drawing rinsed of its pizazz. The accompanying essay reads like Kevin Kelly in Wired circa 1993. I stopped reading when I got to the claim, "Smart healthcare systems can lower the cost of therapy by as much as 90%." Call me when that's ready.
Some days it seems like Steve Jobs will be CEO of Apple until he dies. But after a bout with pancreatic cancer and a health scare earlier this year, peope are starting the grieving process earlier. Part of that involves playing a guessing game about who will take his place. Fortune convincingly argues that Apple COO Tim Cook is the only real candidate.Cook is paid more than anyone else at Apple, and he's the only executive allowed an outside board seat (Cook is a director at Nike). More importantly, he's humble enough not to push for a CEO job that can never be his as long as Jobs is in the saddle. True, Cook is an operations expert, not a product genius like Jobs, but he could surround himself with Apple executives like Scott Forstall and Jonathan Ive to make up for that lack. Only one wild card: Mark Papermaster, the IBM chip executive whose recruitment by Apple has embroiled the companies in a lawsuit. if the hire goes through, Papermaster will report to Jobs, not Cook.
The world's biggest IT services firm fed the New York Times a copy of a speech CEO Sam Palmisano was scheduled to make today in front of the Council of Foreign Relations in New York City. Sam's proposal is blatant: "A technology-fueled economic recovery plan that calls for public and private investment in more efficient systems for utility grids, traffic management, food distribution, water conservation and health care." Also, free Zipcars for gossip bloggers.
Tony Fadell, the head of Apple's iPod division, is exiting Steve Jobs's reality distortion field. While Fake Steve Jobs likes to take credit for inventing the frigging iPod, its real mastermind is Tony Fadell, who took his plans for an MP3 player to Apple in 2001 as a consultant. His replacement: Former IBM chip expert Mark Papermaster, whose erstwhile employer is suing Apple to prevent him from taking a job there. That Papermaster is replacing Fadell makes its lawsuit even stranger; it is seeking to enforce a noncompete clause in his contract, but a job overseeing MP3 players and cell phones hardly seems a competitive threat to IBM. Fadell is planning to take some time off Pity. Since he joined Apple, Fadell's homepage has turned into a placeholder. We were looking forward to the return of the "jazzy, shameless self-promotion" it once offered.
Who's Mark Papermaster, the chip guru Apple and IBM are scrapping over? Here's one clue: He's the kind of guy who has no photos online. There used to be a "Mark Papermaster" profile on Facebook, but it's gone. No wonder he wants to disappear: Apple hired Papermaster, formerly a VP at IBM, possibly to run its PA Semi chip-design subsidiary. Apple switched to Intel chips for its Macs years ago, but after it bought PA Semi, speculation grew that it might use some variation on IBM's Power chips for the iPhone and iPod. Papermaster could help with that.IBM is suing Papermaster and Apple over the terms of his noncompete agreement. Apple and IBM hardly compete, which makes IBM's lawsuit a bit puzzling. California law is unfriendly, in general, to noncompete agreements; if anything comes of the lawsuit, it will likely be some kind of settlement. Here's why I think IBM is suing Apple and Papermaster: It just wants to get some idea of what Apple's up to.
When Wall Street fails, Silicon Valley must step up. So goes the hubristic thinking here. Debt greases the wheels of commerce, and the sale of servers and software is no exception. And that part of the credit industry has hit a rough patch, too, with defaults on equipment loans nearly doubling in the past year. As with other credit markets, this had made traditional lenders nervous. So cash-rich tech companies are venturing into lending themselves. IBM has long had an in-house lending arm, with $24.5 billion in loans outstanding. Cisco lent $4 billion to customers last year. Even eBay is getting into the game through Bill Me Later; it acquired $550 million in consumer loans in conjunction with the purchase of the payments startup.We know how this ends — with tech-company shareholders footing the bill. Cisco wrote off $900 million in bad debt in 2001. It will surely claim to have learned its lessons since then. But as others rush in to help customers acquire their wares, some will surely get burnt. As will investors, who may think they're buying shares in a tech company, only to discover they've put money into a bank.