GEOPOLITICS

Territorial Apps

“The tiny territory is emerging as the front line in a global fight between the U.S. and China over censorship, surveillance, and the future of the internet,” the NYT wrote yesterday.

Hong Kong is a tiny territory with big implications

China recently passed a sweeping security law that will cast new digital surveillance over Hongkongers. Tech companies are reacting quickly. Facebook, Microsoft, Twitter, Google, Zoom, and Telegram say they’re pausing cooperation with government requests for user data. Apple says it’s assessing the new law. 

One step further: On Tuesday, TikTok said it’s pulling out of Hong Kong. The maneuver feels like an olive branch to the U.S. meant to show that ByteDance won’t subject its overseas app (TikTok) to rules that the Chinese version (Douyin) must play by. 

Too little, too late? 

TikTok's attempts to demonstrate good faith may not be enough to placate Washington, which has signaled it might take the India route to dealing with the app. 

On Monday, Fox News asked Secretary of State Mike Pompeo if the U.S. should consider banning TikTok. “We are taking this very seriously and we are certainly looking at it," Pompeo said.

TikTok claims it’s laser-focused on user security. “We have never provided user data to the Chinese government, nor would we do so if asked,” a TikTok spokesperson told me.  

Two tech stacks

The flash point in Hong Kong isn’t a one-off event. The internet will run on two separate architectures in the 2020s: 

• Infrastructure: China and Belt and Road countries are building 5G networks with Huawei gear. The U.S. and its allies...not so much. Google is also scouting out alternatives to Hong Kong for a subsea high-speed internet cable, the FT reports. 
• Exchanges: Tech companies are more likely to list on their own country’s exchange (in China, watch Shanghai’s Star Market). 
• Apps: Parallel app ecosystems have sprung up in the U.S. and China. If TikTok gets the boot from the U.S., expect a short-form video clone to pop up and gain popularity (but not Facebook’s Lasso). 

Bottom line: The tech stacks will have less crossovers and codependencies, no matter how similar they may look.

AR

A Magic Pivot

Yesterday, AR startup Magic Leap named veteran tech exec Peggy Johnson as its new CEO. Founder Rony Abovitz said he would resign as CEO in May; Johnson will step into his shoes on August 1. 

Johnson’s resume: 

• She headed business development at Microsoft, where she reported to CEO Satya Nadella and helped launch a corporate venture arm. 
• Johnson also had a 24-year stint at Qualcomm and, before that, worked at GE’s Military Electronics Division.

The next act

Johnson told the NYT she was drawn to Magic Leap’s spatial technology, which is exciting, expensive—and enormously difficult to commercialize: Magic Leap has raised over $3 billion from investors but struggled to sell consumer AR headsets. 

Now, Magic Leap is pivoting to enterprise solutions. 

Johnson could tap her B2B experience to right the ship and sail it toward the land of synergies and circling back...but Magic Leap isn’t in uncontested waters. Microsoft, Johnson’s last company, continues to upgrade its enterprise-focused HoloLens AR product line.

SPONSORED BY ELECTRIC

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You take a short meeting with them. Then they give you a super nice home security camera—for free.

But here’s the real deal. Electric is the IT solution that protects your company from security threats, enables remote work at half the cost, and provides full visibility into your IT infrastructure. 

They’ll bring peace of mind to your office and your home. At work, your company devices and data will be secure, and your stuff will function like it should. On the home front, you’ll have that free security camera. 

If this was a prominent game show whose title features the word “deal,” we would now say, “We’ll take that deal.” (We can’t say the actual name of the show, because their lawyers are as aggressive as their host is fastidious.)

For the best IT and a free home security camera, get to know Electric.

CONNECTIVITY

Other Bet Lands Stratospheric Job

Yesterday, Loon announced the launch of its first commercial internet service. The Alphabet division’s high-altitude, solar-powered balloons will provide internet to Telkom Kenya subscribers. 

• What’s covered? 50,000 square kilometers across parts of Kenya (roughly the size of Slovakia)
• How many balloons? 35 or more “flight vehicles,” as Loon calls them, will concurrently hang out in the stratosphere.
• Can you hear me now? Video calls and streaming worked in tests. 

Making its corporate parent proud

Alphabet’s moonshot factory, X, is kinda like college. Once you graduate, you focus on commercial viability (I don’t make the rules, I just repeat them). 

Loon provided service to parts of Peru and Puerto Rico after disasters, but the company highlighted the Kenya launch as “the first non-emergency use of Loon to provide connectivity on a large-scale basis.”

Big picture: Traditional telecoms could eventually connect a chunk of the ~3.2 billion people worldwide without internet access. But at the margins, many will never get increasingly vital coverage this way. From internet balloons to low-earth-orbit satellites, tech companies want to beam connectivity more widely and quickly (and cash in).

BITS & BYTES

Stat: Employment in “high WFH” sectors was down 4.5% in June, compared with February levels, according to this chart tweeted by Indeed Chief Economist Jed Kolko. 

Quote: “An absolute heartbreak. I don't mean to make angry my Apple overlords, but there is a difference in picture and sound quality..."—Tom Hanks, telling The Guardian about his movie going direct to streaming rather than theaters.

Read: The New Yorker explores our ghost kitchen future, which I alluded to in Monday’s newsletter. Ghost, dark, cloud, virtual...you name it, delivery-only restaurants are becoming more common.

SPONSORED BY ELECTRIC

How is WFH actually working? That’s the question Electric set out to answer in their new white paper, The State of Remote Work. As a company dedicated to powering business technology—whether you're remote or in the office—Electric put together this report to help organizations benchmark how they’re adapting to this new shift. Get all the WFH data you could ever need right here.

WHAT ELSE IS BREWING

• MIT and Harvard are suing to overturn new Department of Homeland Security and ICE restrictions. On Monday, ICE said international students on F-1 visas could not remain in the U.S. if their fall classes are online. 
• Palantir has confidentially filed to go public.  
• Clearview AI will stop offering its uber-controversial facial recognition tool in Canada. 
• Instagram is testing Reels, its TikTok rival, in India. 
• Lyft’s self-driving test vehicles are back on California roads. 
• Motorola released a budget 5G phone today in Europe. The Moto G 5G Plus (ugh that name) retails for $438. 
• The Supreme Court struck down a law allowing debt collection via robocalls. 

TRIVIA

After that third story, how could I not make today’s trivia about moonshots? Let’s test your knowledge of Google’s various, not necessarily profitable forays into cutting-edge technologies. 

Take the quiz here. 

TECH THINGAMABOBS

For the technically curious: Writer and programmer Justin Gage created a handy SQL guide that breaks down the programming language in digestible terms. Check out his Technically newsletter, which will help you stand your ground in convos with engineering coworkers. 

For a throwback worth your time: A year ago tomorrow, Elon Musk and Jack Ma publicly debated the future of AI. Check out the Brew’s recap. 

For PlayStation fans: Nikkei takes a look at a Sony PS4 factory that’s almost entirely automated. Humans help package the gaming consoles.

ICYMI

Catch up on the top Emerging Tech Brew stories from the past few editions: 

• Seven trends from Q2
• Microsoft launches online retraining program
• TuSimple announces autonomous freight network