HN user
analyst
Completely agree with you re: Bloomberg's somewhat shady history of reporting. However, in this case, the article is citing a research note written by TD Cowen equity research analysts.
For example, here's another article from MarketWatch citing this same research note -- https://www.marketwatch.com/story/the-research-note-thats-ra...
Leads me to lend more credence to the news even though OP is linking Bloomberg.
Link to original GAO report: https://www.gao.gov/products/gao-23-104719 "IRS Needs to Complete Modernization Plans and Fully Address Cloud Computing Requirements"
"The Internal Revenue Service's (IRS) legacy IT environment includes applications, software, and hardware, which are outdated but still critical to day-to-day operations. Specifically, GAO's analysis showed that about 33 percent of the applications, 23 percent of the software instances in use, and 8 percent of hardware assets were considered legacy. This includes applications ranging from 25 to 64 years in age, as well as software up to 15 versions behind the current version. As GAO has previously noted, and IRS has acknowledged, these legacy assets will continue to contribute to security risks, unmet mission needs, staffing issues, and increased costs."
"Snowflake has no incentive to push a code change that makes things 20% faster because that can correspond to 10–20% drop in short-term revenue. In a typical Innovator’s Dilemma, Snowflake prioritizes other things that generate an ever larger menu of compute options, like Snowpark and data apps built on Streamlit, that will bleed your organization dry."
This is not true. Snowflake has done just that - it has continuously improved performance resulting in reduced credit consumption and revenue from customers on a unit compute/storage basis. And it has negatively impacted their revenues and stock price. Snowflake's incentive is to strengthen their competitive position and to hopefully generate more long-term revenue from their customers.
The CFO forecasted a $97 million dollar short fall when guiding for 2022 revenue resulting from product improvements. Snowflake stock dropped immediately after.
See Q4 transcript -- https://www.fool.com/earnings/call-transcripts/2022/03/02/sn...
"Similarly, phased throughout this year, we are rolling out platform improvements within our cloud deployments. No two customers are the same, but our initial testing has shown performance improvements ranging on average from 10% to 20%. We have assumed an approximately $97 million revenue impact in our full-year forecast, but there is still uncertainty around the full impact these improvements can have. While these efforts negatively impact our revenue in the near term, over time, they lead customers to deploy more workloads to Snowflake due to the improved economics."
Also see the Bloomberg article -- https://www.bloomberg.com/news/articles/2022-03-02/snowflake....
"Snowflake Inc., a software company that helps businesses organize data in the cloud, dropped the most ever in a single day Thursday after projecting that annual product sales growth would slow from its previous triple-digit-percentage pace.
Executives said improvements to the company’s data storage and analysis products will let customers get the same results by spending less, which will hurt revenue in the short term, but attract more clients in the future.
“The full-year impact of that next year is quite significant,” Chief Executive Officer Frank Slootman said on a conference call Wednesday after the results were released. But “when customers see their performance per credit get cheaper, they realize they can do other things cheaper in Snowflake and they move more data into us to run more queries.”"
I would not have guessed Roblox was on-prem with such little redundancy. Later in the post, they address the obvious “why not public cloud question”? They argue that running their own hardware gives them advantages to cost and performance. But those seem irrelevant if usage and revenue go to zero when you can’t keep a service up. It will be interesting to see how well this architecural decision ages if they keep scaling to their ambitions. I wonder about their ability to recruit the level of talent required to run a service at this scale.
A great survey of the current landscape of ML tool innovation.
This reminds me of the explosion of "big data" tech, which feels like it started exploding in 2010 and peaked maybe five years later.
If ML follows a similar cycle, then in perhaps five years, most tools will have receded into obscurity but a few frameworks and approaches will become dominant. Big stakes and justifies the prevalence and investment in OSS.
Comparison of "big data" and "machine learning" in Google Trends -- https://trends.google.com/trends/explore?date=all&geo=US&q=b...
Second MF. While expensive, their individually bagged teas use cotton muslin.
Here is the same content in a new LinkedIn post -- https://www.linkedin.com/pulse/why-how-capitalism-needs-refo...
(Part 1 posted yesterday; thanks HN.)
Thanks for the pointer; didn't realize he had posted part 1 separately already. I have now posted links in the comments of that HN thread.
Dalio is now out with Part 2 ("My Diagnosis of Why Capitalism Is Now Not Working Well for the Majority of People", "What I Think Should Be Done", "Looking Ahead")
Here is the new LinkedIn post -- https://www.linkedin.com/pulse/why-how-capitalism-needs-refo...
And here is a link to PDF -- https://www.economicprinciples.org/downloads/Why-and-How-Cap...
Companion post on their motivations to start this -- https://aws.amazon.com/blogs/opensource/keeping-open-source-...
Related to this, supervoting shares are popular with tech startups that are going public, but the street generally frowns upon these structures from a corporate governance perspective.
Founders pitch supervoting control as a way to make sure the company can realize its long term potential by protecting themselves from activist investors with a short term view.
So far, ownership of new IPOs hasn't been affected much due to their small market caps and subsequent miniscule weighting in indices. It will be interesting to see if increasing concentrated ownership by index funds may eventually play a factor and perhaps increase acceptance of supervoting.
I'm hopeful about the news that a new Dune adaption is currently in the works.
https://www.theverge.com/2017/2/1/14471312/dune-movie-adapta...
Does anyone have other news about this? (Anticipated release date?) Googling around, the bits of news seem to indicate it will be a movie that covers only the first half of the Dune book.
In the meantime I'll need to check out the documentary "Jodorowsky's Dune", which appears to have been well received.
A move that was necessary. Diane wasn't able to shift the existing Google culture to one where the enterprise customer's needs came first. (Observable as reflected in their pricing, sales, and support challenges.) Thomas now has a similarly tough job navigating the organ rejection risk of transplanting anything that looks like Oracle culture and practices.
The new company will be based in Boston. I wonder if this is a harbinger of Amazon’s HQ2 opening in Boston as well.
The related CNBC piece cites a McKinsey study on the actual effect -- "Those in favor of guidance say it improves communications with Wall Street, reduces share price volatility and boosts a stock's value. But McKinsey & Co. found in a 2006 study that quarterly guidance didn't affect valuation multiples and didn't reduce share price volatility. The only significant benefit it observed was an increase in trading volumes, which is good for day traders but not useful for most other people."
https://www.cnbc.com/2018/06/06/warren-buffett-and-jamie-dim...
"Many hires were put through a revamped training program, then charged with winning over startups and small businesses that Oracle largely had bypassed."
The article goes on to claim that Oracle has had success with signing startups and small businesses for cloud products. Has anyone here signed on with Oracle? Have things really changed?
Also very interesting in the comments -- "AWS has deep investments in custom silicon and we are installing many 100s of thousands of these custom ASICs each year. Machine learning workloads are a big part of what we run at AWS today and it’s my belief that these workloads are going to just keep growing and I expect that in 10 years, ML will be more than 1/2 of the worlds server side foot print. All other workloads will continue to grow as they are today but ML will eclipse them all."
It's interesting that Amazon continues to move up the stack. This can't be great for folks like Five9, inContact, Genesys, etc. And it's probably incrementally negative for Zendesk, RingCentral, and Twilio - where some percentage of customer use cases is tied to contact centers.
re: EDW - Snowflake Computing? AWS RedShift? Google BigQuery?
https://gigaom.com/report/sector-roadmap-cloud-analytic-data...
Even though productivity gains have been declining, I did not appreciate the gap illustrated by comparing California's output vs France and Texas vs Canada. (Per the WSJ, in the decade from 1994 to 2003, U.S. output per hour worked rose annually by an average 2.8%. Since then it has grown at 1.3%, including just 0.4% since 2011.)
Actually, that is a popular misconception. Airlines have been highly profitable for the past few years. It is directly related to the degraded consumer experience. More capacity discipline and new ancillary fees have really boosted margins. Also, the cost of fuel has plummeted.
From experience, I've seen an explosion in a cottage industry around sourcing and selling data. While it was more common that I'd see startups (esp mobile app companies) supplementing their primary business model by selling their data to investors or data resellers, I've recently noticed startups aimed directly at this market opportunity (Earnest Research, Second Measure, etc.) Interestingly, Priceonomics also pivoted into doing data crawling for hedge funds.
If you get the paywall, either use a Google search result, or use this link - https://archive.is/mfEvt
Marketplace, Prime and AWS have been home runs, but their digital device track record has been pretty mixed. Bezos has been pretty stubborn about it since the Kindle - Fire tablets, Fire phone, Echo, and Dash. I wonder when the Amazon smart watch will be coming out.
From LinkedIn's conference call:
Strategic rationale:
- Believes that the acquisition of lynda.com will be an important step to fulfilling LinkedIn's vision of developing an "economic graph"
- Views lynda.com as essential for professionals to advance their skill sets
- Believes that acquisition of lynda.com will expand the addressable opportunity by 30B into corporate employee education and professional certifications market
- Believes that by leveraging LinkedIn's professional context, content distribution platform and channel focused base of customers, LinkedIn is well positioned to become leader in learning and development market
- Believes the mission and strategy of lynda.com is aligned with LinkedIn and will help integrate lynda.com into their business
- Sees lynda.com having large traction on university campuses which overlaps with LinkedIn's strength looks to capitalize on overlapping presence
Financial details:
- Primary focus will be maximizing long-term member and business value over short term financial results
- Views lynda.com revenue mix as 2/3 consumer driven subscriptions and 1/3 corporate enterprise
- 50% of customer base is higher education in government and other 50% is corporate enterprise
- Sees lynda.com business model made up of 70% gross margin, ~20% content / engineering and ~35% Sales and marketing with EBITDA margins of 5-10%
My understanding is that you need to deliver the data with a latency measured in the range of milliseconds, and even then that might not be fast enough due to direct access. Here are a couple articles in the WSJ --
"Speed Traders Get an Edge" - Feb 6, 2014 - http://online.wsj.com/news/articles/SB1000142405270230445090...
"Firm Stops Giving High-Speed Traders Direct Access to Releases" - Feb 20, 2014 - http://online.wsj.com/news/articles/SB1000142405270230377550...