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Apple CEO Tim Cook is fulfilling another Steve Jobs vision

Inside Telecom Staff

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Apple CEO Tim Cook is fulfilling another Steve Jobs vision2

BERKELEY, Calif. (AP) — Apple co-founder Steve Jobs, who died in 2011, was a tough act to follow. But Tim Cook seems to be doing so well at it that his eventual successor may also have big shoes to fill.

Initially seen as a mere caretaker for the iconic franchise that Jobs built before his 2011 death, Cook has forged his own distinctive legacy. He will mark his ninth anniversary as Apple’s CEO Monday — the same day the company will split its stock for the second time during his reign, setting up the shares to begin trading on a split-adjusted basis beginning Aug. 31.

Grooming Cook as heir apparent was “one of Steve Jobs’ greatest accomplishments that is vastly underappreciated,” said long-time Apple analyst Gene Munster, who is now managing partner of Loup Ventures.

The upcoming four-for-one stock split, a move that has no effect on share price but often spurs investor enthusiasm, is one measure of Apple’s success under Cook. The company was worth just under $400 billion when Cook the helm; it’s worth five times more than that today, and has just become the first U.S. company to boast a market value of $2 trillion. Its share performance has easily eclipsed the benchmark S&P 500, which has roughly tripled in value during the past nine years.

But it hasn’t always been easy. Among the challenges Cook has faced: a slowdown in iPhone sales as smartphones matured, a showdown with the FBI over user privacy, a U.S. trade war with China that threatened to force up iPhone prices and now a pandemic that has closed many of Apple’s retail stores and sunk the economy into a deep recession.

Cook, 59, has also struck out in into novel territory. Apple now pays a quarterly dividend, a step Jobs resisted partly because he associated shareholder payments with stodgy companies that were past their prime. Cook also used his powerful perch to become an outspoken advocate for civil rights and renewable energy, and on a personal level came out as the first openly gay CEO of a Fortune 500 company in 2014.

Apple declined to make Cook available for an interview. But it did point to 2009 comments Cook made to financial analysts when he was running the company while Jobs battled pancreatic cancer.

Asked what the company might look like under his management, Cook said that Apple needs “to own and control the primary technologies behind the products we make.” It has doubled down on that commitment, becoming a major chip producer in order to supply both iPhones and Macs. He added that Apple would resist exploring most projects “so that we can really focus on the few that are truly important and meaningful to us.”

That laser focus has served Apple well. At the same time, though, under Cook’s stewardship, Apple has largely failed to come up with breakthrough successors to the iPhone. Its smartwatch and wireless ear buds have emerged as market leaders, but not game changers.

Cook and other executives have dropped hints that Apple wants make a big splash in the field of augmented reality, which uses phone screens or high-tech eyewear to paint digital images into the real world. Apple has yet to deliver, although neither have other companies that have hyped the technology.

Apple also remains a laggard in artificial intelligence, particularly in the increasingly important market for voice-activated digital assistants. Although Apple’s Siri is widely used on Apple devices, Amazon’s Alexa and Google’s digital assistant have made major inroads in helping people manage their lives, particularly in homes and offices.

Apple also has stumbled a few times under Cook’s leadership.

In 2017, it alienated customers by deliberately but quietly slowing the performance of older iPhones via a software update, ostensibly to spare the life of aging batteries. Many consumers, though, viewed it as a ploy to boost sales of newer and more expensive iPhones. Amid the furor, Apple offered to replace aging batteries at a steep discount; later it paid $500 million to settle a class-action lawsuit over the matter.

Apple has also faced government investigations into its aggressive efforts to minimize its corporate taxes and complaints that it has abused control of its app store to charge excessive fees and stifle competition to its own digital services. On the tax front, a court ruled in July that Apple did nothing wrong.

Cook has turned the app store into the cornerstone of a services division that he set out to expand four years ago. At the time, it was growing clear that sales of the iPhone — Apple’s biggest money maker — were destined to slow down as innovations grew sparse and consumers kept their old devices for longer.

To help offset that trend, Cook began to emphasize recurring revenue from app commission, warranty programs and streaming subscriptions to music, video, games and news sold for the more 1.5 billion devices already running on the company’s software.

After doubling in size in less than four years, Apple’s services division now generates $50 billion in annual revenue, more than all but 65 companies in the Fortune 500. Wedbush Securities analyst Daniel Ives estimates Apple’s services division by itself is worth about $750 billion — about the same as Facebook currently is in its entirety.

That division could be worth even more now had Cook done something many analysts believe Apple should have done at least five years ago by dipping into a hoard of cash that at one point surpassed $260 billion to buy Netflix or a major movie studio to fuel its video streaming ambitions.

Buying Netflix seemed like within the realm of possibility five years ago when the video streaming service was valued at around $40 billion. Now that Netflix is worth more than $200 billion today, that idea seems off the table, even for a company with Apple’s vast resources.

By MICHAEL LIEDTKE AP Business Writer.

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Airline CEOs, Biden officials consider green-fuel breaks

Associated Press

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Airline CEOs, Biden officials consider green-fuel breaks

Chief executives of the nation’s largest passenger and cargo airlines met with key Biden administration officials Friday to talk about reducing emissions from airplanes and push incentives for lower-carbon aviation fuels.

The White House said the meeting with climate adviser Gina McCarthy and Transportation Secretary Pete Buttigieg also touched on economic policy and curbing the spread of COVID-19 — travel has been a vector for the virus. But industry officials said emissions dominated the discussion.

United Airlines said CEO Scott Kirby asked administration officials to support incentives for sustainable aviation fuel and technology to remove carbon from the atmosphere. In December, United said it invested an undisclosed amount in a carbon-capture company partly owned by Occidental Petroleum.

A United Nations aviation group has concluded that biofuels will remain a tiny source of aviation fuel for several years. Some environmentalists would prefer the Biden administration to impose tougher emissions standards on aircraft rather than create breaks for biofuels.

“Biofuels are false solutions that don’t decarbonize air travel,” said Clare Lakewood, a climate-law official with the Center for Biological Diversity. “Real action on aircraft emissions requires phasing out dirty, aging aircraft, maximizing operational efficiencies and funding the rapid development of electrification.”

Airplanes account for a small portion of emissions that cause climate change — about 2% to 3% — but their share has been growing rapidly and is expected to roughly triple by mid-century with the global growth in travel.

The airline trade group says U.S. carriers have more than doubled the fuel efficiency of their fleets since 1978 and plan further reductions in carbon emissions. But the independent International Council on Clean Transportation says passenger traffic is growing nearly four times faster than fuel efficiency, leading to a 33% increase in emissions between 2013 and 2019.

The U.S. accounts for about 23% of aircraft carbon-dioxide emissions, followed by Europe at 19% and China at 13%, the transportation group’s researchers estimated.

The White House said McCarthy, Buttigieg and economic adviser Brian Deese were “grateful and optimistic” to hear the airline CEOs talk about current and future efforts to combat climate change.

Nicholas Calio, president of the trade group Airlines for America, said the exchange was positive.

“Airlines are ready, willing and able partners, and we want to be part of the solution” to climate change, Calio said in a statement. “We stand ready to work in partnership with the Biden administration.”

By DAVID KOENIG.

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Internet disruption reported in southeast Iran amid unrest

Associated Press

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Iran Telecom

Iran’s impoverished southeast has been experiencing wide disruptions of internet services, experts said, as unrest gripped the remote province after fatal border shootings.

Several rights groups reported in a joint statement that authorities shut down the mobile data network in the restive province of Sistan and Baluchestan, calling the disruptions an apparent “tool to conceal” the government’s harsh crackdown on protests convulsing the area.

The reports of internet interference come as Iranian authorities and semiofficial news agencies increasingly acknowledge the turmoil challenging local authorities in the southeast — a highly sensitive matter in a country that seeks to repress all hints of political dissent.

Starting Wednesday, the government shut down the mobile data network across Sistan and Baluchestan, where 96% of the population accesses the internet only through their phones, rights groups said, crippling the key communication tool.

After four days of unverified “localized regional network disruptions” amid the protests, NetBlocks, which monitors worldwide internet access, confirmed a new disruption to internet connectivity in the province beginning late Saturday.

“This is Iran’s traditional response to any kind of protest,” Amir Rashidi from Miaan Group, a human rights organization that focuses on digital security in the Middle East, told The Associated Press on Saturday. “Shutting down the internet to block news and pictures getting out makes (authorities) feel more comfortable opening fire.”

The week saw a series of escalating confrontations between police and protesters. Crowds with light arms and grenade launchers descended on Kurin checkpoint near Iran’s border with Pakistan on Thursday, Abouzar Mehdi Nakhaie, the governor of Zahedan, the provincial capital, said in comments carried by Iran’s semiofficial ISNA news agency. The violence killed one policeman, he added.

Earlier this week, protesters attacked the district governor’s office and stormed two police stations in the city of Saravan, outraged over the shootings of fuel smugglers trying to cross back into Iran from Pakistan on Monday. The border shootings and ensuing clashes killed at least two people, the government said. Many rights activists in the area reported higher death tolls without offering evidence.

Iran’s Foreign Ministry spokesman, Saeed Khatibzadeh, vowed Friday to investigate the deaths. Officials insisted that calm had returned to the streets.

The Iranian government previously has cut off internet access and cellphone service in tense times. In the fall of 2019, for instance, Iran imposed a near nationwide internet blackout as anti-government protests sparked by an increase in fuel prices roiled the capital of Tehran and other cities. Hundreds were reportedly killed in the crackdown nationwide.

Given that authorities targeted the mobile network and not the landline in Sistan and Baluchestan, the disruption likely wouldn’t appear on regular network data, said Mahsa Alimardani, researcher at Article 19, an international organization that fights censorship. The area already suffered from unreliable internet connections.

“This targeted shutdown was very intentional because they knew the realities of this province,” where people are poor and use cheap phones as opposed to computers, Alimardani said.

Sistan and Baluchestan is one of most unstable and least developed parts of Iran. The relationship between its predominantly Sunni residents and Iran’s Shiite theocracy long has been fraught. A low-level violent insurgency in Sistan and Baluchestan involves several militant groups, including those demanding more autonomy for the region.

The area also lies on a major trafficking route for drugs and petrol, which is highly subsidized in Iran and a key source of income for smugglers.

DUBAI, United Arab Emirates (AP) — By ISABEL DEBRE

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Nevada governor proposes giving tech firms power to govern

Associated Press

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Nevada governor proposes giving tech firms power to govern

Nevada’s governor on Friday unveiled a proposal that would allow technology companies to establish jurisdictions with powers similar to those of county governments, arguing the state needed to be bold to diversify its economy and pushing back against those who have likened the idea to company towns.

“This proposal is an exciting, unprecedented concept that has a potential to position Nevada as a global center of advanced technology and innovation, while helping to create immediate positive economic impact and shape the economy of the future,” Gov. Steve Sisolak said of his Innovation Zones idea. “As we’ve learned in the past, an emergency requires us to throw out the tried-and-true, discard the ‘How We’ve Always Done It’ manual and move on.”

Under the proposal, companies developing cutting-edge technologies that have at least 50,000 acres (200 sq. kilometers) of land and promise to invest $1.25 billion could establish “Innovation Zones.” The zones would be governed by a board responsible for overseeing zoning, taxation, law enforcement and other government functions on their land. It would override local county regulations.

The governor’s office of economic development would initially appoint three members to govern the zone, including two required to be from the company.

While the legislation does not specifically mention the company, the proposal is geared toward Blockchains LLC, a cryptocurrency company that owns 67,000 acres of land (270 sq. kilometers) in rural Storey County. Blockchains LLC hopes to build a smart city 12 miles (19 kilometers) east of Reno that would include underground data storage bunkers, 15,000 homes and a research and development park where entrepreneurs could invent applications of blockchain technology.

Blockchain is a digital ledger known mostly for recording cryptocurrency transactions. Local governments have also taken advantage of its secure record-keeping capabilities to document marriage licenses and facilitate overseas voting.

The Innovation Zone proposal has sparked concerns about ceding excessive amounts of power to technology companies. But Blockchains CEO Jeffrey Berns insists that the company’s technology has the potential to empower people to control their digital footprint.

“What we’re trying to build is a place where you have power instead of companies,” he told The Associated Press earlier in February.

An economic impact study commissioned by Blockchains projects the company’s Innovation Zone will create jobs, economic activity and revenue from a tax imposed on transactions made on the blockchain. The study projects Blockchains’ proposal will eventually generate $2.2 billion in direct output annually, about 1.3% of Nevada’s overall economic activity.

But forecasting the economic impact of unproven technology is difficult, particularly because many of the potential applications of the company’s ledger technology have yet to be invented.

Applied Analysis’ Jeremy Aguero, who authored the study, said the projections were based on more than cryptocurrency transactions and encompassed any action on Blockchains’ database made in Nevada or elsewhere. Blockchains, he said, planned to pilot its cryptocurrency in Nevada on industries like cannabis sales or in the gig economy and then expand its applications to other sectors and locations. All of the transaction taxes would be collected by Nevada.

“When we think about it in terms of the revenue estimates that are being yielded, it’s not just related to cryptocurrency. It’s related to any of the transactions that will add a block to the chain,” Aguero said.

Blockchain technology is already used to record financial transactions, store medical records and coordinate supply chain logistics. Sisolak said the purpose of innovation zones is to attract developers to Nevada as they devise new ways to use the technology.

“The applications of the technology are limitless. We cannot even imagine what their technology could be,” he said.

The yet-to-be invented applications are a key reason that Blockchains wants to establish an Innovation Zone. The company and the proposal’s proponents say small jurisdictions are not the ideal governmental bodies to make decisions about new technologies and a massive development that, in Storey County’s case, could increase the population tenfold.

“The traditional forms and functions of local government … are inadequate alone to provide the flexibility and resources conducive to making the State a leader in attracting and retaining new forms and types of businesses,” according to draft legislation.

Some locals disagree. Storey County resident Eileen Gay said that the mechanisms in place for development and project approval protect local interests and the environment.

“Oversight is what makes for safe, well-considered, well-balanced development,” she told county commissioners at a Feb. 16 meeting. “What is to prevent this 800-pound gorilla of a neighbor from swallowing our small neighborhood up?”

Developers may indeed invent new ways to use the digital ledger, but at an August 2020 Storey County Commission meeting, Blockchains lobbyist Matthew Digesti described the company’s proposal as something local governments routinely encounter: a “high-tech business park integrated with a master planned residential community.”

Sisolak said he understood that the Innovation Zones was unconventional, but he said the pandemic had proven that Nevada needs to be bold to diversify its tourism-driven economy. He said government and the private sector needed to work together to induce economy recovery.

“What we’ve been doing has not worked,” he said. “We cannot wait for economic recovery to come to us. We must accelerate and pursue innovative ways to inject Nevada with new and organic economic growth, and more jobs.”

CARSON CITY, Nev. (AP)

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