Fri, 2/15

The beer industry is on track to get a whole lot less boozy

For all the beer snobs out there, here’s a quick quiz: What’s the fastest-growing category of beer? Is it IPAs? Sours? Some European brew with a name you don’t know how to say?

Nope. The fastest-growing beer segment is… non-alcoholic beer. That’s right, O’Doul’s die-hards: According to recent research, non-alcoholic beer sales grew 3.9% last year while boozy beer sales grew just 0.2%.

“I’ll take one beer without the alcohol, please”

Beer isn’t just for German biergartens and American college parties anymore: In the past several years, the sweet wheat has become popular in places like the Middle East, where alcoholic beverages are illegal.

So, to cater to the expanding pool of beer drinkers, large alcohol producers are making beer, well, less beer-ish: Heineken, the world’s 2nd-largest beer brewer, released its first alcohol-free beer in 2017, and its sales have grown more than 10% annually.

The future could be less fuzzy

Due to the success of alcohol-free beers like Heineken’s “0.0,” non-alcoholic beer sales are taking off around the world. 

In China, as much as 30% of new beers released in recent years have been non-alcoholic. Even in Germany — the beer-drinking capital of the world — non-alcoholic beer consumption has increased 43%

Today, non-alcoholic beer accounts for just 5% of overall beer consumption. But AB InBev, the largest beer company in the world, plans for 20% of its beer sales to be low or non-alcoholic by 2025.

Fri, 2/15

Amidst pressure from lawmakers, Amazon cancels plans to build massive HQ in NYC

Who would’ve thought we’d see an Amazon headline bigger than Bezos’ photo scandal… 

After months of debate among Amazon, lawmakers, and lobbyists over the $3B tax incentives offered to Amazon’s expansive Long Island City campus, Amazon has officially pulled the plug on the operation.

The New York Times reports that with many local politicians speaking out against the use of public subsidies to incentivize development and gentrification of Queens, Amazon felt that the political environment had become insurmountably hostile.

The news comes after a yearlong, Bachelor-worthy elimination round of red carpet proposals from over 238 cities. The deal promised to bring 25k jobs to the area, as well as a multibillion-dollar construction investment.

After all those tears… no rose

Gov. Andrew Cuomo and Mayor Bill de Blasio (both of whom have been vocal defenders of the new HQ since negotiating the deal) respectively blamed pressure from Democrats and Amazon’s “my way or the highway” attitude for the plan’s demise.

Meanwhile, Amazon opponents point to the company’s unwillingness to negotiate with local legislators as proof of Amazon’s bullying tactics.

“You used to call me on my cell phone”

NYT reports that de Blasio has attempted to reach out to Bezos to patch things up, but to no avail.

Amazon now plans to spread its wealth across its current offices in places like Boston, Austin, Vancouver — as well as their current 5k-employee office in NYC.

Fri, 2/15

OpenAI says its new robo-writer is too dangerous for public release

OpenAI, an AI nonprofit, developed a text generator so good at creating “deepfake news” that its creators decided the program is too dangerous to release to the public.

OpenAI’s writing won’t end up in your Facebook Feed anytime soon, but robo-writers are already helping other companies write, making it harder than ever for regulators to rein in fake news.

OpenAI-ing Pandora’s box

In 2015, Sam Altman and Elon Musk became worried that the world’s most powerful AI programs were all being developed behind closed doors — that’s why they launched a nonprofit called OpenAI with a mission to make “safe” artificial intelligence publicly available. 

But OpenAI’s program, called GPT2, is so good that it produces writing that’s virtually indistinguishable from real journalism, opening the door for increasingly sophisticated fake news.

“It’s very clear that if this technology matures, it could be used for disinformation or propaganda,” OpenAI’s policy director Jack Clark told the MIT Technology Review. “We’re trying to get ahead of this.”

Robo-reporters are already out there writing

OpenAI’s text generator will be kept under lock and key until its creators understand what it can and can’t do. 

But, robo-writers are already roaming: Bloomberg News uses a robo-writing program called Cyborg in ⅓ of its articles, and The Washington Post, the Associated Press, and The Guardian all produce “machine-assisted” writing.

GPT2 — or something like it — will eventually go public. When it does, researchers hope they’ll have a way to control it. “We’re trying to build the road as we travel…” Clark told The Guardian.

Sounds like something a robot would write…

Fri, 2/15

Big Gig: Gig economy workers join hands to fight for a $15-per-hour minimum wage 

Last year was huge for IPOs: There were 173 through the end of September 2018 alone (3x 2016’s number), and 2019 is on track to be even bigger.

But companies with an eye on going public will try almost anything to cut costs — even if that means cutting a driver’s take-home (pay for companies within the gig economy).

Fast Company reports that drivers from companies like Instacart, DoorDash, and Amazon Flex have banded together with the labor advocacy organization Working Washington to launch a campaign demanding a $15/hour minimum wage across the gig economy.

The decline that broke the driver’s back

Janssen Sartiga, an Instacart delivery driver, claims Instacart’s new cost-cutting pay algorithm dropped his earnings from an average of $20/hour in May to well under $15/hour in January — and he’s not alone.

Citing pay decreases of between 30% and 40%, nearly 1.6k Instacart gig workers signed a petition in January.

The group’s demands delivered a big victory package weeks later, when Instacart rolled out new minimums for workers between $5 and $10 per assignment, despite what the algorithm says.

But the war’s far from over

Each gig platform uses its own algorithms, which means that pay based on distance, number of items, weight of items, time of day, and other factors varies between each delivery-app service.

Instacart drivers have noticed that the service started bundling multiple customer orders into one batch, leaving a smaller payout for drivers.

And let’s not forget, DoorDash, Instacart, and Amazon have all been called out for counting tips toward user payin other words, the tips you leave your delivery drivers are going to billion-dollar corporations.

The fight for $15

Instacart’s win in January inspired them to team up with DoorDash and Amazon Flex — a company that bills maintenance costs into its advertised $18/hour employee wage — to restructure how workers get paid.

“No matter how the pay works, there ought to be a bottom line they can’t go below,” Sage Wilson of Working Washington said. “The details matter a lot, but we need a baseline that can apply to all apps.”

Thu, 2/14

Lonely hearts break the bank: Romance scams cost people $143m last year

For those of you coddling your lonely heart on V-day, just know that your days of romantic solitude could be so much worse.

The Federal Trade Commission (FTC) reported more than 21k Americans fell victim to romance-based scams in 2018, losing a total of $143m.

The FTC said it received more reports of “romance scams” than other consumer-facing fraud last year and that con-jobs involving dating or “courtship” are becoming more popular by the year.

Roses are red, violets are blue, boy do we got a scam for you

According to The Hill, romance-related schemes involve scammers putting on their charm pants through fake profiles on social media.

Once heart-thieves woo their victims, they strike; usually asking their love-drunk targets to send cash for fake emergencies or other made-up expenses.

Scammers usually target Americans, age 40 to 69, who fall victim to romantic scams twice as often as 20-somethings, with a median loss of $10k. Overall, the median was $2.6k — roughly 7x higher than the median loss across other types of fraud.

Happy Valentine’s Day

In 2017, Americans shelled out $18.2B  for Valentine’s Day, a holiday that, no matter how you break the Russell Stover-shaped heart, either leaves you feeling sad, broke or, at the least, stressed — and while it puts the “corporate” in “corporate holiday,” it doesn’t even give us work off! 

All the while, people are getting lonelier by the year, with the cost of romance-related scams jumping from $33m in 2015 to more than $143m in 2018.  

Bottom line: Love is chill. Roses die. Don’t get scammed.

Thu, 2/14

Johnson & Johnson to acquire Auris Health for $3.4B in the name of robotic health tech

Reuters reports that Johnson & Johnson announced plans to buy surgical robotics firm Auris Health for $3.4B in cash yesterday.

The deal will give the 130-year-old pharmaceutical giant access to the privately held Auris Health’s surgical robotic scope, which is used for respiratory procedures and the detection of lung cancer.

Everybody’s doing the robot

The healthcare robotics market is expected to reach nearly $12B by 2023, and the deal marks Johnson & Johnson’s maiden voyage into a field where it hopes to become a major player by 2020.

Founded by surgical robotics pioneer Frederic Moll, Auris was initially focused on lung cancer. But last year, US regulators approved its flagship device, Monarch.

The tool was created for bronchoscopic procedures, where an instrument is inserted into the nose or mouth. Via a controller, surgeons direct a scope through a patient’s body with cameras.

Is it just another pharmaceutical cash grab?

You might assume a robot’s hand never shakes. But research shows that conventional surgery (at the hands of a human) has more favorable overall time and complication rates, while robotic surgery is significantly more expensive to those in need.

So it’s more expensive for patients and less effective — perfect. Nothing to see here, folks, things are feeling shady as usual in ol’ pharma town.

Thu, 2/14

Lufthansa sues its own customer for $2k for gaming its layover loophole

After a passenger failed to show for the final leg of his journey, German airline Lufthansa sued the two-timing traveler $2k for “skiplagging.”

Skiplagging (buying a multi-flight itinerary while intending to end up at a layover city to save money) has become a popular hack. But it’s costing airlines so much that they’re cracking down on Frequent Liar Miles.

The layover loophole

Skiplagging (AKA “hidden city ticketing”) is possible because airlines often make 2 flights less expensive than 1. 

Why do they do this? Airlines offer direct flights between small cities for big spenders willing to pay premiums for nonstop flights. But since there aren’t enough first-class butts to fill those seats, airlines artificially deflate the prices of those same flights to attract connecting fliers.

Skiplaggers are calling the airline’s bluff — but they’re also ruining airlines’ business model. 

Revenge of the airlines

Skiplagging is a really bad deal for airlines because it reduces revenue for last leg flights, makes it harder to forecast crowds, and delays takeoff.

United Airlines and Orbitz tried to sue the 22-year-old creator of a skiplagging site to cut down on skiplagging several years ago, but a judge threw out the case. 

Now, Lufthansa is taking a new approach by suing its customer for violating the company’s terms and conditions — even though he didn’t break the law.

Thu, 2/14

Ex-con app developers are disrupting price-gouging prison phones

Bloomberg reports that inmate messaging apps like Pigeonly, InmateAid, and Flikshop now have millions of users — and are poised to disrupt prison phone companies’ decades-old monopoly.

All started by ex-inmates, these apps aim to give inmates and their families a more affordable way to stay in contact –and bring prisons out of the digital Stone Age without sacrificing their grip on security.

What, email not good enough these days?

Actually, no. Prisons often make 1k+ inmates take turns using just 15 computers (with stripped down permissions) that charge $0.05/minute to get online — for context, many prison jobs pay just $0.08/hour.

What’s more, prison phones have been controlled by the same 3 (soon-to-be 2, pending a major merger approval) companies for the past 3 decades — allowing them to charge up to $0.21/min for long distance and pull in over $1.2B as of 2015.

And, though letters are often the easiest communications for inmates to receive, they can often feel burdensome for digitally spoiled friends and family to send.

All that means that people who are incarcerated often lose touch with the outside world — making it all the more difficult to re-enter society upon release.

The new guard of prison comm

Now, new apps offering convenient, low-cost communication services are thriving: InmateAid, a platform that lets families connect at lower rates for an $8.95 monthly fee, has over 1.2m users. 

Platforms Pigeonly and Flikshop bridge the gap between digital and physical, letting loved ones take pictures through an app, then automatically printing and mailing them to inmates at a low rate.

Though Flikshop bills itself as “Instagram for prisons,” these ’grams aren’t exactly “insta.” They can still take a week or more to make it through the post and screening in the prison mail clerk’s room.

But, as they say in the biz, slow post is better than no post.

Wed, 2/13

A royal pain in the buns: The unlikely winner of Europe’s battle for the Big Mac

Supermac’s, an Irish fast-food chain with a burger called the Mighty Mac, was so sick of never-ending legal beef with McDonald’s that it did something crazy: It sued McDonald’s for the right to Mac.

Even crazier? In a sizzle heard ‘round the world, Supermac’s won. And, after McD’s lost its Big Mac trademark in Europe, a whole bunch of burger bashing began.

David vs. Burger-liath

Pat McDonagh started Supermac’s in 1978 and has since expanded his Mighty Mac business to 106 locations. But, McDonald’s’ legal threats stopped Supermac’s in its burger tracks.

European regulators ruled that McDonald’s failed to prove “genuine use” of its trademark in the preceding 5 years.  

“It’s a unique victory when you take on the golden arches and win,” McDonagh, Supermac’s managing director, told The Guardian

The tables have turned for the world’s biggest burger bully

It was a rare loss for McDonald’s, a well-known trademark tyrant that has registered names such as “Mac Internet” and “Mac Country” just because

Meanwhile, the lost trademark has opened the flame broiled floodgates: Burger King immediately changed the names of its burgers to “The Burger Big Mac Wished it Was” and “The Anything But a Big Mac” at several European locations.

A spokesperson told reporters that McDonald’s plans to appeal the decision and reclaim its Big Mac-opoly. But for now, McDonagh told the BBC, “This is the end of the McBully.”

Wed, 2/13

Oh, how far we’ve come: Hotels are now offering fresh air as an amenity

The New York Times reports that a growing number of global hotels are now floating guests the top-shelf option to book rooms with premium air filtration and purification systems, in an effort to cut down on the current global haze of climatic craziness.

But it isn’t science fiction, it’s real life, and the air’s getting bad, y’all — starring natural disasters and corporate mitt prints (featuring many costars) — and you best believe the Big Hotel biz is gonna inhale the breezy opportunities that follow.

Smoggy stink sells

Last year, the World Health Organization reported that 91% of the world eats polluted air for breakfast, lunch, and dinner — largely blanketing top “urban destinations” around the world… Necessity, CHECK.

Hotels are buying in: The hotel wellness company Pure Wellness’ “Pure Room” (featuring natural fumigation) spans 300 hotels globally across several companies including Marriott, Hampton Inn, Embassy Suites and Hyatt.

Wellness tech company Delos has designed more than 1k hotel rooms globally with its wall-mounted air-purification filters — a brand standard across all 50 Wyndham hotel and resort locations in North America. The list goes on.

A serious situation marked at a premium

Some hotels dippin’ into the business of fresh air are charging a 5% to 7% premium for rooms with filtration and purification systems.

Clean air has become a luxury because it was treated as a given for so long — but now people are coughin’ up the price in more ways than one.

Wed, 2/13

Fraud and abuse are still common in Google and Apple app stores

According to new reports from The Washington Post and TechCrunch, Apple and Google still host dozens of illegal and abusive apps in their app stores, despite efforts to clean up their act.

After struggling to rein in fraud for years, Apple’s App Store and Google’s Play Store increased security. But that hasn’t stopped porn apps, illegal gambling apps, and apps that abuse women from thriving in their e-stores.

The long, dirty process of cleaning up app stores

Early online stores were app-solutely awful: Apps to rate women, pay people for fake reviews, trash talk other people, scam users, and harvest data were rampant.

Apple was the first to try to clean things up, removing more than 47k apps and tightening up its screening process in September 2016. The next month, Google rolled out a new system to detect fraudulent apps.

But, nefarious apps have still slipped through the cracks

Dozens of porn apps and illegal gambling apps sneaked into Apple’s App Store by gaming its Enterprise Certificate program designed to let large companies build in-house employee apps.

Both Google and Apple host an app called Absher, an app that helps men track and control women in Saudi Arabia (where it’s still illegal for women to travel without the approval of a male “guardian”).

Of course, part of what makes it so difficult for Google and Apple to police their own stores is the sheer scale: At the end of last year, Google’s Play Store featured more than 2.1m apps and Apple’s App Store had more than 2m.

Wed, 2/13

A new sheriff in town: The FDA to crack down on the $40B dietary supplement industry

As new startups increasingly flood the supplement market, the Food and Drug Administration vowed to improve its monitoring of the $40B+ dietary supplement industry.

On Monday, FDA chief Scott Gottlieb announced the agency was ready to crack down on manufacturers that falsely plug the abilities of their “remedies.”

“Whatever helps you sleep at night” is a bad phrase

People have been drinking the supplement snake oil since the ’30s — back when rickets and scurvy ravaged the streets.

But the supplement biz got really suspect after the passage of a ’94 federal law that minimized reporting and labeling requirements for vitamin, mineral and herb manufacturers — a still fledgling industry at the time. 

To prevent a company from selling a product, the law still requires the FDA to prove that it is unsafe. Problem is, there are now somewhere between 50k and 80k dietary supplements on the market.

Spoiler alert: Supplements don’t cure cancer

The FDA says that 3 of every 4 American consumers now take dietary supplements regularly — mostly due to the way supplement companies target specific “at-risk” demographics.

Last month, a paper in the Journal of the American Medical Association concluded most of the supplements that claim to help prevent Alzheimer’s, dementia and cancer, well… don’t.

While lobbying for Congress to strengthen the FDA’s authority over the supplement industry, Gottlieb specifically warned 12 of the major companies (including TEK Naturals, Pure Nootropics and Sovereign Laboratories) to stop claiming their products can cure diseases.

New year, new FDA

When Scott Gottlieb was first sworn in as the new head of the FDA in 2017, his ties to the big pharma industry had many rolling their eyes at what they saw as yet another regulatory puppet thrown into the White House cabinet.

But, so far, Gottlieb has made good on the Congress-sworn statements he made, promising to clean up the shady streets of medical miscreants, including threatening Altria and Juul’s partnership with an iron fist last month.

In recent years, the FDA has also cracked down on several sectors of the supplement industry including weight-loss and sexual enhancement supplements. 

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