German executives and state employees targeted by cyber attacks

23 Jun

German executives and state employees targeted by cyber attacks

Germany’s federal cyber-security agency, BSI, said on Friday the private email inboxes of German executives and government employees were being targeted by professional cyber attacks.

Selected executives are being sent deceptively real-looking “spear-phishing” emails. They claim to have noticed irregularities in the use of the inbox or offer new security functions, the BSI said in a statement.

Germany is heading for elections in September, and security experts have warned that officials might face cyber attacks like those that occurred before elections in France and the United States over the past year.

The attacks identified by BSI ask users to click on a link and put their passwords into the website that then opens. If they do, the attackers can get access to their personal inbox.

Yahoo and Gmail accounts were targeted in the attacks. The BSI said it had prevented an attack on the government networks.

BSI President Arne Schoenbohm said the BSI generally could detect such phishing attempts, but private email inboxes were beyond its remit, which made them an attractive target.

“The attack infrastructure used is similar to that used in the attacks on and resulting leaks from the Democrats in the U.S. and against the French En Marche movement,” the BSI said.

U.S. intelligence agencies have concluded Russia orchestrated a wide-ranging influence operation that included email hacking and online propaganda, in an effort to discredit presidential candidate Hillary Clinton and help Donald Trump win the White House in November.

The German government has warned political parties to step up their defenses against hacking after emails from the campaign of Emmanuel Macron were leaked just before he was elected president of France.

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14 Jun

Element AI closes landmark $102-million financing

A Montreal startup in artificial intelligence has closed a landmark financing, raising $102-million (U.S.) just eight months after launching with the audacious goal of building a firm that can rival Silicon Valley tech giants by “democratizing” AI.

The financing for Element AI has support from some of the largest names in the global tech sector. It is led by San Francisco venture-capital firm Data Collective and backed by Intel Corp., Microsoft Corp. and a number of institutional investors, including China’s Tencent Holdings Ltd., Fidelity Investments Canada, Real Ventures, National Bank of Canada and the Business Development Bank of Canada.

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12 Jun

Apple shares drop 3% after Mizuho downgrade

Apple shares were stung by a broker downgrade for a second straight week on Monday, sending the stock lower in early trading, and on the heels of a sharp selloff in the tech sector in the prior session.

Mizuho Securities cut its rating on the iPhone maker to “neutral” from “buy” and reduced its price target to $150 from $160 per share.

“The stock has meaningfully outperformed on a year-to-date basis and we believe enthusiasm around the upcoming product cycle is fully captured at current levels, with limited upside to estimates from here on out,” said analyst Abhet Lamba.

Last week, Pacific Crest Securities lowered its rating on the stock to “sector weight.”

Apple shares were down 3.1 per cent to $144.30 in early trading.

Tech shares came under heavy pressure on Friday, falling 2.7 per cent.

Suppliers to Apple Inc. have borne the brunt of the decline in tech sector stocks after a sell-off started in the U.S. spread to Asia and Europe.

In Europe shares in AMS AG, the Swiss-listed supplier of sensors, fell as much as 9 per cent, while chipmaker STMicroelectronics NV traded as much as 8 per cent lower. The Stoxx 600 Technology index fell as much as 3.6 per cent, the biggest decline in nearly a year.

On Friday, Robert Boroujerdi, global chief investment officer at Goldman Sachs Group Inc., said that low volatility in Facebook Inc., Inc., Apple Inc., Microsoft Corp. and Google parent Alphabet Inc. may be blinding investors to risks such as cyclicality and regulation. Apple’s new iPhone is also said to be lacking the tech to match rivals’ data speed, according to a Bloomberg report Friday.

“It is really the U.S. selloff that is happening now in Europe,” said Charles Lepetitpas, analyst at Natixis Securities. “I don’t see any specific news.”

Both AMS and STMicroelectronics — the biggest tech fallers in Europe — supply chips to companies such as Apple and Samsung. AMS also flagged a weaker-than-expected dividend late Friday. Many of the stocks being hit have been on a tear this year: AMS is the biggest riser on the Stoxx Europe 600 in that period, having more than doubled.

“Some investors are just taking profit,” said Karsten Iltgen, analyst at Bankhaus Lampe KG.

The European slump was the last leg in a global tech selloff that began Friday in the U.S. In Asia, Taiwanese iPhone manufacturer Hon Hai Precision Industry Co., Ltd, closed 2.9 per cent lower. It was the largest single-day decline since last November, according to data compiled by Bloomberg. Hon Hai, better known as Foxconn, said Friday its May sales declined 5.3 per cent year-on-year to NT$279.8 billion.

With files from Bloomberg News

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9 Jun

Digital Realty to buy DuPont Fabros in $7.6-billion deal

Digital Realty Trust Inc said it would buy fellow data center operator DuPont Fabros Technology Inc for an enterprise value of about $7.6-billion, its biggest-ever deal, to help expand in high-demand markets in the United States amid a rapid shift to the cloud by technology companies.

DuPont Fabros’s shares rose as much as 14.6 per cent to hit a record high of $63.46, just below the offer price of $63.60 based on Thursday’s close.

Washington-based DuPont Fabros operates 12 data centers in three major U.S. markets, including Silicon Valley and Northern Virginia, while Digital Realty operates 145 data centers globally.

Digital Realty and DuPont Fabros, which rent out space that companies use for data centers, have also benefited from the surge in demand for data and video.

The combined company would be the “home to the cloud,” Digital Realty Chief Executive William Stein said on a conference call on Friday.

The deal, which would add companies such as Facebook Inc and Yahoo Inc to Digital Realty’s customer base, is expected to close in the second half.

DuPont Fabros shareholders will receive a fixed exchange ratio of 0.545 Digital Realty shares per share held, the companies said.

Based on Digital Realty’s Thursday close, the offer is worth $63.60 per share, a premium of 14.9 per cent to DuPont Fabros’s close. The implied price per share is $64.32, according to a Digital Realty presentation.

The equity value of the deal is about $4.95-billion based on DuPont Fabros’s 77.8 million shares outstanding as of April 2, according to Thomson Reuters data.

“The addition of (DuPont Fabros) should enhance (Digital Realty’s) growth prospects, as it’s acquiring an asset that’s growing at plus 10 per cent per year, with recent momentum including a 28.8 MW lease signed by who we believe to be (Apple),” Wells Fargo analyst Jennifer Fritzsche wrote in a client note.

The deal has the potential to realize up to $18-million of annualized overhead savings, the companies said.

San Francisco, California-based Digital Realty has been acquiring companies to boost growth.

The company said in May last year that it would buy eight data centers from Equinix Inc and in October 2015 bought Telx Group Inc.

Digital Realty said it had a fully committed bridge loan facility from BofA Merrill Lynch and Citigroup to finance the DuPont Fabros deal.

BofA Merrill Lynch and Citigroup are Digital Realty’s financial advisers while Goldman Sachs is advising DuPont Fabros.

DuPont Fabros’s shares were up 12 per cent in morning trading, while Digital Realty’s stock was little changed at $116.77.

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9 Jun

BlackBerry hopes to ride truck tech to further growth

A visit to trucking firm Titanium Transportation helps explain why BlackBerry’s stock is once again a darling in Canadian markets, having soared 70 per cent in two months.

Nestled in an industrial area some 50 kilometers north of Toronto, the trucker is an early adopter of a new BlackBerry fleet-tracking service known as Radar, which uses $400 boxes to collect and transmit information on movement, temperature and physical contents of Titanium’s 1,300 truck trailers.

Efficiency gains tied to Radar should allow Titanium to get maximum utilization of its fleet, positioning it to cut the number of trailers by five percent and also reduce labor costs, company executive Marilyn Daniel told Reuters.

“Time is everything in our world,” she said. “Being able to tell a driver where exactly a trailer is as opposed to having a driver search through a yard for sometimes hours has been a definite improvement.”

Radar is emblematic of BlackBerry Chief Executive John Chen’s strategy for turning around the Canadian icon, by steering the company away from consumer electronics and back to its roots of selling products to businesses.

Beyond Radar, BlackBerry is also betting on other types of software for industrial customers. It is leveraging its QNX subsidiary’s software foothold deep inside car infotainment consoles to expand into self-driving technology, while promoting its cyber-security software and services to thwart increased threats from hacking.

BlackBerry’s stock rallied after it showed signs of progress in quarterly earnings results at the end of March, followed by news in April of a nearly $1 billion cash windfall from arbitration with Qualcomm expected to fund future investments in growth. That comes in the face of an expected revenue decline to below $1 billion this year for the first time since 2004. At its smartphone peak, BlackBerry had annual sales of $20 billion.

Among the recent BlackBerry bulls are institutional investors such as Nokota Management, which took a new position with almost 4.8 million shares in the first quarter, and Oppenheimer Funds, which added 3.3 million more shares to its existing 4 million share stake, according to U.S. securities filings.

Iridian Asset Management and Connor, Clark & Lunn Investment Management, two of BlackBerry’s biggest shareholders, each raised their stakes by around a quarter as of the end of March.

Nokota did not respond to requests for comment, while the others all declined to discuss their stakes in BlackBerry.


The strategy is not without risks. BlackBerry faces challenges entering the telematics market, where analysts say rivals include Omnitracs, Teletrac Navman, Tomtom NV , Trimble Inc and U.S. telecommunications giant Verizon Communications Inc. Verizon last year paid some $2.4 billion to buy GPS vehicle tracking firm Fleetmatics Group Plc.

Radar “is not a unique and earth-shattering product,” said Nicholas Farhi, a partner at OC&C Strategy Consultants who advises companies on optimizing logistics operations.

That’s why some investors advise caution, saying it is too soon to figure out how to properly value the new BlackBerry offerings.

“It’s not the type of situation you can justify from a valuation standpoint,” said Tim Ghriskey, chief investment officer at Solaris Asset Management, which manages more than $1.5 billion and exited the stock a decade ago, when BlackBerry phones were still dominant. “It is all about hope and promise.”

And yet hope and promise among BlackBerry investors were hard to come by in the aftermath of Apple and Samsung walking away with the consumer hand-held phone business.

Since taking the company’s helm in 2013 to attempt a turnaround, Chen has turned to technology products used inside automobiles and corporate cyber security services, in addition to targeting the gritty trucking industry with Radar.

He also bolstered the company’s ability to manage rival devices in the workforce – still the single largest contributor to sales – with the purchase of rival Good Technology in 2015. And he outsourced production of handsets last year, meaning the company receives a cut from any devices sold by its partners rather than carrying the risk and revenue on its own books.

With Radar, BlackBerry enables customers to track trailers across country, and drivers can quickly locate vacant trailers scattered across vast parking lots. Previously, where drivers had to walk around those lots, banging on trailers in search of a hollow sound indicating it was empty.

BlackBerry charges $10 to $20 per month for every trailer connected to Radar, a product that an analyst at investment bank Macquarie says could play a pivotal role in a more than doubling of BlackBerry’s sales by 2020.

Sandeep Chennakeshu, president of the BlackBerry Technology Solutions unit that oversees Radar, told Reuters that large package delivery firms and big carriers of lumber and home goods are among the more than 50 companies testing it.

“It really depends on us convincing our customers to try our solution,” he said. “Once they try it, we’re very confident they’ll see the benefit.”

BlackBerry says that it is targeting some 16 million to 20 million trailers, chassis, vans, refrigerated units and piece of construction equipment for the Radar service, with a new variant on the hardware due to launch later this year.

On its last earnings call, the company named Trailer Wizards, a Canadian trailer rental and storage company with 25,000 trailers, as its third Radar customer.

AT&T will supply needed cellular connections for Radar in North America, and a second carrier is lined up to provide such services when it expands to Europe and Asia, Chennakeshu said.

The company expands Radar’s functionality with quarterly updates. The next one will tell customers if a trailer is a quarter, half or three-quarters full and improve integration with warehouse inventory management systems, he said.

The Radar boxes can send alerts when a trailer door is opened, its internal temperature goes beyond a set range, has been emptied or travels through a specific geography, features which Chennakeshu said are attractive for tightly-regulated movers including pharmaceutical companies.

Raymond James analyst Steven Li forecasts that 8 million trailers will be equipped with Radar by fiscal 2020, generating annual revenue of $80 million.

Macquarie analyst Gus Papageorgiou is even more bullish, saying combined hardware sales and subscription fees could hit $540 million in fiscal 2020.

“The best is yet to come for BlackBerry,” said Paul Rivett, president of Fairfax Financial, the company’s second largest shareholder and owner of BlackBerry debt that can be converted into shares at $10 a piece in late 2020.

“Its future earnings growth as a software company is only starting to be understood,” said Rivett.

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8 Jun

Sony’s PlayStation VR headset sales top 1-million units

Sony Corp has sold more than one million units of its virtual reality (VR) headset globally, the Asia chief of the Japanese firm’s gaming unit said on Wednesday, as a relatively low price helps push the product into an early lead.

Sales of the PlayStation VR headset, released in October, have “exceeded our expectations,” Atsushi Morita, president of Sony Interactive Entertainment Japan Asia, said in an interview.

“We are boosting production and a supply shortage should be solved accordingly,” Morita told Reuters.

The sales momentum supports analysts’ view that Sony is in a good position to build an early lead in the high-end VR headset race with its more modest price tag and by tapping the nearly 60 million users of its flagship PlayStation 4 console.

The headset, designed to work with the PlayStation 4 rather than requiring new equipment, retails at $399, cheaper than Facebook Inc’s $599 Oculus Rift and HTC Corp’s $799 Vive.

According to researcher IDC, about 2 million VR headsets were shipped worldwide in the first three months of 2017. Excluding cheaper smartphone-based headsets, Sony ranked top with 429,000 units.

Morita stressed it was still the beginning of Sony’s long-term vision of VR eventually taking over functions offered by television sets.

“I believe that VR technology is the (greatest) innovation since the birth of television,” he said. “VR allows you to travel to World Heritage sites or to space while staying at home. It’s like a time machine or a door to anywhere.”

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7 Jun

BlackBerry announces updated software platform for vehicle security

BlackBerry’s automotive division has created an updated software platform to help keep the connected and autonomous vehicles of the future secure.

The QNX hypervisor 2.0 allows multiple operating systems to run at the same time on one hardware platform and allows breaches in one part to be isolated without impacting the rest of the car’s software.

BlackBerry QNX head John Wall said multiple automakers are using the product already and provided feedback to help create the product.

BlackBerry (TSX:BB) says Qualcomm Technologies Inc. has adopted the product as part of certain digital cockpit solutions.

The former smartphone-maker ditched its hardware business last year in favour of its growing software business, with chief operating officer Marty Beard saying this past March that the shift was “100 per cent complete.”

BlackBerry’s shares have been on the rise following research reports suggesting the company’s shares could see big gains over the next several years, and one report suggesting the company could be a target for an acquisition.

The company’s shares on the Toronto Stock Exchange rose nearly one per cent in early trading to $15.14.

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6 Jun

Uber fires 20 employees after harassment probe

Uber Technologies Inc. said on Tuesday it fired 20 employees and was improving management training following an investigation by a law firm into sexual harassment allegations and other claims at the ride-hailing company.

Uber fired the staff following a report by law firm Perkins Coie, which Uber hired to look into claims of harassment, discrimination, bullying and other employee concerns.

The law firm has been working in parallel with a broader investigation by former U.S. Attorney General Eric Holder into company culture and practices.

Perkins Coie investigated 215 staff complaints going back as far as 2012, Uber said, taking action in 58 cases and no action on 100 more. Other investigations are continuing.

Of the 215 claims, Uber said 54 were related to discrimination, 47 related to sexual harassment, 45 to unprofessional behaviour, 33 to bullying and 36 to other types of claims.

It said the majority of the claims came from employees based at Uber’s San Francisco headquarters.

The world’s highest-valued venture-backed company – worth $68 billion at its last funding round – also told staff on Tuesday it would expand its employee relations unit to better investigate claims and that it would dramatically increase management training since most Uber managers were first-time bosses, a person familiar with the matter said.

On Monday, Uber said it hired Harvard Business School professor Frances Frei to train all managers, reporting to Uber Chief Executive Travis Kalanick. On Tuesday, it said Bozoma Saint John, prominent in some Apple Inc product launches, joined the company as chief brand officer.

Uber also said it is offering a confidential helpline for employees to report concerns and has implemented a system to log and track all complaints.

Uber’s firing of employees comes after a series of events this year that have raised questions about Uber’s business model and leadership.

In February, former Uber engineer Susan Fowler said in a widely read blog post that managers and human resources officers had not punished her manager after she reported his unwanted sexual advances.

In addition, Uber was caught using technology to avoid regulator crackdowns, a video surfaced showing Kalanick berating an Uber driver, and the company is caught up in legal battles around the world over the way its ride-services business operates.

Uber is also facing a lawsuit from Alphabet Inc.’s self-driving car division, Waymo, alleging trade secret theft.

The company declined to comment further on the move to fire staff. Some saw it as a step in the right direction for Uber to repair its tarnished reputation.

“They are heading the right way, both with action and reaction,” said Jason Hanold, manager partner at human resources executive recruitment firm Hanold Associates. He added it was “not nearly a complete and final surgery to heal a troubled culture.”

The move follows a string of executive departures at Uber, including the company president, heads of finance and product, an East Coast general manager and several high-level engineers.

For the last three months, Uber has been seeking a chief operating officer to work alongside Kalanick, who has earned a reputation as a pugnacious leader. Uber board member Bill Gurley is overseeing the search.

Uber has also been under the microscope of Holder and Tammy Albarran, partners at the law firm Covington & Burling, who were asked to conduct a broad review of sexual harassment at Uber as well as general questions about diversity and inclusion. Their report was completed at the end of May and has been shared with a subcommittee of the Uber board of directors, a company representative said.

In March, Uber board member Arianna Huffington pledged to make the findings of Holder’s investigation available to the public. Initially, the company had expected to make a public announcement this week, but that timing has been pushed back.

Uber is expected to discuss it with staff next week, a person familiar with the matter said.

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6 Jun

Apple unveils the HomePod, a ‘smart’ home speaker

Apple is hoping a new smart home speaker will strike a chord with music lovers — the latest test of the iPhone maker’s ability to redefine markets originally staked out by its rivals.

The trend-setting company also is putting new twists on existing products as it delves deeper into virtual reality and a form of artificial intelligence called machine learning.

‘HomePod’ speaker, new iMacs debut at Apple Expo (The Associated Press)

The moves announced Monday escalate Apple’s technological battle of wits with Google, Amazon, Microsoft and Facebook. These giants are battling over still-emerging fields that are expected to turn into technological gold mines, much the way personal computers and smartphones became moneymaking machines in previous decades.


The “HomePod” speaker unveiled at Apple’s annual developers conference is similar to rival devices that have been released during the past two years.

Like the Amazon Echo and Google Home, the HomePod will play music while also helping people to manage their lives and homes. Siri, a digital assistant that has been on Apple’s iPhone since 2011, will be voice activated to respond to requests for information and other help around the house.

Unlike those other smart speakers, Apple is positioning the HomePod primarily as a way to listen to and discover new songs and artists. Making the most of it will require a subscription to Apple’s own music streaming service, which runs $10 to $15 per month and has attracted 27 million subscribers so far.

The company is casting Siri as a music connoisseur that will learn and cater to the tastes of the HomePod’s owners, as well as answer questions about the songs as they are played. “It will reinvent home audio,” boasted Apple CEO Tim Cook.

The speaker will sell for about $350 in December in the U.S., U.K. and Australia. Amazon sells the main version of the Echo for $180; Google’s Home speaker goes for $130.

The Echo, released in 2015, and Google Home, released last year, were the first entrants in a promising market. The research firm eMarketer says than 35 million people in the U.S. are expected to use a voice-activated speaker at least once a month this year, more than double its estimate from last year.


The HomePod is Apple’s first new gadget in nearly three years, following its announcement of the Apple Watch in September 2014. Although that product came out after other smartwatches hit the market, it quickly outshone competitors, according to industry research firms.

Still, the Apple Watch hasn’t been a smash hit, fueling worries that the company’s ability to transfix customers had waned after the 2011 death of co-founder Steve Jobs. During Jobs’ last decade, Apple introduced the iPod, iPhone and iPad — all huge commercial successes that both reshaped daily life and swamped previous digital music players, smartphones and tablets.

Analysts said the smart home speaker market is ripe for Apple. The company “can’t afford to yield valuable real-estate in the heart of people’s homes to Amazon, Google and others,” said Geoff Blaber, research analyst at CCS Insight. That’s especially important because people are starting to access information, entertainment and search in a more “pervasive” way that’s less dependent on smartphones, he said.

But it’s also possible that the HomePod could expose Siri as less capable than Amazon’s Alexa, Google’s Assistant and Microsoft’s Cortana, Blaber said. (Many reviewers have suggested that the current incarnation of Apple’s assistant already trails competitors in key respects .) “This is the start of the AI wars,” he said.


Apple had plenty of other announcements. New iMacs released Monday are getting better displays and graphics capabilities. Apple said that makes the Mac a great platform for developing virtual-reality “experiences,” although the company didn’t announce any consumer VR products.

Safari, Apple’s web browser, is getting new features aimed at online annoyances. It will block videos that start playing automatically, for instance, and can also prevent ads from following and profiling users. It will not actually block ads, though.

Apple also introduced a new version of its business-oriented iPad Pro at an intermediate size with more storage, a better display and an improved camera. It’s part of Apple’s effort to entice professionals with tablets that can handle many tasks previously reserved for laptops.

New features coming to iPhones and iPads, meanwhile, include marginal improvements such as syncing messages to Apple servers in the cloud, saving storage space on phones and tablets. Apple also laid some groundwork for augmented reality, the projection of digital features onto real-world surroundings, by giving app developers tools for incorporating AR into their products.

Apple is also bringing the ability to send money to friends or other people through its payment service, Apple Pay. So far, the service has limited payments to purchases of products and services from companies and other organizations.

The free software update for mobile devices, iOS 11, is expected in September, when Apple typically releases new iPhones.

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6 Jun

Alphabet shares follow in Amazon’s footsteps and top $1,000

Shares of Google parent Alphabet Inc. passed $1,000 six days after Inc. crossed the same threshold, showing the sustained investor confidence that tech giants can outmatch older companies.

Amazon’s rise reflected a bullishness in e-commerce, coming despite bigger sales in brick-and-mortar retail. Likewise, Alphabet shareholders see that TV ad budgets will continue to gravitate online, where Google dominates.

Alphabet’s transition just under two years ago to a portfolio structure has also buoyed investor confidence in the stock. Alphabet’s shares hit $1,003.76 at 12:18 p.m. in New York Monday, about a 38-per-cent increase since August 2015 when Google became Alphabet, splitting off its audacious, earlier stage ventures from the core Internet business.

During that time, Chief Financial Officer Ruth Porat oversaw cuts to the company’s massive spending bill and decelerations on some pricey initiatives, like its fiber broadband service and drones. Alphabet issued a rare share buyback last year.

Google’s primary ads business has kept expanding too, dodging any threat from the spread of mobile devices. Ad revenue reached $21.4-billion in the first quarter, a 19-per-cent annual leap. And the company has shown some signs of growth in its cloud-computing business, an area of massive investment internally.

Along with cloud-computing, Google has heaved considerable investment into artificial intelligence, such as voice-computing. Many investors believe that investment positions Google well to hedge against any threats to its web search business a shift in computing brings.

Prospects for the one-time “moonshots” — the company’s experiments in industries like health care and transportation, now called the “Other Bets” — have looked brighter this year. Verily, Alphabet’s medical business, closed a $800-million outside investment from Singapore firm Temasek. Alphabet cut investment in its fiber broadband service, a move investors appeared to cheer for the slowdown of capital in a competitive industry.

Waymo, Alphabet’s self-driving car unit, is in position to lead the competitive autonomous transit market, according to a note last month from Morgan Stanley. The analysts wrote that the unit could be worth around $70-billion by 2030 — a prospective value that is not baked into Alphabet’s current share price.

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