In an Eye-Opening Interview, the President of Delta Air Lines Just Revealed an Amazing Plan to Change Everything Passengers Think About Flying on Delta

This is a story about Delta Air Lines, and about the most fundamental question any business has to ask itself. It’s also about the intriguing answer Delta seems to have found.

That question is: “What, exactly, do you sell?”  

Do you sell a simple product? Or do you sell an experience, or maybe a convenience — a solution to customers’ problems?

It’s a philosophical difference, but it has a lot of real-world repercussions. In the airline world, it’s a big issue.

Should an airline think of itself as selling a commodity — a seat on a plane? Or should it think of itself as selling something bigger?

No need for baggage claim?

“Right now, we still sell airline tickets,” Delta Air Lines president Glen Hauenstein recently told the 3 Things podcast, hosted by Red Ventures CEO Ric Elias. “What we really want to sell is the journey.”

For example, as Hauenstein proposes, your “journey” would include not just the flight, but airport transfers and even luggage delivery–so that you could seamlessly book a trip from your home in Atlanta to your hotel in Los Angeles–and have your luggage delivered to you, so you never even have to go to the baggage claim.

“[We want] your luggage to find its way to your mode of transportation, and show up at your hotel or place of residence,” Hausenstein said. “If you use Lyft for ride-sharing, if you use Hilton or Marriott as your preferred hotel vendor, we need to know that. Then, we can provide you a curated experience from start to finish. That’s where we’re headed.”

The plans are apparently for what the airline would be like in about 2025. Not so long from now.

(The podcast isn’t actually available yet, but Hauenstein’s remarks were reported by Darren Murph of The Points Guy. TPG is also owned by Red Ventures.)

Best ‘Major Airline’

I read all this after having just reported on the airlines that fared best in TripAdvisor’s 2019 Travelers’ Choice Awards, which are based on the rankings and reviews that thousands of TripAdvisor users give various airlines during the past year.

As I wrote recently, Southwest Airlines was far and away the winner among U.S. airlines in the rankings. In fact, it was the only U.S. airline that placed in the top 10 worldwide. 

If you look at the reviews that TripAdvisor quoted in announcing its placement, you can see why.

Nobody is talking about the commodity parts of Southwest’s business: things like on-time performance, or the fact that you can usually change flights without an additional fee.

Instead, they’re talking about the intangibles: the “friendly staff,” that “really cares about you and it shows.”

While Southwest took the overall top prize for North America, Delta Air Lines came in first in that ranking for its category: “Major Airlines.” (Southwest is considered a “Low Cost Airline.”

And it’s It probably isn’t surprising to see that the accompanying Delta reviews are fairly close in tone to the Southwest ones. It’s not so much about the product or the service. It’s about the feelings that the product and service inspire in the customers.

Getting past the numbers

Interestingly, moving away from a commoditized airline product doesn’t necessarily mean squeezing either more or less money out of the product itself.

For example, as Gary Leff at View From the Wing points out, Delta seats passengers nine across in some aircraft configurations, when rival airlines like United and American flying the same plane fit 10 in the same space.

So Delta ostensibly gives up revenue for passenger experience in that case.

But Southwest goes the other way sometimes. For example, it gets lots of good press for offering free bags and itinerary changes, but most passengers don’t fully use them. By bundling the features, Southwest arguably makes more money than it would by stripping them out and selling them as-needed.

Either way, it doesn’t really matter in a vacuum. Passengers who care mostly about price, schedule and features can get all that information in an instant now, and they make a pure commodity decision.

But lots of people don’t think that way. They go past the numbers, and they make decisions more on how an airline–or any company–makes them feel as a whole.

Was the trip pleasant? Did the employees seem like they wanted to be working? Is there anything about the company’s public persona that doesn’t square with my personal values?

In most cases, those are the customers you want. Because while you have to work a little harder to get them, they’re the ones who won’t abandon you quickly simply because another competitor offers a slightly lower price, or a slightly more convenient schedule.

In fact, as Delta seems to understand, you’re probably better off getting them to stop thinking about flying with you as simply “buying a ticket.”

Figure out instead how to make them think about “the journey”–and then inspire them to take it with you.

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United Airlines President Says It's Customers' Own Fault the Airline Is Shoving More Seats Into Planes

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek.

United Airlines has been trying.

This doesn’t mean United’s customers have stopped complaining.

Recently, I talked to a United Million Miler who was enraged about delays, not being able to get upgrades and several other apparently annoying elements.

What, though, do United’s customers complain about most?

Poor WiFi is the number one complaint from our frequent travelers and it’s definitely something we want to get fixed.

And there you were thinking that customer service would be the most irritating part of flying.

For me, I confess, the worst is airlines shoveling more and more seats onto planes, so they can make more money.

For Kirby, though, it’s customers’ own fault that United now has 10 seats across a Boeing 777 in Economy Class. He said: 

Quite simply it costs us the same to fly a 777 across the Atlantic with 10 or 9 abreast. You have find what people care about and what they are willing to pay for. If you have only 9 abreast, you’d have to charge everyone 11 percent more to break even. So are people willing to pay an extra $110 on a $1000 transatlantic fare to sit in a row with one less seat? The answer is unequivocally no.

It’s tantalizing, isn’t it? 

Kirby apparently has data showing that you, dear, customer, don’t mind being squished to within an inch of a lung.

He insists, indeed, that most of the world’s airlines agree with him and fly 777’s with 10 seats across.

But then there’s Delta.

The airline had decided that no, it wouldn’t shove 10 seats across its Boeing 777-200 planes.

Even more startling was the fact that it was going to make those Economy Class seats wider.

Could it be that Delta’s customers are prepared to pay a little more for greater comfort?

Could it also be a general sense of superior customer service allows Delta to introduce all kinds of touches that enhance human experience and encourage loyalty?

It’s an enticing thought, isn’t it?

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Fulgent Genetics Has Further Upside

Fulgent Genetics (FLGT) is a genetic testing contractor with proprietary technology enabling a host of different genetic tests. The share price has been on a roll lately, but we think after some consolidation, this could resume as the shares still aren’t all that expensive.

The evolution hasn’t gone in a straight line, although revenues are generally rising, but that can vary a bit quarter to quarter as the mix influences ASPs and the incidence of contracts.

Chart

Data by YCharts

The company provides a series of low-cost tests (see the company website), and it’s still expanding into new areas (Q4CC):

Our focus this year was on stabilizing our business by expanding into new areas, such as reproductive health, cancer as well as sequencing-as-a-service… With the new initiative, our sequencing service packaged with data analysis are driving the strongest volume growth as we have seen momentum with our existing customers, while adding new pharma companies and the research organizations to our client base.

The company also advances through partnerships (Q4CC):

One particular exciting partnership for our carrier screen test is with Columbia University Irving Medical Center, which we announced in early January. This partnership in Columbia University was able to offer their patients — expand the carrier screening test, which provides more accurate view on patients’ genetic condition.

This partnership was outcome of highly competitive situation, where Columbia selected Fulgent due to our superior technology and comprehensive screening capability. This partnership will give us opportunity to business in New York State, which is a new market for the Fulgent. This partnership would also give us the opportunity to leverage Columbia’s expertise in genetical medicine to co-develop additional tests in future.

There were other contract wins like a research initiative agreement with a permanent medical foundation, where the company will provide a full service of genetic testing service, a multi-year, multi-million-dollar contract. And management argues more is in store as it is in talks with other parties and it had several wins in the exome sequencing business, for instance.

Q4 and 2018 results

From the 10-K:

A steady increase in tests delivered (+35% y/y), but ASPs are declining by 15% while cost per test declined only 7%.

For Q4, the main results (from the earnings PR):

  • Revenue totaled $5.7 million, growing 33% year over year
  • Billable tests delivered totaled 6,408, growing 52% year over year
  • GAAP loss was $935,000, or $0.05 per share
  • Non-GAAP loss was $193,000, or $0.01 per share
  • Adjusted EBITDA was $50,000

That is, the company is pretty close to being non-GAAP break-even. Another thing that has to be realized is that the company has a joint venture in China which generates revenue ($1.3M in 2018), but this isn’t counted in the revenue above but appears on the balance sheet. Management is pretty optimistic here (Q4CC):

Long term, we remain confident that the JV uniquely positions us to capture the large China market.

Guidance

Here is the guidance provided on the Q4CC:

We expect revenue for the full year 2019 to be at least $26 million, which represents year-over-year growth of at least 22%. And we expect the year to be back-end weighted as it will take time to ramp on a number of these agreements that Ming has discussed. We also remain focused on improving leverage, while investing for growth. As we continue to scale, we expect to return to GAAP profitability in the latter part of 2019.

Margins

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Data by YCharts

Non-GAAP margins are considerably better as they improved 979 basis points y/y. An important question is whether there will be operational leverage:

  • S&M was $1.1M (GAAP), flat on Q3
  • R&D was $1.4M, flat on Q3
  • G&A was $1.4M, up from $1.3 in Q3
Chart

Data by YCharts

Not yet a great deal of operational leverage, although non-GAAP operating expense was $3.5M versus $3.9M for the GAAP version.

Cash

Chart

Data by YCharts

Cash flows are only recently improving and are still negative on a TTM basis, although cash from operations was a positive $778K in Q4, but much of that was driven by changes in working capital. The following is more important (Q4CC):

We’ve continued to manage our business around cash flow breakeven with the goal of achieving sustainable cash flow generation next year. We ended the fourth quarter with $37.4 million in cash, cash equivalents and marketable securities with no debt. This equates to over $2 in cash, cash equivalents and marketable securities per share.

So the company still has plenty of cash and intends to be cash flow positive next year.

Risks

  • Competition
  • Contracts
  • ASP

These risks are considerably related as more competition tends to reduce ASPs and margins and makes it more complicated to win new contracts. This is not the place for a competitive overview of the market, which is still in the very early innings, but the 10-K had this to say:

Our competitors include dozens of companies focused on molecular genetic testing services, including specialty and reference laboratories that offer traditional single-gene and multi-gene tests. Principal competitors include companies such as Ambry Genetics, Inc.; Roche; GeneDx, a subsidiary of OPKO Health, Inc.; Invitae Corporation; Myriad Genetics, Inc.; and Pathway Genomics Corporation, as well as other commercial and academic laboratories. In addition, other established and emerging healthcare, information technology and service companies may develop and sell competitive tests, which may include informatics, analysis, integrated genetic tools and services for health and wellness.

Perhaps a bigger risk is that technology is a fast-moving target and a new entrant into the market (or existing player) might come up with something better.

A growing market brings big opportunities, with the market set to expand. It was a $5B market in 2017 (Market Watch):

Global Genetic Testing Market is set to exceed USD 22 billion by 2024; according to a new research report by Global Market Insights. Innovation in genetic testing leading to enhanced efficiency, high sensitivity and safety will serve to be a high impact rendering factor. Technological advancement in scientific research as well as research instrument is increasing the importance of genetic testing.

But with such growth, it’s likely that a host of new players will enter, and some of these might offer better and/or cheaper testing. Still, we think that the benefits of market growth far outweigh potential competition at the moment, so we’re not too worried here.

While the company has long-standing customers, revenues cannot generally be called recurring, so it has to keep fighting to gain new contracts, and as a result revenue and earnings might display considerable variability (10-K):

Our results of operations have experienced fluctuations from period to period, which we expect may continue in the future. These fluctuations can occur because of a variety of factors, including, among others, the amount and timing of sales of billable tests; the prices we charge for our tests due to changes in product, customer or payor mix, general price degradation for genetic tests or other competitive factors; the rate and timing of our billings and collections; and the timing and amount of our commitments and other payments, as well as the other risk factors discussed in this report. In addition, in certain prior periods, our results have been impacted by events that may not recur regularly, in the same amounts or at all in the future.

Valuation

Chart

Data by YCharts

The company isn’t yet profitable (although it’s not far off, as we saw above) and 3.5x sales is a fairly reasonable valuation. The one analyst giving estimates has the EPS at $0.02 this year rising to $0.24 the next.

Shares have almost doubled this year already, but we still don’t find them terribly expensive.

Conclusion

We are a little late to this party, but we nevertheless see a solid company that is about to return to profitability this year. The market in which it operates is fast growing and still in the early innings, which provides a tremendous opportunity, but also a bit of a risk as technology is still in some flux.

We would not be big buyers at these levels, but we can recommend a small position that can be added on weakness, which has occurred plenty of times in the past (even if that’s no guarantee for the future).

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Avengers Endgame Broke Records and Websites Just 6 Hours Into its Presale Using This Old-School Strategy

Fandango reported that this latest installment in the Marvel series broke the previous first-day presale record, held by Star Wars: The Force Awakens, in just six hours.

The fanaticism is real. Up until recently, the only Marvel movie I’d seen was Black Panther (because you know, Wakanda Forever). I have a date with my partner to see the new Avengers movie in a few weeks. To make sure I’m fully prepared for the experience, he made sure I watched Captain Marvel and Avengers: Infinity War prequels in advance. 

A similar kind of excitement and eager anticipation exists with Game of Thrones. I’ve seen zero episodes, but have been fascinated by the impact the series has had on people. In anticipation of the final season of the show, I’ve seen people posting photos and videos of their Game of Thrones blankets, whiskey bottles, and action figures. 

Even though I don’t have a television, and am grossly behind in movies, I’m not immune to this kind of fanaticism. Years ago when I did have a tv, I binge watched a full season of Glee while on holidays. When I discovered the Serial podcast I binge listened to the entire season in a day. 

The good news is, there is a similar thread in these content forms that you can apply to get your customers to be just as fanatical about what you produce. And you can implement this simple strategy without having the blockbuster budgets of Marvel, Game of Thrones, or Serial. Here’s how.

How to Create “Must Consume” Content Your Customers Will Devour

Serialize it.

Tell stories with cliff hangers, leave loose-ends, ratchet up the drama, and layer in lots and lots of emotion. Take your customers on an emotional roller coaster, that will make them feel incomplete if they don’t know what happens next.

Soap operas have used this format for years. That’s why people have spent decades watching the twist and turns of the same characters. There is always some detail, some problem, some unanswered question that keeps the audience tuning in day after day, week after week, year after year.

And it’s the approach the Marvel series, Game of Thrones, Glee, Serial, and many more have used to transform eager audiences into superfans and loyal customers. 

You can do the same with your content.

Delivering good content is all about storytelling. And when done well, you can weave stories about your brand into that content.

One way to do it is to tell stories about your company. When Alex Bloomberg started Gimlet Media, a narrative podcasting company, he chronicled the ups and downs, the good, the bad, and the ugly in podcast form for season one of the show Startup

Take your customers behind-the-scenes of what it is really like to build your business. Showcase your goal, and take them along the journey as you show up each day to tackle it. Your customers aren’t looking for perfection. They want to know you’re human, and have triumphs and low points, just like them.

You could tell stories about your customers. Make your customer the hero. Follow along and showcase their own journeys as they work to achieve the transformation your business helps them with.

At my last corporate job, we would feature our patients with type 1 diabetes stories as they worked to tackle big goals. We featured one group as they worked to swim across the English channel, and another athlete in his quest to run across Canada.

The serialized stories you tell don’t have to be real either. Avengers, Game of Thrones, and Glee are pure fiction. But that didn’t stop me or any of the other fans from getting emotionally invested in what happens to the characters.

GE launched a science-fiction podcast series, The Message a few years ago. By going above the brand to tell stories that hooked their audience, GE delivered an experience that delighted millions of listeners.

Producing original content is a smart way to deliver experiences that attract more of your ideal customers. But when you deliver that content in a serialized storytelling format, you set the stage to get those customers so hooked on what you do, that they won’t be able to help but to keep coming back for more of what you produce again, and again, and again.

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This Company Made a Huge Mistake on 'Shark Tank' — But Still Got a Deal

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South Korea first to roll out 5G services, beating U.S. and China

SEOUL (Reuters) – South Korea will become the first country to commercially launch fifth-generation (5G) services on Friday as it rolls out the latest wireless technology with Samsung Electronics’ new 5G-enabled smartphone Galaxy S10.

People take photographs during a launching ceremony for SK Telecom’s 5G service, in Seoul, South Korea, April 3, 2019. REUTERS/Kim Hong-Ji

With one of the world’s top smartphone penetration rates, South Korea is in a race with China, the United States and Japan to market 5G, hoping the technology will spur breakthrough in fields such as smart cities and autonomous cars, and drive up its economic growth that slowed to a six-year low in 2018.

“It is meaningful that South Korean telecom companies are providing services and networks meeting South Korean customers’ high standard in speed and picture quality,” Ryu Young-sang, executive vice president at the country’s top mobile carrier SK Telecom, said on Wednesday.

5G will change the landscape of the gaming industry as it allows games streamed with minimal delay to be played on smartphones, Ryu added.

The technology can offer 20-times faster data speeds than 4G long-term evolution (LTE) networks and better support for artificial intelligence and virtual reality with low latency.

Sometimes it can offer 100-times faster speeds.

South Korean carriers have spent billions on campaigns marketing 5G and, on Wednesday, SK Telecom showed off K-pop stars and an Olympic gold medalist as its first 5G customers.

SK Telecom is working with its memory-chip making affiliate SK Hynix to build a highly digitized and connected factory powered by 5G technology, Ryu said.

The operator expects about 1 million 5G customers by end-2019. It has a total of 27 million users.

Smaller rival KT Corp is set to offer cheaper plans than its LTE service, with unlimited data and 4-year installments to buy 5G devices.

Samsung was the first to unwrap a 5G phone in February when it unveiled the Galaxy S10 5G and a nearly $2,000 folding smartphone, putting the world’s top smartphone maker by volume in pole position in the 5G race, some analysts say.

Smaller local rival LG Electronics plans to release its 5G smartphone in South Korea later this month.

In the United States, carrier Verizon plans to launch its 5G network in two cities on April 11.

SECURITY CONCERNS

While security concerns over 5G networks using telecom equipment made by China’s Huawei have marred the buildup to the release of these services, South Korean telcos have tried to shrug them off.

“I don’t think we have a security issue in South Korea,” Park Jin-hyo, head of SK Telecom’s information and communication tech research center, told reporters.

Slideshow (2 Images)

He added that the company uses advanced technology to block eavesdropping or hacking into 5G networks.

Among South Korea’s top three telecom operators, SK Telecom and KT Corp do not use Huawei equipment for 5G. Smaller carrier LG Uplus uses Huawei gear.

But SK Telecom officials said it was likely there will be an open auction for network equipment makers including Huawei if South Korea needs more base stations for higher frequencies.

Reporting by Ju-min Park; Editing by Sayantani Ghosh and Himani Sarkar

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CMC Markets shares slump on profit warning as finance chief plans exit

(Reuters) – Shares in CMC Markets Plc slid more than 10 percent on Wednesday after the online trading firm forecast a drop in income in the year to March as new rules curbed client activity, and a senior executive decided to depart.

Dealers work at their desks whilst screens show market data following a vote on Prime Minister Theresa May’s Brexit ‘plan B’ at CMC Markets in London, Britain, January 30, 2019. REUTERS/Dylan Martinez

The profit warning dragged down shares in Britain’s biggest online trading firms IG Group and Plus500 Ltd.

Regulators are tightening rules on products that allow anyone with a bank card to make highly leveraged bets on financial markets through apps and online platforms.

CMC Markets said it expected net operating income of 131 million pounds ($172.17 million) for the year to March 31, compared with 187.1 million pounds a year before.

It also forecast a 37 percent drop in revenue to 110 million pounds for the unit that offers complex financial products to retail clients.

“We know that calendar 2019 (year to date) has been weak for retail leveraged trading, but this is more than just industry conditions,” Liberum analyst Ben Williams said.

“They are losing share. It is now a loss-making business and full year 2020 estimates are too high.”

Separately, the company said its chief operating and financial officer Grant Foley would leave the company to pursue other opportunities.

Britain’s financial watchdog said last week it will permanently ban the sale of complex derivative products to retail customers to protect them from large and unexpected trading losses.

That is similar to a temporary ban the European Securities and Markets Authority (ESMA) has in force across the European Union. ESMA also has temporary curbs on contracts for difference (CFDs).

Binary options allow people to bet on whether the price of a share, currency or index will go up or down within a certain timeframe. CFDs give an investor exposure to price movements in securities without owning the underlying asset.

CMC said the new rules had led to retail clients trading less and using more of their cash to fund margin needs, or needing to deposit more funds with CMC to trade at previous levels. It said however trading showed “signs of stabilising”.

The sector has also been plagued by persistent low volatility in financial markets.

The CBOE volatility index, seen as Wall Street’s fear gauge, has slipped from its December peak as investors stayed on the sidelines awaiting clarity around China-U.S. trade talks and the Brexit process.

(Graphic: CMC Markets and rivals face tighter regulation – tmsnrt.rs/2UYExc5)

(Graphic: CMC Markets and rivals face tighter regulation – tmsnrt.rs/2UZ5In4)

Reporting by Muvija M and Noor Zainab Hussain in Bengaluru; Editing by Arun Koyyur, Bernard Orr and Jan Harvey

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Bilibili launches $621 million offering, as China techs tap markets after IPOs

HONG KONG (Reuters) – Chinese video platform Bilibili launched on Tuesday a convertible bond sale and a follow-on share offering that could raise around $621 million combined, in a return to the capital markets just over a year after it went public in New York.

Bilibili, one of China’s leading online video sharing and entertainment platforms, announced the fundraising on Tuesday but did not disclose detailed terms.

The company is selling a $300 million seven-year convertible bond and 17.1 million shares, of which 10.55 million are primary and the rest come from an existing shareholder, according to a term sheet seen by Reuters.

The follow-on offering could raise around $321 million based on Bilibili’s closing price of $18.8 on Monday. Its shares have risen 32 percent so far in 2019.

This year has already seen other U.S.-listed Chinese companies return to the capital markets to raise additional funding, be it through convertible bonds or follow-on offerings, as they seek more growth capital.

Chinese electric vehicle maker NIO, video streaming company iQIYI and e-commerce firm Pinduoduo, all 2018 IPOs, have come back to the market to raise funds.

Bilibili’s convertible bond is being marketed with a coupon range of between 1.375 percent and 1.875 percent, while the conversion premium – the price at which buyers can convert their bond holding into the company’s shares – will fall between 32.5 percent and 37.5 percent, the term sheet showed.

Convertible bonds are a cheaper funding avenue due to their lower coupons in exchange for giving the bondholder the option of converting the debt into shares at a set price in future.

Tech companies find them particularly attractive as normal debt is more expensive for them, especially if they are still unrated, like Bilibili.

Qiming Venture Partners is the selling shareholder in Bilibili, according to the term sheet.

The firm raised $483 million in its Nasdaq initial public offering (IPO) in March last year.

Bilibili plans to use the proceeds from Tuesday’s offering to enrich content offerings, research and development and potential strategic acquisitions, investments and alliances.

The deal will price after U.S. markets close on Tuesday.

Bank of America Merrill Lynch, Citigroup, Credit Suisse, JPMorgan and Morgan Stanley are joint bookrunners for Bilibili’s offering.

Reporting by Julia Fioretti; Editing by Muralikumar Anantharaman

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Is Instagram Checkout a Game Changer? What Your Business Needs to Know 

Last week, Instagram launched “Checkout on Instagram,” a feature which allows consumers to shop directly for products featured in Instagram posts and ads without leaving the app at all. The feature launched with 23 brands in closed beta, including Adidas, Burberry, Michael Kors, Prada and Warby Parker. In the company’s latest announcement in a series of big announcements, Instagram promised more brands will be coming soon and shared that they will take an undisclosed percentage of transactions generated through Checkout. 

So, is this a game changer for Facebook, or for mobile commerce? Most important, is this move a game changer for your business? To find the answers to these questions, I turned to the smartest person I know on the topic of social media advertising: Dan Kerpen (yes, he’s my little brother.) Dan and I talked about this latest move and its implications and these are the insights I took away from our conversation: 

What This Means For Small Businesses 

It depends on your industry. For most industries, it won’t matter. If, on the other hand, you can figure out how to sell something that can be displayed in a natural looking photograph (preferably with a human in it), then you can work towards a strategy than might fit well with a buy now option on Instagram.

So if you’re in the fashion, clothing, makeup, accessories, food, consumer products, or household goods verticals, start thinking about how your Instagram strategy might change with this new feature available. If you’re in another industry where you think you can create natural photographs that include your product, go for it! If, on the other hand, you think that would be a stretch for your business or category, it’s probably not worth the effort. 

What This Means For The Social Media Landscape

Facebook is clearly vying for more click attribution, because most sources weigh it more heavily/seriously than view attribution. They are also quietly combating Pinterest, who has had “buyable pins” up since 2015 with moderate success for certain key verticals.

Facebook / Instagram’s Challenges

Facebook has two challenges here:

1. Getting users to click more.

At Likeable, we usually see a fair amount of view attribution on our Instagram ads, whether the ad is a link post or not. And this makes sense if you talk to people about how they interact with ads on the platform. Many people notice what they like, close the app, and then search for it. And often they only look for things that stick out in their minds later.

2. Not annoying users with the wrong content.

I don’t think this will annoy most users, as long as it stays within certain verticals. Instagram for makeup and fashion, for instance, has historically been good, whereas link ads on the platform for many other industries really haven’t been a good fit. So one big challenge could be how to find other products that fit and don’t annoy users. Facebook chose their initial launch partners very carefully, aware that they’d need big wins to justify expanding this feature to other partners.

The Bottom Line 

For some industries, Checkout on Instagram could be a game changer. It could be the answer to the challenging question of how to sell on mobile phones that ecommerce companies have been trying to solve for a decade. For other industries, Checkout could be a total non factor. 

What industry is your business in, and will you test out Checkout on Instagram when it becomes available to you? Let me know your thoughts in the Comments section below. 

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China calls on New Zealand to provide 'fair' investment environment

BEIJING (Reuters) – Chinese Premier Li Keqiang called on New Zealand on Monday to ensure a fair investment environment, as he meet Prime Minister Jacinda Ardern whose country has rejected a bid by Chinese telecom giant Huawei to build a 5G mobile network.

New Zealand Prime Minister Jacinda Ardern (R) and China’s Premier Li Keqiang attend a welcome ceremony at the Great Hall of the People in Beijing, China, April 1, 2019. REUTERS/Jason Lee

Ardern, on a one-day visit to China, said before meeting Li that she hoped to have a dialogue with Beijing about New Zealand’s intelligence agency’s decision to reject the bid.

Ties with China have been tense under Ardern’s government which has openly raised concerns about Beijing’s growing influence in the South Pacific.

China postponed a major tourism campaign in New Zealand days before its launch in February.

“At present, China-New Zealand ties overall are developing in a stable manner,” Li told Ardern at the start of their meeting in Beijing’s Great Hall of the people, noting New Zealand’s desire for good relations.

“China also places a high importance on relations with New Zealand,” he said.

“And we hope that we can aspire to the greatest common denominator regarding each others’ interests and that when each sides businesses invest in each other’s businesses, they can enjoy a fair, transparent, convenient environment.”

Ardern told Li that she wanted to underline the importance her country placed on its relationship with China. In 2008, New Zealand became the first Western country to sign a free trade agreement with China.

“I reiterated to Premier Li that New Zealand welcomes all high quality foreign investment that will bring productive economic growth to our country,” she said in a statement following the meeting.

“We discussed the FTA upgrade, and agreed to hold the next round of negotiations soon and to make joint efforts towards reaching an agreement as soon as possible.”

China is New Zealand’s largest goods export partner.

Talking to reporters before the Li meeting, Ardern said she would set out the process New Zealand followed in the Huawei decision, and point out that there had been no political or diplomatic influence in the matter. She said media reports that suggest Huawei was banned in New Zealand were not true.

The interview with reporters was streamed on New Zealand’s 1NEWS.

Ardern has acknowledged there were complexities in the relationship with China, but has dismissed concerns of a rift with New Zealand’s largest trading partner. The trip has been trimmed down to a one-day visit in the wake of an attack on two mosques in Christchurch on March 15 that killed 50 people.

New York-based Human Rights Watch called in a letter to Arden last week for her to publicly express concern about the situation in China’s far Western region of Xinjiang when she meets Chinese leaders.

Slideshow (5 Images)

China has faced growing international opprobrium over a controversial de-radicalization program in the heavily Muslim populated Xinjiang, where critics say China is running internment camps. China strongly denies this and calls them vocational training centers, defending its need to de-radicalize a part of the country where the government has blamed Islamist extremists and separatists for multiple attacks in which hundreds have died in recent years.

Before her meeting with Li, Ardern said New Zealand had raised the issue of Uighur Muslims in the past but did not say if it would be discussed.

“Human rights issues are things that New Zealand routinely raises in our bilaterals with China,” she said. There was no mention of human rights in Ardern’s later statement.

Reporting by Ben Blanchard; Additional reporting by Praveen Menon in WELLINGTON; Editing by Michael Perry

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Saudis gained access to Amazon CEO Bezos' phone: Bezos' security chief

FILE PHOTO: Jeff Bezos, president and CEO of Amazon and owner of The Washington Post, speaks at the Economic Club of Washington DC’s “Milestone Celebration Dinner” in Washington, U.S., September 13, 2018. REUTERS/Joshua Roberts/File Photo

WASHINGTON (Reuters) – The security chief for Amazon chief executive Jeff Bezos said on Saturday that the Saudi government had access to Bezos’ phone and gained private information from it.

Gavin De Becker, a longtime security consultant, said he had concluded his investigation into the publication in January of leaked text messages between Bezos and Lauren Sanchez, a former television anchor who the National Enquirer tabloid newspaper said Bezos was dating.

Last month, Bezos accused the newspaper’s owner of trying to blackmail him with the threat of publishing “intimate photos” he allegedly sent to Sanchez unless he said in public that the tabloid’s reporting on him was not politically motivated.

In an article for The Daily Beast website, De Becker said the parent company of the National Enquirer, American Media Inc., had privately demanded that De Becker deny finding any evidence of “electronic eavesdropping or hacking in their newsgathering process.”

“Our investigators and several experts concluded with high confidence that the Saudis had access to Bezos’ phone, and gained private information,” De Becker wrote. “As of today, it is unclear to what degree, if any, AMI was aware of the details.”

A spokesman for the Saudi embassy in Washington did not immediately return a request for comment. In February, the kingdom’s minister of state for foreign affairs said Saudi Arabia had “absolutely nothing to do” with the National Enquirer’s reporting on the affair.

A representative for AMI did not immediately respond to a request for comment. AMI has previously said that it acted lawfully in the reporting of the Bezos story.

De Becker said he has turned over the findings of his investigation to U.S. federal officials, without elaborating.

Reporting by Christopher Bing; Editing by Mary Milliken and Rosalba O’Brien

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This Video Is How Microsoft CEO Satya Nadella Introduced Himself to an Audience of 17,000 and It Was Perfect

If you had to introduce yourself to an audience of 17,000 people with a one-minute video, what would it be? I’ve been pondering that question since attending the Adobe Summit this past week, where one of the keynote speakers was Microsoft CEO Satya Nadella. The video he chose was Microsoft’s Super Bowl commercial about a new Xbox Adaptive Controller which makes it easier for the disabled to play video games. That choice says a lot about Nadella as a leader and as a person.

Nadella is certainly a celebrity, but he wasn’t the only high-profile keynote speaker at this very, very large conference. Before each famous speaker appeared onstage, that speaker was introduced with a brief video. In every other case, the video was about the speaker and his or her achievements, or possibly about the speaker’s organization its accomplishments.

Then there was Nadella, who introduced himself this way:

Microsoft also ran this same 60 second video as its commercial during the Super Bowl. This year, Super Bowl ads reportedly cost $5.25 million for only 30 seconds which suggests it cost the company into the eight figures to put this message out there on game day.

A lot of viewers and commentators admitted that watching that ad was an emotional experience for them, and you can count me in that number. The moment that gets me is when the father of Owen Sirmons, a severely disabled nine-year-old, says with tears in his eyes, “He’s not different when he plays.” My stepdaughter is disabled too, and I’ve seen that same high emotion in my husband when he’s found devices that let her move in the world the way non-disabled people do. 

If you know much about Nadella, you know that he, too, has reason to feel personally connected to the Adaptive Controller, since he has a severely disabled son. In fact, you might assume that the product was a pet project of his. But you’d be wrong. 

“It wasn’t even a sanctioned product. It came from a hackathon,” he told the audience. And, he said, the Xbox engineers who came up with it weren’t satisfied once the Adaptive Controller design was completed. They also redesigned the packaging so that gamers with only one hand or no hands could have the enjoyment of unboxing it unassisted. That reportedly took a further year of engineering work. “The more we can invoke our ability to meet unmet, unarticulated needs, that’s the source of innovation,” Nadella said.

Creating the Xbox also gets at one of the things Nadella says Microsoft has needed most–a sense of purpose. “Microsoft is 44 years old,” he said. “As a tech company you have to get a lot of things right, bet right long before it’s conventional wisdom, all that’s a given. But what is the real source of inspiration for getting those things right? One is a sense of purpose, and the other is culture.”

But when it came to purpose, the company was a victim of its own success. “In the 1990s, our mission was to get a personal computer in every home and on every desk, and by the end of the 1990s, we had pretty much achieved that in the developed world,” he said. “Since then, we’ve been seeking a mission.” Creating that sense of empowerment in technology users is part of that, he said. 

Today, Nadella added, every industry sector is being transformed by ubiquitous computing–first conceived the late Xerox PARC chief scientist Mark Weiser who coined the term in 1988. In Weiser’s vision, computers would become invisible servants and “recede into the background of our lives”–a vision Nadella says is coming true today.

What happens tomorrow? Nadella says he’ll keep learning. “If you’re going to keep reinventing yourself you need a learning culture,” he explained. “I went on a massive quest where I said what are the attributes of a learning culture? Fortunately, my wife introduced me to the Carol Dweck book Mindset.” He says he read it more as a father than as a CEO, but found the key to Microsoft’s future innovation in the idea. The goal, he says, is to “go from being know-it-alls to learn-it-alls and maintain that posture.” 

Creating the Xbox Adaptive Controller is a perfect example of how to be a learn-it-all. After watching the Adaptive Controller video, one software engineer posted this comment on YouTube: “I genuinely have never felt so much pride saying ‘I work at Microsoft.'” Looks like Nadella has helped the company find its sense of purpose again as well.

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10 Foolproof Ways to Spot BS at Work

The pushback didn’t surprise me, since it’s easier to laugh at passé fads than management fads that are currently providing employment for thousands of consultant and are been deeply embedded in your company’s mission statement.

For the past 25 years, a big part of my job has been detecting and exposing various forms of business bullsh*t; I even wrote a minor bestseller explaining how to avoid bullsh*t in the workplace. Spotting bullsh*t is a crucial skill because then you know to be elsewhere when the bullsh*t hits the fan… as it always eventually does.

Trying to debunk business bullsh*t and management fads one by one is like playing Whack-a-Mole, so rather than keep doing it solo, I’m going to share the “red flags” that tell me that a business theory, management concept, or technology category is doomed-to-fail hype. Here they are:

1. Concentrated Biz-Blab

The validity of any business proposition or concept is always inversely proportional to the amount of vaguely-defined corporate-speak used to describe it. Fuzzy terminology always reflects fuzzy thinking. Example: the statement: “collaboration increases the ability for nimble market transformation” actually means nothing but sounds good. Ergo bullsh*t.

2. Sponsored Research

Over the past few years people have gotten more savvy when it comes to spotting “research” that’s obviously self-serving and therefore invalid. Nevertheless, I still get story pitches citing research like “90% of employees want better entry door security,” the topline of a study that (of course) was funded by an entry door security provider. Ergo bullsh*t.

3. No Double-Blind Testing

A huge software company–SF.com for instance–could easily fund a study comparing, say, a sales group given fully-functioning software and a sales group given a hobbled version, with the testing company and vendor unaware of which group had which version. That would tell us if CRM really works as advertised. But not study ever happens. Ergo bullsh*t.

4. Category Refreshes

Products and services that actually work–provide value to their customers–tend to keep the same name over time. Why change it? Products and services where the hype has outrun reality require periodic “umbrella term” refreshes. Hence, “SFA” begat “CRM” begat “Sales 2.0” begat “Sales Enablement.” Ergo bullsh*t.

5. Anecdotal Proof

“Company A bought our product or service and their costs went down and their revenue went up.” Sorry, but correlation isn’t causation and how do we know that there’s not companies B, C, D, and E who bought that product or service and it turned into a pig’s breakfast? Case studies aren’t proof. Ergo bullsh*t.

6. Metaphorical Proof

Example: “Diamonds form under high pressure, therefore a high pressure workplace makes you stronger.” Say whut? Another example: “Our AI learned to play poker, therefore it can make complex business decisions.” Dudes, “business as poker ” is a metaphor. Poker’s rules can be printed on a single page; there are over 1 million books about business. Ergo bullsh*t.

7. Obviously Biased Endorsements

As evidence that a product or service works, the vendor quotes somebody whose career now depends on the purchase proving successful. (E.g. a facilities manager who bought into open plan is quoted on how successful it’s been.) Similarly, quoting employees who know they’d be fired were they to tell the truth. Ergo bullsh*t.

8. “Google Does It” Proof

Aka “Apple Does It”, “Microsoft Does It”, “Amazon Does It”, “Facebook Does It”, etc. Seriously, are we really going to hold these firms up as the pinnacle of business wisdom? From what I can see they’re pretty screwed up in multiple ways. In any case, if every company is doing something (like open plan), how could you possible know whether it’s working or not? Ergo bullsh*t.

9. Quasi-Religious Claims

Any claim that a technology will result in either the apocalypse or human immortality is simply repurposing religious hopes and fears. Example: “AI will take over the world!!!” Yeah, just like Y2K was going to destroy it. Another example: “Humans will transfer their minds into computers and live forever!!!” Religion not science. Ergo bullsh*t.

10. Denialism

Despite overwhelming peer-reviewed evidence that open plan offices are productivity disasters, we still encounter “there are studies on both sides” arguments. There aren’t. Similarly, multiple studies have shown CRM installations have a huge failure rate, but we still hear “CRM is a strategic investment” lingo. Can’t pass a simple reality check? Ergo bullsh*t.

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AT&T Stock Is Nearing A Big Breakout

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5 Quick Numbers That Tell the Story of Amazon (and Why Some Politicians Want to Break it Up)

Amazon is enormous, and an easy target for politicians who are thinking about getting into the trust-busting business, 21st-century style. 

Earlier this month, Sen. Elizabeth Warren, a candidate for the Democratic nomination for president, came out explicitly for the idea, with a post on Medium titled, “It’s time to break up Amazon, Google and Facebook.

“Today’s big tech companies have too much power — too much power over our economy, our society, and our democracy,” Warren wrote. “They’ve bulldozed competition, used our private information for profit, and tilted the playing field against everyone else.”

Against this backdrop, Bloomberg’s Matt Day and Jackie Gu have put together an interesting set of graphics focusing on Amazon, and showing just how dominant it is any particular industry. 

It’s the world’s largest online retailer, and the #1 seller of books (its first foray), period. But it’s also a tech company and an entertainment company and an infrastructure company — and while it’s a heavy player in every industry it enters, and leverages success in each one to prop up its efforts in the others, it’s not always number one.

“In just about every market Amazon has entered, it encounters well entrenched competitors, including some retailers who are finding success by blurring the line between online and offline commerce,” the Bloomberg report says.

Still, the numbers. From 2018:

  1. 807 million books sold, plus another 560 million ebooks.
  2. $524 billion in total ecommerce. That puts it at 45 percent of the entire industry. eBay is second at 6.8 percent; Walmart is third at 4.0 percent.
  3. 100 million Prime subscriptions, putting it behind only Netflix, which has 139 million subscribers.
  4. $80.4 billion in cloud computing, good for 32 percent of the industry. The #2 is Microsoft, at 17 percent.
  5. $70 billion in online apparel sales, putting it at 35 percent of the market. The #2 is Macy’s, at 8.7 percent.

They also have total dominance in e-readers (84 percent market share) and with the acquisition of Whole Foods, they’re the fifth largest grocer in America.

None of this is shocking, but it’s striking to see it all in one series of charts like this. And it just goes to show why Amazon will continue to be mentioned first among equals in any conversation about antitrust concerns as we approach the third decade of the 21st century.

Here’s what else I’m reading today:

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ZTE Corp shares surge 14 percent, forecasts first-quarter rebound

FILE PHOTO: People walk next to ZTE booth at the Mobile World Congress in Barcelona, Spain February 25, 2019. REUTERS/Rafael Marchante/File Photo

HONG KONG (Reuters) – Shares of ZTE Corp rose as much as 14 percent on Thursday after the company forecast a first quarter profit of up to 1.2 billion yuan ($178.18 million) as it recovers from U.S. sanctions.

The Chinese telecommunications equipment maker said in filings late on Wednesday it expected to make a net profit of 800 million to 1.2 billion yuan in the first quarter of 2019, up from a net profit of 276 million yuan in the December quarter.

ZTE, the world’s fourth-largest telecommunications equipment maker by market share, was forced to stop most business between April and July last year due to U.S. sanctions.

The sanctions were lifted after ZTE paid $1.4 billion in penalties. The company reported its worst half-year loss of 7.8 billion yuan in August..

That resulted in a 2018 full year loss of 7 billion yuan, just within its guidance range of 6.2 billion yuan to 7.2 billion yuan, but deeper than the average 6.2 billion yuan loss estimated by 10 analysts, according to Refinitiv Eikon data.

Hong Kong-listed shares of ZTE jumped as much as 14 percent to HK$25, while Shenzhen-listed shares rose by the daily maximum limit of 10 percent.

ZTE said its revenue for the quarter ending in December was 26.7 billion yuan, while its full-year revenue dropped 21.4 percent to 85.5 billion yuan, against an average estimate of 87 billion yuan by 12 analysts.

($1 = 6.7233 Chinese yuan renminbi)

Reporting by Sijia Jiang and Hong Kong newsroom; Editing by Stephen Coates and Darren Schuettler

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South Korea chipmaker shares rise on Micron's industry recovery outlook

SEOUL (Reuters) – Shares of South Korean chip giants jumped on Thursday after U.S. chipmaker Micron Technology Inc forecast recovery in a memory market saddled with oversupply as device demand sags.

FILE PHOTO: Memory chip parts of U.S. memory chip maker MicronTechnology are pictured at their booth at an industrial fair in Frankfurt, Germany, July 14, 2015. REUTERS/Kai Pfaffenbach

The world’s second-biggest memory chip maker, SK Hynix Inc, saw its shares surge nearly 7 percent by 0330 GMT, while technology giant Samsung Electronics Co Ltd gained 4.3 percent.

Micron said on Wednesday it saw recovery in the memory chip market, after reporting quarterly profit that beat analyst estimates as cost control helped offset falling demand and prices.

“Micron’s projection on growing memory chip demand from data center operators set up a positive outlook for the memory chip industry, helping boost shares of South Korean chipmakers,” said analyst Seo Sang-young at Kiwoom Securities.

Analysts have been wary about prospects of the memory chip market due to lower demand for smartphones and slumping investment from data center companies.

“With its plan to cut production, it seems that Micron is determined to better control oversupply problems in the chip market,” said analyst Park Sung-soon at BNK Securities.

Tech research firm TrendForce in a report on Wednesday said it expects a only a slight decline in NAND flash chip sales in the second quarter as demand recovers from smartphones, computers and servers.

“Although it won’t cause an immediate reversal of the oversupply situation, it will have a positive effect on the market environment,” analyst Ben Yeh at DRAMeXchange, a Trendforce division, said in the report.

Both Samsung Electronics and SK Hynix said in their earnings conference calls in January that they expected sales of memory products to revive in the second half of the year.

Rising chip shares helped lift the broader KOSPI stock price index by 0.3 percent.

Reporting by Heekyong Yang; Editing by Christopher Cushing

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Mozilla’s Firefox Send Solves One of Email’s Biggest Problems: Sending Large Files

Moving top secret files around the Internet just got a little easier.

Mozilla launched a new tool on Tuesday called Firefox Send. The service, which will serve as a direct competitor to the publicly traded Dropbox, lets anyone quickly, and easily, share important files, before it gives them the disappearing Snapchat treatment, making them disappear forever into the dark void of the Internet.

The new service allows anyone to drag, drop, and share files as big as 1GB, without needing to log in or register for an account. People who register for an account will be able to transfer up to 2.5 GB.

Firefox Send is incredibly easy to use. After going to the site, users can drag and drop a link, choose an expiration date, or limit the number of downloads. They can also add a password for an extra layer of security, if they choose. After that, users are then given a link, which can be shared with their trusted contacts.

The new service is also a workaround for sending large files over email, which take up storage space, and can jam the recipient’s inbox. Mozilla said it expects to release an Android app in beta later this week.

Mozilla, which is a nonprofit, is perhaps best known for its Firefox browser. The group has also positioned itself as a champion of privacy. It pulled its Facebook ads in the wake of the Cambridge Analytica scandal, has offered tracking protection in its browser, and even released an extension last year called Facebook Container, which isolates their browsing activity on Facebook.

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How the FAA Decides When to Ground a Jet Like Boeing’s 737 MAX 8

When an Ethiopian Airlines Boeing 737 MAX 8 jet crashed shortly after takeoff from Addis Ababa on Sunday morning, killing all 157 people aboard, observers quickly noted that the circumstances resembled those of another flight. In October, Lion Air Flight 610 crashed into the Java Sea, killing all 181 passengers and eight crew. Both flights plummeted a few minutes after takeoff, in good weather. And both were on 737 MAX 8 jets, the plane Boeing started delivering in 2017 to replace the outgoing 737 as the workhorse of the skies. Since 2017, Boeing has delivered 387 MAX 8s and 9s. It has taken orders for 4,400 more, from more than 100 customers.

As of Tuesday evening, various foreign aviation regulators and airlines had decided that after the two crashes, the plane shouldn’t be in the air. Officials in the European Union, China, Indonesia, Singapore, Australia, and the United Arab Emirates have all grounded the planes. Of the 59 operators that fly the new 737, at least 30 have parked it.

In the US, though, Boeing’s plane is free to fly. American Airlines, Southwest Airlines, and United Airlines are still putting their 737 MAX jets—74 in total—in the air. (So is Air Canada.) And the Federal Aviation Administration—the agency that oversees American airspace—says that’s just fine.

Which might seem strange, since the FAA is notoriously safety-conscious. Planes in search of an airworthiness certificate must meet stringent standards; the certification process usually takes years. And it gets results: Just one person has died in American airspace on a commercial airplane since 2009. But, it seems, the agency has not yet found reason to ground the new 737.

In a statement Tuesday, acting FAA administrator Daniel Elwell said the agency is looking at all the available data from 737 operators around the world, and that the review “thus far shows no systematic performance issues and provides no basis to order grounding aircraft.” Elwell said the FAA “would take immediate appropriate action” should such problems be identified. The FAA and the National Transportation Safety Board both have teams at the crash site outside Addis Ababa to investigate and collect data.

The agency did note in a directive published Monday that it would probably mandate flight control system enhancements that Boeing is already working on, come April. And after the Lion Air crash, the FAA made a Boeing safety warning mandatory for US airlines.

“We have full confidence in the safety of the 737 MAX,” Boeing said in its own statement Tuesday. “Based on the information currently available, we do not have any basis to issue new guidance to operators.”

A number of senators, including Ted Cruz of Texas, Elizabeth Warren of Massachusetts, and Dianne Feinstein of California, have called for the US to ground the aircraft. But it’s the FAA chief who has final say. (Elwell has been the acting administrator since January 2018, though Politico reports that the Trump Administration is close to nominating Delta Air Lines executive Steve Dickson as administrator.) He doesn’t make that decision alone, says Clint Balog, a flight test pilot and human factors expert with the College of Aeronautics at Embry-Riddle University. Any grounding goes through a “semi-formal” process, full of discussions with experts on the specific aircraft and crash situation, both in- and outside the federal government.

“The FAA looks at all of this information and decides, ‘OK, if it’s just likely that there’s a significant problem here, it doesn’t matter what the cost to the traveling public is—we have to put safety first and ground this aircraft,’” Balog says. “However, if they look and say, ‘Well, jeez, grounding this aircraft is going to be a monumental cost to the world and we simply don’t have enough information to know what the risk really is with this aircraft, do we really want to ground it at this point in time?’”

The FAA has grounded aircraft before. In 1979, the FAA grounded all McDonnell Douglas DC-10s (and forbid the aircraft from US airspace) after a crash in Chicago killed 273 people. An investigation found the problem was maintenance issues, not the aircraft design, the FAA lifted the prohibition just over a month later.

In early 2013, the FAA grounded Boeing’s 787 Dreamliner, after two lithium ion-battery related fires in the aircraft. “We are issuing this [directive] because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design,” the FAA wrote in its emergency airworthiness directive. It didn’t let the jet take to the sky again until Boeing found and corrected its design issues. (That happened in April.)

So far, though, we have little concrete information on whatever might be going on with the 737 MAX. The investigation into the Ethiopia crash is in its earliest stages. Indonesia’s civil aviation authority has released a preliminary report on the Lion Air crash, but has not issued any findings on what caused it.

Based on its directives, the FAA hasn’t “seen any red flags that are significant enough” to ground the aircraft, Balog says. So he’d have no problem getting on a 737 MAX-8. “More importantly, I would have no problem having my family get on a 737 MAX-8 at this point.”


More Great WIRED Stories

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Facebook Will Crack Down on Anti-Vaccine Content

As Clark County, Washington, combats an ongoing measles outbreak, Facebook announced Thursday that it’s diminishing the reach of anti-vaccine information on its platform. It will no longer allow it to be promoted through ads or recommendations, and will make it less prominent in search results. The social network will not take down anti-vaccine posts entirely, however. The company also said it was exploring ways to give users more context about vaccines from “expert organizations.”

The decision was widely anticipated: Facebook, along with YouTube and Amazon, has faced criticism from journalists and lawmakers in recent weeks for allowing vaccine misinformation to flourish on their sites. Facebook also told media outlets in February that it was looking into how it should address anti-vaccination content.

Last month, Adam Schiff, a Democratic representative from California, sent letters to the CEOs of YouTube and Facebook demanding they answer questions about the spread of anti-vaccine information on their company’s platforms. He followed up with a similar letter to Amazon CEO Jeff Bezos last week. On Wednesday, an 18-year-old from Ohio testified before the Senate that his mother primarily read misinformation about vaccines on Facebook and opted not to inoculate him. (A major study released Monday found no link between the MMR vaccine—which protects against measles, mumps, and rubella—and autism.)

In a blog post written by Monika Bickert, Facebook’s vice president of global policy management, Facebook said it will begin rejecting ads that include false information about vaccinations. The company also removed targeting categories such as “vaccine controversies” from its advertising tools. Last month, the Daily Beast reported that more than 150 anti-vaccine ads had been bought on Facebook, which often targeted women over 25. Some of the ads were shown to users “interested in pregnancy.” In total, they were viewed at least 1.6 million times. YouTube similarly announced last month that it would begin preventing ads from running on videos featuring anti-vaccine content.

Facebook will also reduce the ranking of pages and groups that spread misinformation about vaccines in search results and in its News Feed. In February, The Guardian found that anti-vaccination propaganda often ranked higher and outperformed accurate information from more reliable sources on Facebook.

The social network’s effort to fight vaccine disinformation extends to Instagram, where the company says it will stop recommending content that includes vaccine misinformation on the app’s Explore page. Instagram will also stop displaying vaccination misinformation in hashtag search results. It’s not clear how long these new controls will take to roll out: An Instagram search for #vaccine Thursday afternoon surfaced the hashtag #vaccineskill as the number one result, for instance. Last month, Pinterest received praise for its decision to stop displaying search results for vaccines entirely, even if they are medically accurate. (In 2017, Pinterest previously banned “anti-vaccination advice” from its platform.)

As The Atlantic has pointed out, the majority of anti-vaccination content on Facebook appears to originate from only a handful of fringe sources. It likely won’t require a herculean effort for Facebook to tackle this strain of misinformation. The question is why the company waited until it became the subject of media reports and criticism from lawmakers to finally act.

Facebook increased its efforts to fight false information more broadly on the platform in the wake of the 2016 presidential election, including with initiatives like third-party fact-checking. The company admits it won’t catch everything, and demonstrably fake stories still do go viral. While there is little public data about user behavior on Facebook, researchers have found signs that the reach of fake news declined between 2016 and 2018 midterm elections. (Though they also say there remains plenty to be concerned about when it comes to misinformation.)

It’s not yet clear whether the proliferation of anti-vaccination content online has led to a significant decrease in vaccination rates in the United States. Unscientific information about vaccines has been circulating on- and offline for well over a decade. But as Slate has pointed out, the number of children under 3 who have received their first dose of the MMR vaccination has remained steady for years, according to data from the Centers for Disease Control and Prevention. The World Health Organization named vaccine hesitancy one of its “ten threats to global health in 2019,” but cites “complacency and inconvenience in accessing vaccines” as two of the key reasons why people choose not to vaccinate, in addition to “lack of confidence.”

There’s still little doubt that social media platforms like Facebook, but also YouTube and Amazon, have indeed made anti-vaccination talking points more accessible to wider audiences. Its proponents were aided by recommendation and search ranking algorithms, which often promoted anti-vax content to the top of the pile. Facebook’s announcement today is further acknowledgment of its role in that ecosystem, and the idea that free speech is not the same as free reach.


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An Email Marketing Company Left 809 Million Records Exposed Online

By this point, you’ve hopefully gotten the message that your personal data can end up exposed in all sorts of unexpected internet backwaters. But increased awareness hasn’t slowed the problem. In fact, it’s only grown bigger—and more confounding.

Last week, security researchers Bob Diachenko and Vinny Troia discovered an unprotected, publicly accessible MongoDB database containing 150 gigabytes-worth of detailed, plaintext marketing data—including 763 million unique email addresses. The pair are going public with their findings today. The trove is not only massive but also unusual; it contains data about individual consumers as well as what appears to be “business intelligence data,” like employee and revenue figures from various companies. This diversity may stem from the information’s source. The database, owned by the “email validation” firm Verifications.io, was taken offline the same day Diachenko reported it to the company.

While you’ve likely never heard of them, validators play a crucial role in the email marketing industry. They don’t send out out marketing emails on their own behalf, or facilitate automated mass email campaigns. Instead, they vet a customer’s mailing list to ensure that the email addresses in it are valid and won’t bounce back. Some email marketing firms offer this mechanism in-house. But fully verifying that an email address works involves sending a message to the address and confirming that it was delivered—essentially spamming people. That means evading protections of internet service providers and platforms like Gmail. (There are less invasive ways to validate email addresses, but they have a tradeoff of false positives.) Mainstream email marketing firms often outsource this work rather than take on the risk of having their infrastructure blacklisted by spam filters, or lowering their online reputation scores.

“Companies have email lists and want to start emailing them, but they’re not sure how valid they are,” says Troia, who founded the firm Night Lion Security. “So they go to a company that will essentially send out spam. Troia speculates, but has not confirmed, that the database may be so large and varied because it comprises all of Verification.io’s customers’ data. WIRED was unable over the course of several days to contact the company or CEO Vlad Strelkov. On Monday, the entire Verifications.io website went offline and has not been restored since.

Record Setter

In general, the 809 million total records in the Verifications.io trove include standard information like names, email addresses, phone numbers, and physical addresses. But many also include things like gender, date of birth, personal mortgage amount, interest rate, Facebook, LinkedIn, and Instagram accounts associated with email addresses, and characterizations of people’s credit scores (like average, above average, and so on). Meanwhile, other records in the collection seem related to generating sales leads at businesses, including company names, annual revenue figures, fax numbers, company websites, and industry identifiers for categorizing companies called “SIC” and “NAIC” codes.

The data doesn’t contain Social Security numbers or credit card numbers, and the only passwords in the database are for Verifications.io’s own infrastructure. Overall, most of the data is publicly available from various sources, but when criminals can get their hands on troves of aggregated data, it makes it much easier for them to run new social engineering scams, or expand their target pool.

In the exposed database, the researchers also found evidence of test email accounts, hundreds of SMTP (email sending) servers, the text of emails, anti-spam evasion infrastructure, keywords to avoid, and IP addresses to blacklist. Diachenko suggests that in the Verifications.io work flow, customers would upload an Excel spreadsheet listing the email addresses to validate, and then Verifications.io would run their tests and return lists of clean addresses and ones that bounced back. It’s possible, given the piecemeal nature of the data and evidence that it was imported from numerous different Excel files, that Verifications.io also retained some or all of the data it received from customers after concluding its email address checks.

The researchers validated samples of the data with companies listed as Verifications.io customers. Troia says his own information appears in the database. WIRED spoke to the proprietor of an email marketing firm who confirmed the validity of a segment of the data. WIRED also checked for four individuals, but did not find them listed. Diachenko and Troia also note that they have no way to know whether anyone discovered and downloaded the Verifications.io data while it was publicly available and fully exposed.

“I have no idea if anyone else accessed this besides us,” Troia says. “But it was definitely out there for anyone to grab.”

‘Another Day on the Internet’

Much remains unknown about the database and Verifications.io, because the company is difficult to track. When the researchers initially contacted the company through a messaging portal on its site to disclose the database exposure, someone responded with an unsigned note. “Thank you for reporting the issue. We appreciate you reaching out and informing us,” the reply said. “This is our company database built with public information, not client data. We were able to quickly secure the database. Goes to show, even with 12 years of experience you can’t let your guard down.”

Much of the data in the database is publicly available, though it’s not clear that all of it is. When the researchers asked in the portal for the name of the owner of the company and the legal name of the company, someone wrote back declining to answer.

It is also unclear where Verifications.io is based. Most of its materials list Boca Raton, Florida, but some of its web assets are registered in California and Delaware. The Verifications.io website lists addresses in Estonia, but some of those matched up with what appear to be a museum and a government building.

Security researcher Troy Hunt is adding the Verifications.io data to his service HaveIBeenPwned, which helps people check whether their data has been compromised in data exposures and breaches. He says that 35 percent of the trove’s 763 million email addresses are new to the HaveIBeenPwned database. The Verifications.io data dump is also the second-largest ever added to HaveIBeenPwned in terms of number of email addresses, after the 773 million in the repository known as Collection 1, which was added earlier this year. Hunt says some of his own information is included in the Verifications.io exposure.

“The main takeaway for me is that this is just another case where someone has my data, and hundreds of millions of other people’s data, and I’ve absolutely no idea how they got it,” Hunt says. “I’d never heard of the company until now and I certainly can’t ever recall consenting to their use of my data. Of course, it’s entirely possible that buried in some other service’s terms and conditions it says they’re allowed to pass my data around in this fashion, but that’s not really consistent with my expectations of how my data should be used.”

As with recent data exposures from the business data aggregator Apollo and the marketing firm Exactis, there’s not a lot you can do to individually protect yourself when vast repositories of data compiled from both public and private sources leak. Check HaveIBeenPwned to see if your data was in the Verifications.io exposure, and continue your general vigilance about using strong, unique passwords, monitoring your financial statements, and giving out your Social Security number as infrequently as possible. But also know that none of those measures provide a full solution to this society-scale problem.

The disjointed nature of the exposed Verifications.io data speaks to the chaotic state of the data industry overall. People’s personal information is shared by massive companies like Facebook, bought and sold by shady marketers, or stolen from data giants and doomed to circulate endlessly in the purgatory of criminal forums. The churn makes it difficult for consumers to control who has their data and where it ends up. As Hunt puts it, “Sadly, it’s just another day on the internet.”


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Zuckerberg says Facebook's future is going big on private chats

SAN FRANCISCO (Reuters) – Facebook Inc Chief Executive Mark Zuckerberg said on Wednesday the company would encrypt conversations on more of its messaging services and make them compatible, the latest sign that the world’s biggest social network sees its future in intimate online chats.

Zuckerberg said in a post on his Facebook profile that within a few years direct messaging would dwarf discussion on the traditional, open platform of Facebook’s news feed, where public posts can go viral across the world.

“Working towards implementing end-to-end encryption for all private communications is the right thing to do,” Zuckerberg said. He cautioned that details of the plan could change as the company consults experts throughout 2019.

The strategy could frustrate law enforcement surveillance efforts as well as lawmakers who have called on Facebook to better moderate user content. It also would limit the company’s ability to generate revenue through targeted ads.

But Zuckerberg said he could live with those tradeoffs because users want better control of their data while still having easy access to their contacts.

As part of Zuckerberg’s strategy, a Facebook user would be able to communicate with WhatsApp users while only having a Messenger account and vice versa. Users would also have more options for how long chats are saved, he added.

“The future of communication will increasingly shift to private, encrypted services where people can be confident what they say to each other stays secure and their messages and content won’t stick around forever,” he said. “This is the future I hope we will help bring about.”

Facebook shares rose 0.7 percent on Wednesday. Shares in Snap Inc, which owns messaging app Snapchat, ended down more than 2 percent.

Zuckerberg acknowledged that the public may be skeptical about Facebook’s privacy push given the company does not have a “strong reputation for building privacy protective services.”

Lawmakers, users and investors have expressed concerns over the last two years that Facebook is not doing enough to safeguard user data after a series of breaches and privacy bugs.

But Zuckerberg wrote that “we’ve repeatedly shown that we can evolve to build the services that people really want.”

Facebook is one of the biggest global players in private messaging with its WhatsApp, Messenger and Instagram, each used by more than 1 billion people. Only WhatsApp fully secures message content from all outsiders, including Facebook itself.

Police have raised concerns about introducing similar security to the other services because they would no longer be able to access online chat records to track religious extremists or other perpetrators.

Regulators have called for Facebook to increase moderation of user content, but more encryption would make it difficult to view and track problematic posts.

Encrypted conversations also limit Facebook’s ability to send targeted advertisements. Facebook may need to look for new ways to insert itself between businesses and consumers to generate revenue.

Tencent Holdings Ltd’s WeChat app has shown how a messaging service can generate revenue through not only displaying ads, but also being a marketplace for games, merchandise and services such as taxi rides.

Facebook has encouraged messaging conversations between businesses and consumers since at least 2016 but has not disclosed its revenue from the efforts.

FILE PHOTO: Facebook CEO Mark Zuckerberg speaks at Facebook Inc’s annual F8 developers conference in San Jose, California, U.S. May 1, 2018. REUTERS/Stephen Lam

Zuckerberg said on Wednesday that “significant thought” still needs to go into integrating commerce into messaging.

James Cordwell, a financial analyst at Atlantic Equities, said Facebook’s strategy risks undercutting its current way of making money.

“But if they can pull off this WeChat-esque strategy,” he said, “it could open up material revenue streams beyond just advertising, something that investors have been craving for quite some time.”

Reporting by Peter Henderson and Paresh Dave in San Francisco and Akanksha Rana in Bangalore; editing by Meredith Mazzilli and Richard Chang

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Amazon to close U.S. pop-up stores, focus on opening more book stores

FILE PHOTO: The logo of Amazon is seen at the company logistics centre in Boves, France, August 8, 2018. REUTERS/Pascal Rossignol

(Reuters) – Amazon.com Inc will close all of its U.S. pop-up stores and focus instead on opening more book stores, a company spokesperson said on Wednesday.

The company’s shares closed down 1.4 percent, while shares of bookseller Barnes & Noble Inc ended 8.9 percent lower.

Amazon’s 87 pop-up stores in the United States are expected to close by the end of April, the Wall Street Journal reported earlier on Wednesday, citing some of the employees at the stores.

The news underscores how the online retailer is still working out its brick-and-mortar strategy.

Pop-up stores for years helped Amazon showcase novel products like its voice-controlled Echo speakers, but the company is now able to market those products and more at its larger chain of Whole Foods stores, acquired in 2017, and cashierless Amazon Go stores, which opened to the public last year.

The online retail giant will also open more “4-star stores” – stores that sell items rated 4-stars or higher by Amazon customers, the spokesperson added.

“After much review, we came to the decision to discontinue our pop-up kiosk program, and are instead expanding Amazon Books and Amazon 4-star, where we provide a more comprehensive customer experience and broader selection.”

Reporting by Uday Sampath in Bengaluru; Editing by Maju Samuel

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What’s the Weather Like on Mars? Now You Can Check

Think it’s cold where you are today? Trust us: It’s a lot worse on Mars.

While much of the nation is in the grips of a major winter storm that’s snarling air traffic, closing offices, and canceling school, Mars will likely only hit the single digits today, and plunge to -130 or below tonight.

Elon Musk might want to bring a heavy coat when he moves there.

NASA has begun making daily weather reports from Mars available to the general public, with data supplied from the Insight lander. It’s not exactly up to the minute (reports appear to be delayed by two or three days), but it’s a good way for weather enthusiasts to keep up with the meteorological comings and goings of the red planet.

The most recent readings, from Feb. 17, show a high of 2 degrees and a low of -138 degrees Fahrenheit. That’s a bit of a cold front, compared to six days prior when it got up a balmy 15 degrees. (By the way, with the average wind speed of 12 mph, that brings the wind chill range of Mars on Sunday to between -27 and -212 degrees Fahrenheit.)

More disturbing: That’s about as warm as it gets on Mars right now. The data is being gathered at Elysium Planitia, a flat, smooth plain near Mars’ equator.

InSight is gathering the data with a number of sensors that constantly monitor Martian weather data. (Days on Mars last 24 hours, 39 minutes and 35 seconds.) The reports will continue to be sent to earth for the next two years, giving scientists (and Martian meteorologists) a better understanding of weather patterns on the planet.

Researchers also hope to get a better understanding of storms on the planet, learning how much wind it takes to lift dust in the planet’s atmosphere.

“It gives you the sense of visiting an alien place,” said Don Banfield of Cornell University, in Ithaca, N.Y., who leads InSight’s weather science. “Mars has familiar atmospheric phenomena that are still quite different than those on Earth.”

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American Airlines Just Suffered a Huge Embarrassment. But Is It Really the Airline's Fault?

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

Frequent business flyers can be an insipid, self-regarding bunch.

They watch the masses troop to the back of the plane, sip on their champagne and smugly pat themselves on the back for their evident superiority.

Airlines pander to them, of course. They want their money on a repeat basis. 

Sometimes, though, you have to wonder what goes through fine minds of so-called Elites.

Last weekend saw the release of a video — posted to Twitter by travel blogger Jamie Larounis — that starrred four female American Airlines Flight Attendants.

They were in slightly more alluring Flight Attendant attire than that normally seen on board.

And they were performing a skit in which they fawned all over a First Class passenger. 

You know, um, sexily.

The organizers of this, oh, entertainment, reportedly were some Executive Platinum and Concierge Key customers. Yes, American’s most important passengers.

It was held at a private venue and was supposed to raise money for charity.

Some might be less than charitable on seeing that the performance featured a large American Airlines logo in the background.

It’s not clear who took this liberty, but American did offer a few items for auction at this event.

I feel fairly sure its brand image wasn’t one of them.

Perhaps this was all good clean, humorous insider fun for these privileged types.

The part, however, that may have caused a little more consternation was when the four female Flight Attendants began to dance — with alleged sexy intent — around a First Class passenger.

To heighten the steamy effect, they sang Big Spender.

Yes, of course a Flight Attendant ends up sitting on the customer’s lap. You needed to ask?

The song was first performed in 1966.

And goodness me, this skit wouldn’t have looked out of place then.

These days, however, it might reek to many of bilge-brained sexism.

The fawning Flight Attendants are, reports say, real Dallas-based American Airlines Flight Attendants.

Which led the The Association of Professional Flight Attendants — representing American’s Flight Attendants — to demand an investigation.

There was the suspicion, you see, that the airline had some involvement in all this.

The Transport Workers Union — which also represents many American Airlines employees — saw the invisible hand of American’s management in the show. It claims this is all part of the airline’s strategy: 

Destroy blue collar America and expose air travelers to potential disaster by fixing AA planes on foreign soil, while simultaneously sexualizing and degrading their own flight attendants.

Naturally, I contacted American to ask for its view. It offered me the contents of a memo it sent on Sunday to all its staff. It read, in part: 

This was not an American Airlines event. We did not have any say about the content of the event, nor did we preview any of the agenda. Additionally, we were particularly upset to see our logo on the screen as the skit was performed.

Well, indeed. American also said: “We are as upset as many of you are with the video.”

It didn’t, at least in this memo, specifically rail against its manifest sexism. (Its utter lack of actual humor might have deserved a mention, too.)

Larounis, at American’s request, removed the video. Sadly, thanks to the internet’s cloying immediacy, it soon proliferated far and wide.

Many will hiss and tut at those who performed in this abject display.

Somehow, though, I can’t help but consider those who laughed and applauded. 

Flying regularly in First Class may have its privileges. 

I wasn’t aware that permission to be a sad, myopic, dunderheaded Neaderthal was one of them. 

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With 4 Short Words, Amazon Just Revealed the Brutal Truth About Its Decision to Cancel HQ2 in New York. (So Many People Don't Want to Admit This)

It’s not a plan really, not a hidden secret message. It’s more of an expression of emotion. Maybe a realization of necessity.

In fact, while the text Amazon posted on its blog on February 14 runs 363 words, the most important part of this crucial passage is just four words long. But those four words speak volumes.

It starts with a dig at “state and local politicians” in New York, and a statement about how many New Yorkers supposedly supported the deal. Then, we get to the crucial part:

We are disappointed to have reached this conclusion–we love New York, its incomparable dynamism, people, and culture–and particularly the community of Long Island City, where we have gotten to know so many optimistic, forward-leaning community leaders, small business owners, and residents. 

There are currently over 5,000 Amazon employees in Brooklyn, Manhattan, and Staten Island, and we plan to continue growing these teams.

Those four crucial words? “We love New York.”

They’re not included by accident. In fact, I’ll bet this statement probably went through more writing, editing and rewriting than anything in Amazon’s history.

But the passage is crucial. It’s a recognition that even in a post-HQ2 world Amazon, still depends big time on New York. That’s why I think the company is at pains to reassure everyone that it isn’t going to try to just reopen the HQ2 search and do this elsewhere.

The brutal truth is: New York City is special.

I know people don’t like to admit this. I know that there are many trying to make political points, attacking union leaders and politicians who they say are to blame for Amazon running away.

But there is no other place truly like New York City, and Amazon isn’t really going to run — not completely. It’s not just chest-thumping; it comes down at least partly to sheer numbers. Here are three of them:

  • By far, New York is the largest city in America, with 8.6 million people–almost as big as the second, third, and fourth largest cities combined.
  • By far, it’s the largest metropolitan area: more than 20 million people. If it were its own state, it would be about as big as Florida — but much more densely packed.
  • By far, it has the largest GDP of any metro area, at at $1.7 trillion. That’s nearly 9 percent of the entire country.

Was it ever possible that Amazon would direct a personal insult at the largest and most important market in the country, by jilting it for say, Nashville? 

No offense to Nashville, the so-called runner-up. It’s a really great city too, but numbers don’t lie: it’s tiny compared to New York.

Remember, they just proved it at Amazon, too.

After staging a 14-month beauty contest, playing off more than 200 cities against each other, and keeping the terms secret so that none of them could know what they needed to do in order to win, the result was almost comically predictable:

Amazing n couldn’t do better than New York and an area right outside Washington, D.C. 

You know what I think’s going to happen now? Amazon is going to redistribute those 25,000 jobs around a lot of different places. (Remember, it was only planning to create 700 jobs this year, and wouldn’t hit the full number until 2028 at least.)

Now, New York will still get the largest share, only without having to give an average of $120,000 per job in tax breaks to get them.

And, it will make up the rest and still more–because Amazon just did the legwork for every other company in America.

Especially if the state and city can come up with anything even approaching a small percentage of the deal they were willing to give Amazon, and offer it to a wide array of smaller employers,  think things look pretty rosy.

No matter your size, and as long as you don’t try to squeeze completely one-sided terms out of the deal, if you want to attract amazing workers and expand in one of the greatest cities in the world, Amazon just proved where you should go. 

Amazon loves New York. And a lot of other people do too. 

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Before You Set Out to Transform Your Organization, You First Need to Build Trust

One of the most interesting aspects of the discussion was how crucial trust is for driving transformation and change. We tend to think of trust as static, but Accenture’s research, as well as that of the participants, made it clear that trust is especially important when you need to drive an organization to do something different.

All too often, transformation is seen as a simple matter of strategy and tactics, but nothing could be further from the truth. Nobody can drive really change alone, you need buy-in from a variety of stakeholders, such as customers, employees, suppliers, analysts and investors to make it work. So before you set out to transform your organization, you first need to build trust.

Purpose, Values and Constraints

Every change effort starts out with a grievance. Sales are down, customers are unhappy, regulation restricts a once profitable activity or something else. That’s what drives the need to change, but it does little to provide a will to change. In researching my book Cascades, I found that every successful change effort starts by transforming an initial grievance into an affirmative “vision of tomorrow.”  To drive a true transformation, people need to believe in it.

For example, when Paul O’Neill took over as CEO at Alcoa in 1987, the company was in dire straits. So analysts were more than surprised when he declared that his first priority at the company would be safety. It was an odd vision for a struggling company, but O’Neill understood that improving safety would also improve operational excellence. The company hit record profits a year later.

Or consider Lou Gerstner’s tenure at IBM. When he arrived, the once high-flying firm was near bankruptcy and many thought it should be broken up. Yet Gerstner saw that by shifting its focus from its own “stack of proprietary products” to its customers’ “stack of business processes,” the company could have a bright future. The result was one of the greatest turnarounds in history.

Notice how each of these visions also included important constraints. When safety is the first priority, managers can’t cut corners. When customers’ “stack of business processes” is the company’s focus, salespeople can’t wring every last dollar out of each deal. Yet those constraints are crucial in building credibility with key stakeholders, such as unions and customers.

Small Groups, Loosely Connected

Anybody who has ever been married or had kids knows how hard it can be to convince even one person about a significant decision. So it is somewhat puzzling that business leaders so often think they can convince thousands through mass communication campaigns. The truth is that change happens when people convince each other.

Consider the case of Wyeth Pharmaceuticals, which in 2007 saw sales for one of its top drugs fall by 70% due to the launch of a generic version. In order to compete more effectively, the company’s leadership embarked on an ambitious effort to instill lean manufacturing practices across 25 sites employing 17,000 people. 

Yet rather than try to transform the whole company all at once, it chose one keystone change, involving factory changeovers, at one facility. It had limited impact, but with the success of that one initiative at one facility, it then moved on to others, implementing the transformation in phases, speeding up as the process gained momentum.

The result was a 25% reduction in costs, an improvement in quality and a more motivated workforce. It’s tough to imagine how that could have been achieved if the management had simply decided to cut salaries instead.

Training to Empower Transformation

When Barry Libenson first arrived at Experian as Global CIO in 2015, he spent the first few months talking to customers and everywhere he went they were asking for the same thing: access to real-time data. That was much easier said than done, because it meant that he would have to shift from a traditional data infrastructure to the cloud, which would entail far more than just implementing new technologies.

“The organizational changes were pretty enormous,” Libenson told me. “For example, agile development requires far more collaboration than traditional waterfall development, so we need to physically reconfigure how people were organized. We also needed different skill sets in different places so that required more changes and so on.”

To spur these changes, the company identified high potential employees that it thought could help drive change. It also brought in outside partners to train them in agile development, so that they could train and coach others. Those employees then became centers of excellence and helped drive change even further throughout the organization.

“Building trust was crucial to making it all work,” Vijay Mehta, Chief Innovation Officer at the credit bureau stressed to me. “When you are trying to build an innovative, fail-fast culture, people need to trust that they won’t be penalized for being ambitious and failing. So that had to come from the top and be constantly pushed all the way down to make it all work.”

Transformation Is Always A Journey, Never A Destination

All too often, we see change through the lens of a specific objective. Paul O’Neill needed to return his company to operational excellence. Wyeth needed to cut costs to compete with generics. To provide its customers with the access to real-time data, Experian needed to shift its decades-old infrastructure to the cloud.

Yet change is never as easy as it first would seem, because the status quo has inertia on its side, which can be a powerful force in any enterprise. In fact, research by McKinsey has found that only 26% of transformational efforts succeed. The reason is that change is often narrowly construed as a series of procedures, a cost cutting target or a technology implementation project.

Yet Alcoa, Wyeth and Experian succeeded where most fail because they saw driving change as more than just a series of objectives, but as a shift in values, skills and capabilities. That’s why they started not with a detailed plan, but with building trust, because leaders can’t implement change, they can only inspire and empower it.

The truth is that transformation is always a journey, never a destination. O’Neil’s focus on safety unlocked a passion for operational excellence. Gerstner’s focus on IBM’s customers led it to a highly profitable service business based on deep partnerships. Wyeth’s lean manufacturing program empowered its employees to create value for the company and its customers. Experian’s shift to the cloud was just a prelude to an ambitious foray into artificial intelligence.

None of this would be possible without trust, because trust is open ended. It is, in its essence, a social contract that demands that employees, customers and other stakeholders are not treated as merely means to an end, but ends in themselves.

(Disclosure: In the past, Experian has paid for me to appear at its annual conference and travel to speak to its executives)

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It's Time For Social Media to Change the World (Again)

In the summer of 2007, soon after a college intern convinced me to join Facebook, I remember thinking, “This is going to change everything. This is going to change the world.”

Facebook, Twitter, LinkedIn, Snapchat, and other social networks, blogs, and interactive online media have undoubtedly impacted billions of people over the past 12 years. Social media has helped topple dictatorships and given a voice to many millions of people previously unheard. It has reunited families, reconnected old friends, and rekindled romances. It has created opportunities for a massive number of small business owners, authors, and entrepreneurs. My wife and I are two of those people.  

But there has also been a dark side to the last 12 years of social media: Cyber-bullying, negative headlines, data and security breaches, Russian interference in elections, impact on mental health,–the list of harmful elements of social media, sadly, goes on and on.

Whether you log on and see someone complaining about something small, like how boring a tv show was last night, or something big, like how toxic our current political environment is, it’s impossible to use social media these days without constant exposure to negativity.

Forty-one percent of Generation Z social media users recently said that social media makes them feel sad, anxious, or depressed. A 2017 study found that the more time 18-22-year-olds spent on social media per day, “the greater the association with anxiety symptoms.” Disinformation Twitter accounts continue to publish more than a million tweets per day. The majority of teens have come across racist or sexist hate speech on social media. Nearly 43% of teens have been bullied online, and 41% of all Americans have experienced online harassment. The data is all startling, but we don’t need the data to know how we feel when we log in and check our feeds.

What then can we do to combat the negativity? Could we all quit social media? No, in 2019, social media is an unavoidable part of our lives, for better or for worse. We could put the responsibility in the hands of the social media companies themselves, but they haven’t exactly proven trustworthy lately. So really, the only thing we can do is to change our individual behavior. And it starts with small acts of kindness that will have a ripple effect.

Here’s one idea: #BeLikeableDay, a global movement which asks people and organizations to pledge to take one minute out of the day on February 26th to commit to an act of kindness on social media. Compliment a friend on their outfit on Instagram, share gratitude for a neighbor on Facebook, or leave an unsolicited recommendation for a colleague on LinkedIn. Re-tweet a charitable cause on Twitter, or simply say something nice on the social network of your choice.

Together, one person and one act of kindness at a time, we can start to make social media a more positive place to spend our time, first, on February 26th, and then, maybe eventually, every day. And here’s the good news: Online acts of kindness don’t just change the world of social media for the better, they change you for the better.

recent study by Yale and UCLA researchers suggest that performing small, kind gestures diffuses stress and improves mental health. In a Berkeley study, participants reported greater feelings of calmness and increased self-esteem after helping others. Committing acts of kindness even lowers your blood pressure: According to Dr. David R. Hamilton, author of The 5 Side Effects of Kindness, acts of kindness release the hormone oxytocin. Oxytocin causes the release of nitric oxide, which in turn reduces your blood pressure. Yes, there is science to being nice online! 

So, instead of complaining about all of the negativity and toxicity of social media, and making it even more negative, how about choosing positivity on social media, on #BeLikeableDay and every day? You might improve your mood. You might even change the world.

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What Happens When Techno-Utopians Actually Run a Country

On the night of Italy’s 2013 parliamentary elections, Paola Nugnes decided to stay late at her office and catch up on work. She skipped the rolling election coverage on TV. And by the time she finally left her architecture studio to go out, it was well past dark.

When she arrived at Mumble Rumble, a nightclub in western Naples, at around 9 pm, Nugnes still hadn’t checked the news. The club was hosting a party for activists in a political movement Nugnes had been part of for the past six years. And as she walked in, the crowd erupted. Nugnes asked if her friend Roberto Fico, the most famous local figure in the group, had won his race for a seat in Parliament. But before anyone could answer, a pack of journalists pounced, thrusting microphones in her face: “How do you feel about being elected?”

Nugnes stared at them, dumbfounded. That’s how she found out she was now a senator.

Along with hundreds of other political rookies, Nugnes had run for office under the banner of something called Five Star, an online phenomenon whose explosive, organic rise was shocking even to those it had just swept into power.

Just a few years before, in the mid-2000s, the movement had been little more than the fan base of a blog fronted by a foulmouthed comedian, Beppe Grillo; from there it became an earnest protest movement organized around Meetup.com groups called Friends of Grillo; then it had unified under the name Five Star in 2009. The movement tapped deeply into one of the most powerful forces in Italian politics: disgust with Italian politics. Rather than offer an ideology or platform, Five Star offered a wholesale rebuke of the country’s entrenched, highly paid, careerist political class—left, right, and center. And it married that disdain to a grand techno-utopian project: Through an online voting and debate portal, Five Star was building a direct democracy on the internet. The long-term goal was to replace Parliament altogether—to automate it out of existence. But in the meantime, Five Star had also decided to displace the establishment seat by seat.

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The 2013 election was Five Star’s first foray into national politics. While a handful of its candidates were expected to win their races, Nugnes highly doubted she would be one of them; she barely gave it a thought, in fact. So Nugnes had worked through the evening, while the rest of the country reeled from the news that Five Star was now Italy’s second-biggest party, having swept 25 percent of the vote, upending the political establishment in a single stroke.

Amid the whirl of embraces and congratulations at the election night party, Nugnes struggled to think through the ramifications. “We were all very excited—and frightened,” she says. She would have to quit her architecture studio. “It was very traumatic,” she says.

A couple hours’ drive up the coast, near Rome, Elena Fattori, a molecular biologist who was also active in Five Star, faced a similar bout of disbelief that night. “I had taken it all very lightly,” she says of her run for the senate—so much so that she volun­teered to help supervise the vote count that day. As she watched the running tally, Fattori could see firsthand that Five Star was far exceeding expectations and, eventually, that she herself had been elected. “It was a shock,” Fattori tells me. “I took a couple of days to accept it.”

All told, some 160 Five Star candidates with virtually no experience in politics became members of Parliament that day. This put the movement in an awkward position. Governments in Italy are normally formed via alliances between two or more parties that can command a majority of seats in Parliament; Five Star had won so many seats that it had the option of going straight into a governing coalition with the first-placed bloc, led by the center-left Democratic Party. But that was out of the question: One of Five Star’s founding principles was “no alliances.” And besides, the movement saw the Democratic Party as central to the corrupt establishment it had sworn to fight. So Five Star went into opposition.

While Five Star sees itself as neither right- nor left-wing, much of the party’s base is left-leaning. Many of its voters and activists, including Fattori and Nugnes, were drawn to the movement after becoming disenchanted with the Democrats and other parties on the left. Nugnes, a woman with Marxist sympathies, had grown alienated from Italy’s communist parties, which she viewed as ailing, top-down institutions. “I felt like an orphan,” she recalls. Five Star, by contrast, was a “cultural revolution,” a horizontal movement that put governing directly in the hands of anyone who cared to log on.

To the extent that Five Star did have a political platform, it vaguely resembled that of a Green Party. The movement’s name ostensibly refers to its first five policy priorities: sustainable transportation, sustainable development, public water, universal internet access, and environ­mentalism. Nugnes was particularly attracted to the movement’s more recent flagship policy, a universal basic income that proposed a monthly stipend of 780 euros (a bit less than $900) for Italy’s poorest citizens. In short: While the movement had always included people across the political spectrum, it was easily taken for a progressive popular front.

But if Nugnes and Fattori were shocked to become elected members of government, the next few years would be even more vertiginous. As the movement’s fledgling nonpoliticians found their feet in Parliament, they realized that dealing with other parties was unavoidable. At times, in opposing the Democratic Party–led government, Five Star found itself siding with another faction defined by antiestablishment roots—a right-wing populist party called Lega, or the League. Lega’s nativist leader, Matteo Salvini, had long campaigned on an “Italians first” platform. He has said that his country needs a “mass cleansing” of illegal immigrants, “street by street, district by district, piazza by piazza.”

When Italy’s 2018 national elections came around, Five Star—whose emphasis on popular sovereignty had, at times, come to sound sympatico with anti-EU, anti-immigrant sentiment—won so many seats that it became the largest party in Italy. This time, the movement didn’t shy from stepping up to run the country. And it chose to do so in partnership with Salvini’s Lega.

Last September, Stephen K. Bannon, former chief strategist to Donald Trump and would-be pied piper to Europe’s ethno-nationalists, visited Rome to celebrate the alliance. Of all the countries he had visited in his recent travels, he singled out Italy as “the center of the political universe.” The new government there was a Bannonite dream come true: a left-right, antiestablishment coalition. “A populist party with nationalist tendencies like the Five Stars, and a nationalist party with populist tendencies like the League,” he enthused to Politico’s European edition. “It’s imperative that this works, because this shows a model for industrial democracies from the US to Asia.”

While Bannon gushed, members of Five Star like Nugnes and Fattori reeled at where their movement had ended up: tied to a party led by a man many of them regarded as a fascist.

They were also beginning to realize that Five Star’s evolution had never been as organic as it seemed. At every step along the way—from the creation of Grillo’s blog and the organization of the movement’s first mass protests to the construction of its direct-democracy platform, all the way to its recent turn toward nativist politics—Five Star’s course had been meticulously directed by a camera-shy cyber-­utopian named Gianroberto Casaleggio, the movement’s cofounder.

Casaleggio, who died of brain cancer in 2016, was, in some ways, a familiar type. In the 1990s and early 2000s, he and a slew of other Internet Age prophets—many of them writing in this magazine—foretold a digital revolution that would flatten the priesthoods of politics, government, and journalism, and replace them with decentralized webs of direct participation. But Casaleggio, unlike his fellow pundits, actually went on to mount a revolutionary force that took over a country. Not only that, he directed this supposedly leaderless movement while drawing barely any attention to himself. So here’s the mystery at the heart of Five Star: Who the hell was Gianroberto Casaleggio—and how did he do it?


The Faces of Five Star

The small city of Ivrea sits cradled in the foothills of the Italian Alps, 30 miles south of the Swiss border. An 18th-century bridge over the Dora Baltea river leads to a quaint historic downtown of cobbled streets and pastel-colored buildings. But in the 1970s, Ivrea was Italy’s answer to Silicon Valley. It was the hometown of Olivetti, an icon of postwar European design, electronics, and manufacturing. The company’s most famous devices—its portable typewriters—were the Apple products of their day, technological fetish objects that were coveted around the world. In the early days of the computer industry, Olivetti was one of the few European contenders for market dominance; in 1965, it released the world’s first device marketed commercially as a “desktop computer.”

The young Gianroberto Casaleggio was one of Olivetti’s software designers. A local with a long mane of frizzy hair, he had studied physics in college before dropping out and turning to computers. He ended up in a small office on a quiet lane developing Olivetti’s operating systems. Enrica Zublena, an engineer who worked next to Casaleggio for many years, remembers their early days at the company as an exciting time. “We thought we could become a reference point for the evolution of basic IT around the world,” Zublena says.

Olivetti was a heady place to work in other ways as well, especially for anyone prone to utopian thinking. Adriano Olivetti, the late owner and general manager of the firm, had run his company as a kind of philosopher-­CEO. He built futuristic factories and living complexes for his workers in Ivrea and advocated a “third way” between right and left sociopolitical thinking; he started his own political movement—a fusion of liberalism, socialism, and local self-determinism—which took him all the way to Parliament. He also wrote books expounding on his views. In one, Democracy Without Political Parties, he argued that technology should be used to hand the mechanics of politics back to citizens.

Casaleggio shared Olivetti’s interest in the transformative potential of computing. “We saw the birth of the client-server model in IT,” Zublena says—the emergence of systems that distribute tasks among many computers in a network, allowing distant nodes to cooperate. “It brought a level of decisionmaking freedom to the periphery.” It seemed inevitable to Casaleggio that such architectures would change everything in society.

By the 1990s, Casaleggio was running his own company, and it was his turn to play philosopher-­CEO. The firm, which was eventually called Webegg, quickly became one of the leading internet consulting outfits in Italy, doing a brisk business helping older firms to find “web-based solutions” and other­wise navigate the bewildering world of bits, messaging software, and online marketing. “It was the time of the first call centers, the first internet banking,” says Zublena, who followed her colleague to Webegg. But Casaleggio was impatient to explore the grander implications of the internet.

In a monthly column for a magazine called Web Marketing Tools, he inveighed against the drabness of most thinking about the web. “The net has been reduced to an instrument of financial speculation and marketing,” he wrote, but its true significance was as a force for “radical social and revolutionary change.” Perhaps most of all, Casaleggio was interested in how the internet would transform organizations from the inside. Accordingly, he turned Webegg into a laboratory for sometimes bizarre social experimentation.

Throughout his career, Casaleggio liked to give extraordinary responsibilities to his youngest, most talented, and most impressionable recruits. One such hire at Webegg was a Bolognese engineer named Carlo Baffè. When he arrived fresh out of school in 1997, Baffè was promptly handed the reins to one of the company’s biggest projects. “Don’t worry,” Casaleggio reassured him. “Napoleon invaded Italy when he was 26.” About a year later, Baffè got another call. “I have this new special project in mind,” Casaleggio told him. “Would you like to join?” Baffè accepted eagerly. He went to the company’s Milan headquarters and, in a meeting room near Casaleggio’s office, sat at a circular table with the CEO and four other young, excited employees, all from different parts of the firm.

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Casaleggio explained that the aim of this new project was to experiment with communication dynamics on the company’s intranet. Casaleggio would select topics from the firm’s internal forum and assign members of the group specific roles to play in each discussion. Say he wanted a forum debate to reach conclusion X: One member of the restricted group would suggest X, a second would argue for contradictory conclusion Y, and over time a third would post a variation on X—and so on, subtly driving the rest of the unwitting employees toward the preordained conclusion. Baffè and the other experimenters worked a few hours a week on the project and met with Casaleggio once a month to evaluate progress.

The original stated aim of the project was to observe how internal electronic communications worked, and then to sell the findings as a consulting service. But the experiment also had more far-reaching implications, Baffè realized. Casaleggio was interested in learning how consensus—on, say, whether people should be happy to work long hours—could be manufactured in a way that looked organic. Twenty years before trolls working for Russia’s Internet Research Agency would use similar techniques to steer debate on Facebook and other online forums, Casaleggio seemed to be using his own company as a laboratory to figure out how online discourse could be guided from above. “I’d just started working and was excited to be part of a project like that,” Baffè says. It wasn’t until years later, he says, that he “realized it was the beginning of a long-term experiment.”

The intranet study group was only one such special project. Baffè was also invited to join another select group of about 20 employees who were given advanced communications training, grounded in something called neuro-linguistic programming.

A new-age therapeutic phenomenon, NLP purportedly offers a means to influence people by surreptitiously tapping into the unconscious patterns that guide their behavior. Practitioners are taught that people can be “reprogrammed” —to shed a phobia, say, or desire a product—with relative ease. “It taught us how to classify people,” Baffè says: By identifying which kinds of metaphors a client favored, employees at Webegg could aim to “mirror” that client, making them more susceptible to the company’s message. The sessions also focused on the teachings of an American hypnotherapist named Milton H. Erickson, who likewise made extraordinary claims about the suggestibility of the unconscious mind. By subtly confusing and unsettling his patients, Erickson claimed that he could induce them into trance states that made them more pliable. (NLP is popular among sales gurus and with the modern pickup artist community, but psychologists tend to regard it as a pseudoscience.)

The monthly sessions were led by two psychologists, a man and a woman, and they were a bit like “group therapy,” Baffè says. Employees were encouraged to air their feelings. At first, Baffè was thrilled to take part. But gradually his enthusiasm waned as he began to wonder who, exactly, was being influenced. The psychologists were seemingly omnipresent in the Webegg offices, where they appeared to be keeping tabs on staff for Casaleggio. “I’m sure he controlled every single detail of their activity,” Baffè says. (WIRED spoke to one of the psychologists, who confirmed that she had worked with Webegg and called Casaleggio a “true visionary” but declined to be interviewed.)

In practice, Casaleggio’s intranet discussions, group sessions, and psychological interventions often seemed to be a means of bypassing directors and team leaders—the firm’s middlemen—to exert maximal influence over his staff. “The channel is direct between the boss and every employee,” Baffè says. Increasingly, the young engineer started to see Casaleggio as an “evil scientist.”

This impression was reinforced by his boss’s increasingly eccentric behavior. During the Y2K panic, Casaleggio printed out a “decalogue”—a set of 10 commandments—telling employees what to do if civilization collapsed. He wrote a magazine column praising Genghis Khan’s (apocryphal) practice of murdering his generals at random as an effective means of keeping subordinates and intermediaries on their toes. Khan, he wrote, “became the greatest conqueror in history with the application of techniques and principles that are necessary today to compete on the web.”

But even as he praised Khan’s absolute rule, Casaleggio also extolled the absolute power that masses of people would have over their leaders in the internet era. In a 2001 book entitled The Web Is Dead, Long Live the Web, Casaleggio described how technology would force governments to become completely transparent and accountable to the will of the people. “Referenda on topics of national importance will become as routine as reading the papers or the evening news,” he wrote. “The interactive leader will then be the new politician, someone who continually transforms the wishes of public opinion into reality. This new politician will not need interpretation by today’s media, which will thus lose their importance.”

Like any number of cyber-­utopians writing in places like WIRED—several of whose writers he cited in his work—Casaleggio repeatedly predicted the imminent demise of journalism. He held that in a few years, information would become a utility, like electricity or water, pervading people’s daily lives; it would replace the current “virtual reality” that the press had constructed for them, “the Matrix that surrounds us.”

To his point, the media Matrix in Italy was exceptionally claustrophobic: In 2001, the scandal-prone media tycoon Silvio Berlusconi had just begun his second term as prime minister; not only did he own the biggest commercial television network, he also dominated the state broadcaster, RAI.

While Casaleggio was busy peering into the future, he was neglecting more run-of-the-mill sources of revenue that Webegg needed to turn a profit. “He put all the best people on the new stuff that was very sexy for him,” Baffè says. But the company’s core business foundered. “At some point,” Baffè says, “his ego took over.”

Amid mounting financial losses, Casaleggio was forced out in 2003 by the company’s main shareholder, Telecom Italia. Webegg closed shortly thereafter. Casaleggio had the contacts and experience to remain a player in the Italian tech industry, but by then his interest in the early internet was pivoting from business to another arena: politics.

Even those who knew Casaleggio well (but who perhaps didn’t read his books closely) were surprised by the sudden turn. Zublena remembers telling him, “But Gianroberto, you’ve never been remotely interested in politics!” In response, the usually taciturn Casaleggio burst out laughing, exposing the boyish gap between his front two teeth. “Come on,” she persisted, “with all the things in the world, you’re going into politics?” But Casaleggio only laughed and kept his reasons to himself.

Edoardo Narduzzi, who had known Casaleggio since 1998 and served as a Webegg board member, thinks Casaleggio saw “an interesting space” in Italian politics, ripe for testing out his ideas for a web-based, bottom-up movement—“a political startup.” It all began with a simple punt. In 2004, Casaleggio ran as an independent candidate in his home village, near Ivrea. Out of 294 votes cast for a seat on a local council, Casaleggio won just six. That didn’t mean he would give up. All he needed was a front man.

As Italy’s top barnstorming comedian, Beppe Grillo was accustomed to overzealous fans. But none made an impression like the visitor who came to see him one night in April 2004. After a show in the coastal city of Livorno, Gianroberto Casaleggio appeared at Grillo’s dressing room door and introduced himself as a web entrepreneur. But with his shock of wild gray hair, John Lennon glasses, and quiet intensity, Grillo recalls, he seemed more like an “evil genius.”

Grillo recounts this first meeting in a preface he wrote for Casaleggio’s next book, Web Ergo Sum. “He explained webcasting to me, direct democracy, chatterbots, wiki, downshifting, usability, objects of digital interaction, social networks, Reed’s law, intranets, and copyleft,” Grillo recalled. He likened Casaleggio to the medieval radical Saint Francis of Assisi, but “instead of talking to wolves and to the birds, he spoke to the internet.”

The comedian was initially wary: “Everything was clear,” Grillo wrote, “he was a madman.” But Casaleggio’s madness was one that envisioned a better future thanks to the web: companies made democratic, the end of political intermediation, and the devolution of power down to the individual. Before long, Grillo fell under Casaleggio’s spell—which was remarkable, given that Grillo had famously long been a technophobe. For a time, he had been known for smashing computers with a sledgehammer during his act.

Casaleggio offered to build Grillo a blog. The comedian was a household name in Italy, but he’d been sacked from state television in the 1980s after making an off-color joke about corruption in the then-­Socialist government. Now Casaleggio was offering him a new route to a mass audience and a way out of endless theater tours: the internet. “We’re going to become one of the three top blogs in the world,” Casaleggio promised. And so began a partnership that would transform Italian politics.

On January 26, 2005, nine months after Casaleggio’s visit to Grillo’s dressing room in Livorno, the blog, beppegrillo.it, went live. It was, at the start, a simple black and white affair, firing out a post or two a day. The few tabs listed tour dates, information on Grillo’s latest show—fairly typical elements of a fan page. But another tab, labeled “How to Use the Blog,” gestured at something more grand and open-ended. “Beppe Grillo’s blog is an open space at your disposal,” the page explained. “Its usefulness depends on your collaboration; for this reason, you are the real and only person responsible for the content and its fate.”

Grillo’s first posts were short and snappy. “Is there any sense in still speaking of right, or left, or center?” ranted one. “We don’t need a leader, we are adults!” Within months, the number of commenters on any given post had mushroomed into the hundreds, and soon thousands. Posts became ever more detailed and elaborate, with embedded video, images, and cartoons. Video and phone interviews with intellectuals brought in the likes of economist Joseph Stiglitz, Italian playwright Dario Fo, and Noam Chomsky. The blog hosted articles and letters by other writers; it started to seem more like a cultural institution than a comedian’s promo page.

Today, when the most prominent members of Five Star think back to what got them hooked on beppe­grillo.it, most of them describe how it provided a compelling source of alternative information: a rival to the traditional, Berlusconi-­dominated media. Alessandro Di Battista was a young university graduate in music and performing arts when he started frequenting the site. “I read in Beppe’s blog what I’d always wanted to read in the newspapers, but that you could never find,” Di Battista says. Grillo’s blog dealt in “counter­information,” as Di Battista calls it, “taking political positions that seemed to me fundamental but that no one else had the courage to take.”

Beginning that first year, Grillo and Casaleggio also used the blog to push their readers toward political action. They launched initiatives like Parlamento Pulito, or “Clean Parliament,” an email-­writing campaign to protest the number of elected officials in Italy with criminal convictions. And in July 2005, six months after the website’s launch, a blog post announced a new group on Meetup called Friends of Beppe Grillo, through which readers could arrange to meet, discuss, and “transform a virtual debate into a moment of change.”

Several such groups instantly popped up around the country, including one in Naples started by a recent communications graduate named Roberto Fico. “Within two months, there were almost 300 members,” Fico says. The young Fico poured all of his spare time into the burgeoning Friends of Grillo movement as he cycled through jobs in PR, tourism, and at a call center. “As soon as I finished work, I’d go to the meetings, the demonstrations,” he says. Thanks in part to his group’s activism, in 2006 a local Democratic Party water privatization scheme was successfully blocked. “The point,” Fico says, “was that it was political, but outside the institutions.”

In addition to commenting on posts and joining Meetup groups, beppegrillo.it also urged its readers to start their own blogs. One such fan turned blogger was a young college dropout named Marco Canestrari. In September 2006, the unemployed Canestrari happened to meet Casaleggio at an event; he had no idea who the older man was. But Casaleggio told him, “I know you who you are; I follow your blog.” Shortly thereafter, Casaleggio offered Canestrari a job at his new internet consulting firm, Casaleggio Associates. Canestrari, 23, could hardly believe his luck: “That was my first job, actually.”

Based in an exclusive neighborhood in Milan, Casaleggio Associates employed about 10 people at the time—most of them former employees of Webegg. The young Canestrari found his new boss “very clever, interesting, and exciting,” an avid reader of history, comics, and science fiction, particularly the novels of Isaac Asimov. Despite their age gap, Canestrari and Casaleggio, then in his fifties, formed a close rapport, with Casaleggio often expounding on his views about the web and the future. “He basically talked about that all day, all the time,” says Canestrari, one of the few people Casaleggio took into confidence.

Within a short time, Casaleggio—in keeping with his habit of delegating large tasks to unformed young men—made Canestrari a manager of beppegrillo.it. After just three years, Grillo’s page was already the most popular site on the Italian internet and one of the 10 most-read blogs in the world. But the fact that most astounded Canestrari as he took up his new position was this: “Grillo never wrote a single word on the blog,” he says.

Grillo and Casaleggio would speak several times a day to discuss the contents of the daily posts, and Casaleggio might read out the final draft to Grillo over the phone, says Filippo Pittarello, another employee who helped to produce the site. But according to multiple sources, it was Casaleggio, not Grillo, who actually wrote the hottest blog in Italy.

Just like the page’s millions of readers, Canestrari had no inkling of this before coming to work for Casaleggio. Far from feeling hoodwinked, he was thrilled to see behind the curtain. At Casaleggio’s side, he would get to play a vital role in a political revolution.

In 2007, the staff at Casaleggio Associates celebrated the millionth comment on beppegrillo.it. Casaleggio spent whole days reading the comments, according to Canestrari and Pittarello, and he recognized a lot of the commenters, especially the more active ones. He thought that, through the blog, he was seeing into the belly of Italy—what its people really thought and felt. And what he noticed was anger.

Casaleggio had recently watched V for Vendetta, a 2005 dystopian futuristic thriller. (Tagline: “People should not be afraid of their governments. Governments should be afraid of their people.”) In the film, Britain is ruled by a fascist dictatorship; one night, a lone insurgent wearing a Guy Fawkes mask hacks into a state-controlled news broadcast and tells the people of Britain to meet him outside Parliament in exactly one year, setting in motion the end of the regime. Inspired by the movie, Casaleggio wrote a late-night post, published under Grillo’s name, on June 14, 2007. Beneath a picture of a Guy Fawkes mask, Casaleggio summoned all of Grillo’s readers to gather in person for something called Vaffanculo Day, or “Fuck Off Day,” in three months’ time—a mass collective middle finger to the political establishment.

The morning after writing the post, on his way to the office, Casaleggio reportedly called and told his son, Davide—who was also a young employee at Casaleggio Associates—to gather the rest of the staff for a breakfast meeting downstairs. “We have to do something big,” Casaleggio told the group, according to a book that Canestrari later cowrote about the origins of Five Star, called Supernova. “The anger is rising, and if we don’t let it vent in some way, it’ll die out.”

The ostensible purpose of V Day would be to ratchet up the Parlamento Pulito campaign. The goal: to collect signatures to force a law that would limit elected representatives to two terms and ban candidates with criminal convictions. But the deeper purpose was to muster a show of force—to demonstrate that the movement wasn’t just a virtual phenomenon.

Canestrari worked day and night over the next three months, coordinating with Friends of Grillo Meetup groups to mobilize them. Casaleggio called every contact he had. The Italian web fizzed with anticipation; the national press was silent. The day before V Day, Canestrari and Pittarello drove down from Milan to Bologna, where a giant stage was being set up in the city’s main plaza.

By the afternoon of V Day, September 8, 2007, the square had swollen with a crowd of about 50,000 people. All around Italy, in some 200 squares, other crowds were massing too. In Naples, people started lining up at 9 am to sign petitions, says Fico, who ran the signature-collecting campaign in his home city. “We couldn’t believe our eyes.”

When Grillo got to the microphone in Bologna at around 4:30 pm, he took in the crowd, visibly shaken. It was enormous. “Boh … what have we done?” he finally said, teetering around the stage and shaking his head in disbelief. Gathering himself, he launched into a typically throat-tearing tirade against Italy’s ruling elite.

The success of V Day was thrilling. Two million people had turned out across the country; 350,000 signatures were gathered for the Parlamento Pulito. And it had all been meticulously planned by Casaleggio Associates. “The entire company was there that day,” Canestrari says. Yes, the grassroots Meetup groups had been in charge of collecting signatures, “but everything else—everything else—was organized by us.” And if anyone asked who Canestrari and his colleagues were? “We called ourselves the ‘Beppe Grillo staff,’ so nobody knew.” The vast majority of people in the movement had no idea that Casaleggio or his consulting firm even existed. “Grillo has always been the front man, and he knew that,” Canestrari says. “And it was fun for him. But he never made a real decision about anything.”

Hoping to channel the energy of V Day, Friends of Grillo groups around the country started to talk about putting some of their members forward as independent candidates in local elections. Paola Nugnes ran for a seat in the regional senate of Campania. Roberto Fico ran for the presidency of the same region. Alessandro Di Battista ran in municipal elections in his native Rome. The idea was that, even with just a few elected officials at the lowest levels, the movement’s “counterinformation” would inexorably seep into town and regional governments.

With this turn toward electoral politics, Casaleggio told Canestrari to start developing an online platform to unify the disparate Meetup groups: a single web portal with a forum. Casaleggio also wanted to give some shape to the movement’s politics. “Let’s set some rules,” he said. Friends of Grillo members elected to office would have to observe a two-term limit. No candidates with criminal convictions were allowed, nor were those who had ever sought election under another party. Just a few fixed principles, Casaleggio said, like Asimov’s three laws of robotics.

The rules offered insurance that the movement’s politicians would be amateurs, not careerists. They also ensured that Grillo could never run for office in his own movement: He had been convicted of manslaughter in 1981 after a tragic car accident.

The Friends of Grillo barely made a showing in those early local elections; many candidates, including Fico and Di Battista, failed to get more than 1 or 2 percent of the vote. But their careers in politics were far from over. On October 4, 2009—as the global economic crisis began to pummel Italy, setting off a decade of malaise and widespread youth unemployment—the Five Star Movement was officially launched in a packed theater in Milan. From the stage, Grillo said they were starting the party because no one was listening to them, but he admitted that he wasn’t sure what they were doing or where they were going. Casaleggio, however, knew exactly where they were headed: Rome.

A Five Star demonstration in Rome in 2013, shortly after the movement sent 163 of its members to serve in Italy’s Parliament.

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Five Star’s attempts at competing in local and regional politics in the next few years were fairly undistinguished. The party did well in Sicily’s regional vote in October 2012, after Grillo, 64, swam to the island from mainland Italy in a media stunt. (A life-jacketed Casaleggio followed by boat.) But ahead of 2013’s general election, the movement’s huge slate of candidates was barely polling in the double digits.

No one was prepared, in other words, when Five Star stormed into Italy’s Parliament with 25 percent of the vote in February 2013. Casaleggio suddenly found himself an object of morbid public fascination. The Italian press was relentless in its scrutiny—and its derision—of the bizarre-­looking web entrepreneur turning Italian politics on its head.

The papers often described Casaleggio as Grillo’s “guru.” The business daily Il Sole 24 Ore wrote that Casaleggio ran Five Star “like the cult of Genghis Khan.” Il Giornale, a newspaper owned by the Berlusconi family, mocked a 2008 video that Casaleggio had made as the ravings of a crank. (The short animated film, which refers darkly to the Masons and the Bilderberg Group, envisions an apocalyptic world war that will usher in a single, global direct democracy, administered by Google.) “I will never forget how they treated him,” says Alessandro Di Battista, who’d just been elected to the lower house.

At the same time, 163 brand-new, almost wholly inexperienced Five Star MPs also came under the media’s klieg lights. Unsurprisingly for a movement with no ideological consistency or message discipline, the MPs offered plenty of fodder. The new leader of the lower house, Five Star’s Roberta Lombardi, made front-page news when it came out that she had once written a blog post that seemed to defend fascism and its original “socialist-­inspired sense of national community.” And a live feed in which the new MPs earnestly introduced themselves to the public was met with widespread mockery. “Hi, I’m Simona,” went one parody. “I  have a degree and I’m unemployed. I bend over backwards to manage my monthly budget and I want to be economy minister.”

Casaleggio came to Rome to try to reassure the new MPs, many of whom had never met their party’s cofounder. “If we stay united,” he told them, “there’s no obstacle we can’t overcome.” Suffice it to say, they didn’t stay united.

Several paradoxes were quickly emerging at the heart of the Five Star project. On the one hand, Casaleggio was busy developing the technology that would evenly distribute power across the breadth of the movement. By mid 2013, users of beppegrillo.it, still Five Star’s central website, could click through to a web portal where they could sign up as Five Star members, log in, and access a basic direct democracy platform—for the moment, a glorified web forum that let members review laws proposed by Five Star MPs, debate their content, and suggest wiki-style edits. Even still, users felt the thrill of direct participation in policymaking.

But at the same time, Casaleggio was anxious to mold and prop up a few key leaders. Shortly after the elections, he invited a select group of the most telegenic young MPs to Milan for media and communications training. Di Battista, who had won a seat in the lower house, was one of them. So was Fico. They were joined by a young college dropout named Luigi Di Maio and a few others. The meetings were led by a TV coach who was skilled in, among other things, neuro-­linguistic programming.

Casaleggio began using the blog and, increasingly, social media to elevate this handpicked group to become the biggest political stars in Italy. They had little in common with each other, save that they had almost all been near-penniless young men before Casaleggio picked them up and mentored them. “Gianroberto was a second father to me,” Di Battista says. “He was the man who gave me the biggest opportunity of my life … I have never known a person who knew how to listen like him.”

Casaleggio maintained an arm’s-length relationship with the rest of Five Star’s parliamentary caucus. He hired a former journalist named Nicola Biondo to help run the movement’s press office in Rome and to run herd on the other new members of Parliament. Biondo regretted taking on the role after just a few weeks on the job. The Five Star MPs were difficult to manage. They often ignored his advice; they tried to make TV appearances that hadn’t been sanctioned by Casaleggio or Grillo. Time and again, Biondo would get a call from Casaleggio saying: “Why are they saying that?”

Things got worse when Casaleggio fell ill and was diagnosed with a brain tumor. “Some MPs tried to profit by his absence,” Biondo says. The web entrepreneur was desperate to stay in control of his wildly successful project, but he felt his grip weakening.

Biondo recalls sitting in Casaleggio’s office one day; the older man placed a hand on Biondo’s leg and confided in him. “I’ve realized that in my political activity there are many people who wish me ill, who attack me with negative energy,” Casaleggio said. “I sense that so many people hate me.”

Casaleggio seemed increasingly obsessed with the idea that people were out to get him. “He was constantly searching for people who would adore him, who would never question his intelligence,” says Biondo, who would go on to coauthor the book Supernova with Canestrari. Meanwhile, dissenters began to be expelled from the movement—one for going on TV without permission, another for criticizing the running of the party as a “feudal system of loyalty.” One MP was kicked out for calling Five Star a “cult of fanatics” in which criticism was not permitted.

The movement was streamlining. MPs were reportedly told to hand over the usernames and passwords to their email accounts; some gave Casaleggio Associates access to their social media accounts as well. Rising stars like Di Battista and Di Maio were constantly posting on Facebook to their hundreds of thousands of followers, and Casaleggio appointed employees at his firm to study Google Analytics and Facebook Insights to monitor which social media posts went viral, so their success could be replicated. According to Biondo, Casaleggio was also building his online movement into an army of “digital soldiers” that could be steered against political adversaries, establishment figures, and internal dissenters alike. “He did the same on the blog as he did at Webegg,” Biondo says. “This is called social engineering.”

Although Grillo’s blog had supposedly been founded to combat the virtual reality—the “Matrix”—of traditional media, Casaleggio’s employees at times peddled dubious information themselves. Some posts on the blog attacked obligatory vaccination in Italy, regurgitating unfounded claims that vaccines were linked to autism.

The site also began to lead its readers toward political conclusions that strayed somewhat from Five Star’s origins. Despite the movement’s vaguely progressive cast of mind, Casaleggio himself had long harbored certain right-wing sympathies. He thought the rights of citizens should not become subservient to international bodies like the European Union, and he respected that populist parties like Lega often called for referenda in the name of self-determination. (As it happens, Casaleggio and the founders of Lega both share a common inspiration: the political philosophy of Adriano Olivetti.) And as Five Star attained real political power, Casaleggio set about steering it to the right.

In 2014, Italian voters sent 17 members of Five Star to serve in the European Parliament, the body that oversees the European Union. According to one of the movement’s young delegates to Brussels, Marco Zanni, Casaleggio quickly made it clear that he wanted Five Star to ally with the UK Independence Party—the party led by far-right British provocateur Nigel Farage, whose lifelong mission was to get Britain to leave the European Union—in the EU Parliament.

Five Star’s web portal now included a tool for subjecting important decisions to an online vote, and so the decision on whether to ally with UKIP was put to the movement: direct democracy in action. But in the days and weeks before the vote, Casaleggio published articles on the blog hailing Farage as a democratic crusader against a monolithic EU. “Farage Defends the Sovereignty of the Italian People,” read one headline. Another article, entitled “Nigel Farage, The Truth,” listed UKIP’s supposedly progressive credentials, such as being an “antiwar … democratic organization” where “no form of racism, sexism, or xenophobia is tolerated,” and which believes in “direct democracy.”

The post that finally teed up the online vote made it very clear that the proposed alliance with UKIP was the best and only solution. According to Zanni, this was Casaleggio Associates’ modus operandi when it came to online votes: Provide a “cosmetic” appearance of choice while pushing for a particular option. In the end, 78 percent of the members who voted opted to join Farage. After years of studying how to shape online consensus, Casaleggio had mastered the art.

The alliance with UKIP was just the beginning. On a crisp morning in January 2015, Casaleggio Associates received some unusual visitors: Farage, Raheem Kassam—then a UKIP strategist, later a Breitbart London editor and aide to Steve Bannon on his European missions—and Liz Bilney, the future CEO of pro-Brexit campaign group Leave.EU.

The group wanted to learn how Five Star had pulled off its stunning political rise, and to grasp how it used technology—“to understand the mechanics of it all,” Bilney says. Casaleggio and his son, Davide, gave them a briefing that offered a timeline of important events in web-based politics and the development of Five Star. Then father and son explained the new and improved direct democracy platform they were developing for the movement. Soon, they said, registered members would be able to propose laws and debate and edit them, as well as use the portal to put themselves forward and select candidates in online ballots. As an engine for user engagement—a crucial metric in social media as in politics—the platform seemed formidable. Farage “thought it was fascinating,” Bilney says, “because UKIP were keen to build their membership.”

Kassam agrees that Farage was “very excited” by the meeting. “He wanted me to go and look into the systems that they used,” Kassam says, “and how UKIP might implement them.” The Casaleggios didn’t share much technical know-how with the group, but Kassam was impressed by how many resources they were dedicating to Five Star’s digital operations and data analysis. Bilney, for her part, left the meeting buzzing with ideas about the way Five Star used social media. It was this meeting, she says, that “planted the seed of ideas” that would lead to the success of Brexit. Leave.EU was founded six months after the Milan meeting, and a year after that the UK voted to leave the EU. (Bilney is now under criminal investigation for allegedly breaking spending rules.)

A few months after the meeting, a post on Grillo’s blog announced that the new version of Five Star’s online direct democracy platform was almost ready. It would be called Rousseau, and it would serve as the Five Star Movement’s mobile-friendly “operating system.” After users logged in, they would land on a homepage with different primary-­colored windows for voting on candidates and party decisions, as well as for proposing and debating laws, participating in fund-raising, and more.

Beppe Grillo had known that Rousseau—the long-awaited, all-­singing, all-dancing version of the direct democracy web portal—was on its way. What he hadn’t been told was that Casaleggio Associates was also building a new website that would supplant beppegrillo.it as the online home of Five Star. Fearing he was being squeezed out, Grillo confronted Casaleggio. As recounted in the book Supernova, the phone call quickly turned sour: “Vaffanculo!” Casaleggio yelled down the line. “I never want to hear from you again.”

Those were the last words Grillo would ever hear from Casaleggio.

Grillo initially agreed to a written interview for this article, only to later demand 1,000 euros per question, with a minimum of eight questions. I wondered if it was a weird joke—Grillo is famous for his offbeat humor—but a few days later a post appeared on his blog detailing his new tariff for conversations with the press. WIRED does not pay for interviews.

Despite Grillo’s vital role in the rise of Five Star, Casaleggio arranged, from his deathbed, for the ascension of his son, Davide, to a position of great power within the movement. Legal documents signed just before Casaleggio’s death state that Rousseau was to be managed by a new organization, the Rousseau Association. The documents also set up Davide Casaleggio, the new CEO of Casaleggio Associates, to be the Rousseau Association’s president and treasurer. He is, in short, the absolute ruler of Five Star’s data. (Casaleggio declined to speak with WIRED.) Five Star’s MPs are forced by new rules to pay 300 euros a month toward the running of the platform. Grillo, for his part, retained the rights to Five Star’s name and logo.

On April 12, 2016, Gianroberto Casaleggio died in Milan at the age of 61. As his coffin was carried out of the church that houses Leonardo da Vinci’s The Last Supper, a throng of Five Star supporters chanted “Onesta!” (“Honesty!”)—a party slogan. Di Maio and a tearful Di Battista led the chorus. Also in attendance was Umberto Bossi, the founder of Lega. Outside the funeral, a banner read: “We will realize your dream.” The day after Casaleggio died, Rousseau went live.

As the 2018 national elections approached, Five Star took one more step away from its original conception as a horizontal, leaderless movement: Via an online ballot on Rousseau, it set about choosing an official party chief. Once again, the contest offered a somewhat cosmetic appearance of choice. Of the best-known, highly groomed members of Five Star, only Luigi Di Maio ran for the job. Fico and Di Battista kept their heads down. So Di Maio was pitted against a slate of relative unknowns, including Elena Fattori.

To no one’s surprise, Di Maio won, becoming Five Star’s leader at 31 years old in the fall of 2017. Only about 30 percent of Rousseau’s members voted. Afterward, Grillo began to distance himself from the movement. In January 2018, when Grillo relaunched his blog, there wasn’t a Five Star logo in sight.


Steve Bannon’s Recruitment Tour

Steve Bannon—the former White House chief strategist and far-right impresario—has been trying to unify Europe’s most strident populists into a supergroup called the Movement. Some nationalists have been receptive; others see him as an unwelcome foreign influence. (Go figure.) Five Star has held off on joining. Here’s how Bannon has fared elsewhere. —Graham Hacia


On March 4, 2018, Five Star participated in its second national election. This time, Nugnes, the architect turned parliamentarian, watched the coverage on TV alongside activists and representatives in a hotel in central Naples. Unlike in 2013, everyone knew Five Star would do well. But the final results were nevertheless stunning—with 33 percent of the vote, and after just five years in parliament, Five Star had become the largest party in Italy. While her colleagues celebrated, Nugnes worried. “I just saw right away that the overall picture was very disquieting,” she says. Right-wing parties—particularly Lega—had performed well too, off the back of a fiercely anti-­immigrant campaign.

Nugnes watched uneasily as Five Star tried to form a government, seeming to go against the movement’s original “no alliances” principle. From the start, it was clear that Di Maio—who had criticized the previous, centrist government for presiding over a corrupt, NGO-run “sea taxi” service for migrants to Italy—favored a deal with Lega. Nugnes, who had made a name during the previous five years as an outspoken senator, wrote a scathing post on Facebook about the prospect of an alliance with “he who wants to end immigration,” referring to Lega’s leader, Salvini. “I wouldn’t get into the same elevator,” she went on, “or breathe the same air.”

After nearly 90 days of talks, Five Star and Lega came to an agreement; Di Maio and Salvini would share power as deputy prime ministers. When the agreement went up for a vote before Five Star’s members via Rousseau, an astounding 94 percent approved the deal. Movement heavyweights insist that the agreement isn’t an alliance. “If it were an alliance, it would be completely different,” Fico says, explaining that the two parties had instead arrived at a “contract” on a specific program of legislation—a contract that included, crucially, Five Star’s cherished plan for a universal basic income.

The new Italian government was hailed by populists around the world. “What is happening here is extraordinary. There has never been a truly populist government in modern times,” Bannon told La Repubblica. “I want to be a part of it.” Bannon gloated that he had advised Salvini to make the deal with Five Star, and he claimed that he had advised Five Star as well. A source close to Bannon confirmed to WIRED that when he was in Rome in June, Bannon met with Davide Casaleggio.

Days after the new government took power, Salvini—assuming a dual role as both interior minister and deputy PM—closed Italy’s ports to migrant rescue boats and proposed a census of the country’s Roma community ahead of possible expulsions. Some four months later, Five Star’s universal basic income was approved by Parliament in the government’s annual budget. Di Maio promptly took to the balcony of the parliamentary palace to punch the air in celebration. “We’re going to end up with machines replacing many of today’s jobs,” he tells me later, echoing a common argument in Silicon Valley. “The basic income can be a tool not just to help struggling families but one that allows us to face the fourth industrial revolution.”

The EU has denounced Italy’s universal basic income as profligate. The country’s public debt stands at 2.3 trillion euros, or 130 percent of the country’s GDP, which far exceeds EU limits; authorities in Brussels fear that Italy’s spendthrift budget will cause the country to default on its loans. Salvini quickly seized on Europe’s rejection of the policy to drum up anti-EU support. As his rants against immigration and the EU continue, Lega is soaring past Five Star in opinion polls. Di Maio has done little to push back against the government’s rightward turn, even as the rebels in his party are growing more defiant.

Nugnes and Fattori have both courted expulsion from Five Star over the past year, after refusing to vote with the party at times. They have been subjects of internal investigation, severe criticism by Di Maio, and storms of online abuse. “If they expel me, it will mean that this is no longer the right place for me,” Nugnes says. But she adds: “There are so many like me in the movement. No one can know the future of the movement.”

Many believe that the future of the movement is Alessandro Di Battista. The popular former MP decided not to run for election in 2018, despite being omnipresent during the campaign; he says he wanted to get back to the “real world” outside Parliament for a while. Insiders speculate that the real aim of his political hiatus is to avoid hitting his mandatory two-term limit. Once his ally Di Maio’s time is up, many figure, Di Battista will take over the party’s leadership.

Of all the movement’s leaders, Di Battista is Five Star’s unabashed Casaleggian radical. On a scratchy WhatsApp line from Guatemala, where he has passed much of his time out of power, Di Battista comes out swinging when I ask about Five Star’s apparent rightward slide: “Today, whoever wants to take back sovereignty is considered a fascist, a nationalist, a populist, a demagogue,” he says. Such allegations, he says, are just another case of media elites missing the point. “The world can’t be judged from an attic in Manhattan. They don’t understand anything—just as they understood nothing of Trump and Brexit, just as they’ve understood nothing about the Five Star Movement.”

For Di Battista, Five Star’s grand techno-utopian project is never far from sight. “Representative democracy is obsolete,” he tells me. It will soon be as old hat as absolute monarchy seems to us today. “The future is inevitably direct democracy,” he says. But who knows if that future will be quite as inevitable without a hidden hand to steer it.

Redux Pictures (Casaleggio portrait source); Getty Images (all other portrait sources)

Darren Loucaides (@DarrenLoucaides) is a British writer who covers politics, populism, and identity.

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Cities Spurned By Amazon for HQ2 Renew Courtship After Winning New York Has Second Thoughts

As Amazon faces political obstacles in building a huge office in New York City, cities that were once candidates for the campus are courting the tech giant once again.

Cities including Miami, Chicago, and Newark, NJ have all recently talked to Amazon, brushing off their earlier rejections in hopes of landing thousands of jobs. Then Denver and Dallas said they never stopped speaking with Amazon.

Since announcing plans to build a new “second headquarters” in New York City three months ago, Amazon has encountered intense blowback. New York politicians are balking at a plan to hand over huge financial incentives to one of the biggest companies in the world while local residents complain about the impact of thousands of new workers on an already expensive and crowded neighborhood.

The opposition has Amazon second-guessing its move into the city, according to media reports, opening the door to former candidates to dust off their old proposals.

Last year, Amazon last year received 238 bids for the new headquarters, which originally was planned for one city. Candidate cities made big offers—like Maryland’s $8.5 billion incentive package—in hopes of landing the giant.

After going through the proposals, Amazon released a list of 20 finalists, which included Atlanta, Austin, Boston, Chicago, Denver, Los Angeles, Miami, and Columbus, OH—though very few of these cities publicly disclosed the incentives attached to their bids.

Ultimately, Amazon decided to change course and name two winning cities, but with only 25,000 job each. In addition to New York City, the company chose Crystal City, VA.

And while many losing cities were disappointed about being passed over, a few now are taking advantage of the tension in New York for a second chance with Amazon.

Illinois governor J.B. Pritzker, who previously helped pitch Chicago, immediately jumped on the phone with Amazon.

“Governor Pritzker reached out to Amazon to make a full-throated pitch to attract these good-paying jobs to Illinois and assure them that they would have a strong partner in the governor’s office,” Jordan Abudayyeh, spokeswoman for the governor’s office, told Fortune in a statement.

Meanwhile, Newark, NJ contacted Amazon to let the company know the city and state still have incentive packages, approved before the city was rejected, waiting for Amazon. Officials hope the news will show Amazon that it can move in without any risk of second guessing.

Miami-Dade’s mayor Carlos Giménez told the Miami Herald that he’s ready to restart talks about bringing the Amazon to Miami or other South Florida sites that were included in an earlier joint bid. The mayor of Magic City, Fla., said he planned to reach out to Amazon CEO Jeff Bezos to pitch him directly, according to the Herald.

A representative of the Dallas Regional Chamber said during a panel that that organization “never hung up the phone with Amazon,” according to media reports. The chamber declined to comment on whether Dallas planned to approach the company directly.

But Dallas mayoral candidate Jason Villalba was vocal about the matter on Twitter, saying, “Dallas can win this bid!” Undoubtedly, he also was using the issue as a way to highlight his experience in economic development to voters.

Similarly, The Dallas Morning News took the opportunity to write an op-ed titled, “Dear Amazon, New York doesn’t want you; Dallas does.” Mind you, the Morning News’ former headquarters is one of the potential sites for Amazon’s headquarters that Dallas listed in its proposal—a financial consideration that the News failed to mention.

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