ISSUE 19



Baidu’s self-driving cars require more human intervention than Alphabet’s Waymo


Baidu, which has ambitions to build an operating system for autonomous cars, requires more human intervention during road tests in the US compared with Waymo, the self-driving unit of Google parent Alphabet.


Beijing-based Baidu, which operates China’s largest internet search service, reported to California’s Department of Motor Vehicles (DMV) that its self-driving cars had “disengaged” from autonomous control every 41 miles (65.9 kilometres), compared with every 5,596 miles for Waymo.


The term disengaged refers to human drivers taking over from a car’s self-driving system or when that autonomous control itself fails.


Baidu, which received a permit to test its autonomous cars in California’s public roads in 2016, reported that its vehicles had 48 “disengagements” between October 2016 and November 2017 after driving a total of 1,971.7 miles.

Waymo’s self-driving cars recorded 65 disengagements between December 2016 and November 2017, when these logged a total of 352,544.6 miles.


The details of those disengagements, which were released last week by California’s DMV, formed part of the supplemental documents requested by the authority from eight companies, including Baidu, Waymo and Nissan Motor.


The DMV earlier this year asked 20 companies licensed to test self-driving cars in the state to submit reports about those trials. Baidu and Waymo were among eight firms that had filed reports considered by the DMV as providing little information.


The US data provided a glimpse of the closely guarded information surrounding self-driving car tests and the relative progress of each carmaker and technology company.


It also showed that Baidu’s self-driving car technology was far from being ready and literally, miles behind what US companies have accomplished so far. Waymo reported the smallest rate of disengagement among the companies involved in self-driving tests in the US.


Waymo’s biggest US rival Cruise, the driverless car unit of General Motors, reported that its vehicles drove about 131,000 miles last year in tests that showed human drivers intervened only once every 1,250 miles.


That Cruise report showed that traditional car makers are looking to close the gap with technology firms in developing efficient and safe self-driving vehicles.


Baidu’s report said the situations in which its autonomous cars needed the intervention of human drivers included “localisation error-caused drift” and “misclassification of traffic light detection”, which presumably meant that the self-driving car veered from its course after misreading the traffic light.


In an email reply to inquiries made on Friday, Baidu declined to comment about the disengagements recorded at its US trials beyond what was contained in its report to the DMV.


The stakes are high for a public roll-out of self-driving cars because the expectation is that autonomous vehicles will be capable of efficiently handling different situations on the road.


Baidu, which last November was identified by China’s Ministry of Science and Technology as national champion in the country’s efforts in self-driving cars, was reportedly working on Level 4 capability, which means cars can self-drive in most conditions `without human intervention.


At the CES trade show in Las Vegas in January, Baidu chief operating officer Lu Qi said China was already closing the gap with the US in artificial intelligence, thanks to strong government support and the country’s huge population size, which are key ingredients in promoting the development of the technology.


Baidu was even ranked ahead of Tesla, Uber Technologies and Apple in the race to build self-driving cars, according to a study published in January by Navigant Research. That study was based on the evaluation of 10 criteria, including technology, corporate vision and strategy to commercialise products.


Still, Baidu has been moving rapidly in partnering with more than a dozen car makers and automotive parts suppliers for its self-driving platform Apollo. The company has also teamed up with bus maker King Long United Automotive Industry to produce China’s first fully autonomous bus.


While the death of Elaine Herzberg, who was hit by an Uber self-driving car while crossing the street in Tempe, Arizona in March, cast a pall on the nascent autonomous driving industry in the US, China continued to move forward. That same month, Beijing gave the long-awaited go-ahead to Baidu to conduct open-road tests for its autonomous vehicles. The firm’s hi-tech rivals Tencent Holdings and Alibaba Group Holding, the parent company of the South China Morning Post, are also conducting their own self-driving tests.


China is also formulating technology standards and industry guidelines for autonomous vehicles as the world’s largest car market plays catch-up with the US in what many see as the future of transport.


The National Development and Reform Commission, China’s top economic planning agency, also unveiled a three-year plan in December, making the development of smart cars a national priority.


Self-driving cars are increasingly seen as an amalgamation of recent hi-tech advances, including 5G and new energy fuel, and the holy grail of the next-generation of technologies that are set to revolutionise the way people live, work and play.


China is likely to emerge as the world’s largest market for autonomous vehicles and mobility services, worth more than US$500 billion by 2030, according to a McKinsey report released last month.


By –South China Morning Post



‘Seek medical attention,’ her Apple Watch said. Good thing she did.


Deanna Recktenwald remembers feeling slightly out of breath. But she chalked it up to being out of shape.


“I used to play volleyball at school. I was on the cheerleading squad and I was a gymnast for 13 years, but I hadn't been active in a while,” said the 18-year-old from Lithia. Then her Apple Watch pinged.


“Take a breath,” the watch told her.


A few minutes later, it pinged again. “Take a minute to breathe,” it said.


The watch's health app also was tracking her heart rate, which spiked to 120 beats per minute, then 130.

The last message from the watch said “seek medical attention”.


So Recktenwald told her mom, who was sitting with her in church last Sunday.


Stacey Recktenwald, a registered nurse, monitored her daughter's heart rate for about an hour and confirmed the results from the watch. She took her daughter to an urgent care clinic, where doctors and nurses seemed sceptical.

“They didn't believe us at first,” Deanna Recktenwald said. “But then they took my pulse and told us we should go to the emergency room.”


Blood work taken at Tampa General Hospital revealed that Deanna's kidneys were barely functioning, at just 20%. A biopsy later would lead to the diagnosis of alport syndrome, a genetic condition characterised by kidney disease.

“Deanna is a healthy child. She had no other symptoms,” Stacey Recktenwald said. “I'm just so grateful for the watch.”


To her, it had been just a fitness device, with not a piece of medical equipment.


But the Apple Watch's abilities as a health monitoring system have piqued the interest of physicians worldwide, said Dr Peter Chang, chief medical informatics officer at Tampa General.


“This technology started with the Fitbit, which tracks steps. But the Apple Watch can in fact track heart rate, and this device and others are being used by physicians to 'fill in the gap' information-wise from when a patient leaves the hospital or doctor's office, to when they see them again,” Chang said.


The watch uses green LED lights on its underside to detect the amount of blood flowing through the wrist and track the heart rate. Other wearable tech devices use low electric pulses to do so.


Chang says these tracking methods are, for the most part, fairly accurate.


“Because of this technology, and Bluetooth, we can use the information saved on something like an Apple Watch and import it into our medical records systems at some hospitals,” Chang said. “Some studies show that tech like this can be just as accurate as an EKG (electrocardiography) reading.”


In November, the US Food and Drug Administration approved the Apple Watch's heart rate monitoring system, making it the first medical device of its kind to receive FDA approval. Apple also launched an initiative called the "Apple Heart Study” where the company will collect heart rate data for future research.


Chang thinks this is just the beginning.


“There are devices that can track weight gain and other health concerns,” he said. “But wearable devices like the Apple Watch provide the lowest cost way for patients to keep track of their health and manage better outcomes.”


Deanna Recktenwald is on the road to recovery, which will require life-long maintenance of the syndrome and a potential transplant later in her life. But the senior at Foundation Christian Academy in Valrico is looking forward to a bright future, with plans to attend Southeastern University in the fall.


“I want to be a nurse practitioner like my mom,” she said. “I do believe the watch was a blessing.”


Deanna got it as a Christmas gift and uses it mostly to check Instagram, her mother said.


“If she went away to college not knowing about this condition, who knows what could have happened?”


After the trip to the hospital, Stacey Recktenwald reached out to the Silicon Valley technology company to express her thanks.


“On the Apple website, there's a box to send messages but I couldn't put my gratitude into 600 characters or less,” she said. “So I called the Apple Store and they forwarded it on to corporate.”


Soon after, Recktenwald got an email from Tim Cook, the CEO of Apple.


He thanked her and said he was glad Deanna was OK. — The Tampa Bay Times/Tribune News Service


From–The Star


Flipkart yet to finalize stake sale deal with Walmart-sources


Indian e-commerce firm Flipkart’s board is yet to finalize a deal to sell a controlling stake to Walmart Inc, two sources with direct knowledge of the matter said on Friday, adding a deal could just be days away.


Bloomberg reported earlier on Friday, citing unidentified sources, that Flipkart’s board had approved a deal to sell a stake of about 75 percent in the company to a group led by U.S. retail giant Walmart for about $15 billion.


A third source told Reuters that while Flipkart’s board had “in-principle” approved engaging with Walmart based on the terms of an offer before them, taxation related concerns and a few other issues need to be resolved.


The first two sources said Alphabet Inc is also likely to invest in Flipkart alongside Walmart, but terms of the deal may change. Japan’s SoftBank Group, the biggest investor in the Indian firm through its private equity fund, is considering selling its roughly 20 percent stake as part of the deal if the price is right, two other sources said.


“SoftBank does not like to be a passive investor,” one of the sources said.


Reuters had previously reported Walmart was in advanced talks with Flipkart to acquire a controlling stake in the Bengaluru-based online marketplace at a valuation of at least $18 billion.


Flipkart has bought back $350 million worth of shares from its investors as it seeks to convert its Singapore-incorporated company to a private limited firm, in a move that could ease the way in for a new strategic investor, regulatory filings show.


Flipkart and Alphabet did not respond to Reuters’ requests seeking comment. Walmart and SoftBank declined to comment.


AMAZON OFFER


Earlier this week, Indian TV channel CNBC-TV18 reported Amazon Inc had made a formal offer to buy 60 percent of Flipkart and that it had also proposed a $2 billion breakup fee to convince Flipkart to discuss its offer.


Sources told Reuters that Amazon had shown an interest in buying Flipkart, but said a deal with Walmart was much more likely to go through. Amazon is Flipkart’s biggest rival in India.


Amazon’s move to bid for Flipkart may push up valuations of the Indian firm, but engaging with the tech giant could be fraught with risks for Flipkart, said industry insiders and lawyers.


Beyond the risk of opening its books for due diligence and exposing sensitive commercial agreements to its biggest rival in India, an Amazon-Flipkart combination could face significant antitrust hurdles, they said.


Amazon is currently seeking legal opinion to understand how the country’s antitrust regulator, the Competition Commission of India (CCI), is likely to view any deal with Flipkart, a lawyer and an industry source familiar with the matter told Reuters.


A former senior CCI official said e-commerce firms were already giving deep discounts and an Amazon-Flipkart union was likely to be in a position to sway the market their way, but the CCI could be convinced to approve a deal if both firms suggested “innovations or remedies.”


“This definitely would be a tricky case and not easy to sail through,” he added.


Amazon declined to comment on whether it had bid for Flipkart or was seeking legal opinion for a potential investment in the firm.


Flipkart, together with its fashion units Myntra and Jabong, controls nearly 40 percent of India’s online retail market, while Amazon is a close second with a 31 percent share, according to data from research firm Forrester.


Both Amazon and Flipkart are pouring billions of dollars into winning shoppers in the fast-growing market that is expected to be worth $200 billion within a decade.


From – Reuters


Huge number of Chinese tech unicorns likely to IPO in Hong Kong in 2018, says JPMorgan Asia-Pacific chief


Combined valuation of these companies could reach up to US$1 trillion, says co-head of company’s investment banking unit in Asia-Pacific.


A huge number of Chinese technology unicorns are likely to launch initial public offerings in Hong Kong in the next 12 to 24 months, which could significantly boost liquidity in its capital market, according to Nicolas Aguzin, chairman and chief executive for Asia-Pacific at JPMorgan.


“2018 will be a blockbuster year for Chinese unicorns to come to the capital market,” Aguzin said in an interview with the South China Morning Post in Hong Kong. “Investors here [in Hong Kong] have strong appetite for these high-growth, new economy companies.”


John Hall, co-head of the company’s investment banking unit in Asia-Pacific and global head of technology services, said a wave of Chinese technology IPOs in the next 12 to 24 months is likely to set a record for Hong Kong.


A number of Chinese technology companies have already started talking to investment banks and potential investors about the possibility of going public. If successful, these rapidly expanding Chinese technology stars could bring hundreds of billions worth of new shares into the market.


“I would say the combined valuation [of these companies] could reach up to US$1 trillion,” said Hall.


On Friday, Ping An Good Doctor, China’s largest online medical services platform, debuted on the Hong Kong stock exchange, after its US$1.12 billion IPO received a retail oversubscription of 653 times, the most for a main offering since 2009.


On Thursday, Xiaomi filed its application to go public in Hong Kong in what could be the world’s biggest flotation since Alibaba Group Holding’s US$25 billion debut in 2014.


Edmond Hui, chief executive at Bright Smart Securities, said the listings of Good Doctor and Xiaomi might be the catalyst for a potential wave of new economy IPOs, such as that of Ping An unit Lufax, an online wealth management platform, and Inke, a video streaming mobile app.


These companies are representative of China’s new economy and their flotations could ignite Hong Kong’s IPO market in the second quarter, he said.


In 2014, Alibaba went public in a record-setting US$25 billion IPO, which valued it at US$168 billion.

Four years on, a lot of Chinese technology companies have matured and scaled up, and are now reaching a point where their shareholders want to monetise.


“I think this [the number and scale of unicorns seeking to tap the IPO market] is an unprecedented phenomenon in global capital markets. It is a historical event,” said Hall. These IPOs will bring “fundamental changes” to Hong Kong’s capital market, he said.


China has the world’s most dynamic technology start-up scene, thanks to the rapid rise of an internet economy supported by a high mobile penetration rate and mobile-first consumer habits.


The Hurun Research Institute recently released a list of start-ups in China, with 151 companies reaching unicorn status by the end of the first quarter. Their combined valuations exceeded 4 trillion yuan (US$630 billion). Half of these unicorns were incubated or backed by industry titans such as Alibaba and Tencent Holdings.


“I think China is leading the global unicorn race ahead of the US,” said Aguzin. Some big Chinese companies have created an ecosystem for innovation, and are incubating some of the best technologies in the e-commerce, financial, health care, mobility and entertainment sectors, he said.


“We are in a world where the winner takes most. Being early is important, and being sizeable is critical.”

For companies in the technology and innovative sectors, if they can build a critical mass or user base fast enough, they will be able to generate a “network effect”, which is hard for others to replicate.


Ronald Wan, the chief executive at Partners Capital, said as a group of Chinese internet and technology companies have expanded and are now near the stage of going public, the competition to win over big Chinese “unicorn IPOs” has also intensified among global markets.


That is probably why stock exchanges in Hong Kong, China, the United States and Singapore have made or considered rule changes to entice such companies, whose debuts are expected to bring significant changes to their capital markets, he added.


From –South China Morning Post


From - PitchBook




Chinese hedge fund’s venture capital bets on start-ups yields returns of more than US$1.3b


ChinaRock Capital Management has rewarded investors in its five-year-old venture capital fund with 27 times their initial outlays by scoring huge returns from financing start-ups involved in everything from artificial intelligence to ride sharing.


The US$37.5 million CRCM Opportunity Fund has distributed more than US$1 billion since it was set up in 2013, Toby Zhang, a venture capital partner of ChinaRock, said by telephone from San Francisco. An earlier venture capital fund returned more than US$300 million.


Years of central bank easing has crimped the volatility that helped drive hedge fund returns and contributed to years of underperformance that prompted many hedge funds to seek alternative strategies. ChinaRock has been ahead of the curve, opening its first venture capital fund in 2005 with investments in fledgling companies that scored large returns when they eventually got sold or went public.


“We are looking for opportunities where today in the market it’s very nascent, but in the next three to five years, we think, will drive the next wave of innovations in technology,” Zhang said.


ChinaRock founder Ding Chun, who once managed money for Farallon Capital Management, set up the Genisis Fund in 2005, initially raising US$32 million to invest in early-stage internet and technology companies. ChinaRock now has US$158 million in four funds that focus on young tech companies in the US and China, Zhang said.


ChinaRock also manages a traditional hedge fund.


ChinaRock’s strategy is to get in on the ground floor and then cash in big when companies are eventually sold or launch hotly contested public offerings.


When ChinaRock’s second venture capital fund invested in video-sharing application Musical.ly, the Shanghai-based start-up had a staff of two. It went on to top the most popular application charts for both Android and iOS, and was downloaded by hundreds of millions of teenagers across the globe. Musical.ly was bought by Chinese media company Toutiao for nearly US$1 billion last year, Zhang said.


Among the second fund’s other profitable investments are shuttle bus company Chariot, now part of Ford Motor, and Orbeus, the San Francisco-based artificial intelligence and image recognition company acquired by Amazon.com.


The CRCM Opportunity Fund also took part in late 2014 in a round of private financing for Ripple Labs, the company behind the cryptocurrency. It still holds that stake.


Some of Ding’s bets have helped produce new ChinaRock investors. Ding’s first fund backed a one-person video-streaming start-up called Youku. The company was bought by e-commerce giant Alibaba Group Holding in 2015, in a deal that valued Youku at US$4.8 billion. Alibaba owns the South China Morning Post.


Youku is now an investor in ChinaRock’s fourth venture capital fund that finished raising US$56 million in the first quarter, said Zhang.


The two newest funds have yet to return cash to investors. One focuses on enterprise information technology, consumer, health care and bio- and financial technology, while the newest fund, Frontier Technology, will dabble in AI, augmented and virtual reality, robotics, drones, self-driving vehicles and blockchain, Zhang said.


That fund invested in Cargo, which provides vending machines to ride-sharing companies, allowing drivers to sell consumer items such as mobile phone chargers and snacks to riders. New York-based Cargo also boasts the backing of consumer goods giant Kellogg. Frontier Technology also provided financing to the Drone Racing League, which runs competitions in which racers use virtual reality glasses to pilot drones.


From –South China Morning Post





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