Salesforce will likely end its $5 billion buying spree this year, but its rivals won't (CRM)

Marc Benioff, chairman and CEO of Salesforce speaks at the Wall Street Journal Digital Live ( WSJDLive ) conference at the Montage hotel in Laguna Beach, California  October 20, 2015.      REUTERS/Mike Blake

Salesforce famously went on a record shopping spree last year, spending roughly $5 billion on acquisitions.

Add that to its failed bid for Microsoft-LinkedIn’s $26 billion deal, and its surprise interest in buying $12 billion Twitter, and Salesforce truly had one of the most remarkable binge-buying years in history.

But it sounds like Salesforce management is finally planning to put the brakes on its spending this year, according to a note published by UBS’s Brent Thill on Tuesday.

“M&A is still important, though any active, ongoing evaluations are focused on smaller tuck-ins for interesting tech (e.g., AI) or talented teams,” Thill wrote about Salesforce’s thinking after meeting with the company’s leadership team. “Management stated it needs to digest the string of recent M&A, which we agree with.”

Thill noted this is important because Salesforce stock has underperformed in 2016 in large part due to investor concerns around Salesforce going after another “mega-sized” acquisition. That would not only hurt Salesforce’s cash position, but also signal it’s having difficulty finding organic growth from existing products.

Still, Salesforce is likely going to continue to make smaller deals aimed at boosting its artificial intelligence capabilities, as Thill noted. The company’s been making a strong push towards adding more AI features to its core products, and has recently hired hundreds of data scientists. Just last month, Salesforce made another acquisition in this space, when it bought a startup called Twin Prime.

Screen Shot 2017 01 10 at 1.30.51 PM

 

Strong software M&A pace to continue in 2017

Salesforce’s record buying pace last year coincided with one of the most active M&A years in the software space. 

As seen in the chart above, made by Evercore’s Kirk Materne, the total enterprise value of the deals in 2016 was significantly higher than any of the previous four years. UBS’s Thill also notes there were 58 deals worth more than $100 million last year, up 45% year-over-year from 2015.

And even if Salesforce, the leading cloud vendor in the software space, is expected to slow down its pace of acquisition this year, don’t expect other companies to stop the trend.

In fact, Evercore’s Materne predicts M&A will continue to be a “key alpha generator” in 2017, with “at least one or two” mega-deals happening. He gives the following five reasons for why 2017 is poised to be another strong year for software M&A:

  1. Big vendors keep buying SaaS: Legacy vendors, like Oracle and SAP, want to move to the cloud, and see buying SaaS cloud companies as a “compelling opportunity” to make that transition faster. There could be more interest in companies laser focused in one area, like AI, machine learning, or digital marketing.
  2. Non-traditional buyers continue to acquire software assets: Non-traditional software buyers, like GE and Cisco, will continue to be aggressive in this space. Cisco, for example, made nearly all of its acquisitions in software last year, while half of GE’s deals were software-related.

  3. Private equity interest in M&A continues: Private equity firms have been very active, engaging in deals worth billions of dollars in recent years. The thinking is to combine public companies with other private companies in their portfolios. Look for this trend to continue.
  4. Google remains a wildcard: Google wants to expand in the enterprise space, but it doesn’t have the same level of “enterprise credibility” as Microsoft or AWS does. Google also has $83 billion in cash on its balance sheet. “We view Google as the biggest potential ‘wildcard’ in the software universe,” Materne writes.
  5. Repatriation could catalyze heightened levels of M&A: The combination of a lower corporate tax rate and a repatriation tax holiday, both expected under Trump’s presidency, will potentially help cash-rich software companies to be more flexible with their spending and be more aggressively in M&A.

SEE ALSO: Eric Schmidt and other tech execs want government protection from China, and it sounds a bit like Trump

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Two of the best cars at the Detroit auto show were boring sedans

2018 Lexus LS Detroit Auto Show

Sedans, those stalwart four-doors, are falling out of favor.

In both the mass- and luxury markets, consumers are shifting their preferences to SUVs. Sales of these vehicles helped drive a new record in the US in 2015, as 17.55 million cars and trucks rolled off dealer lots. More than half of those were SUVs and pickups.

That said, sedans are still important products for many companies. One of them is Toyota.

At the 2017 Detroit auto show, Toyota and its luxury brand, Lexus, unveiled a pair of new four doors: the mighty Camry, Toyota’s most important sedan and one that got a redesign for 2018; and the Lexus LS, also redesigned, and celebrating 28 years on sale in America.

These are both “flagship” sedans for their respective brands and both carry a heavy weight of expectations. 

Maybe it was just that the Detroit show this year was a little skimpy on excitement, but I grooved on both cars. 

SEE ALSO: Joe Biden just checked out the greatest Corvette ever made at the Detroit auto show

Here’s the 2018 Camry.

“The all-new 2018 Camry is, without a doubt, the most captivating mid-size sedan we’ve ever produced,” Bob Carter, a Toyota VP, said in a statement.

“It delivers on everything Camry owners have come to expect from America’s best-selling car, and adds to it, jaw-dropping design, more advanced technology, cutting-edge safety systems, and stirring performance that raises it to an unparalleled level of excitement.”

The new sedan has by far the most aggressive design the vehicle has ever received.

I think it’s probably the best-looking Camry ever. The sedan has long been a bestseller in the US, but it’s always been knocked for being a boring four-door.

No more.

“There were three primary design goals when penning the all-new Camry: a distinctive, low center of gravity that results in a firm wide stance; a practical-yet-emotionally styled cabin profile, and a sporty and upscale image both inside and out,” Toyota said.

Believe it not, from my seat Toyota succeeded on all three fronts with the new car.

The new car will get three new powerplants.


The engines on tap include a 3.5-liter V6, a 2.5-liter four-banger, and a hybrid.

That covers the Camry’s bases quite well. The V6 will provide reasonably peppy performance and make good on that “sporty” redesign. The four-cylinder will serve up decent power and good MPGs. And the hybrid will satisfy those Camry buyers who don’t think a Prius is enough car for them.

For what it’s worth, Camrys have enjoyed a near-legendary reliability reputation. My mom owned one and practically drove the wheels off.

See the rest of the story at Business Insider

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US Intel: Russia hacked Republican groups during election

Democratic groups and figures weren’t the only ones targeted in Russia’s suspected campaign to influence last year’s U.S. election. Russian cyberspies also targeted computers from state-level Republican groups and stole information from local voter registration records, FBI director James Comey said.

“There were successful penetrations of some groups and campaigns, particularly at the state-level on the Republican side,” Comey said during a senate committee hearing on Tuesday.

He and three U.S. intelligence chiefs spoke at the hearing, following their Friday report accused the Kremlin of ordering a covert campaign that helped boost incoming President Donald Trump’s election chances.

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Adobe patches critical flaws in Flash Player, Reader, and Acrobat

Adobe Systems released security updates for its Flash Player, Adobe Reader and Acrobat products fixing critical vulnerabilities that could allow attackers to install malware on computers.

The Flash Player update fixes 13 vulnerabilities, 12 that can lead to remote code execution and one that allows attackers to bypass a security restriction and disclose information. Adobe is not aware of any exploit for these flaws existing in the wild.

Users are advised to upgrade to Flash Player version 24.0.0.194 on Windows, Mac and Linux. The Flash Player plug-in bundled with Google Chrome, Microsoft Edge and Internet Explorer will be automatically upgraded through those browsers’ respective update mechanisms.

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Intel Joule shipments blocked in key countries, pending certification

If you can’t find Intel’s Joule developer boards in your country, it’s because shipments have been held up.

Intel’s Joule 570x and 550x are powerful computer boards that can be built as a PC, or be used to build robots, drones, or smart devices. But Intel is now seeking government certification so the boards can be cleared for shipment in those countries.

Joule shipments have currently been blocked in a number of countries, including Taiwan, Japan, and Israel, all of which have active technology markets where hobbyists design hardware.

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This education startup is teaching kids how to spot fake news

surprised kid girl

Jennifer Coogan puts it bluntly: If adults can’t be trusted to spot fake news, how can we expect kids to know when they’re getting duped?

Coogan, editor-in-chief of education startup Newsela, believes children need a middle man to show them the way.

“Their lives are one-hundred percent digital,” Coogan tells Business Insider. “And frankly, it’s a lot easier in the digital world to create something fake.”

Newsela’s primary focus is helping kids boost their literacy skills through online news articles, but in the months since the presidential election the company has taken on a more civic-minded role. Across its user base of more than one million American teachers — which represent roughly 75% of American K-12 schools — it wants to mold students into responsible consumers of news.

This is a huge challenge, as there is no shortage of fake news on the internet. One estimate suggests there are dozens of major fake news sites, whose social media followings rise into the millions. Some are intentionally satirical, like The Onion (motto: Tu stultus es, Latin for “You are dumb”), but many purport to deliver straight news with no sign of fabrication.

To help kids separate fact from fiction, Newsela partnered with the American Press Institute in October of 2016. Now whenever kids read an article on their electronic device, in addition to their normal comprehension questions, they’re prompted to ask questions about the article itself: Where do the facts come from? Is there a bias? What’s missing from this piece?

“That’ll be like a mini-research project for the student,” Coogan says.

Teachers can ask kids probing questions about the outlet, including where it’s headquartered, where it receives funding, and what affiliations its members might have. No one would go to such great lengths reading the morning paper, Coogan says, but it’s meant to be overkill in order to instill healthy levels of skepticism.

“It’s a good exercise to always question the source of the information,” she says.

reading newspaper washington dcHistorically, parents would help their kids discern what’s real and fake. But Coogan argues there is a fundamental divide that exists in how parents and kids consume their news. Parents grew up with reputable, hard-copy sources at a time when producing fake news was an elaborate process.

“You’d have to get a printing press and roll out a bunch of issues of your fake newspaper,” she says.

Today’s young readers are digitally native, which means their news sources are, too. Parents who are familiar with only a few big-name publishers will struggle to offer any help in gauging which of these sources are trustworthy. They know the New York Times and Wall Street Journal are real, but what about AmericanNews.com and Infowars? Each sounds reputable enough, but both have been flagged as untrustworthy.

“Even if [children] come from a family where the parents are news junkies,” Coogan says, “the way parents are consuming news is just not going to foster home training.”

Newsela’s approach has seen some early anecdotal success at getting kids to question what they read, and to filter out the sensational and suspicious, but concrete data is hard to come by. The larger goal is to move kids toward feeling confident that what they read is true and fair. 

“I do think the onus is now on the teacher” to groom kids’ savviness as readers of the news,” Coogan says. “Maybe it does need to become a new standard.”

SEE ALSO: This education startup you’ve never heard of is in 75% of American classrooms

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Mark Zuckerberg just poached Obama's former campaign manager to deepen his charity's ties to Washington

David Plouffe

Mark Zuckerberg has poached former Obama campaign manager and Uber board member David Plouffe to be his philanthropic organization’s president of policy and advocacy, The New York Times first reported on Tuesday.

Plouffe’s hiring is intended to help deepen ties between Washington and The Chan Zuckerberg Initiative, the company Zuckerberg and his wife Priscilla Chan created in 2015 to give away the majority of their wealth.

Along with hiring Plouffe, who will remain on Uber’s board, Zuckerberg told The Times that his organization is forming a public policy board that will be led by Kenneth Mehlman, the manager of President George W. Bush’s 2004 re-election campaign.

“You can make change, but in order for it to be sustainable, you need to build a movement to support it,” Zuckerberg said in an interview with Mike Isaac of The New York Times. “No amount of private research or philanthropy is going to shift that. At the end of the day, the government has far more resources than any individual organization does.”

In a statement sent to Business Insider, Uber CEO Travis Kalanick said that Plouffe will continue to play a “key part” in the company.

“Three years ago, I was looking for someone to help guide Uber’s strategy as we launched in more cities around the globe,” Kalanick said. “David impressed me with his storytelling skills, his ability to connect with people on a human level, and his incredible passion for Uber and our mission. I’m excited that he’ll bring that passion to the world-changing efforts underway at the Chan Zuckerberg Initiative, and that he will remain a key part of our family as an Uber board member, an advocate for our company, and an advisor to me.”

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Joe Biden just checked out the greatest Corvette ever made at the Detroit auto show (GM)

Biden Corvette Detroit auto show 2017

DETROIT — Vice-President Joe Biden is a known Corvette fan.

So it makes sense that he would want to check out the Greatest Corvette in Human History — the Corvette Grand Sport.

We can understand why the Veep would want to have a look: the GS’s 6.2-liter V8 and overall stupendous speed and handling blew us away. It would blow anyone away. Even Biden, who doesn’t blow away easily.

Biden was squired around the GM booth at the Detroit auto show by GM VP Mark Reuss, a Vette man himself who is often spotted at race tracks worldwide with Corvette Racing.

Biden Corvette Detroit auto show 2017

The Vice-President was mobbed by reporters.

But he had a security detail that kept everything under control.

Here’s the car:

Corvette Grand Sport

Biden knows a bargain: the GS can be had for a mere $70,000, making it perhaps the best value in high-performance cars on the planet. Certainly in the USA.

SEE ALSO: The $70,000 Grand Sport is the greatest Corvette ever

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Microsoft drops a pay-as-you-go Azure cloud option

Microsoft is shifting its licensing for its Azure cloud service, eliminating the pay-as-you-go option for new Azure customers using MPSA (Microsoft Products and Services Agreement) as of Feb. 1. Instead, they will be steered toward the company’s CSP (Cloud Solution Provider) program.

Geared to organizations with at least 250 users, MPSA is Microsoft’s simplified agreement consolidating purchase of cloud services and software. The move detailed today follows on Microsoft’s decision to not proceed with its proposed Enterprise Advantage program, which was meant to allow customers to buy organization-wide on the MPSA.

Microsoft’s volume licensing focus is on creating synergies across three business strategies: partner value-added, self-service web, and partner-assisted, said Richard Smith, Microsoft general manager of commercial licensing. This required adjustments in licensing programs.

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Tech luminaries team up on $27M AI ethics fund

Artificial intelligence technology is becoming an increasingly large part of our daily lives. While those developments have led to cool new features, they’ve also presented a host of potential problems, like automation displacing human jobs, and algorithms providing biased results.

Now, a team of philanthropists and tech luminaries have put together a fund that’s aimed at bringing more humanity into the AI development process. It’s called the Ethics and Governance of Artificial Intelligence Fund, and it will focus on advancing AI in the public interest.

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