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Count the Ticking TikToks

The summer has been eventful for ByteDance, the owner of the rapidly growing social network TikTok. First, the government of India banned the application from distribution in the country due to concerns that the Chinese government is accessing user data. Then, a number of US companies warned employees to remove TikTok from their work phones. Most recently, US President Donald J. Trump threatened to ban TikTok in the US.

Into this maelstrom has stepped Microsoft CEO Satya Nadella with an offer to purchase the US business of TikTok. Nadella has earned a reputation as a savvy operator. He has restored Microsoft’s growth with smart bets on various types of business software, and a strong push to move the users of various applications, including the company’s lucrative Office products on to the online Office 365 version. Nadella has also remade the image of the swaggering giant as a kinder, gentler, more thoughtful company.

Image of Satya Nadella by Brian Smale

Microsoft’s purchase of TikTok would be Nadella’s riskiest bet to date. If Beijing, in fact, views TikTok as a crucial asset for influencing US political and social discourse, it could attempt to put backdoors into the software and service. Microsoft would need to work hard to extricate them, and they could result in TikTok’s being shut down anyway.

Also, with TikTok, Microsoft would enter the politically fraught world of social-content moderation. Microsoft has assiduously avoided political controversy, but TikTok would inevitably force Nadella to enter that arena in one way or another. For example, critics have loudly complained that TikTok censored videos of recent Hong Kong protests, citing that as evidence of Chinese government control. One can imagine similar discontent, due to slights — real or perceived — arising among any number of causes, particularly at either extreme of the US political spectrum.

TikTok’s present valuation $5 billion has critics warning that Microsoft is about to overpay. That is one of many things that could halt the deal altogether — valuation, government intervention, and fresh revelations of spying on users being just a few.

Yet the logic of the acquisition is clear. TikTok is under threat of closure by the US federal government. It’s hard to imagine that Microsoft will pay its full valuation price. For ByteDance, this may offer a graceful exit from a business that it realizes will only create more problems. So, Nadella may be making a smart bet — one with less to lose and more to gain than others realize.

Microsoft would increase its market presence by simultaneously acquiring both a social medium and an application popular with the younger crowd. It has long pined for more of the under-25 group, and TikTok may fulfill that aspiration most clearly and cleanly. Also, TikTok, a kinder, gentler social network than Facebook and Twitter, aligns culturally with Microsoft’s carefully groomed image.

The platform is designed to encourage discovery and consumption, but not to fan the flames of extremism. That does entail algorithmically controlling content more carefully and spreading new content more slowly than Facebook and Twitter care to. To date, however, moderation has been a lesser problem on TikTok than on other platforms and, due to its design and mechanism, is likely to remain so.

With TikTok would come a large and growing pool of user-generated video data for training Microsoft’s artificial intelligence (AI) engines. In theory, if Microsoft can continue to grow TikTok’s user base, its advertising benefits to Microsoft may be enormous. Microsoft’s cash flow would benefit from the added diversity of the advertising revenue and potentially of another rapidly growing source: social advertising. To put this into perspective, Amazon’s fastest-growing revenue stream, of late, has been advertising sales on its powerful eCommerce platform.

The purchase’s major benefit to Microsoft and the US public may be the ability of US consumers to continue to use an innovative platform for free expression and creativity after rescuing it from the quicksand of politics. Yes, we must remain vigilant in limiting government spying (which, let’s be honest, both sides engage in) and restrictive business practices (in which China is clearly the worst offender). But ultimately the potential of such technology as TikTok is to soar above partisanship and divisiveness to let people connect and create.

Certainly, social networks have created their fair share of problems for society, and TikTok is not a perfect vessel. People will find ways to abuse its potential. For now, however, Microsoft’s purchase of TikTok would, in a rare win-win, benefit Microsoft, TikTok’s users, and society.

And just as the US learned from India’s ban, India now needs to learn from it. China’s National Intelligence Law of 2017 requires all of its companies and citizens to ‘support, assist and cooperate with the state intelligence work’. If China decided to launch more aggressive moves against India, it could have its companies intercept private communications, shut down key services, or even sabotage infrastructure. This is why the US State Department launched the Clean Network program: to purge Chinese companies from US infrastructure. This applies to telecoms carriers, cloud services, undersea cables, apps, and app stores.

Removing Chinese-developed infrastructure will take time. But India can surely take a page out of the US State Department’s book and require companies such as Xiaomi, Haier, Oppo, Vivo, Oneplus, Huawei, and Motorola to sell their Indian products to local players. Companies such as Reliance, Mahindra, and Tata have the capability and funding and could win in the same way as Microsoft.


Vivek Wadhwa is a distinguished fellow, Labour and Worklife Program, Harvard Law School, US, and co-author of the forthcoming book, From Incremental to Exponential: How Large Companies Can See the Future and Rethink Innovation.

This piece was first published here.

License for embedded image can be found here.

Tech Mahindra For A Safe Global Reopening

To be sure of the safety and efficacy of Covid-19 screening technology that he was considering for his employees, Tech Mahindra CEO CP Gurnani, suggested testing it on himself and his household members. That decision may have saved him and his family from having to be admitted to hospital —as actors Amitabh and Abhishek Bachchan were last week. As it turned out, everyone in the house received a clean bill of health, except the two sons of his cook who were diagnosed as high risk.

As the Bachchans too must have done, Gurnani had had his domestic staff take all necessary precautions, remaining distant and wearing masks. His cook’s sons did not show any visible sign of infection, yet were potential Covid-19 carriers.

The fact is that the testing techniques in common use are inadequate, and social distancing isn’t always possible. RT-PCR (reverse transcription polymerase chain reaction) tests have ‘false negative’ rates of 20-67%, depending on when they are taken. Also, temperature screening and contact tracing fail to identify the presymptomatic spreaders who, according to mathematical modeling, could be responsible for half of the infections. When Delhi health minister Satyendar Jain showed symptoms, his first RT-PCR results came back negative. But they were positive the very next day.

The technology and techniques I had persuaded Gurnani and Tech Mahindra to pilot — and that I had a hand in developing — are based on understanding an individual’s risk and performing monthly testing. The reality is that even though Covid-19 can be devastating for a few, not everyone who gets infected will have serious symptoms. We can identify the people at high risk with reasonable accuracy based on studies from around the world and data from India. And we can give them special treatment.

For example, it is well established that men above 65, whose health is chronically compromised by diabetes, cardiovascular disease, or obesity, are at higher risk of severe outcomes. Further, severity can be predicted by a number of tests, including those for hypertension, diabetes, and obesity, and measures of lactate dehydrogenase (LDH) and D-dimer.

Businesses in the US have considered offering these types of tests. But the costs and logistics of doing so are usually prohibitive, with the most basic tests costing more than $100 apiece, and requiring the shipment of samples to labs. A single comprehensive screening for an individual could cost over $1,000, and is usually not covered by insurance plans. It can take days to get basic test results.

This is where India has an advantage over the West: it has developed screening devices, such as HealthCube, which can conduct a range of biochemical and physiological tests for a tiny fraction of the US cost. These include 12-lead electrocardiograms (ECG), tests for blood pressure, oxygen saturation, blood glucose, hemoglobin and cholesterol, and rapid diagnostic tests for infectious diseases.

With HealthCube, an entire regimen of tests, including a test for Covid-19 antibodies and severity markers, can be performed for less than Rs1,000 within minutes. The technology has received Europe’s CE certification.

The Covid-19 risk screening program underway at Tech Mahindra on the HealthCube platform uses patient risk factors — age, gender, medical conditions, potential exposure, recent travel or being in a crowded place, public health data, aggregations from previous screenings, patient symptoms, etc — to compute a risk score for patients. Those at high risk are checked for markers, such as D-dimer and troponin, which are elevated in those who develop the severe disease (which indicate heart ailments). These tests are followed up by teleconsultations and further testing, as appropriate.

With more data and testing, the artificial intelligence (AI) algorithms become increasingly accurate, and people are given an individualized screening and testing protocol based on their risk factors, rather than being treated like machines that need temperature checks.

Antibody tests have been controversial largely because the first generation of tests performed worldwide were mostly from China and were low quality and defective. There have also been doubts about whether all Covid-19 patients develop antibodies and, even if they do, how long the immunity lasts.

The newer generations of tests, made outside China, are highly accurate. Swiss pharma giant Roche, for example, claims that 14 days after infection, its test can detect antibodies with 99.8% specificity and 100% sensitivity. HealthCube claims that its India-made tests have 98% specificity and 96% sensitivity. These are both a huge leap from the 5.4% accuracy of the tests that China first sold to India.

There is substantial evidence that within 19 days after symptom onset, 100% of patients test positive for Covid-19 antibodies. And as Harvard epidemiologist Marc Lipsitch explained in the New York Times, ‘After being infected with SARS-CoV-2, most individuals will have an immune response, some better than others. That response, it may be assumed, will offer some protection over the medium term — at least a year — and then its effectiveness might decline.’ Even half a year will buy us time to understand and develop better approaches to prevention and treatment — and administer vaccines to those at high risk.

Gurnani told me that his personal experience, and the testing Tech Mahindra has conducted on a few hundred employees, have convinced him to offer the full health screening to the entire India Tech Mahindra employee base — including third-party employees, who typically can’t afford the test and are the most vulnerable because they stay in crowded places. He says that he puts his employees’ health above any business needs and cannot allow even one person to be at unnecessary risk.

Gurnani’s ambition is to show India — and the world — how to safely and sensibly open businesses and economies.

Vivek Wadhwa is a distinguished fellow and professor, Carnegie Mellon University’s College of Engineering, Silicon Valley.


This article was republished with permission from the author and can be originally found here.

Foreign Worker Visas Are the Tech Industry’s Dirty Secret

U.S. President Donald Trump signed an executive order that bars hundreds of thousands of foreigners from seeking employment in the United States by suspending new work visas.

The argument against the most significant of these visas, the H-1B, has always been that they harm employment prospects for Americans and depress wages. Some of the criticism is justified: The H-1B visa, which U.S. technology companies and outsourcing firms use to hire 85,000 new foreign specialists each year, is indeed problematic because it puts both American and foreign workers at a disadvantage. These visas are the U.S. tech industry’s dirty secret. They tie the foreign workers to their jobs and allow the employer to pay them less than they could be earning—which drives down pay for American workers as well.

But the solution isn’t for the government to lock the doors or try to control wages; it is to let competition on the labor market do its magic. The simple fix is to allow H-1B visa holders to work for any employer that pays them the highest wage or for the start-up that offers the most rewarding work.

This is something I have written about a lot, including in a 2012 book titled The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial Talent. I warned then about the deep flaws in U.S. immigration policies and predicted that China and India would greatly benefit from these flaws—and, unfortunately, that prediction was correct. With help from workers who honed their skills in the United States but couldn’t stay, both of those countries have built innovation capabilities that rival the United States’, and both now have many technology start-ups valued in the billions of dollars.

Here is the problem: For decades, the United States has been bringing in large numbers of workers on temporary visas such as the H-1B, but it never increased the numbers of permanent-resident visas (“green cards”) available for those who want to stay. There are 140,000 green cards issued per year to employment-based visa holders, and the law stipulates that each nationality may receive no more than 7 percent of the total number of employment-based green cards. My research team documented in 2007 that this limitation had trapped more than 1 million skilled immigrants and their families in immigration limbo. The Cato Institute found that number to be unchanged in 2020 and forecast that the backlog would increase to 2.4 million by 2030. Today, skilled Indian workers make up 75 percent of the employment-based backlog, and those who recently arrived face a wait of 90 years.

Technically, any H-1B worker can change jobs by filing a petition with the government, and some do take advantage of this rule. But there is a catch: The H-1B visa allows a path to permanent residency only when an employer sponsors a worker. And this is the carrot employers offer, one that most people coming to the United States want. Once they accept this carrot, they are trapped in immigration limbo because they can only change sponsoring employers or take new jobs at their current companies if the new job is in the same category and at the same level as the old one—otherwise, they risk losing their status or having to reapply. Most don’t take the risk. Therefore, visa holders shun promotions and changes in their job descriptions, leading to stagnating careers and lower salaries than they could otherwise make.

Opponents of the H-1B visa are correct in claiming that the visa disadvantages American workers, who are effectively competing with bonded labor. To the would-be immigrants, this indentured servitude is compounded by the employment restrictions that their spouses now face once again: The H-4 visas that permit them employment have also been suspended by Trump.

The overall problem could be fixed if the number of permanent-resident visas available for skilled workers was increased and the wait times decreased dramatically. But that is not going to happen in this era of pandemics and xenophobia. The most realistic solution is to untether the visa holder from the hiring company. In other words, allow an employee who enters the country on an H-1B visa and gets an offer of a higher salary to change jobs regardless of the status of his or her green-card application—without cumbersome additional paperwork. This way there’s no cheap labor anymore, and market forces take over. And, of course, the spouses of H-1B workers must not be prevented from working; no civilized society can place such restrictions on a group that is mostly women.

Technology companies don’t propose such a fix because it would cause them to lose power over the employee. Politicians won’t propose such legislation because it is not what tech-industry lobbyists want. Instead, we get a series of convoluted proposals that increase the role of government and disadvantage all workers, both American and foreign—and create the immigrant exodus.

Sadly, there is unemployment in the tech industry, and there are many heart-breaking cases of Americans being displaced by cheap foreign labor. This is not an acceptable situation, and it is why smart immigration reform would fix the salary disadvantage. Having more highly skilled, job-creating immigrants will lead to more innovation and more jobs. It will make the economic pie bigger for everyone.

The key to competitiveness is to allow the tech industry to hire the best talent, no matter where it comes from. The economy thrives on competition of every form, including technology and skill. Attacking immigrants and demanding that companies hire Americans over people who are more skilled, as Trump is doing, is the fastest way to destroy the United States’ remaining competitive advantages—and prolong the recession.

Vivek Wadhwa is a distinguished fellow and professor, Carnegie Mellon University’s College of Engineering, Silicon Valley.

This article was republished with permission from the author and can be originally found here.