Privacy watchdog says data-sharing scheme is 'an infringement of national data protection law'
Facebook has been ordered to stop collecting and storing data on WhatsApp users in Germany, marking the first regulatory challenge to a controversial data-sharing scheme that the social media company announced in August. In a statement published Tuesday, Germany's privacy watchdog said that sharing WhatsApp user data with Facebook, the messaging app's parent company, constitutes "an infringement of national data protection law." The regulatory body also ordered Facebook to delete all data that has already been transferred from WhatsApp.
Facebook's data-sharing scheme has been closely monitored by privacy groups across Europe. When Facebook acquired WhatsApp in 2014, the app's co-founder, Jan Koum, assured users that their privacy would not be compromised. Under the policy announced in August, however, WhatsApp will share some user data — including phone numbers — with Facebook, and plans to allow businesses to contact users directly through its app.
"FACEBOOK HAS TO ASK FOR THEIR PERMISSION IN ADVANCE. THIS HAS NOT HAPPENED."
WhatsApp has said that the arrangement will allow Facebook to deliver more targeted advertising and friend suggestions, and that analytics data will help combat spam and fraud. But privacy advocates have criticized the companies for not being transparent about the change. In a blog post published after the announcement, the Electronic Frontier Foundation (EFF) described the move as "a clear threat to users’ control of how their WhatsApp data is shared and used."
Johannes Caspar, the Hamburg data protection commissioner, echoed those concerns in a statement on Tuesday, saying that Facebook has not "obtained effective approval" of the policy change from WhatsApp users. Caspar also expressed concern that Facebook may eventually seek to collect data on a broader range of users, including those listed in WhatsApp contacts lists who are not connected to Facebook.
"This administrative order protects the data of about 35 million WhatsApp users in Germany," Caspar said. "It has to be their decision, whether they want to connect their account with Facebook. Therefore, Facebook has to ask for their permission in advance. This has not happened."
Other privacy regulators have raised concerns over the data-sharing scheme. CNIL, France's data protection authority and the chair of a group of privacy regulators across Europe, said in August that privacy watchdogs will be monitoring the change to WhatsApp's policy "with great vigilance." The Information Commission's Office (ICO), Britain's data privacy regulator, also said it would monitor how data is shared across the two platforms, though it does not have the authority to block the scheme altogether.
In an email statement, a Facebook spokesperson said that the company will appeal the order from Germany's privacy watchdog.
"Facebook complies with EU data protection law," the spokesperson said. "We will appeal this order and we will work with the Hamburg DPA in an effort to address their questions and resolve any concerns."
Update September 27th, 10:39AM ET: Updated with new statement from Facebook, clarifying the company's plans to appeal.
The UK's Secret Intelligence Service, MI6, is to grow by nearly 1,000 staff by 2020, BBC Newsnight has learned.
The spy agency argues the planned boost - from 2,500 staff to a little under 3,500 - has been made necessary by the development of the internet and technology.
MI6 will use the extra staff to ensure the security of people and operations.
No public announcement has been made, but the BBC has established the 40% boost via Whitehall sources.
Intelligence bosses around the world are trying to work out how they can continue to operate covertly in an age where almost everyone in Western societies has left traces on the internet, making it far harder to create fictitious identities.
Facial recognition technology has also reached the point where images - for example of an intelligence officer travelling under an assumed identity - can be easily reverse searched to find pictures posted online under their real identity, before they joined MI6 or the CIA.
In a rare public appearance in Washington DC on Tuesday, Alex Younger, the chief of the Secret Intelligence Service, alluded to the scale of this challenge.
"The information revolution fundamentally changes our operating environment," he said.
"In five years' time there will be two sorts of intelligence services - those that understand this fact and have prospered, and those that don't and haven't.
"And I'm determined that MI6 will be in the former category."
That pledged 1,900 additional staff, but MI6 will get most of that figure, with the Security Service (MI5), Government Communications Headquarters (GCHQ, the eavesdropping organisation), and police Counter Terrorist Command sharing the remainder.
It quickly became clear that the hit team had travelled on European passports that had been cloned, and belonged to real people who had visited or were living in Israel.
It is thought Mossad may have done this because of the difficulties of operating today with completely false identities.
MI6 officers fear that sensitive operations will be increasingly open to compromise by foreign spies or even militant groups skilled at using the internet.
"Our opponents who are unconstrained by conditions of lawfulness or proportionality can use these capabilities to gain increasing visibility of our activities which means that we have to completely change the way that we do stuff," Mr Younger said.
Both MI6 and GCHQ face increasing challenges also because of the breakdown in co-operation between technology firms and the agencies following the revelations of US whistleblower Edward Snowden.
"To the extent that those revelations damaged and undermined the trust that needs to exist, I think it's highly problematic," said Mr Younger.
Image captionThe NHS is rich in data and Google is the world's biggest data mining firm
Google's artificial intelligence unit DeepMind is getting serious about healthcare - with ambitious plans to digitise the NHS - but first it needs to convince patients to hand over their medical records.
Back in February, it began work with the Royal Free to create an app to help doctors spot patients who might be at risk of developing kidney disease.
Image captionThe records shared by the Royal Free go back over the past five years and include full names
That led to some pretty negative headlines and questions from some of the patients involved as to why they had not been informed their data was being used in this way.
The app - dubbed Streams - is now under investigation by the Information Commissioner's Office (ICO) while the National Data Guardian, which is tasked with safeguarding health data, is also looking at it.
Newly determined to forge a better relationship with the public, Google hosted its first ever patient engagement forum this week at its new headquarters in King's Cross, pledging that it wanted, in future, to work in closer partnership with the public.
"Patients are at the heart of what we do and as we embark on this decade-long opportunity, we really need a diverse group of people to help us design the products," said Mustafa Suleyman, co-founder of DeepMind and head of DeepMind Health.
The audience was polite during the presentation - making encouraging comments and seeming excited about the possibilities.
So far, DeepMind has two other continuing projects:
research into age-related macular degeneration at Moorfields Eye Hospital which will involve the use of one million anonymised patient scans
But, during the course of the forum, it became clear that DeepMind has much more ambitious plans when it comes to patient data, so much so that anyone attending could have been forgiven for thinking that it had won a contract to digitise the NHS.
Mr Suleyman spoke at length about a patient portal that would be accessible to both patients and doctors and available on their own smartphones.
It would allow doctors to search a patient's entire medical history in chronological order before they arrived at their bedside. Patients may be able to input their own data, for example, if they suddenly had a change in their condition or experienced problems after an operation.
The plan shocked some audience members who had not spoken out earlier.
"What was astounding to me, was the sense of entitlement that this commercial company clearly feels to access NHS patient medical records without consent and that many in the room seemed to have accepted that unquestioningly," said Jen Persson, a co-ordinator from campaign group Defenddigitalme.
"Patients have been left out so far of what DeepMind has done. The firm is not at the start of 'patient and public engagement' as it put it, but playing catch-up after getting caught getting it wrong," she added.
The patient portal is just an idea at this stage, admitted Mr Suleyman, and his team is probably "years away from building it".
The audience raised concerns about how safe such data would be and valid questions were asked about how DeepMind could ensure data did not get into the wrong hands.
"It may be that we stream data so it is not stored on a local device or that we have Trust-owned devices with an encrypted operating system or that data won't be accessible outside of the Trust's wi-fi," offered Mr Suleyman.
But he admitted there were also big hurdles: "How do patients verify themselves, how do we handle someone forgetting their password? There is a lot of work to do."
There is currently no national agreement between the NHS and DeepMind and the BBC understands that there was no representative from NHS England at the event.
The forum - which was a mix of formal speeches from doctors and patients who have been involved in DeepMind's trials as well as views from the audience - also heard from a health data-sharing advocate, Graham Silk.
The businessman was diagnosed with leukaemia in 2001 and given three years to live. He found out for himself the power of having his data in the right hands when he was invited to join a trial with an experimental new drug.
He has since set up a charity to put doctors and patients in touch with new drug trials and believes that we have a hypocritical view when it comes to data-sharing.
"Millions go on Amazon every day and give away their name, address, bank account details and it is bizarre that they don't feel the same about health data which has the power to do the most good," he said.
He thinks data is the "lifeblood" of the NHS but cannot understand why some patients might be wary of sharing information that could ultimately save their life or the lives of others.
He wants to see a system where the NHS can earn money from selling patient data to commercial partners.
"Much of the focus of the media and others is on whether using data is safe but, if we are to improve patient outcomes, we have to utilise this precious asset."
Perhaps the most pertinent question posed during the forum was one from a patient who asked simply: "What's in it for Google?"
Mr Suleyman has previously told the BBC: "Ultimately we want to get paid when we deliver concrete clinical benefits. We want to get paid to change the system and improve patient outcomes," something he reiterated at the event.
Ms Persson is not convinced.
"DeepMind couldn't answer clearly what their business model was with these NHS Trusts and what was in it for Google.
Google is not the only firm that the NHS shares data with but it is difficult to say how many there are as they are not centrally stored and each trust makes its own agreements.
Each one goes through a rigorous approval process.
DeepMind said that patient information is held "with the highest level of security and encryption.. and isn't shared with Google."
Patients can opt out of sharing data by emailing their NHS Trust's data protection officer.
Only 148 Royal Free patients decided to do so after learning about the DeepMind partnership.
Those figures chime with a survey commissioned by medical research charity the Wellcome Foundation earlier this year to find out more about public attitudes to data sharing.
Image captionGoogle co-founder Larry Page, who suffers with a vocal cords problem, has made no secret of the fact he believes everyone should share their health data
Its survey of more than 2,000 patients, conducted in April, found that most were unaware that their data was being shared with commercial organisations and that there were "red lines" that patients felt should never be crossed - such as sharing data with insurance companies.
But only 17% said that they would never consent to their anonymised data being shared with third parties, even for research purposes.
There is obviously a lot of good that can be done with patient data and advances in data mining and artificial intelligence offer an incredible new tool for doctors and care-givers.
But it is a tool that needs to be used carefully, thinks Ms Persson.
"Hospital trusts should think twice before gifting commercial companies confidential data on an ad hoc basis, without informed patient consent, without transparent oversight, and patients should be asking what precisely will it be used for, by whom, and with what safeguards."
Wada has also said that Fancy Bears are Russian in their statementconfirming the validity of the documents.
But Russia's denied having anything to do with the hack.
Some people have linked the group with other attacks
The New York Times said the Bears are possibly the group who "compromised the Democratic National Committee's servers".
Crowdstrike also refers to this in its blog, saying they "identified the hacking group as the mastermind behind this summer's DNC email leak" - when thousands of emails from the Democrat Party were made public.
Apple's iOS 10 software update will be made available for download on 13 September, three days ahead of the iPhone 7 release.
The firm announced during Wednesday's keynote that iOS 10 will be available on existing devices from next Tuesday, along with watchOS 3, and promptly seeded the Gold Master release to developers.
iOS 10 will run on the iPhone 5 and above, which means that those still using an iPhone 4S and iPhone 4 will be left behind.
On the iPad side, iOS 10 will work with all iPad Air and iPad Pro models, the 4th-generation iPad, and the iPad mini 2 and later. iOS 10 will also work with Apple's sixth-generation iPod Touch.
iOS 10 was announced at WWDC in June and includes a major Siri upgrade. Apple has released new APIs so that developers can build it into third-party apps. This means you can order an Uber by barking at your phone, for example, or get the digital assistant to fire up Spotify playlists.
The iMessage app has had a huge overhaul to become more interactive and media-heavy, so you can do things like send animated wallpapers and draw images.
3D Touch on the lock screen will allow you to open and interact with apps via notifications without having to actually open the app in question. The phone will use the fingerprint scanner to ensure that it's you.
Another nice touch is Rise to Wake, which will show the time and any on-screen notifications simply by lifting the phone, rather than having to press the home button, which can often unlock the phone by accident.
Three very different organisations, three success stories
Mobile is most definitely where it's at. New data and insights from three very different organisations - Gumtree, the Royal Shakespeare Company (RSC) and Littlewoods.com owner Shop Direct - have shown that focusing on mobile is vital to digital success.
And, even better for shareholders, profits have risen 43 per cent to £150.4m. Mobile has been core to this success, as sales from mobile browsers and the firm's iOS and Android apps rose 46 per cent year on year.
“The previous RSC website was good and handled a lot of ticket bookings, but it was starting to look dated. It wasn’t responsive and didn’t allow personalisation, so it needed updating,” said Richard Adams, the contractor who oversaw the project.
Since changing the firm is now much better able to take bookings and provide information to visitors, and to gather more insights on how customers use the site to refine the information it presents.
No doubt there are other organisations out there with similar tales to tell, and if these are the firms that got it right early and are now reaping the benefits, there are likely to be many more on this path that will make similar noises in six, nine or 12 months' time.
Clearly, the time to act is now, and any organisation still in the planning stages, or debating whether to push more money into mobile apps, or updating websites to be responsive, risks being left behind.
The market moves quickly and it does not take long for a firm to fall by the wayside if it can't provide what people want. The experiences of Nokia and BlackBerry, once leaders in the mobile market itself, are testament to that.
So it's no surprise that the celebration is short lived for the firms seeing mobile success, and the focus now is on the next set of digital technology trends such as big data, machine learning and artificial intelligence (AI).
Indeed, Shop Direct CEO Alex Baldock explained that the firm is already investing heavily in these areas.
“We’ve made big strides in m-commerce, big data and personalisation. But there’s a lot more to play for in these areas," he said.
"In particular, we believe that AI can change the game for us in data and personalisation. We’re deploying it already and are serious about going much further."
Big data, machine learning, AI. It's shopping, but not as we know it.
Regardless, Apple insists that removing the headphone jack was an act of "courage;" a bold willingness to sacrifice the comfortably familiar and push us toward the wireless-headphone future. Plus, ditching the classic 3.5 mm jack apparently makes room for bigger batteries and better cameras inside the iPhone 7 and 7 Plus.
So let's take Apple at face value here. Apple's move toward wireless headphones is a super-important signal of how it's looking at the next wave of technology — and hints at the next wave of computing to come.
But first, it's in Apple's best interests (and maybe your own) that they teach you to never take your headphones off, ever.
AirPods are the key
The keys to the whole affair are Apple's new $159 AirPod wireless headphones. Technically, they're standard Bluetooth earbuds/microphones, so they'll work with any old Windows PC, Android phone, or Blackberry you may have lying around.
But the real magic of the AirPods come when you use them with a Mac, iPhone, or iPad: Thanks to Apple's proprietary W1 chip, the AirPods smoothly and seamlessly pair with any iPhone or iPad in range, provided they're running iOS 10. When the new macOS Sierra comes out later this September, it'll work with that, too.
Pairing the AirPods with an iPhone is as simple as opening their charger case.Steve Kovach/Business Insider
Most importantly of all, the AirPods lack any kind of physical buttons whatsoever. The only control on the AirPods, at all, is a touch sensor that activates Siri, Apple's voice assistant.
It's that one-touch access to Siri that best showcases Apple's ambitions for the AirPods, for Siri, and for how people should be using computers.
Siri is everything
Apple has spent a lot of time and energy making sure people know that next week's iOS 10 update comes with some big upgrades to Siri, including the ability to access and use other apps. In other words, you'll be able to use Siri to send money with Square Cash or reply to a WhatsApp message, as well as control your Apple HomeKit-compatible smart appliances, all with your voice.
From there, it's a natural progression: The AirPods make it easier than ever to use Siri.
Siri lets you use your apps without taking your phone out of your pocket or checking your Apple Watch. So, ideally, you'll keep your EarPods in even when you're not listening to music.
An Apple promo for what Siri will be able to do in iOS 10.Apple
Since they don't have wires, AirPods are way less obtrusive than your usual headphones. And because they sync with all your Apple gadgets, it means that same one-touch access to Siri can follow you from phone to tablet to laptop. Siri's on the Apple TV, too, so it seems reasonable that it'll get AirPod syncing one day.
This has a big business benefit for Apple, since it means you need at least an iPhone to take full advantage: Without access to Siri, the EarPods are just Bluetooth headphones. It's an important driver to keep people in the Apple product family as the smartphone boom grinds to a halt.
But it's also a tantalizing glimpse at the possibilities of using Siri to spend less time staring at a screen and more time living your life.
Our science-fictional future
That increased reliance on Siri is Apple's short- to medium-term vision. In the long-term, though, Apple can get really weird with it, in some exciting ways. Slate's Will Oremus recently referred to the AirPods as "Apple's first ear computers."
From the earliest days of the PC, all the way through the modern smartphone, computing has usually relied on some kind of display, whether that's a TV, monitor, watch face, or touchscreen, plus some kind of keyboard, physical or virtual.
Looking forward, as AirPods and the wireless headphones they inspire mature and evolve, it's not hard to imagine a new kind of App Store for audio apps — apps that use the iPhone's intelligence to make the people around you sound like the parents from "Peanuts," maybe, or more active ones that let you rewind the last 30 seconds of a conversation.
There are some roadblocks ahead, if Apple really wants the AirPods to spark a revolution.
First, as analyst Ben Thompson rightly notes in a recent post to his Stratechery blog, the iPhone is great, but "Apple's user experience advantages are still the greatest when it comes to physically interacting with your device," and "the weakest when it comes to service dependent interactions like Siri."
In other words, Apple's Siri still has a long way to go before people start to truly rely on her to get stuff done.
Apple AirPods work with all Apple devices.Apple
Second, the technology needs to get a lot better.
Apple claims that the AirPods, in their current incarnation, get five hours of charge. That's pretty good for teeny-tiny earbuds, but not great in a future where Apple wants to make them indispensable accessories for everyday living. That's going to make this wireless future an even tougher sell, beyond the price and beyond the lack of a traditional headphone jack on the iPhone 7.
For now, though, there's one big problem that Apple can solve, and that's teaching you to keep your headphones in all the time. Once that's done, the rest can start to fall into place.
The first step in Sage’s mission to transform 50 Accounts …
Driven by customer feedback, every improvement Sage has made to 50 Accounts v23 has been made with you in mind. Letting you work faster, smarter and more efficiently than ever before. The new improvements are the result of using feedback from over 3,000 customers.
The improvements Sage has built into this release have been both requested and voted on by customers using the Sage 50 Roadmap. Sage customers have been heavily involved in the design and build, giving Sage fantastic feedback about the value the improvements will deliver.
Show negative items on sales invoices
More flexible invoices
Quickly & easily enter negative lines on invoices.
Great when you want to show discounts you’ve given to customers.
Full transactional detail in
most used screens
See every detail
See full transaction details within customer, supplier, bank and activity nominal screens. No navigating to financials to see details you need.
Enter invoices and
Auto double entry
When entering batch invoices, you’ll be able to enter payments on the same line. This removes the need to navigate to Bank in order to enter payments for invoices you’ve just processed.
Flexible due dates on invoices
Control your cash flow
When using invoices, you’ll be able to over-write the invoice due date as needed – or set automatic calculations. The due date will be surfaced in lists and reports – giving you even more visibility.
Sage has also improved things ‘under the hood’ to make Sage 50 Accounts faster and more efficient for you to use. Also improved Automatic Backup options now mean you can choose to back up to a cloud location.
Employee #1 is a series of interviews focused on sharing the often untold stories of early employees at tech companies.
Shel Kaphan was the first employee at Amazon. He is currently pursuing personal interests and still living in Seattle.
Discussed: Getting Online, Prior Startups, Vetting Jeff Bezos, Moving to Seattle, Early Versions of Amazon, Finding Traction Through Netscape, Building the Company, Changing Roles, Life After Amazon.
Craig : What were you doing before Amazon?
Shel : I worked as a programmer starting in 1975. My first real programming job was with an MIT spinoff called Information International, Inc. (also known as Triple-I) that was in Los Angeles, Culver City actually. I went there for a summer job in 1975. I was in college at the time, for the second time around, having dropped out once already, but stayed at Triple-I for three years. In 1978 I decided I should finish my undergraduate degree so I went back to school at UC Santa Cruz for a while and stayed in Northern California until I moved up to Seattle.
Craig : Ok, and how did you end up going to Seattle?
Shel : In early 1994, I had been working at a company called Kaleida Labs, which was a joint venture of Apple and IBM. I left there in the spring of 1994. One of the younger guys who had recently come out of university showed me Mosaic, which was brand new back then. The first time I got onto the the ARPANET, the precursor to the Internet as we know it, was 1969 or 70. I always had the feeling that there was something incredibly cool about it, but for some reason very few people seemed to think it was all that exciting. I couldn’t really imagine where it was all going to go eventually.
When I saw Mosaic, something clicked and I knew the Internet was finally going to open up to a much wider audience. Having missed a couple of earlier waves of technology that didn’t seem that interesting to me at the time, I thought this wave was one that was really going to be interesting and I wanted to do something with it. I didn’t know exactly what, but I knew I wanted to be involved. There were already a few new web-related businesses hiring some of the hotshots that I knew at the time. Netscape had been founded and some people I knew were already working there. It didn’t seem like a good fit for me, if I even could have gotten a job there. I wanted to do a startup and be more involved in the early phases of a business.
I was kicking around ideas with a friend of mine in Santa Cruz, who I had worked with at Frox and then Xerox, Herb Jellinek, trying to figure out some business idea that would be attractive to us that we could work on together–one that we thought might possibly work. We started talking to various people in our networks. Herb had gone to grad school at Stanford and one of his friends from there had gone to work at a hedge fund in New York, which happened to be the same one where Jeff Bezos worked at the time. He connected us with Jeff because he knew that Jeff was going to leave to start a web-related business that he had analyzed for this hedge fund. For whatever reason, that company didn’t want to pursue it but Jeff did.
Herb talked to Jeff, and then Jeff flew out to meet us in Santa Cruz. We had breakfast together and Jeff told us about his idea to start an online bookstore. We were even talking about possibly locating it in Santa Cruz. This was in spring of ‘94. Jeff went back home to New York and started thinking about where he wanted to locate. We were looking at office space in Santa Cruz but as he learned more about mail-order business he eventually decided it made more sense to be in a smaller population state or one that didn’t charge sales tax. He narrowed it down to someplace in Nevada or Seattle. I pretty much knew that I wasn’t going to be moving to Nevada. When he finally decided on Seattle, it took him all summer to convince me to move because I had lived in Santa Cruz for nearly 20 years and I liked it there.
Eventually, I decided that there was enough that I wanted to do on the project that it made sense to move. Herb, who had only recently moved to Santa Cruz, decided to stay. At first I was a little bit tentative about it–I kept my house in Santa Cruz and I only moved the minimum amount of stuff I needed to live.
At the time I thought, “Okay, I’m going to be building this website to run a bookstore and I haven’t done that before but it doesn’t sound so hard. When I’m done with that I’m not sure what I’ll do.” At that point there was no idea of doing anything but a bookstore. I thought maybe I would be able to go back to Santa Cruz and monitor it from there. I was pretty wrong about how the business would develop and how ambitious Jeff was. I didn’t know him at the time. We had just met.
Craig : How did you vet each other? Was he technical? Had you worked with many entrepreneurs before?
Shel : I’d worked in a few different startups. We both gave each other references to check out. But I think my choice was mostly based on the sense I had that he was fairly likely to make something work. I had been in a number of startups where there was an absence of people with sufficient business intelligence who understood how to fundraise, market something, and make business plans that weren’t based on hopelessly complicated technology that was super interesting but that nobody was ever going to pay for. I liked the idea that it was a very straightforward sounding business. I liked that I could explain to people who the customers were likely to be, what they were going to be paying for, and how the company could pay its own way.
I liked the guy when I met him. He has a very engaging personality. I was excited about the project so there were other reasons too besides the people involved. At the time there was this confluence of networking, hypertext, graphics and all this stuff that was coming into play with the web for the first time.
I wanted to take Books In Print or something like it and make a hypertext version. I’d been thinking about that before I even met Jeff. I wasn’t thinking about it in the context of selling books, but I was thinking, “Man, I hate going to the library and ruffling through those card catalogues and trying to find that thing that I’m looking for.” Nobody alive probably remembers that anymore. You actually had to go through drawers full of index cards to find books you were interested in. Then you’d walk around the library and browse the shelves to see if maybe the thing you’re interested in would be nearby.
I thought solving that problem was a perfect application for hypertext. There were a couple other online bookstores popping up around that time, too. Nobody seemed to grasp that issue particularly well. So, I thought, “Okay, well, I really want to build this and this project is a chance for me to do it.” Plus, I had worked just after high school in a mail order operation that sold books and other things, so I felt like I was going back to my roots, and that also felt good.
Craig : What was the first thing you guys had to build to get started?
Shel : Well, there was basically nothing except for a little library from NCSA of primitive things that you could use to build slightly interactive websites. I started by building up machines and getting a database system and putting together a little development environment. There weren’t any cloud services or anything like that at the time. It was all build your own and run it yourself. There was precious little in the way of tools or development environments for web stuff or libraries to build things out of. It was all cobbled together. At that point the web was a very static thing–mostly just a collection of pages.
There were hooks in the HTTP servers for running scripts, which is what we were depending on because all of our pages had to be dynamically generated. There was really nothing that existed to build a stateful application. In other words, where you are serving different things to different people and you have to keep track of that person’s progress, as they’re adding things to a shopping basket and going through an ordering process and all that. We pretty much had to figure that out and learn how to do it.
Craig : How did you troubleshoot? Today I use Stack Overflow constantly. What would you do when you ran into a bug that you couldn’t figure out?
Shel : Stay up late.
Craig : [Laughter] Fair enough.
Shel : I don’t recall that we had a lot of help from outside parties. At one point we decided to switch from Sun Microsystems to Digital servers. I was more familiar with Sun’s machines at that time so when we got the Digital machines and had some performance issues at first, Jeff found a professor at UW who could help with kernel tuning, which I was not terribly familiar with.
Everything else was debugging as usual. Technically speaking, Amazon was really pretty straightforward to build in the beginning. Although believe me, we had our share of bugs. But they were mostly relatively straightforward.
Craig : Were you also doing the software for inventory management?
Shel : A month after I got there we hired a guy named Paul Davis who had been in the Computer Science staff at UW, and who was a really great hacker. He and I worked together quite well. I was mostly focused on the website and customer-facing stuff. He was primarily focusing on shipping, receiving, inventory, charging credit cards and all that kind of thing. But we both had our hands on all of the code. He only stayed for a year and a quarter or so. When he left, it was just me for several months before I could hire anybody else. I was doing all of it at that point in time. I remember I worked seven days a week for 3 months straight, and they weren’t 8-hour days. Then we started hiring a few people who could take over specific aspects of the code.
Craig : Do you remember how many orders you were getting per month at the time?
Shel : I don’t remember numbers but it was minuscule by today’s standards. That said, our business was doubling quarterly for about six quarters or more in a row. In the beginning before we got the Digital servers, we ran the whole business on a couple of small Sun desktop machines. That was everything. We didn’t have much of a budget for hardware. We were trying to get absolutely everything we could out of a small number of tiny machines. We were always a little bit behind the curve on adding more hardware as we needed it.
Craig : Did that ever come around to bite you guys?
Shel : Yeah, for sure. We were always up against the limit of what the hardware could do. For one reason or another, sorting out architectural issues to scale more gracefully was something I could never convince Jeff to allocate resources to do. There were always too many customer-facing features that needed to be developed.
There were times when some piece of hardware would crap out and corrupt a database and, of course, some of the backups hadn’t been working. But somehow we survived.
Craig : Were you guys running any kind of analytics at that point?
Shel : No. Not in the beginning. I think it was maybe spring or summer of 1997 when the first people came in that were starting to work on that. In the beginning we were saving our server logs thinking they’d be really interesting to analyze, but not right now.
Craig : When we have a ton of extra money and time.
Shel : Yeah, maybe when we have a thousand extra programmers or something.
Craig : Exactly. So had you been working with Jeff on the product? How was the ship being steered?
Shel : During that time we were just a bookstore, so it didn’t seem to me there was a lot of steering to be done. That said, I don’t know all the things that Jeff might have been doing that I wasn’t aware of at the time. If I think back, I can’t even clearly picture what it was that he was actually doing. He wasn’t working on any of the technical stuff. We never even had a written business plan that I know of.
Craig : [Laughter] Was he sourcing the books?
Shel : He wasn’t doing that. Well, maybe he was at the very, very beginning before we hired people to interact with publishers. At the very beginning we were mostly just working with distributors. But we wanted to have a large catalogue, so we also had to work directly with publishers who weren’t represented by the distributors. That was what allowed us to claim a million titles, which was a big deal back then.
Craig : How were people discovering you guys?
Shel : Well, Google wasn’t around at the time. There are probably other opinions about this but, first off, there weren’t that many websites that were interesting back then. Second, as it turned out, there was a couple who worked at Netscape at the time–Eric and Susan Benson. I had worked with Eric in three different places by then. We had a “friends and family” soft launch in the spring of ‘95. They were among the people that were trying it out. We later hired both of them at Amazon. Susan was working on Netscape’s website in an editorial capacity. I only learned this last year, but when we opened up to the public it was she who put Amazon on their “What’s New” and “What’s Cool” pages. She put us on those lists. Then because the name started with an A, it was above the fold so lots of people saw it. That was, in my opinion, a super important connection for us. It might have happened without the personal connection, but who knows, maybe not.
Craig : That’s wild. Were you shipping to all 50 states in the beginning?
Shel : Yeah, and several foreign countries as well. We had a lot of international orders from fairly early on.
Craig : At what point did you realize, “Maybe I shouldn’t keep my place in Santa Cruz. I might be at Amazon for a while.”
Shel : I think that happened two years in or so. It started to be annoying to have to manage the house remotely, even though it was a friend of mine who was renting it. I was still responsible for it. At that point I also thought, if I do move back there, I’m probably not going to live in that house. It was not a particularly great house. I decided it would make my life a little simpler to get rid of it.
At that time we started extending into different product areas, too. We started having sites in a couple of other countries. Germany and England were the first two. And we started to make acquisitions. I think the acquisitions were probably post-IPO, which was spring of ‘97.
Craig : Whoa. I didn’t realize it was that fast. Three years?
Shel : Yeah, about two and a half.
Craig : What was your role around the time of the IPO?
Shel : My role was always primarily technical with some technical management. At that time I was VP of Development and was responsible for writing the software and keeping the systems up and running. One of the people who were hired to replace me in my original role came in only a month or maybe two before the IPO. The next guy came in September of that year. Early on, the small team of technical folks had been working for me, and I was mainly doing a lot of programming myself, but also system administration, network configuration, and so forth. I was putting disk drives in enclosures and running Ethernet cabling around the building and that kind of thing.
Craig : Not quite the glamorous startup life some people imagine.
Shel : Well, yeah. Those days were still before everything that’s happened with glorifying startups. If you were going to do a startup business, there wasn’t a huge expectation that it was going to be glamorous in any particular kind of way. You were going to work really hard and maybe it was going to work, though probably not.
Craig : Are there any vestiges of your work at Amazon?
Shel : Up until recently, maybe a few years ago, I could have said yes. But I don’t really see anything that looks like it now. It seems highly unlikely that anything I did actually still exists over there anymore.
Craig : What about even design patterns? Like, this is how a shopping cart works.
Shel : I don’t remember learning that from some other website. Though it seems like, as soon as you start thinking about that problem, it’s self-evident what it has to be like. You don’t want to make people go through a transaction every time they pick something. You have to let people go through the site and pick things that they’re interested in, put them somewhere so they can come back and get it all shipped at some point. I remember doing a lot of framing of that process on the website. Putting in text that said you could always take this out of your shopping basket later if you change your mind. So people wouldn’t feel they were overly committed.
Back in those days nobody was used to being a customer of online businesses. You had to be careful to make people feel comfortable and let them know their actions were reversible. Even though I was mainly doing technical things, the appearance of the website and a lot of the text on it were my doing in the early days. I was careful about making things acceptable to what I understood the culture of internet users to be in those days.
Craig : That’s so wild. You were designing for a completely different level of knowledge. You can assume so much more today.
Shel : Yes. Absolutely. Back in those days, it was the very beginning of doing commerce on the internet. There was a whole debate around allowing commercial activity on the internet. At least that’s how I recall it. Many people online were like, “We’re not so sure about commerce on this thing. You better not overdo it. You better be tasteful.”
There were these cases where people doing overtly commercial things were chastised by the community at large. There were some lawyers advertising their services for getting Green Cards and they were doing it by massive spamming activities. It created a huge fuss back then. It’s laughable now because so much stuff like that happens all the time.
And when cookies started being a feature in web browsers a lot of people were really concerned about their privacy, so they would turn them off. So we had to figure out how to make things work without that. Some people were running text-only browsers back then. Plus they were on dial-up. Sending pictures was not a good thing for those people.
Craig : Wait, you could use the early Amazon as a text-only site?
Shel : Yeah, we tested it. It always seemed important for us to make things continue to work, even for people that didn’t have a high bandwidth connection or the latest and greatest computers and all that.
Craig : How long did you end up staying in Amazon?
Shel : I was there for five years.
Craig : At the time you left, was it still a bookstore? What was it like?
Shel : Well, they had branched out into several other product areas. There weren’t any digital products yet. Ebooks hadn’t happened yet. They hadn’t developed any hardware products yet. Their computing services were not public yet. It was still pretty much a retail business. Although it was definitely branching out into other product areas and other countries.
Also around the time of an IPO and afterwards, the kind of people that are attracted to go to a company changes a lot. There were boatloads of MBAs and people like that coming. It was already a big company from my perspective.
Craig : So you’ve observed all these technological shifts. Do you have thoughts about how people should evaluate technologies when they’re about to start building something?
Shel : At this point, I don’t know. It’s a huge subject. For myself, when I look at technology these days, I see that it’s either doing something to connect people or it’s doing something that isolates people. I tend to make value judgments based on that kind of consideration about what is worth working on.
You walk down the streets, you have to weave around people standing there in random orientations in the middle of the sidewalk looking at their cellphones. Then you see people speaking robotically so that their speech recognizer can understand them. Now they are running around in mobs in parks with their phones in front of them trying to catch imaginary animals. I don’t necessarily see all that as a positive development.
I think technology has a role to play but I don’t see it being exploited very carefully in that way. But this is the kind of economy that we live in. And it’s very, very addictive. Even people who complain about it are still subject to it.
Craig : For sure. Where do you see Amazon falling on that spectrum now?
Shel : I think that a lot of what they do is more on the isolating people side. Everything caters to convenience so much that you don’t even have to get out of bed to take care of your day-to-day business. To me, that’s a step too far. Of all the major online businesses, I don’t really think that they extend in that way much beyond what we did very early on by allowing for customer reviews.
Craig : Had you and Jeff stayed close?
Shel : Not really. When he replaced me in my original job and I was moved into the CTO slot, I was nominally in charge of architecture, but in fact that just meant rubber stamping projects that were 95% complete by the time I saw them. That was all after having told me that my job was mine as long as I wanted it. And I didn’t have resources other than myself to work on anything I was interested in either. So I would say we were not really on particularly friendly terms at that point.
Craig : In retrospect, how do you feel about how things unfolded with Jeff and Amazon?
Shel : He’s obviously a super brilliant businessman. If I had any inkling about what kind of a company Amazon would turn into, both in terms of how successful they are and some of their business practices, I probably would have been a little bit more careful about my own relationship to it at the beginning. I also might have decided it wasn’t what I wanted to do.
One thing that the Amazon experience taught me is try to imagine what a project or company would be like if it was more successful than you could ever possibly imagine. It’s very unlikely but it’s possible. You have to think about what the environment will be like if that happens, and how the people involved in it might change. When I was joining Jeff to form Amazon in the beginning, I didn’t even allow myself to go there. I’d worked for a lot of startups so it almost felt like a jinx to think too much about what might happen if it really succeeded in a big way. That was my mentality. I was like, I hope this makes it and is a moderate success. Maybe it even generates enough cash to let us retire at some point. You don’t really want to think about massive success beyond what you can imagine. Then, if it is successful, you have to start thinking, what’s my role in enabling this? Is that something I really want to be doing?
I would say, of all the jobs I had, and I had quite a few between when I started programming and when I left Amazon, the first couple of years at Amazon really were a high point for me. I really, really liked that. A lot of that wasn’t so much because of the technical side of it, it was because of having worked in lots of small businesses that didn’t go anywhere or were the wrong thing at the wrong time or something like that. Being a part of something from the very beginning that engages people and has an astonishing growth curve–being part of making that actually work–was hugely satisfying, and I still look back on those first couple of years as a really exciting and great time in my life.