The tech sector in Washington accounts for 22% of the state economy and ranks first…
Weekly News Roundup: February 20, 2015
Tech Investors Create a Billion-Dollar-Baby Boom
New York Times | Michael J. de la Merced and Mike Isaac | Feb. 19
http://www.nytimes.com/2015/02/20/business/investors-create-a-billion-dollar-baby-boom.html?_r=0
“Giant sums of money and sky-high valuations are nothing new in the technology industry. But the latest burst of activity has put on clear display the frenzied pace of investors, who are eager to catch the next blockbuster company like Facebook. The action is also again spurring talk that overeager investors are poised to relive the dot-com boom and bust at the turn of the century, when overinflated start-ups led to a quick and painful downturn…Just last year, 38 privately held companies backed by venture capital joined the billion-dollar club, putting the membership of that group at 54, according to the data firm CB Insights. Digi-Capital, a mobile Internet advisory firm, estimates that the total value of mobile Internet start-ups worth $1 billion or more increased $28 billion in just the last quarter of 2014…Part of what drives the bigger investments, investors say, is the advent of today’s technology — high-speed Internet connections, the ubiquity of smartphones, modern social networks — that has made it possible for start-ups to become nearly overnight sensations, moving much faster than they would have 15 years ago.”
Big Tech Companies Continue to Set up Shop in Seattle, and Office Lease Rates Climb as a Result
GeekWire | John Cook | Feb. 17
“Amazon, Facebook, Tableau, Zillow and a host of other technology companies are gobbling up office space in Seattle at an aggressive pace, and as you’d expect…the asking rental rate in the Seattle area now comes in at $27.63 per square foot, up from $27.29 per square foot for the fourth quarter of 2013. Meanwhile, the vacancy rate has continued to decline, finishing the year at 12.41 percent…Amazon alone is responsible for a big chunk of the new office space coming online in Seattle…Zillow, which is in the process of acquiring rival Trulia, a deal that is set to close Wednesday, announced in November that it plans to take over another five floors in the Russell Investments Center…And just this past weekend, we reported on Facebook’s plans to lease 275,000 square feet at the Dexter Station building in the South Lake Union neighborhood, with room to accommodate as many as 2,000 employees. Other companies — including Oracle, Alibaba, Apple, Dropbox, Sears and HP — have announced engineering centers in Seattle in recent months. John Heimbigner of OfficeSpace.com said the downtown Seattle and South Lake Union areas are exploding with activity, since many companies want to be located near Amazon.com. ‘It is a hotbed’ for tech companies, said Heimbigner.”
Obama Accuses EU of Attacking American Tech Companies Because It ‘Can’t Compete’
The Verge | James Vincent | Feb. 17
http://www.theverge.com/2015/2/17/8050691/obama-our-companies-created-the-internet
“Barack Obama has angered officials in Europe after suggesting that investigations by the European Union into companies like Google and Facebook were ‘commercially driven.’…Obama says: ‘We have owned the internet. Our companies have created it, expanded it, perfected it in ways that they can’t compete. And oftentimes what is portrayed as high-minded positions on issues sometimes is just designed to carve out some of their commercial interests.’ Over the past few years, it’s true that EU regulators have attempted to crack down on what they perceive as the unfettered power of American companies in Europe. The targets for these officials haven’t just been limited to commercial power and have included issues such as tax avoidance and privacy rights — including the so-called right to be forgotten which gives EU citizens the right to petition Google to remove links from certain search results.”
Can Tech Conservatories Save the Day?
Washington Post | Catherine Rampell | Feb. 17
“Once upon a time, if you emerged from college with zero marketable skills but dreams of a safe career path, you went to law school. For three years and $150,000. Today, it seems, you go to a computer coding boot camp. For just three months and just $15,000. In the past few years, dozens of these sexy new ‘coding conservatories’ have cropped up around the country. They promise to teach in only a few months the hard skills required to land a stable, high-paying, lifelong career. Currently these programs are usually ineligible for federal student aid, but policymakers have begun eyeing them as potential successors to more traditional retraining programs…Employers, students and policymakers seem to view such programs as the magic bullet for putting unemployed Americans back to work and closing high-tech skill shortages, and investors see them as cash cows…In one entrepreneur’s analogy, coding boot camps equip people to be carpenters who build things from other people’s plans, but not the higher-paid architects or engineers who create the designs and make sure they’re structurally sound. Maybe that’s okay; the tech economy needs carpenters, too.”
Amazon Won’t Be Able to Fly Its Delivery Drones Under the FAA’s Proposed Drone Rules
Business Insider | Maya Kosoff | Feb. 15
http://www.businessinsider.com/amazon-faa-drone-regulations-2015-2
“The Federal Aviation Administration proposed new rules for drones on Sunday. The proposed rules would require ‘people flying drones for commercial purposes obtain a special pilot certificate, stay away from bystanders and fly only during the day,’ Reuters reported. Drones would also have a 100 miles-per-hour speed limit and an altitude limit of 500 feet. The new, proposed rules aren’t good news for Amazon’s Prime Air program, which would enable drone delivery to customers in half an hour or less. ‘The FAA’s proposed rules for small UAS could take one or two years to be adopted and, based on the proposal, even then those rules wouldn’t allow Prime Air to operate in the United States,’ said Paul Misener, Amazon’s vice president of Global Public Policy…Amazon CEO Jeff Bezos saw this coming. Back in December at Business Insider’s Ignition conference, he said Amazon Prime Air’s main hurdle would be regulatory…That same month, Amazon sent a letter to the FAA warning that the company would “have no choice” but to move more of its drone research outside the US if it wasn’t allowed to do more testing outside. Amazon tests its drones in the United Kingdom because US regulations restrict drone usage outdoors.”
Candy Crush Maker Gobbles up Seattle Gaming Company Z2
Puget Sound Business Journal | Rachel Lerman | Feb. 13
“Seattle mobile gaming company Z2Live was scooped up by gaming giant KingDigital Entertainment, better known as the makers of Candy Crush, in a deal announced Thursday.
London-based King will pay $45 million in cash to acquire Z2. It will pay an additional $105 million if Z2 hits certain benchmarks, including revenues generated by specific games…Z2 will be the London-based King’s first U.S. outpost, signifying the importance it is putting on the U.S. market. The acquisition further cements the Puget Sound region as one of the nation’s major hubs for game development…Seattle casual gaming company Big Fish was acquired by Churchill Downs for $885 million in November, and DoubleDown Interactive was acquired by IGT two years ago. Such deals help get the region noticed, especially because large offices for the acquired companies remain in Seattle. Z2 has about 100 employees, and operates the popular Trade Nations app.”
Obama Signs Executive Action, Calls for Collaboration to Fight Cyber Attacks at Stanford Summit
Forbes | Kate Vinton | Feb. 13
“Obama briefly touched on the public’s fears of government overreach, saying that the government has to grapple with how to ‘protect people from adverse events while making sure the government itself is not abusing its power.’ He spoke of a commitment to protecting ‘the privacy and civil liberties’ of Americans. Obama steered clear of mentioning the NSA and how much information the government is gathering about its citizens and those in foreign countries. At the end of his speech, Obama signed an executive order “promoting private sector cybersecurity information sharing’ to cheers from the audience. This executive order is part of a larger push by the Obama administration to pass new cybersecurity legislation this year. At the State of Union, Obama had asked Congress to pass new legislation, saying that ‘no foreign nation, no hacker, should be able to shut down our networks, steal our trade secrets, or invade the privacy of American families.’ Following the State of the Union, Obama introduced new cybersecurity legislation to Congress, calling for a national data breach notification law that would provide protection to companies who share information with the government. Earlier this week, Obama also announced a new Cyber Threat Intelligence Integration Center that will gather information about cyber threats.”
UW Partners with Army Reserve, Microsoft, T-Mobile, Boeing to Train Cyber Soldiers
Puget Sound Business Journal | Emily Parkhurst | Feb. 13
“ ‘Why World War III will be fought on the internet.’ That’s a recent headline from the Daily Dot and a common refrain from those in the cybersecurity industry who have seen the advanced persistent threats coming from well-trained foreign enemies. Well, now the U.S. forces who fight back against those threats will be trained in Tacoma. The University of Washington has partnered with the U.S. Army Reserve to train soldiers in the art of cyber warfare. The program, called the U.S. Army Reserve Private Public Partnership Cyber Initiative, or USAR Cyber 3P, will be a collaboration between the UW Center for Information Assurance and Cybersecurity and the U.S. Army Reserve…‘The demand for cyber security personnel and cyber-experienced soldiers far outpaces current inventory,’ Lieutenant General Jeffery Talley, chief of the U.S. Army Reserve said in a statement. The government currently needs about 50,000 more cybersecurity operatives, Talley said, and so this partnership is aimed to resolve that need.”
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