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Good morning. The concept of how mobile applications function in the workplace is evolving before our eyes, with the role of the platform becoming ever more important. The latest example of this evolving approach is United Continental Holdings Inc., which plans a major overhaul of its mobile technology. Its effort will include the development of new apps and the upgrade of the iPhones and iPads used by 50,000 flight and ground employees. The air carrier will work with Apple Inc. and International Business Machines Corp., which announced an alliance three years ago to develop business apps for Apple’s mobile devices. CIO Journal’s Kim S. Nash has the story.
The overhaul, which will include integration of the newly coded apps with older technology that manages customer and operations data, represents an effort by the airline to stop using one-off mobile apps and build a suite of apps, Jason Birnbaum, vice president of operations technology at United, tells CIO Journal.
The company also is looking for ways in which employees can make greater use of mobile technology. As part of the overhaul, the airline has defined at least 39 roles of employees involved in a typical flight, Mr. Birnbaum said. For example, a gate agent waiting for a late-arriving passenger who is on the way from a connecting flight might query an app that the pilot has updated to determine if the door can be left open a few extra minutes. Today, that information is often relayed by voice, with employees moving between plane, ramp and doorway. “We want to create a social community around a flight,” Mr. Birnbaum said.
The role of the software platform extends far beyond any single industry. In many cases, corporations are taking charge of their software development, all or in part. It is core to what they do. And in the process, markets are being redefined, as Gartner Inc.’s Peter Sondergaard has noted. “Vertical industries are being redefined as a result of this. The initial reaction of vertical companies is to say, well, I am a bank, so I am not interested. Or I am a retailer, so this actually doesn’t concern me, because I operate in a business to consumer marketplace. But what if you say the new definition of a vertical industry is this list of things, the home, the car, the industrial complex?” Add the airline to the list.
Valley National Bancorp is going paperless, finally. The New Jersey-based bank says by summer it’s planning to roll out its first Salesforce.com Inc. customer relationship management system, after years of relying on ad-hoc tracking platforms, spreadsheets and paper-based filing systems, The Wall Street Journal reports. The move is part of a four-pronged strategy to modernize the bank’s IT systems, digitize manual processes and make better use of data, says the bank’s CIO, Robert Bardusch. He called it an enormous “cultural change” and described his role as “being able to bridge the canyon.”
TECH EARNINGS
Cloud buoys Amazon.com Inc. gains, but growth disappoints. Despite a 55% rise in fourth-quarter profit, buoyed by cloud services, Amazon’s reported sales of $43.74 billion fell short of analysts’ expectations, sending shares down 3.9% to $806.50 in after-hours trading Thursday, writes The Wall Street Journal’s Laura Stevens. For the December quarter, the online retailer’s profit rose to $749 million, or $1.54 a share, from $482 million, or $1 per share, a year earlier. Operating income in its Amazon Web Services cloud division for the quarter increased to $926 million, from $580 million a year ago, while sales grew 47% to $3.54 billion.
LEADERSHIP
Don’t miss. The Wall Street Journal CIO Network, scheduled for Feb. 27-28 in San Francisco, will bring together chief information officers and technology officers from the world’s largest and most influential companies with the mission to identify key challenges in technology and new opportunities for innovation that will unlock value for their organizations. Click here to learn more about the scheduled events, which include a keynote by Salesforce.com Inc. CEO Marc Benioff.
MORE TECHNOLOGY NEWS
Uber CEO says he wasn’t hailing the chief. Travis Kalanick, the ride-hailing firm’s chief executive officer, on Thursday announced that he was stepping down from President Donald Trump’s economic advisory council, saying his participation was misconstrued as an endorsement of Trump’s policies, The Wall Street Journal reports. The move follows widespread criticism of firm since Mr. Kalanick joined the council, including a grassroots social-media campaign to delete Uber’s app. According to the New York Times, 200,000 customers have deleted their accounts in recent weeks.
The end of employees. Never before have big employers tried so hard to hand over chunks of their business to contractors, reports the WSJ’s Lauren Weber. At Google parent Alphabet Inc. there are roughly equal numbers of outsourced workers and full-time employees, Ms. Stevens writes. In oil, gas and pharmaceuticals it’s worse, with outside workers sometimes outnumber employees by at least 2 to 1. But some companies try outsourcing and then change their minds. About 70% of Target Corp. ’s information-technology jobs were outsourced when Mike McNamara became chief information officer at the retailer in 2015. About 70% of those jobs now are done by employees. “I’m a strong believer that if you can get competitive advantage out of something, you want it in-house,” he says. “That I have better supply-chain algorithms than [my competitors] really matters.”
Microsoft presses for immigration-ban exceptions. Microsoft Corp. President and Chief Legal Officer Brad Smith, in a letter sent Thursday to Secretary of State Rex Tillerson and Secretary of Homeland Security John Kelly, requested a process for granting exceptions to last Friday’s executive order on immigration, the Journal’s Jay Greene reports. Mr. Smith said 76 of the company’s employees, along with 41 of their dependents, were affected by the executive order, which bars entry to the U.S. by people from seven nations. He asked the secretaries to create a category for applicants to be classified as a “Responsible Known Traveler with Pressing Needs.”
Facebook most vulnerable to future visa move. An analysis of U.S. Labor Department filings by Reuters finds that more than 15% of Facebook Inc.‘s U.S. employees in 2016 used a temporary work visa, the highest dependence on H-1B visas among Silicon Valley companies. The Trump administration is expected to reform the visa program.
Oracle among companies calling on higher import taxes. A group of 25 companies, including Oracle Corp., GE and Boeing Co., is backing up a plan by House Republican to tax all imports, Reuters reports. The move underscores the division among U.S. companies, Reuters adds, noting that many import-dependent companies, such as Target Corp., say the such a tax would outweigh benefits from any lower corporate taxes.
Snapchat parent reveals initial public offering plans. The messaging app’s offering, filed Thursday, is expecting to value the company as high as $25 billion, making it the largest U.S.-listed IPO since Alibaba Group Holding Ltd. made its $168 billion debut in 2014, The Wall Street Journal reported. In the filing, the six-year-old firm reported revenue of $404.5 million in 2016 and a loss of $514.6 million, up from $57.7 million in revenue and a loss of $372.9 million a year earlier. Four months ago, the Venice, Calif.-based firm renamed itself Snap Inc., in a bid to show its ambitions extend beyond Snapchat.
Facebook earnings enjoy a nearly $1 billion tax Windfall. Facebook’s 2016 earnings got a boost of more than $900 million thanks to accounting change enacted by rules makers last March, says the WSJ’s Michael Rapoport. The change is expected to increase the earnings of companies like Facebook that are heavy users of employee stock compensation and have seen their stock prices rise.
Defects found in Space X rockets The Government Accountability Office’s preliminary findings reveal a pattern of problems with turbine blades that pump fuel into rocket engines, the WSJ’s Andy Pasztor reports. The crack-prone parts are considered a potentially major threat to rocket safety, the industry officials said, and may require redesign of what are commonly called the Falcon 9’s turbopumps. This year, the company aims to launch more than double the eight rockets it launched last year to meet commitments to NASA, and whittle away at a bulging backlog of delayed commercial missions.
Hackers hit radio stations with anti-Trump song. Ars Technica reports that hackers took advantage of known vulnerabilities in a so-called Low Power FM radio transmitter used by smaller radio stations to broadcast a certain song in the days following the presidential inauguration.
WHAT YOUR CEO IS READING
Every week, CIO Journal offers a glimpse into the mind of the CEO, whose view of technology is shaped by stories in management journals, General interest magazines and, of course, in-flight publications.
Give us your tired, your poor, your thirsty. A 60-second spot slated for Sunday’s Super Bowl has already attracted buzz for its portrait of a brewmaster as a young immigrant—no surprise for these politically-charged times. In “Born the Hard Way,” strapping Adolphus Busch encounters his share of bigots before that fateful meeting with Eberhard Anheuser in a sepia-toned bar. Slate’s Sam Adams (ha!) talks to William Knoedelseder, author of a history of beer giant Anheuser-Busch Companies, Inc., to find out how much of the spot is actually true. Like a can of Bud, the televised product is pretty sudsy, according to Mr. Knoedelseder. Mr. Busch was hardly poor and struggling when he arrived in the U.S. in 1857. He was also—gasp!—a wine drinker. But never let the truth get in the way of a good story. “Ironically, that’s what Adolphus would do. He used the Battle of Little Big Horn to sell Anheuser-Busch. No one had ever done that before,” says Mr. Knoedelseder. Nevertheless, he says, Bud’s rise remains an amazing American immigrant success story.
Taking a stand is good for business. Former U.S. Treasury Secretary Larry Summers says that business leaders uneasy with the protectionist stance of the current administration have an obligation to speak out. “Business leaders always talk about the importance of long-termism,” he tells Harvard Business Review’s Adi Ignatius. “One aspect of long-termism is supporting a society in which a business is embedded. What could be a more important long-term issue for American business than American leadership in the world?” Remaining silent could work against corporate interests, says The New Yorker’s John Cassidy, noting how protectionism and opposition to multilateral trade puts the entire ecosystem under threat. “In today’s economy, firms like G.E., Intel, and Apple get most of their revenue from overseas, and their operations are spread all over the world. What matters to them most is the preservation of a global trading system that took decades to build.”
Signal and Slack redefine collaboration. Slack Technologies Inc. this week launched a more enterprise-friendly version of its collaborative tool. But as Politico reports there was another story this week in office collaboration and it is coming from a cadre of workers in the federal government who are using the app Signal, which encrypts communication, to voice their dissatisfaction with some of the new administration’s policies. “The goal is to get their message across while not violating any rules covering workplace communications, which can be monitored by the government and could potentially get them fired,” Politico writes.
EVERYTHING ELSE YOU NEED TO KNOW
President Trump plans to sign an executive action to scale back Dodd-Frank rules, a sweeping plan to dismantle much of the regulatory system put in place after the financial crisis. (WSJ)
Crude futures consolidated gains on hopes that the output cuts by major producers would continue to chip away at global oversupply. (WSJ)
A dispute over creative control led Ralph Lauren CEO Stefan Larsson to leave the struggling luxury fashion brand after less than two years at the helm. (WSJ)
Why does the Super Bowl ring, the most desired piece of jewelry in sports, have to be ridiculous and unwearable? (WSJ)
Angus Loten and Tom Loftus contributed to this article. The Morning Download comes from the editors of CIO Journal and cues up the most important news in business technology every weekday morning. Send us your tips, compliments and complaints. You can get The Morning Download emailed to you each weekday morning by clicking http://wsj.com/TheMorningDownload.
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