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Sir Martin Sorrell’s Silicon Valley charm offensive

Sir Martin Sorrell is the kind of founder who people in Silicon Valley most prize. He has enjoyed huge success, having built the world’s biggest advertising conglomerate over 32 years, WPP. He’s also out for revenge. Soon after WPP’s board began investing an “allegation of misconduct” in the spring of last year — it later asked him to pay back $200,000 in personal expenses — Sorrell left the company in a huff.

Six weeks later, he’d formed a new company, S4 Capital, using a playbook that he knows works. He and a partner launched London-based WPP by buying a controlling stake in publicly traded company that made wire baskets and teapots, then using it to launch a global shopping spree. Similarly, S4 emerged from a reverse-merger with Derriston Capital, a small shell company that went public on the London Stock Exchange in 2016 and rebranded as S4. Then it started bulking up.

Already S4 — which Sorrell funded himself with £40 million and that has raised tens of millions more from other institutions for acquisitions — has successfully pursued nine companies, though Sorrell stresses these are mergers. “All half cash and half stock.” No long lock-ups, either, says Sorrell, who was bouncing around the U.S. this week before heading to the Web Summit event in Lisbon.

“If you want to sell your company, if you want to make a quick kill and get out, we’re not interested. If you want to sign up to our vision” and help turn S4 is a powerhouse in its own right, that’s a different story, he suggests.

Silicon Valley is seemingly a big piece of the picture. Last month, S4 Capital finalized a $150 million deal to merge with the largest digital agency in the region, nine-year-old Firewood, with S4 paying $112 million up front in shares and cash and the balance coming if Firewood hits its targets for the year.

It also late last year merged with the San Francisco-based digital media and programmatic consultancy MightyHive in a deal valued at $150 million.

If it sticks it to WPP on occasion, that’s probably okay, too. S4 Capital’s first acquisition, for example, of the Dutch digital production agency MediaMonks, came at the expense of WPP, which had also been trying to buy the company. The WSJ reported at the time that S4 agreed to pay roughly $350 million for the agency.

The broad idea, Sorrell says, is to focus S4 entirely on digital advertising and on media and marketing services specifically, where in 2019 for the first time, the world’s advertisers will spend  more than half of their ad budgets. “The digital media industry is up 6 percent [for the year] and it’s down for traditional media, so we’re going where the growth is and pushing on an open door, unencumbered by legacy or analog businesses.”

Asked whether he doesn’t also have an axe to grind when it comes to WWP — which is steeped in both the digital and traditional ad worlds — Sorrell doesn’t hesitate. “I want to see this approach succeed. And if that’s an axe, that’s correct.”

Much of that approach centers on partnering with, rather than trying to compete, with the giants of ad tech, including Facebook and Google, precarious as that arrangement can be.

Other current tech clients include Apple, Salesforce, Microsoft, LinkedIn, Uber, and ServiceNow, which, according to Sorrell, treat S4’s creative and strategic marketing professionals as extensions of their internal marketing teams.

Firewood, for example, will embed teams within companies like Google to “understand the client as well as possible,” Sorrell says. As he explains it, “We don’t compete with [these companies]. We service them; we work with them. If we’re being crude about it, we’re resellers for each one of them. They don’t want to get into the service business.”

They also want to maintain control over what they know of our tastes and interests and other data on which they have an increasing lock, but asked whether he thinks some of these tech clients should be broken up, he insists that he does not, “as long as they’re transparent and they really exercise the power they have responsibly.”

Asked how S4 overcomes the growing number of people who don’t think companies are acting responsibly with their private information and might increasingly opt out of sharing it, Sorrell shrugs off the idea that people are deeply concerned about targeted advertising. “My view is that as long as the consumer knows what they’re letting themselves in for, it’s fine. If I know how my data will be used, in simple language, [I’m not going to opt out.] I do think we’ll have differentiated models, [such as] ‘I want to control my data so [you’re going to pay me for it in some fractional way].’ The problem is caused by people not knowing what’s being done with their data.”

And even that problem is dwarfed by what Sorrell sees as the real reason for so much hand-wringing, which is the size of these companies. “When Apple was the first to become a trillion-dollar company, [former Goldman Sachs CEO Lloyd Blankfein] was asked which would be the first $2 trillion company, and he said there won’t be one because no nation-state would allow a company to get to $2 trillion. You see this in China, too,” he says. “I’ve heard concerns expressed about the size of Alibaba. It’s not just a Western phenomenon.”

And what of political ads leading up to the U.S. presidential election, we ask Sorrell. Twitter has taken a stand; Google is weighing changes to its own ad policy. Should these platforms be running them, no matter their content?

That one, he says is “very difficult. My view has always been that these are media companies that are responsible for the content flowing through their pipes. I think they are acknowledging it; Facebook has thousands of people monitoring content.

“But should we take political advertising or not? Well, in the U.K. You have to be truthful. If the ads aren’t truthful, we’ve got trouble. I think Zuckerberg made the argument that his people know what’s a fact or not, but arbitrating what’s the truth or not is quite difficult,” he concedes.

Before long, our time is up, but before he goes, we discuss with Sorrell traditional ad giants, like the one he himself built across three decades before leaving it abruptly last year. Perhaps it’s unsurprising, given his new endeavor, but he says those companies, with their tangle of properties, most of which are run like independent fiefdoms, should most definitely be dismantled. “I don’t think they have a chance of making it with the legacy assets they have.”

Sorrell recalls one “snotty comment” made by one of the established players, regarding his new venture: “Someone called us a spec in the mirror.” Continues Sorrell, “When you’re in a car crash, that spec in the mirror catches up with you very quickly.”

Sir Martin Sorrell’s Silicon Valley charm offensive

Sir Martin Sorrell is the kind of founder who people in Silicon Valley most prize. He has enjoyed huge success, having built the world’s biggest advertising conglomerate over 32 years, WPP. He’s also out for revenge. Soon after WPP’s board began investing an “allegation of misconduct” in the spring of last year — it later asked him to pay back $200,000 in personal expenses — Sorrell left the company in a huff.

Six weeks later, he’d formed a new company, S4 Capital, using a playbook that he knows works. He and a partner launched London-based WPP by buying a controlling stake in publicly traded company that made wire baskets and teapots, then using it to launch a global shopping spree. Similarly, S4 emerged from a reverse-merger with Derriston Capital, a small shell company that went public on the London Stock Exchange in 2016 and rebranded as S4. Then it started bulking up.

Already S4 — which Sorrell funded himself with £40 million and that has raised tens of millions more from other institutions for acquisitions — has successfully pursued nine companies, though Sorrell stresses these are mergers. “All half cash and half stock.” No long lock-ups, either, says Sorrell, who was bouncing around the U.S. this week before heading to the Web Summit event in Lisbon.

“If you want to sell your company, if you want to make a quick kill and get out, we’re not interested. If you want to sign up to our vision” and help turn S4 is a powerhouse in its own right, that’s a different story, he suggests.

Silicon Valley is seemingly a big piece of the picture. Last month, S4 Capital finalized a $150 million deal to merge with the largest digital agency in the region, nine-year-old Firewood, with S4 paying $112 million up front in shares and cash and the balance coming if Firewood hits its targets for the year.

It also late last year merged with the San Francisco-based digital media and programmatic consultancy MightyHive in a deal valued at $150 million.

If it sticks it to WPP on occasion, that’s probably okay, too. S4 Capital’s first acquisition, for example, of the Dutch digital production agency MediaMonks, came at the expense of WPP, which had also been trying to buy the company. The WSJ reported at the time that S4 agreed to pay roughly $350 million for the agency.

The broad idea, Sorrell says, is to focus S4 entirely on digital advertising and on media and marketing services specifically, where in 2019 for the first time, the world’s advertisers will spend  more than half of their ad budgets. “The digital media industry is up 6 percent [for the year] and it’s down for traditional media, so we’re going where the growth is and pushing on an open door, unencumbered by legacy or analog businesses.”

Asked whether he doesn’t also have an axe to grind when it comes to WWP — which is steeped in both the digital and traditional ad worlds — Sorrell doesn’t hesitate. “I want to see this approach succeed. And if that’s an axe, that’s correct.”

Much of that approach centers on partnering with, rather than trying to compete, with the giants of ad tech, including Facebook and Google, precarious as that arrangement can be.

Other current tech clients include Apple, Salesforce, Microsoft, LinkedIn, Uber, and ServiceNow, which, according to Sorrell, treat S4’s creative and strategic marketing professionals as extensions of their internal marketing teams.

Firewood, for example, will embed teams within companies like Google to “understand the client as well as possible,” Sorrell says. As he explains it, “We don’t compete with [these companies]. We service them; we work with them. If we’re being crude about it, we’re resellers for each one of them. They don’t want to get into the service business.”

They also want to maintain control over what they know of our tastes and interests and other data on which they have an increasing lock, but asked whether he thinks some of these tech clients should be broken up, he insists that he does not, “as long as they’re transparent and they really exercise the power they have responsibly.”

Asked how S4 overcomes the growing number of people who don’t think companies are acting responsibly with their private information and might increasingly opt out of sharing it, Sorrell shrugs off the idea that people are deeply concerned about targeted advertising. “My view is that as long as the consumer knows what they’re letting themselves in for, it’s fine. If I know how my data will be used, in simple language, [I’m not going to opt out.] I do think we’ll have differentiated models, [such as] ‘I want to control my data so [you’re going to pay me for it in some fractional way].’ The problem is caused by people not knowing what’s being done with their data.”

And even that problem is dwarfed by what Sorrell sees as the real reason for so much hand-wringing, which is the size of these companies. “When Apple was the first to become a trillion-dollar company, [former Goldman Sachs CEO Lloyd Blankfein] was asked which would be the first $2 trillion company, and he said there won’t be one because no nation-state would allow a company to get to $2 trillion. You see this in China, too,” he says. “I’ve heard concerns expressed about the size of Alibaba. It’s not just a Western phenomenon.”

And what of political ads leading up to the U.S. presidential election, we ask Sorrell. Twitter has taken a stand; Google is weighing changes to its own ad policy. Should these platforms be running them, no matter their content?

That one, he says is “very difficult. My view has always been that these are media companies that are responsible for the content flowing through their pipes. I think they are acknowledging it; Facebook has thousands of people monitoring content.

“But should we take political advertising or not? Well, in the U.K. You have to be truthful. If the ads aren’t truthful, we’ve got trouble. I think Zuckerberg made the argument that his people know what’s a fact or not, but arbitrating what’s the truth or not is quite difficult,” he concedes.

Before long, our time is up, but before he goes, we discuss with Sorrell traditional ad giants, like the one he himself built across three decades before leaving it abruptly last year. Perhaps it’s unsurprising, given his new endeavor, but he says those companies, with their tangle of properties, most of which are run like independent fiefdoms, should most definitely be dismantled. “I don’t think they have a chance of making it with the legacy assets they have.”

Sorrell recalls one “snotty comment” made by one of the established players, regarding his new venture: “Someone called us a spec in the mirror.” Continues Sorrell, “When you’re in a car crash, that spec in the mirror catches up with you very quickly.”

Here are all 47 artists featured in Netflix’s ad highlighting black representation

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Netflix recreated a legendary photo for its new ad showcasing black artists who create original content with the streaming giant.

Aired during Sunday’s BET Awards broadcast, the ad dubbed “A Great Day in Hollywood” features 47 black actors, writers, showrunners, and producers from over 20 Netflix original shows, films and documentaries.

Notably, the ad comes just days after Netflix fired its top communications chief Jonathan Friedland for “insensitive” remarks, which included repeated use of the N-word.

Directed by Lacey Duke (who also did Janelle Monae’s “I Like That” music video), the ad directly references Art Kane’s infamous 1958 Esquire photograph, “A Great Day in Harlem,” which featured 57 jazz legends sitting on the steps of a brownstone in Harlem, New York, including Thelonious Monk, Count Basie, and Charles Mingus. Read more…

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Google spruiks Assistant with Chrissy Teigen and John Legend

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Just like you, celebrities find the small things in life difficult.

It’s something that’s highlighted in a series of ads for Google Assistant, released during the Oscars on Monday.

The first of the ads features John Legend and Chrissy Teigen, trying to deal with the annoying task of searching for a show on TV, convincing that you should “make Google do it,” the ad’s tagline.

Legend actually sings in one of the ads too, albeit about the time it takes for Teigen to find a TV show.

Then here’s NBA star Kevin Durant forgetting to remember his grocery list. Read more…

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Australian lamb ad causes outrage for featuring vegetarian Hindu god

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A new ad promoting Australian lamb has caused a strong reaction from the Australian Indian and Hindu communities, for the representation of deity Ganesha encouraging the eating of lamb.

Released on Monday, Meat and Livestock Australia’s new spring ad brings the world’s religious figures together for a casual barbecue — serving lamb, of course.

Guest include Jesus, Moses, Zeus, Buddha and Scientology founder L. Ron Hubbard, along with Hindu god Ganesha. Unfortunately for MLA, Ganesha is known as vegetarian, which contradicts the campaign’s key message: “Lamb, the meat we can all eat.”

So the Hindu community in Australia is outraged by this ad. Of course. Tbf it is offensive if Ganesha is God to you https://t.co/tuyP53OwRT

— Malhar Bhadbhade (@malharcfc08) September 6, 2017 Read more…

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Heinz's new Australian ad could be mistaken for a Pixar short film

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If you’re in the business of marketing baked beans, you’ll pull out a fair few stops and a large budget to cut through the noise.

Heinz has launched their new Australian ad for baked beans, as part of their new ‘Can Size for Every Aussie’ product launch, and it could be mistaken for a Pixar short.

Created over a year, the ad has a rather Up vibe. It focuses on central character Geoff, head of innovation at the company. Essentially, the ad is a three-minute life narrative of a man addicted to beans, and his future wife in the spaghetti department. See for yourself above. Read more…

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People are not cool with Katy Perry's Australian ad

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Don’t mess with the koalas, Katy Perry.

The pop star faced criticism for telling her pet dog Nugget “let’s go chase some koalas” in an ad for Australian department store chain Myer. 

But one veterinarian wasn’t cool with the koala, saying it reverses efforts to stop dogs coming into contact with the marsupial.

“Perry is a role model to so many young people, and this just destroys all the good work we do to try to encourage people not to let their dogs come into contact with koalas,” Queensland vet Claire Madden told the Courier Mail. Read more…

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Quora just launched a self-serve ad platform

 While Quora has been around for almost seven years, it’s been a little slow when it comes to monetization through advertising.
The question-and-answer site first launched ads last year in April 2016, but since then it’s only existed in closed beta to pre-approved advertising partners like Mulesoft and Shopify.
Until now.
The startup just announced that it’s opening its… Read More

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Ads will target your emotions and there's nothing you can do about it

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If you’re happy and you know it, you might be interested in buying these products. 

With everything about consumers now tracked online, it comes as little surprise that emotions have recently popped up as a quiet — and rather creepy — way for advertisers to target you. 

Over the weekend, The Australian revealed that Facebook’s ad targeting tools may be able to prey on teen insecurities. It’s the sort of story that weds traditional advertising’s worst tendencies with the creepy omnipotence of its modern form in a way that makes one wonder if Facebook is actively cribbing ideas from episodes of Black Mirror.   Read more…

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Nivea actually ran an ad with the slogan 'white is purity' and didn't end well

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You don’t need to be a genius to figure out that putting the words “white” and “purity” together is problematic, what with white supremacy and all.

Yet beauty brand Nivea slapped a “white is purity” slogan on one of its recent advertisements. A move they’re now presumably regretting. 

The ad for its invisible deodorant was posted on the brand’s Facebook page, geo-targeted at followers in the Middle East, according to the BBC.

“Keep it clean, keep bright. Don’t let anything ruin it, #Invisible,” the post reads. 

Nivea removes ‘white is purity’ deodorant advert branded ‘racist’ https://t.co/aXA9P6fY0N pic.twitter.com/tTxUcfP5xI

— BBC Newsbeat (@BBCNewsbeat) April 4, 2017 Read more…

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Donald Trump-inspired app counts how often men interrupt women

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Tired of being interrupted? A new app claims it may be able to help.

Called Woman Interrupted, the app uses your smartphone’s microphone to analyze conversations and track how many times men interrupt women in a given conversation. 

Created by Brazilian ad agency BETC to coincide with International Women’s Day, the app’s creators say Woman Interrupted was inspired in part by the first presidential debate when Donald Trump repeatedly interrupted Hillary Clinton. 

The app, which is available for both iOS and Android, uses your smartphone’s microphone to track conversations and determine the number of interruptions in a given conversation.  Read more…

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Brother and sister fight over a guy in Coke's new ad

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Nothing like some good old sibling rivalry. 

Coke’s new ad features a brother and sister that are both fighting over the attractive guy cleaning their pool.

The video, which has been viewed almost three million times, has been praised for being inclusive and supporting diversity. 

But the real question is, who gets the guy in the end? Watch to find out. Read more…

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Why newspaper subscriptions are on the rise

Newsboy wearing flat hat holding newspaper and shouting to sell.Megaphone in right hand, and newspapers in left hand.Model is wearing red suspenders.The image was shot with Hasselblad H4D So much for the death of the newspaper industry. A recent study found that more than 169 million U.S. adults read newspapers every month, in print, online or mobile. That’s almost 70 percent of the population. Why are readers and publishers alike embracing paid subscriptions for content services over ad-based business models? Read More

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This startup buys and fixes up languishing mobile games and tools

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Major app stores are often littered with forgotten or neglected husks of software — apps that developers have, for whatever reason, long given up on updating or actively managing.

While some simply gather cobwebs, others maintain loyal followings of a respectable size despite their dilapidated code. In those latter cases, inattentive proprietors are often letting a steady stream of potential advertising dollars fall by the wayside. 

That’s the opportunity two ad tech veterans are looking to seize with Maple Media, a startup that buys or manages apps with owners who are either unequipped for or uninterested in the day-to-day busy work of running and maintaining them. Read more…

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Apple responds to people's tweets with entire commercials

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When it comes to fielding customer service questions on Twitter, most companies are content to respond with a simple at-reply. 

But Apple is thinking different.

The Cupertino tech giant just released a series of iPad Pro commercials, each of which address an individual customer’s social media concern. 

The ads each feature an actor holding a giant print-out of a tweet, while chatting with a helpful narrator. The tweets and usernames are real, but the avatars have been changed to match their presenters.

The idea is to demonstrate how the iPad might help with some of the real frustrations people have with their laptops. Read more…

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A new anti-smoking ad slams Big Tobacco for targeting black neighborhoods

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The tobacco industry knows all about diversity — and knows exactly how to exploit it. 

That’s the message of a new ad campaign from anti-smoking group Truth Initiative that highlights the ways in which cigarette marketers disproportionately target disadvantaged groups.

In the commercials, comedian and former MTV VJ Amanda Seales talks through some stark statistics about the abundance of tobacco ads in black neighborhoods, near low-income schools and other areas where they’re more likely to be seen by various underprivileged populations.  Read more…

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A new anti-smoking ad slams Big Tobacco for targeting black neighborhoods

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The tobacco industry knows all about diversity — and knows exactly how to exploit it. 

That’s the message of a new ad campaign from anti-smoking group Truth Initiative that highlights the ways in which cigarette marketers disproportionately target disadvantaged groups.

In the commercials, comedian and former MTV VJ Amanda Seales talks through some stark statistics about the abundance of tobacco ads in black neighborhoods, near low-income schools and other areas where they’re more likely to be seen by various underprivileged populations.  Read more…

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Facebook updates its ad policies and tools to protect against discriminatory practices

Facebook CEO Mark Zuckerberg speaks at the company's headquarters in Menlo Park, Calif., Thursday, April 4, 2013. Zuckerberg says the company is not building a phone or an operating system. Rather, Facebook is introducing  a new experience for Android phones. The idea behind the new Home service is to bring content right to you, rather than require people to check apps on the device.   (AP Photo/Marcio Jose Sanchez) In November, Facebook announced it would stop advertisers from targeting users by race for ads that focused on housing, employment, and credit opportunities, in response to a report that found that Facebook’s tools could be used to place discriminatory advertisements. Today, the social network provided a progress update on the matter, disclosing what actions it has taken since… Read More

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Weird Yellow Tail wine Super Bowl ad embarrasses a nation of Twitter users

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The Kangaroo Jack of wine, Yellow Tail, has managed to do something not even Fosters beer or pseudo-Aussie restaurant chain Outback Steakhouse has achieved: Embarrass the hell out of actual Australians. Why? The brand’s 30-second Super Bowl Sunday advertisement. 

It features some dude in a bright yellow suit, running his mouth about how drinking Yellow Tail wine equals a fun time, hanging with an animated kangaroo DJ and a thinly-veiled dick joke aimed at bikini-clad model, Ellie Gonsalves. It’s a mess.

Just watch.

After Australia’s Prime Minister was recently yelled at by Trump, the last thing the land Down Under needs is an additional battering from a terrible ad for even more terrible wine.  Read more…

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Brutally honest ad for a 2002 Oldsmobile brings the internet infinite joy

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You know it’s a dark day in America when a used car salesman is more capable of telling the truth than the president.

A Facebook ad for a 2002 Oldsmobile went viral this weekend for all the right reasons. Instead of trying to oversell what is undoubtedly a deeply terrible car, the advertiser keeps it honest with folks. This is a predictably awful, cheap car that probably won’t kill you. Yet. 

Twitter user kel121121 shared a screenshot of the ad, which has since been retweeted 72,000 times.

“Don’t bring your ass down here saying it looks different in pics or you didn’t know it had that much rust. I’m telling you now. This bitch rusty,” the ad reads. Read more…

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Uber fights against #DeleteUber hashtag with targeted ads

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Ride-hailing app Uber has had a rough weekend. The company found itself the target of a negative hashtag Sunday, stemming largely from Donald Trump’s executive order to ban citizens of seven Muslim-majority countries from entering the U.S.

Saturday saw a huge protest against the de facto Muslim ban at JFK International Airport in New York. Taxi drivers refused to pick people up from the airport in solidarity with those who were detained after Trump’s order.

Uber, meanwhile, one of the world’s wealthiest startups last valued at $68 billion, continued operating and promoted the decision to eliminate its controversial surge pricing, which lowered prices but was seen by many as “strike breaking.”  Read more…

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This bag of chips can sense if you've been drinking and call you an Uber

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Tostitos’ new bag wants to chaperone your Super Bowl party.

In honor of the big game, the chip maker is launching a special-edition version of its packaging with a built-in sensor that can detect trace levels of alcohol in your breath. 

If it decides you’ve been drinking — regardless of how much — an image of a red steering wheel appears on the otherwise stark black bag along with a reminder not to drive and a code for a $10 Uber discount (valid only on Super Bowl Sunday).

And if you’ve had so much to drink that the mere act of hailing an Uber becomes a difficult chore, the bag will even do that for you. The package is equipped with near-field communication technology that will automatically order a ride when tapped with a smartphone. Read more…

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This startup is taking on fake news in the vitamin and supplement world

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The term “snake oil” — now a catch-all for any scam good with a flashy sales pitch — originated in the days when con artists would roam from town to town by wagon, shilling useless health elixirs to unwitting marks.

Today, their spiritual successors have a bit more technology at their disposal. They’ve traded in the slick speeches and stages for blogs and websites, making for an online media universe of holistic cures and herbal remedies that’s notoriously rife with sometimes dangerous misinformation.

That bad reputation is one of the biggest challenges faced by a new startup called Care/of, which offers personalized vitamin and supplement regimens on a monthly subscription basis.  Read more…

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