Good morning, Broadsheet readers! President Trump attacks four freshman congresswomen, Norah O’Donnell is set to take over CBS Evening News tonight, and Serena Williams puts her money behind a startup fighting maternal mortality. Have a mindful Monday.
Good morning from Aspen! Fortune’s Brainstorm Tech conference kicks off today. You can watch the mainstage panels here starting at 2 p.m. Mountain Time (4 p.m. EST), and you’ll hear from:
— Doug McMillon, CEO of Walmart: As the world’s largest retailer, what do you do to stay there? Online, digitally enabled brick and mortar stores, organic food, pick-up and delivery, massive advertising—how do you keep up?
— Jamie Siminoff, founder of Ring: Ring went from Shark Tank rejection to Amazon acquisition. The CEO, who, during his “midlife entrepreneurial crisis” created the first Wi-Fi video doorbell in his garage, will share what he’s learned along the way.
— Katrina Lake, founder and CEO of StitchFix: In 2017, Katrina Lake took her company public. But first she spent years building her business, wisely leveraging data in the fickle retail and fashion worlds, and developing a sustainable new model in a highly competitive industry. How does she keep honing it to stay ahead?
… and many more. I’ll provide a synopsis tomorrow for those who are interested in reading further.
LIBRA HEARINGS: Politicians haven’t exactly welcomed Facebook’s Libra project with open arms. Politicians on both sides have expressed skepticism that Facebook can be trusted with a digital currency. Even President Donald Trump tweeted that Libra could threaten the power and dominance of the dollar.
Facebook has said repeatedly that it plans to work with regulators to get Libra off the ground, and David Marcus, the Facebook executive who has spearheaded the Libra effort, will testify before multiple congressional committees this week. Marcus is scheduled to testify before the Senate banking committee on Tuesday and the House financial services committee on Wednesday. He will likely be asked about privacy, money laundering, consumer protection and the stability of the financial system, all issues lawmakers say Libra raises.
Marcus wrote in a blog post last week that he wants to “ensure that Libra helps with the kinds of issues that the existing financial system has been fighting, notably around money laundering, terrorism financing, and more. Stay tuned because this will be one story to watch closely.
Katherine Dunn in London here, filling in for Alan. This morning, all eyes are on China, and the question everyone’s trying to answer is: just how bad was its second quarter?
The headline number certainly isn’t good: in the April to June period, China’s economy slowed to its weakest pace since 1992—the first year the country’s quarterly growth data figures were released. That represents 6.2% growth in GDP from the same period last year, a drop from 6.4% in the first quarter, and far below China’s typical blockbuster rate of expansion.
That figure looks like a sign that the U.S.-China trade war is really starting to bite, and comes amid a massive, two trillion yuan ($291 billion) stimulus program of tax cuts and benefits intended to limit any drag on growth, given Beijing’s goal of doubling the economy between 2010 and 2020.
But there are nuances in the numbers, and analysts are diverging on whether there are bright spots underneath the top-line drop.
A few possible silver linings: there were signs of investment across fixed assets at private firms, manufacturing, and infrastructure. Retail sales were better than expected, too. Meanwhile, numbers for June alone were actually considered strong, with growth in the manufacturing and retail sectors.
The question comes down to whether, in the second half of the year, Beijing’s stimulus is already taking the sting out of the trade war—or whether June was merely a blip.
China will be a big talking point at Fortune’s Brainstorm Tech conference, which kicks off in Aspen this afternoon. You can watch the livestream here, starting with an interview with Walmart CEO Doug McMillon just after 2 p.m. local time.
More news below.
Microsoft researchers have used an algorithm designed to work on an as-yet-nonexistent quantum computer to enhance the speed and quality of medical imaging.
The advance may one day improve the treatment of breast cancer and other diseases, the company says. For instance, it might allow doctors to determine within days whether a tumor is shrinking in response to chemotherapy, rather than having to wait weeks or months.
The development is one of a number of recent cases in which researchers have used algorithms designed for future quantum computers, machines that would make today’s supercomputers look like abacuses, to improve calculations running on today’s existing hardware. Other examples include using quantum algorithms to find better ways to manage the load across an electrical grid, improve delivery routes in a crowded city, and control risks and returns in an investment portfolio.
Better medical scans, more quickly
In the most recent illustration, Microsoft worked with scientists at Case Western Reserve University in Cleveland, who specialize in a type of medical imaging called magnetic resonance fingerprinting (or MRF.) Like the more familiar magnetic resonance imaging (MRI), the technique uses powerful magnetic fields and radio waves to create images of internal organs and soft-tissue. But while traditional MRIs can only identify areas of light or dark, which a radiologist must then subjectively evaluate, MRF can differentiate precisely between tissue types, allowing for more detailed and interpretable images.
Mark Griswold, a pioneer in MRF at Case Western Reserve who led the project, likes to use the analogy of trying to listen to a choir, where the tissues in the body are the singers: With a conventional MRI, it is as though the entire choir is all singing the same song, and the listener can only determine if one singer is a bit louder or softer than others, a bit higher or lower pitched, and maybe if they are out of tune. With MRF, on the other hand, it is like listening to a choir in which each singer has his or her own unique song, and the listener is able to isolate that song from the other voices in the choir and use it to identify the singer.
Configuring a scanner to find a particular tissue type—to isolate those individual songs—is time-consuming. With help from Microsoft’s quantum algorithm, the Case researchers found they could produce the scans in one third to one sixth of the time it took previously, while simultaneously boosting the precision of the scans by more than 25%. “The increase in precision is really important because it allows us to see smaller and smaller changes in the tissue,” Griswold says.
Microsoft has been highlighting the potential of quantum algorithms in part to seed the market for its future quantum computer. But it has also been emphasizing its quantum-inspired software because, unlike some rivals, it doesn’t yet have any fancy quantum hardware to show off, despite years of development.
The rise of quantum computing
Quantum computers use quantum mechanical properties to represent and manipulate information. In a conventional computer, information is processed in a binary format called bits, which have a value of either 0 or 1. The value of each bit is independent from all the other bits being used in the calculation. In a quantum computer, information is represented using quantum bits, or qubits. These qubits can be created using any number of phenomena that have quantum properties (for instance, the spin of electrons or the polarization of photons).
Unlike bits, qubits can represent both a 0 and a 1 at the same time—or in some cases, any value between 0 and 1. What’s more, the value of each qubit affects the value of other qubits in the system, opening the door to nearly instantaneous solutions instead of having to process information in a serial fashion. These two factors, in theory, give quantum computers an enormous advantage over conventional ones: Each additional qubit added to a quantum computer increase its power not linearly, but exponentially. A sufficiently large quantum computer ought to be able to do things that are beyond the ability of even today’s biggest supercomputers—like find much more energy efficient processes for manufacturing fertilizer or break the encryption that protects much of the world’s data.
Quantum computers were once the stuff of sci-fi novels. But in 2011, D-Wave Systems, a Canadian company, debuted the first commercially available quantum computer. (Its machine, however, can only be used for a certain sub-set of mathematical problems.) Since then, IBM, Google, and Rigetti Computing, a Berkeley, Calif.-based startup, have all built more general-purpose quantum computers that customers can access over the Internet. Meanwhile, Intel has unveiled quantum processors, although these are not yet available to commercial customers.
So far, none of these quantum computers are powerful enough to do something a conventional computer can’t, although it is believed Google may be close to crossing this threshold, which is known as “quantum supremacy.” Even when that happens, the quantum machines will still be too small and their calculations too prone to errors to be useful for most commercial applications.
The corporate quantum race
In the past year, Chinese company Alibaba has announced that it would build a quantum processor, Amazon has quietly hired a team of quantum computing experts, signaling it too may be building a machine, while at least a half dozen startups are also working on quantum hardware.
At Microsoft, CEO Satya Nadella has described quantum computing as one of three groundbreaking technologies —along with augmented reality and artificial intelligence—that will be essential to the company’s future. Under his leadership, the company has made a big bet on quantum: hiring a team of physicists, mathematicians, computer scientists and engineers from around the globe and placing one of its most experienced engineering executives, Todd Holmdahl, a veteran of both the Xbox game console and the HoloLens mixed reality headset, in charge of the effort.
The company has chosen an untested architecture for the qubits of its quantum computer, based on an elusive sub-atomic particle physicists weren’t even 100% sure existed until 2017. Those sub-atomic particles form a braid, and this shape should make them much more stable and less susceptible to buffeting interference from surrounding electromagnetic forces than those being used by IBM, Google, and Rigetti. That buffeting creates errors in a quantum computer’s calculations, which then have to be corrected. With a theoretically lower error rate, Microsoft’s design ought to be a safer bet for commercial applications. But, first, the company has to prove it can reliably create these braids and use them to form qubits—something it hasn’t yet done.
In the meantime, Microsoft has a whole group of mathematicians and computer scientists looking at ways to program quantum computers. And, as it turns out, some of the algorithms developed to take advantage of the weird properties of quantum computers can also be used to great advantage on normal ones.
A custom algorithm
With MRF, the trick is figuring out exactly how to tune the strength, frequency, and angle of the radio pulses the scanner transmits, Griswold says. Finding the right pulse pattern is what enables the scanner to identify tissue types—to isolate the song of each singer in the choir to use Griswold’s analogy. There is a mathematically optimal pattern that would allow the scanner to pick up only that tissue type with a precision down to the individual cell—but finding it involves so many variables that it is beyond the computational power of a conventional computer, he says. So researchers have relied almost entirely on educated guesswork to plan the pattern of pulses for each scan, he says. Even with this imperfect method, he says, MRF still results in much more detailed images than a typical MRI.
To get further improvements, Griswold says, he needed to get beyond human intuition. But when his team applied for a grant to research how to optimize the MRF scans using conventional algorithmic techniques, the application was rejected on the grounds that solving such a mathematically-challenging problem was simply impossible.
Then Griswold heard that Microsoft, which had worked closely with medical imaging experts at Case on a test case for its HoloLens augmented reality goggles, was looking for partners to create similar demonstration cases for quantum algorithms. Griswold, who had followed quantum computing developments closely for 20 years and knew some of the researchers now working on Microsoft’s efforts, realized this might be his chance.
“We like problems that are seemingly impossible,” Mattias Troyer, Microsoft quantum computing researcher who worked on the MRF project, says. What’s more, Troyer, says, MRF was the kind of seemingly impossible problem—an optimization challenge—for which quantum algorithms already existed.
Troyer says the existing quantum algorithm, however, had to be tweaked for Griswold’s exact problem. “What we like to stress it to really get the full power of the quantum optimizer, one really has to make a bespoke solution,” he says. In this case, Troyer says, the hard part was figuring out, from the several thousand variables involved in building an MRF image, which subset of factors the algorithm should try to optimize. Once you do this, he says, “the initially impossible begins to look possible.”
He also says that even though running the quantum algorithm on a conventional computer resulted in a significant increase in the speed and precision of the MRF scans, the results would have been even more impressive on a large-enough quantum computer. “It would have been much faster,” he says.
But the size quantum computer Troyer is talking about would require about one million logical qubits. And machines of that size are still many years, if not a few decades, away.
After Serena Williams gave birth to her daughter in 2018, she shared the life-threatening complications she experienced—and how, as a black woman, she was three times more likely to die from pregnancy or childbirth-related causes.
Now Williams—through her firm Serena Ventures—has invested in Mahmee, a startup working to end the maternal mortality crisis affecting black women in the United States. About 700 women die from pregnancy-related complications in the United States every year, according to the Centers for Disease Control. Three in five of those deaths are preventable, and one-third of those deaths happen up to a year after the birth.
Williams was joined in the $3 million funding round by angel investor Mark Cuban, returning investor the Bumble Fund, as well as ArlanWasHere, the joint project between Arlan Hamilton of Backstage Capital and Cuban, among others. The deal is the first lead investment for ArlanWasHere.
“I am incredibly excited to invest and partner with Mahmee, a company that personifies my firm’s investment philosophy,” Williams said in a statement. “Given the bleak data surrounding maternal death and injury rates, I believe that it is absolutely critical right now to invest in solutions that help protect the lives of moms and babies.”
Mahmee, founded in 2014, offers an online platform that allows women to track their health and the health of their child after giving birth. The platform connects users with supplemental health professionals, like lactation consultants, and lets them ask questions they feel don’t rise to the level of contacting their doctor. Unlike other telehealth platforms, Mahmee does not prescribe birth control or other medication. Its stated goal is to “close the gaps” in maternal and infant care.
“Technology’s not going to save the world, it’s not going to save the maternal health care industry,” says Mahmee CEO Melissa Hanna. She co-founded the company with her mother, Linda Hanna-Sperber, a longtime nurse and lactation consultant, and a third co-founder, Sunny Walia. “It can be a component of a solution here,” she says.
By selling its service through health systems and hospitals—like current partners Cedars-Sinai Medical Center and Children’s Hospital Los Angeles—Mahmee works to reach consumers of all income levels. A woman who receives health coverage through Medicaid, for instance, can use the Mahmee platform if her hospital offers it.
According to Hanna, Williams connected with Mahmee through Hamilton. Serena Ventures has invested in more than 30 companies and increased its public profile in the past year. “It was a really important moment for our team to have support from someone like her,” Hanna said.
With its funding, Mahmee plans to hire more engineers, clinicians, and sales staff to support its expansion; the startup is focusing on cities with especially high maternal mortality and morbidity rates.
More must-read stories from Fortune:
—Sallie Krawcheck wants CEOs to “break the wheel” to solve the diversity crisis
—What’s next in blockchain? Ask this teenage engineer
—Accenture names a new CEO: Julie Sweet
—Here’s how to get more women in leadership
What started as an apparent publicity stunt for Amazon’s loyalty program has become an unmatched retail phenomenon. Black Friday might still be considered the king of deal days by many, but when you look at the numbers, Prime Day might be the best time to buy.
A four-year price comparison of Prime Day vs. Black Friday by BestBlackFriday.com and Offers.com shows that prices during Amazon’s summer sale regularly best the unofficial start of the holiday shopping season. And this year could have even more deals than last.
Prime Day 2019 is predicted to have prices that will be better than Black Friday 2018 on at least 70% of the featured items, say the sites. If that proves accurate, it will top last year, when 67% of Prime Day prices were better than the previous year. (In 2018, another 15% of the items tied their Black Friday pricing.)
For comparison’s sake, in 2017 76% of the deals on Prime Day were better than Black Friday. That number hit 77% of the deals in 2016 and 64% in 2015.
The good news is: You won’t have to stay up late obsessively bargain hunting. The best deals on Prime Day historically have happened during daylight hours, not late at night. Some of the best deals don’t go live until the final hours. (TVs, for instance, saw deep discounts at the end of Prime Day in 2017.)
Related reading on Amazon Prime Day 2019:
—8 ways to track the best Amazon Prime Day deals
—eBay is crashing Amazon Prime Day (and so is Target)
—Prime Day 2019: By the numbers
Code breaker and father of artificial intelligence Alan Turing will be the face of the U.K.’s new polymer 50-pound ($63) note.
The mathematician was chosen from almost 1,000 eligible nominations from the field of science suggested by the public, Bank of England Governor Mark Carney said at an event in Manchester, U.K. on Monday.
“Alan Turing was an outstanding mathematician whose work has had an enormous impact on how we live today,” Carney said. “Turing is a giant on whose shoulders so many now stand.”
— Bank of England (@bankofengland) July 15, 2019
Other names on the shortlist for the note included Stephen Hawking, Ada Lovelace and Charles Babbage, and Mary Anning.
Turing — played by Benedict Cumberbatch in a 2014 movie about his life — was best known for his work devising code breaking machines during World War II and later helped develop the first computers. His work on the question of whether computers can think laid the foundations for AI.
The decision follows a campaign for more diversity on the U.K. currency. Turing, who was convicted for gross indecency for his relationship with a man, was chosen from a shortlist of nine men and four women. He was pardoned posthumously in 2013.
The new polymer note, Britain’s highest denomination in circulation, is set for release by the end of 2021 and the concept design unveiled by Carney featured a photograph of Turing taken in 1951. A table and mathematical formula from his academic work, a picture of an early digital computer, binary code, and a quote from Turing are also included.
More must-read stories from Fortune:
—A Brexit architect sees opportunities in resignation of U.K.’s Trump-bashing ambassador
—Fashion retailers sidestepping Trump’s trade war with China
—Ford’s new plan for Europe: Fewer jobs, more SUVs
—The U.S. threatened France with China-style tariffs. The French didn’t blink
—Listen to our new audio briefing, Fortune 500 Daily
Catch up with Data Sheet, Fortune‘s daily digest on the business of tech.
Good morning from Aspen, Colo., literally (at 8,000 feet) and figuratively one of the most breathtaking places in the world. My Fortune colleagues and I convene the annual Brainstorm Tech conference this afternoon (starting at 2 p.m. Mountain Time). We’ll be joined by some of the brightest lights in tech, all here to see around corners on the weightiest topics facing the industry. You can watch most of the proceedings at Fortune.com. We’ll have lots of questions of our guests. Here are some I’d particularly like to see asked:
- Alibaba commercialized Single’s Day in China. Amazon’s Prime Day is Monday and Tuesday (is that cheating?). Why is there no Walmart Day? President and CEO Doug McMillon may have thoughts.
- What the heck is quantum computing, really, and when will it be a commercial reality? Microsoft’s Krysta Svore and Andrew Fursman of 1QBit should enlighten.
- Do the business and societal and health-related upsides from genetic testing outweigh the downside of the ick factor of giving companies the most intimate of personal information? Margo Georgiadis of Ancestry.com and Color’s Othman Laraki will weigh in.
- Has social media turbo-charged hate speech, or have we just become more hateful? Sadly, the Anti-Defamation League’s Jonathan Greenblatt knows the answer.
- Do musical artists love or hate Spotify? (Or both?) Singer-songwriter FLETCHER (look her up) will opine in the presence of Spotify’s “chief premium business officer” Alex Norstrom. (And what exactly does that title mean?)
- Did Slack even consider doing an old-fashioned money-raising IPO rather than the direct listing it successfully completed last month? CEO Stewart Butterfield can say.
These are just a few previews of the first day. Please follow our coverage and expect more throughout the week.
Some recommended reading before you go:
- Here’s a colorful and revelatory account of the president’s unbalanced White House Social Media Summit last week.
- For years I have scrambled in various locations around the country to find a print newspaper, often knowing Starbucks was my first and best hope. (For all the online reading I do, I continue to find print to be the best discovery vehicle.) No longer.
- If the unrest in Hong Kong or the enigma that is modern China interests you, please read this haunting, beautiful, troubling, and important essay by the artist Ai Weiwei.
On Twitter: @adamlashinsky
It’s going to seem like just about everything is on sale when Prime Day 2019 is going strong. And, to some extent, that might be true. But there’s a difference between an item being on sale and being at its best price of the year.
As tempting as it may be to buy certain items on Prime Day, a little patience can work in your favor. Here’s a quick look at where you’ll save the most—and where you might want to wait a while.
What should you buy on Amazon Prime Day 2019?
Prime Day is as much about expanding Amazon’s reach into the home as it is about driving Prime memberships. As a result, devices like the Echo, Kindle, Fire TV and Ring Video Doorbell are being offered at significantly reduced prices, some as much as 40% less than they cost on Black Friday 2018.
This category is a bit hit or miss. Pattern, a third-party seller, analyzed the most popular products sold on Prime Day last year and found that roughly half of the tech products were cheaper during the sale, with significant discounts.
Adobe Analytics agrees that electronics are the hot item during Prime Day.
“Consumers, look for the steepest electronic discounts on smart items, specifically watches, TVs, and home accessories,” said Taylor Schreiner, principal analyst at Adobe Digital Insights (ADI).
Pattern’s study found that Prime Day is prime time to stock up on tents and other camping supplies. (A not entirely surprising revelation, since camping season is nearing its end.)
Amazon offers lots of clothing sales during Prime Day. And Adobe’s research shows that the discounts often outpace those you’ll find during the holidays.
As with clothing, Prime Day discounts on sheets and bedspreads are greater than those during the holiday season.
What should you not buy on Amazon Prime Day 2019?
Many people use Prime Day to get a jumpstart on holiday shopping, but Pattern finds that it’s better to wait when it comes to toys. Those discounts tend to be deeper during Black Friday and Cyber Monday sales.
While the timing of your needs for these products is generally not flexible, new parents won’t see tremendous savings on essentials during Prime Day, says Pattern.
This is another category that could go either way. Adobe notes that discounts on home goods are often on par with Cyber Monday, but Pattern insists that if you’re looking for, say, a blender or other kitchen appliance, you’re better off waiting until the holiday sales.
Related reading on Amazon Prime Day 2019:
—8 ways to track the best Amazon Prime Day deals
—eBay is crashing Amazon Prime Day (and so is Target)
—Prime Day 2019: By the numbers
China’s economy slowed to the weakest pace since quarterly data began in 1992 amid the ongoing trade standoff with the U.S., while monthly indicators provided signs that a stabilization is emerging.
Gross domestic product rose 6.2.% in the April-June period from a year earlier, below the 6.4% expansion in the first quarter. In June, factory output and retail sales growth beat estimates, while investment in the first half of the year also gave further evidence that stimulus measures to curb the slowdown are feeding through.
Fixed asset investment growth in the first half accelerated at private firms, whereas state companies eased back, a further sign that government efforts to funnel cash to the private sector may be bearing fruit.
For the manufacturing sector, investment accelerated a notch to 3% in the first half, while infrastructure investment also picked up to 4.1%.
Better-than-expected retail sales data also lend credence to the idea that stability will emerge in the second half of the year. While the data are volatile, faster growth in sales of consumer goods, household appliances and furniture also point to the modest recovery ongoing in the vital property sector.
The overall retail sales result was also driven by robust auto sales growth, though with heavy discounts attracting buyers in June economists remain cautious on whether that upturn can be sustained.
A fiscal stimulus plan including about two trillion yuan ($291 billion) of tax cuts is slowly feeding through into the economy. The government has stepped up efforts recently, easing the rules for using government debt in some infrastructure projects and pledging to renovate hundreds of thousands of old buildings.
“We can take comfort in that the expansionary measures by the government are actually working,”said Mary-Therese Barton, head of emerging market debt at Pictet Asset Management SA, speaking on Bloomberg TV. “So we take a lot of heart in the retail sales data, in particular, and the strength of domestic consumption.”
Amid concerns about emerging price bubbles and risks in the financial sector, officials are likely to keep the recovery in the property market tightly controlled. Property development investment slowed for a second month in June, dragging down the growth of newly started property construction and inventory.
Until now, China’s leadership is tolerating the continued deceleration in the economy while the official unemployment rate remains low, and monetary policy has remained supportive without flooding the financial system with cash. Further tweaks to cement any nascent stabilization could be announced following a meeting of top leaders this month.
“China’s economy in the third quarter may face more downward pressure,” said Larry Hu, head of China economics at Macquarie Securities Ltd. in Hong Kong. “There probably won’t be any obvious policy adjustment in July, but more possibilities of change in the fourth quarter.”