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Code/red: Winter Is Coming, Says John Chambers

Plus, drunk fish and Google’s plans to advertise on thermostats.


  • Opponents of the proposed Comcast/Time Warner Cable merger are protesting outside Comcast’s annual shareholder meeting in Philadelphia.
  • eBay CEO John Donahoe is having a really bad day.
  • Twitter is holding its first annual shareholder meeting.

Cisco CEO Invites IT Pals to Red Wedding

Cisco CEO John Chambers traded his affable Southern gentleman persona for that of a prophesying, fire-and-brimstone preacher at Cisco Live earlier this week. Delivering the keynote address at the company’s annual summit, Chambers warned of dark times ahead. “You are going to see a brutal, brutal consolidation of the IT industry where out of the top five players, only two or three of us will be meaningful in as quick as five years,” he said. “Out of the private sector companies in this room, 87 percent of you will have a major financial shortfall in the next 15 years, and just 10 percent of you will manage to come back from it.”

Welcome to Google’s Invasive Advertising Dystopia — Population: Everyone

Google: “A few years from now, we and other companies could be serving ads and other content on refrigerators, car dashboards, thermostats, glasses, and watches, to name just a few possibilities.” (Please, just leave us the bathroom.)

Hackers to eBay: Great Transaction! Highly Recommended! A+++

Fire up that password manager — eBay’s been hacked. The company is encouraging its users to change their passwords following a cyber attack that compromised its corporate network and a database attached to it. That database didn’t include financial data, but it did store a bevy of important personal information — passwords, email addresses, physical addresses, phone numbers and birth dates. EBay says there’s no evidence that the attack has resulted in any unauthorized user activity, but that’s hardly reassuring as the company didn’t even notice the compromise until about two weeks ago and concedes that the attack that made it possible occurred sometime between late February and March.

You Know Who’d Make a Great FBI Recruiter? Snoop.

FBI Director James B. Comey: “I have to hire a great workforce to compete with those cyber criminals and some of those kids want to smoke weed on the way to the interview.”


Kleiner Perkins Caufield & Byers has a new chief operating officer: Scott Ryles. The former CEO and founder of Echelon Capital Strategies replaces Eric Keller, who served as COO since 2008. No word yet on what happened to Keller or his future plans.

Alternate Theory: Surface Pro 3 Ate the Mini in the Lab

Bloomberg: “Microsoft Chief Executive Officer Satya Nadella and Executive Vice President Stephen Elop decided that the [Surface Mini] wasn’t different enough from rivals and probably wouldn’t be a hit, said one of the people, who asked not to be identified because the plans weren’t public.”

You Notice Charlie’s Got That Nervous “Last Call” Look on His Face Lately?

Verizon CEO Lowell McAdam has a message for investors wondering if AT&T’s $49 billion deal for DirecTV will inspire him to buy satellite television company Dish: Not gonna happen. “There were not, and there are not, discussions going on with Dish,” McAdam told attendees of the J.P. Morgan Global Technology, Media and Telecom Conference. “I know there are reports out there that we are talking to Dish. I can tell you now, that is someone’s fantasy.” Someone, in this case, being Dish Network Chairman Charlie Ergen, who looks to be left out of this particular wave of consolidation. As MoffettNathanson analyst Craig Moffett quipped, “Dish Network hasn’t been so much ‘smoked out,’ as it has merely been … smoked. It loses both of its best exit options.”

How’s That Fainting Couch, Marc?

Venture capitalist Marc Andreessen, January 14: “I increasingly feel like we’re all on some gigantic collective fainting couch. Oh my WORD I can’t believe that spy agencies SPY.”

Venture capitalist Marc Andreessen, May 19: “The level of trust in U.S. companies has been seriously damaged, especially but not exclusively outside the U.S. Every time a new shoe drops — and there are 10,000 of them — it serves a blow to the U.S.”

And Thousands of Foreign Startups Just Changed Their Exit Strategy

Expect a significant uptick in Google M&A activity this year and beyond. According to a December letter to the Securities and Exchange Commission, published late Tuesday, the company has parked a ton of cash overseas (some $35 billion) with an eye toward blowing it on foreign company buyouts. “We continue to expect substantial use of our offshore earnings for acquisitions as our global business has expanded into other product offerings like mobile devices,” Google wrote. “It is reasonable to forecast that Google needs between $20 to $30 billion of foreign earnings to fund potential acquisitions of foreign targets and foreign technology rights from U.S. targets in 2013 and beyond.” Disclosed in the same letter: An abandoned buyout of a foreign company “with a valuation estimated in the range of $4 to $5 billion.”

Point/Counterpoint: Peering and Net Neutrality Are Cousins vs. Yeah, Cousins in the “Deliverance” Sense

FCC Chairman Tom Wheeler: “A lot of people seem to think the whole peering and interconnection topic is the same as net neutrality. It’s not, it’s a different issue — it’s a cousin, maybe a sibling.”

Netflix CFO David Wells: “If they are first cousins, they are a bit like 18th century royalty cousins and might have had a child along the way.”

Oh No! Haunted Empire!

After a three-year run atop the list of the world’s most valuable brands, Apple has slipped to the No. 2 spot. The new leader of Millward Brown’s BrandZ Top 100 Most Valuable Global Brands ranking? Google. Evidently, the company’s brand value rose 40 percent year-on-year to $159 billion, while Apple’s slipped 20 percent to $148 billion. The presumed reason for Apple’s decline? “A growing perception that it is no longer redefining technology for consumers, reflected by a lack of dramatic new product launches.”

Renfield, No! The Pappy Van Winkle Is for Us; The Old Crow Is for the Fish.

Elizabeth Preston, Discover: “For his latest study of intoxicated fish, Porfiri and his coauthors had their subjects swim in three different alcohol concentrations: 0.25 percent, 0.5 percent, and one percent. The highest concentration translates to about a 0.1 percent blood alcohol content in the fish, Porfiri says — above the legal limit of .08 percent for people in the United States.”

Off Topic

David Lynch’s “Return of the Jedi” and Steven Spielberg, stealth master of the long take.

Thanks for reading. Got a tip or a comment? Reach me at, @johnpaczkowski. Subscribe to the Code/red newsletter here.

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