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Cryptocurrency Bitcoin Alphabet Is Grounding Loon—but Won’t Call It a Failure


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Cryptocurrency Bitcoin Alphabet Is Grounding Loon—but Won’t Call It a Failure

Hi, everybody. Do you detect something missing? Like that unease in your gut that everything has gone to hell? Wonder why that is.Oh, and for those of you who are reading this newsletter on WIRED’s website, here’s some news. First, we’re sending this out early because we have a scoop timed to tonight. And now…

Cryptocurrency  Bitcoin Alphabet Is Grounding Loon—but Won’t Call It a Failure

Cryptocurrency Bitcoin

Hi, everybody. Do you detect something missing? Like that unease in your gut that everything has gone to hell? Wonder why that is.

Oh, and for those of you who are reading this newsletter on WIRED’s website, here’s some news. First, we’re sending this out early because we have a scoop timed to tonight. And now for some bad news: Aside from an occasional episode shared out of the goodness of my heart, Plaintext will hereafter be available only for subscribers. Don’t look shocked—I’ve been warning you about this for a year! The good news is that you can subscribe for an initial offer of five lousy bucks and get Plaintext, unlimited WIRED online access, and a luscious print magazine that, properly cared for, will last longer than you do. Take that, Substack!

The Plain View

Silicon Valley loves crazy. VCs will tell you that the crazy ideas are the ones that turn their investments into billions. Steve Jobs recited a prose-poem about how they push the world forward. And Alphabet—whose founders were told that it was crazy to capture all of the web to tackle the already-solved problem of search—has a whole division, dubbed X, devoted to nurturing crazy ideas. They call it their Moonshot Factory, but the original Apollo moonshot was fanatical about avoiding failure. Better to call this one a crazy factory.

Even with that mission, one project was so out there that they called it Loon. It involved circling the globe with packs of balloons that would beam internet access to underserved earthlings. Launched in 2013, it confounded skeptics by soaring toward viability. Loon’s technology kept improving, with balloons that stayed aloft longer and sent bits straight to cell phones. In 2018, Loon “graduated” from X and became a division of its own, known as one of Alphabet’s Other Bets. It got its own CEO and, eventually, some outside funding to augment the many millions of dollars the company had already spent. (Though it won’t say how many millions.) It helped send data to Peruvians after an earthquake and to Puerto Ricans post-hurricane. Last year, in a pilot project in Kenya, the division successfully delivered bandwidth to customers. Loon refused to give Alphabet a reason to kill it.

Until now. Tonight, Alphabet is announcing that it is grounding Loon. Astro Teller, who heads X and was also the chair of the Loon board, recommended that Alphabet no longer fund it, effectively letting the air out of the division’s balloon. “No one wanted to pick up the mantle,” he says.

The interesting thing is how far Loon got before Alphabet pulled the plug. When Teller first heard the idea, he says, he gave it about a 1 or 2 percent chance of succeeding. By the time of its launch in 2013—which I traveled to New Zealand to attend, following some of its first internet-bearing balloons—it had gotten to around 10 percent. By the 2018 graduation, Teller thought it was 50–50.

But in the last six months, the odds reset, like some grim-reaper-ish version of the New York Times needle. Loon had two challenges: the technological leap to deliver internet by balloon, and making the business case that people would pay for it. While the tech side was solving problems, the commercial environment became less favorable. In the last decade, much of the underserved world became connected—internet availability rose from 75 percent of the world to 93 percent. The remaining areas are primarily populated by those who can’t afford the 4G phones that receive Loon signals, or aren’t convinced that the internet—which in some cases has little content in their own language—was worth the effort. Teller came to realize that Loon was unlikely to ever contribute to Alphabet’s profits. And so the bet was lost.

Loon does leave a legacy. Probably no one has ever spent more money and brainpower on balloon technology, and Loon constantly set records for keeping them aloft. It broke ground in using sophisticated algorithms as well as the US government’s National Oceanic and Atmospheric Administration weather data to figure out how to ride wind currents and navigate the skies at 60,000 feet. Just last month, Loon engineers had a paper in Nature describing how their technology pioneered deep learning techniques to help their balloons autonomously form networks that thrived in a challenging environment. Another Loon breakthrough—sending high-speed data via beams of light (like fiber optic without the fiber)—kicked off a separate X project, Taara.

The fall of Loon is a good occasion to take a look at X’s accomplishments. Last year, the Moonshot Factory celebrated its first decade. In that time, it’s pioneered autonomous driving, which is now the basis of the Other Bet called Waymo; another project, Google Brain now powers much of Google’s technology with deep learning; and Alphabet still has high hopes for X graduates like its medical bet Verily, and its drone delivery company, Wing. And still inside X are projects involving robots and food. But it has also populated a boneyard of costly failures, now including Loon.

But Teller won’t call it failure. Loon, he says, was “a successful experiment.” Considering that he just killed a costly high-profile enterprise, I asked him what an unsuccessful experiment might look like. “Real failure is when the data tells you what you’re doing isn’t the right thing, and you do it anyway.” Loon was a success, he says, because once it was clear that it would never become a viable business, or solve internet connectivity, he called it quits.

Crazy? That’s the X way. “We can’t get access to these really exceptional opportunities unless we’re willing to be wrong a decent amount of the time,” says Teller. His bosses are cool with that. He gets regular reviews from Alphabet CEO Sundar Pichai and CFO Ruth Porat, and says both continue to be supportive. How does Teller himself rate the performance of X? ”Eight out of 10,” he says.

Still, it’s never fun to end a project. “We wanted Loon to be a beautiful solution to a seemingly unsolvable problem,” says Teller.

Now, someone else will have to solve the problem. A few dozen Loon balloons are still aloft. Over the next nine months, remaining Loonatics will painstakingly recover them as they sink into the sunset. X will be on to its next crazy project, and Alphabet will keep the money flowing. “You can’t make Loons,” Teller says, “unless you’re willing, when they don’t work out, to just say, ‘OK, let’s start over and do something else.’”

Time Travel

In 2013, I wrote about the launch of Loon, describing how its cofounder Rich DeVaul helped shape the concept. (DeVaul, a leader of the X rapid evaluation team, left the company in 2018 because of a sexual harassment issue.)

Teller gave DeVaul some ideas to kill. One of them was a concept to deliver wireless Internet access via balloons in the stratosphere. CEO Larry Page had often spoken of this, and Teller knew that favorite topics of the cofounders had a leg up in funding decisions. But there was a big problem: Balloons are hostages to wind. If you try to keep a balloon in a fixed location, you must apply Sisyphean efforts to resist that wind. It almost always ends badly. Lockheed Martin recently tried to beat the odds with a giant solar-powered dirigible. But in its maiden test in 2011, Lockheed’s High Altitude Long Endurance-Demonstrator prototype failed to reach altitude and was forced to abort, landing in a Pennsylvania forest. Lockheed has no plans for another test.

As DeVaul began spreadsheeting the possibilities, he came up with another concept. Rather than a behemoth that required massive amounts of energy to fight stratospheric winds to stay in place, he found himself drawn to the idea of smaller, cheaper weather balloons that sometimes stay aloft for 40 days or more, circling the globe. “I thought, why not have a bunch of these things, covering a whole area? How crazy would that be?” he says.

Ask Me One Thing

Penny asks, “Do you think people who don’t wear a mask or take other precautions should sign a waiver, voluntarily giving up their option for ER care and just take care of themselves at home if they contract the virus?”

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That’s easy, Penny: No! I’m no doctor, but if I were one I would have taken a Hippocratic oath that actually compels me to treat such people, dumb or stubborn as they are. Oath or not, it’s the right thing to do. Don’t get me wrong—we all should be wearing masks outside of our homes. Businesses should refuse to let those with naked faces into their establishments. Socially shun these people! And toss out any craven elected official that encourages otherwise! But when it comes to the emergency room or the clinic, sick people must be treated, regardless of what culpability they may have had in contracting their disease. Penny, when you wear a mask, you are not only protecting yourself but others, including folks you don’t know and maybe don’t even like. You are saying, “We’re all in this together.” Even if some won’t understand the sentiment until their oximeter reading drops to the 80s, let’s hold on to that sentiment. And don’t forget to wash your hands.

You can submit questions to mail@wired.com. Write ASK LEVY in the subject line.

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