Virgin Galactic is cleared to resume flights of its SpaceShipTwo space plane, the Federal Aviation Administration (FAA) said Wednesday, after capping a safety investigation into issues that came up during the company’s July flight carrying its founder Richard Branson. During that mission, SpaceShipTwo strayed from its designated airspace on its descent from space, and Virgin Galactic didn’t tell the FAA about it when it was supposed to.
With the investigation now closed, the FAA required Virgin Galactic to make changes “on how it communicates to the FAA during flight operations to keep the public safe,” it said in a statement. Virgin Galactic said that includes “updated calculations to expand the protected airspace for future flights” and “additional steps into the Company’s flight procedures to ensure real-time mission notifications to FAA Air Traffic Control.” Another change: “Updated calculations to expand the protected airspace for future flights,” the company said.
The July 11th mission, called Unity 22, carried Branson and three company employees to the edge of space and back over Virgin Galactic’s Spaceport America facilities in New Mexico. The company’s SpaceShipTwo, a winged suborbital space tourism plane with two pilots, flew 53.5 miles high, executing a highly publicized demonstration mission. The company has a backlog of some 600 paying customers waiting for their chance to fly.
The mission appeared successful until months later, on September 1st, when The New Yorkerreported that pilots had been alerted to warning lights during their rocket-powered ascent to space. Those warnings indicated the spaceship wasn’t ascending vertically enough to be able to free-glide back to Earth after reaching space.
“We appreciate the FAA’s thorough review of this inquiry. Our test flight program is specifically designed to continually improve our processes and procedures,” Virgin Galactic CEO Michael Colglazier said in a statement, adding that “our entire approach to spaceflight” is focused on safety. “The updates to our airspace and real-time mission notification protocols will strengthen our preparations as we move closer to the commercial launch of our spaceflight experience.”
The company’s next flight, Unity 23, is a research mission flying three members of the Italian Air Force. Virgin Galactic has said the FAA probe hasn’t affected the timeline for Unity 23, but another technical issue might push things back. Earlier this month, the company said “a third-party supplier recently flagged a potential manufacturing defect in a component of the flight control actuation system that they supply to Virgin Galactic,” and that “the earliest the Company expects to open its flight window for Unity 23 is mid-October.”
Lance Wade didn’t say “snitches get stitches” out loud, but with his behavior in the courtroom today he didn’t have to. It’s the most aggressive performance we’ve seen so far from Elizabeth Holmes’ defense attorney, and that’s probably because the latest testimony is just that bad for Holmes’ case.
On the stand today was former Theranos lab director Adam Rosendorff, who was responsible for the lab where patient results were processed. In his opening statement, Wade was clear that he was prepared to blame Theranos lab directors — including Rosendorff — for many of the company’s problems. His questioning of Rosendorff drew two successful objections from the government, for argumentativeness.
Until now, the defense used a softer approach. Faced with whistleblower Erika Cheung, Holmes’ lawyers didn’t try to demolish her credibility. Wade was solicitous, even kind — and used her to introduce some documents and testimony that would bolster his client’s case. With Surekha Gangakhedkar, who worked in R&D and helped develop many of the company’s tests, Wade introduced evidence suggesting that Holmes was a thoughtful boss, one who even tried to talk Gangakhedkar out of quitting.
But today, Wade appeared trapped from the beginning of his cross-examination. Rosendorff’s testimony earlier in the day had brought into evidence emails that looked awful for Holmes, who is on trial for wire fraud and conspiracy to commit wire fraud. They showed Rosendorff getting increasingly frustrated with the tests, management, and Holmes’ brother, Christian, who’d been inserted between Rosendorff and complaining doctors. Perhaps that’s why Wade began by aggressively attacking Rosendorff’s credibility.
Wade listed a number of federal agents — with the FBI, the Postal Service, and the FDA — that Rosendorff had been in a room with, and seemed consternated that Rosendorff didn’t remember all their names. (In some cases, Rosendorff testified, those agents hadn’t even spoken to him.) Had Rosendorff been coached by the government on his answers? Wade demanded, nearly shouting.
Wade did manage to score some points, like when he got Rosendorff to say that Holmes never told him to report an inaccurate result. He showed that Rosendorff had previously answered a question about why he’d left Theranos slightly differently while under oath two years ago.
Wade also got Rosendorff to say that the patient launch we’d heard about last week — the one Rosendorff wanted to delay — was for friends and family only. I’m not sure that soft launch testimony helped Wade, though. After all, wouldn’t friends and family be more understanding if the company needed extra time to get things right?
The tone shifted after we returned from a brief break. (Lawyers often read reporters’ live-tweets of their trials, as well as our stories. Hi, Lance!) Wade began to portray Holmes as a Steve Jobs-like marketing genius. Noticeably quieter and friendlier to Rosendorff, he got the former lab director to say part of the reason he’d joined Theranos was because he thought it would be the next Apple.
Wade held up Walter Isaacson’s biography of Jobs, which Rosendorff said he’d read, as he asked questions. Part of Apple’s success was its intense focus on marketing, right? (Chiat Day, which later worked with Theranos, came up with Apple’s “Think different.”) And Apple was crazy-focused on secrecy, right? Judge Edward Davila interrupted this line of questioning to say “this isn’t the time for a book report,” but by that point Wade had hit the highlights.
There was, however, a big problem for the Steve Jobs metaphor: Elizabeth Holmes’ brother, Christian.
In one email chain, Christian — who had no medical or scientific background — appeared to be usurping Rosendorff’s role as lab director when a customer service rep asked Christian, not Rosendorff, whether to approve a second draw for a failed test.
In another email chain, a doctor wrote that a cholesterol test didn’t add up. Rosendorff wrote to Christian that something was wrong with the test. In response, Christian gave Rosendorff a paragraph of explanation to give to the doctor. Rosendorff rejected it, saying he wouldn’t defend the test. In response, Christian chastised him — and received an “attaboy!” email from his sister. “You handled this excellently,” Holmes wrote to her brother.
Thanks to this meddling, Rosendorff seemed like he was at the end of his rope: “100% honesty and transparency to the patient is essential,” he wrote to Christian. “My first duty is not to Theranos but to the patient as per my Hippocratic oath ‘premium non nocere.’” Christian forwarded this to Holmes and Sunny Balwani, Holmes’ co-defendant who is being tried separately. Rosendorff ended up sparing the patient from another Theranos fingerprick and using an FDA-approved venous draw test instead.
In another set of emails, Rosendorff said he felt out of the loop on what the company was doing. He asked to be taken off the lab’s license. “I am feeling pressured to vouch for results I cannot be confident in,” he wrote to Holmes.
In response, she wrote, “How sad and disappointing to see this from you.” She said he hadn’t raised his concerns before — not true, as we’ve seen emails of him doing it and cc’ing her in. Rosendorff also testified Friday to meeting with Holmes about his concerns.
It wasn’t just a few bad tests that needed to be kept quiet. Theranos appeared secretive to the point of fooling public health officials — with Holmes’ blessing. When auditors from the California Department of Public Health were scheduled to visit the lab, Holmes emailed Rosendorff and Balwani, among others, to find out where they’d be walking. The day of the inspection, no one was to go into or out of Normandy, the lab where the Edison machines were kept, Rosendorff testified. To his knowledge, the auditors didn’t see an Edison device that day.
Legally, labs are required to do proficiency testing, which is meant to ensure accurate results. Rosendorff “felt management was paying lip service to this issue,” he said. He testified that he received no resources or support for his proficiency testing plans. Nothing changed by the time he left, either. Rosendorff forwarded an email about this to his Gmail account, in case he might need it later.
Eventually, he found another job and gave notice, staying on for a while so they could find another lab director. During that time, in November 2014, there was another bad test result. Rosendorff was blunt, telling Holmes and Balwani that the test’s accuracy was in question. “Are you both comfortable with this?” he wrote in an email.
In response, Balwani essentially dismissed Rosendorff’s concerns. Rosendorff forwarded that response to Holmes, writing, “I find Sunny’s response offensive and disingenuous. He should apologize.” Holmes then forwarded that email to Balwani, saying that they should “cut him Monday,” which Rosendorff interpreted to mean that they should fire him rather than let him serve out his last few days.
Sure, Rosendorff talked to the feds and knew roughly what questions he’d be asked. Yes, the launch Rosendorff had testified to on Friday was a “soft launch.” But that doesn’t speak to email after email of patient complaints, or to Rosendorff’s increasingly blunt efforts to address bad tests. It certainly doesn’t explain Christian Holmes’ involvement, or why his sister was praising him for slapping down Rosendorff, her lab director.
Rosendorff’s cross-examination will continue tomorrow. But so far, not much has been produced to undermine him — and the emails that have been introduced bolster him. They also raise a lot of questions about Elizabeth Holmes’ credibility, and that’s going to be hard to explain away.
I hope my headline is an overstatement, purely for job purposes, but in this week’s Vergecast artificial intelligence episode, we explore the world of large language models and how they might be used to produce AI-generated text in the future. Maybe it’ll give writers ideas for the next major franchise series, or write full blog posts, or, at the very least, fill up websites with copy that’s too arduous for humans to do.
Among the people we speak to is Nick Walton, the cofounder and CEO of Latitude, which makes the game AI Dungeon, which creates a plot in the game around what you put into it. (That’s how Walton ended up in a band of traveling goblins — you’ll just have to listen to understand how that makes sense!) We also chat with Samanyou Garg, founder of Writesonic, a company that offers various writing tools powered by AI. The company can even have AI write a blog post — I’m shaking! But really.
Anyway, toward the end of the episode, I chat with James Vincent, The Verge’s AI and machine learning senior reporter, who calms me down and helps me understand what the future of text-generation AI might be. He’s great. Check out the episode above, and make sure you subscribe to the Vergecast feed for one more episode of this AI miniseries, as well as the regular show. See you there!
If you’re a Decoder listener, it’s a pretty sure bet that you’ve heard of Theranos and its charismatic, troubled founder Elizabeth Holmes. Holmes convinced a long list of major investors and companies to give her huge amounts of money, all on the back of her claims that the Theranos technology could do hundreds of blood tests with just a tiny sample of blood — a pinprick.
The Theranos testing machine — called the Edison — wasn’t accurate, even though it was deployed in Walgreens locations around the country. All the while, Holmes was appearing on covers of magazines, signing more deals, and attracting greater and greater fame. Until everything changed. Right now, Holmes is on trial in a criminal lawsuit brought by the federal government. Her former partner, Sunny Balwani, will face his own trial for similar charges.
Today, I’m talking to the reporter who first exposed Holmes and Theranos, and started it all. John Carreyrou was working at The Wall Street Journal in 2015 when he started publishing articles about how Theranos was misleading customers, partners, and investors. Theranos aggressively tried to stop John’s reporting in 2015 and Holmes even tried to get Journal owner Rupert Murdoch, who was an investor in Theranos, to stop the story. He declined, and the stories have become a cautionary tale: you can’t just believe the hype.
I wanted to talk to John about the case and what it has been like to cover the story for six years. He is as close to this story as any reporter can be. He’s even on the witness list — and he was put there by Elizabeth Holmes’ legal team. And because this is Decoder, we talked about what it’s like to be a podcast creator — John is covering Holmes’ trial on a new podcast called Bad Blood: The Final Chapter — how that business is going, and why he decided to put some of his episodes behind the Apple Podcasts subscription system. And I asked for the numbers, of course.
This transcript has been lightly edited for clarity.
John Carreyrou, you were an investigative reporter for the Wall Street Journal. You broke the Theranos story. You’re the author of Bad Blood: Secrets and Lies in a Silicon Valley Startup, a book about Theranos. And now you are the host of the podcast Bad Blood: The Final Chapter, which is coming out alongside the trial of Elizabeth Holmes, the CEO and founder of Theranos. Welcome to Decoder.
Thanks for having me, happy to be here.
I’m very excited to talk to you. I feel like, I followed your reporting, I read the book, listening to the podcast, all excellent work. And I think, a kind of a watershed moment in tech reporting and how the Valley perceives itself in relationship to the media. So I want to talk about all that, but let’s start with the very beginning. I think a lot of listeners to the show are familiar with the Theranos story, they’re familiar with what happened, but give us kind of the basics. In 2015, you put out a story saying the Theranos fingerprick test just didn’t work. How did you come to that story?
I had not heard of Elizabeth Holmes until I read a profile of her in the New Yorker in mid-December 2014. At that point, she’d been raising her profile for about a year and a half in Silicon Valley and had become pretty well known. There had been the iconic cover story of her in Fortune magazine, about six months prior. So she was becoming a celebrity, but this New Yorker story was the first time I’d ever heard of her. I read the story with interest, commuting back from the Journal’s offices in midtown Manhattan to where I lived in Brooklyn. As interesting as I found it, I also was immediately suspicious because this whole conceit at the heart of the story was that she was a college dropout who was revolutionizing this very technical corner of medicine, namely blood diagnostics. That didn’t seem right to me.
At that point I had been covering medicine for over 10 years, doing a lot of investigative reporting about health care and medicine, and I knew that science is hard and that it takes a long time. And it’s not like computer coding where people like Mark Zuckerberg, and Bill Gates before him, learn how to code when they were in high school, in their parents’ basement. Medicine is not like that, you don’t teach yourself medicine in your parents’ basement. And so I was suspicious about that, but to be fair, when I got off the subway and I got home, I put the story out of my mind and kind of forgot about it.
And it was a few weeks later that I got a tip from a pathologist in the Midwest, who had read the very same New Yorker story. And he had been even more suspicious than me because he knew a lot about blood testing. He didn’t believe this idea that she had created this great invention that could do all these tests off a finger stick of blood. And he and I had had dealings before. So he called me up with a tip and I started digging from there. That was the inception of the whole thing.
One of the things we talk about on this show is: there are products and then there are the enabling technologies that allow you to create the products. So the product for Theranos was this device called the Edison, which is what analyzed the extremely small amount of blood. The enabling technology was the ability to do the tests on a small amount of blood, right? That was the claim.
Actually, Elizabeth Holmes and Theranos had not been very transparent about what they were doing at all. It was very much a black box, physically and figuratively, but what came out of all these glowing interviews was that she had a device that could do hundreds of tests off a pinprick of blood. And if that was true, that was a real advance because up until that point, no one had figured out how to do more than a couple of blood tests off that small a volume of blood. There are two reasons for that; the first is that there are about four big categories of blood tests and once you do a couple tests from one category you quickly exhaust your sample.
And if you try to do a few more from another category of blood tests, which require completely different methods and techniques, you don’t have any sample left. No one had solved that problem. The second problem was that capillary blood, which is blood that comes from the finger, is not pure. It’s polluted by tissue and cells and those interfere with certain tests like the potassium test. And no one had figured out how to solve for that either. So, if what she was saying was true, it would’ve been a real medical advance.
These are questions that you, as a reporter, as pathologists who are writing you tips, immediately leapt to. Obviously a huge part of the Theranos story, the reason they’re in court now, is that investors gave her a lot of money. Why do you think those investors weren’t asking the same questions, weren’t asking for evidence that these tests could work the way that she was claiming they could?
Well, I think you have to rewind the tape back to 2015 which was really, the height of the unicorn boom. Facebook had made some people a ton of money, Twitter too. You had more and more of these private companies that were getting billion-dollar valuations. In fact, interestingly, Theranos, for a short period of a couple weeks, was the most valuable private startup in Silicon Valley — it was more valuable than Uber, Airbnb, or Spotify. I think investors wanted to join the next rocket ship to riches. And as a result, they kind of suspended disbelief and were less careful. This is before the backlash against tech, there was less skepticism back then. And to be fair, she was an incredibly compelling saleswoman. I mean, she had an amazing charisma. She is very smart. She’s a chameleon, a fantastic actress. And I think she charmed the socks off a lot of these investors and they really, really believed her.
I’ve always been stuck on that. I run a tech site and we were operating in 2014 and 15. I often think that we would’ve written the Theranos story that Fortune or the New Yorker wrote about the claims she made even though the product didn’t exist yet. She was a very compelling figure, but at the heart of it is kind of a very simple math problem: You’ve got a tiny amount of blood. Everything suggests that if you run these tests, you’re going to just run out of blood. How did you solve that problem? I’ve never seen any part of the Theranos marketing materials, or Holmes’s presentations, or interviews where that question was addressed.
Right. And I think the reason that the journalists who covered her in those initial two years and wrote the glowing profiles didn’t pick up on that is they didn’t come from a medical reporting background. They accepted the way she framed herself, which was as a tech entrepreneur, who was following in the footsteps of these other legendary tech entrepreneurs — Steve Jobs in particular, who she idolized and whom she dressed like. And reporters who were used to covering tech accepted that she was a tech entrepreneur, when in fact she was a medical entrepreneur. It didn’t take me long after the initial tip and then doing some digging to get the laboratory director of Theranos, who had just left the company, on the phone and granted him confidentiality.
He started confiding in me a bunch of problems that he’d seen. It didn’t take me long after that to just reach out to the heads of pathology departments at universities to ask them about Holmes’s claims. And I found out that quietly, a lot of people in the pathology community had been extremely suspicious and skeptical because they didn’t think it was physically possible. So it wasn’t hard to find people to explain to me why this was probably not true.
That skepticism is a dynamic that we all live with now, there has been a giant backlash to tech companies, and we’ve all learned to be more skeptical of their claims and what they promise they will deliver. But the back-and-forth is: the skepticism is unwarranted, we’re doing things that are hard, we might fail, but we have to try risky things in order to have the big innovation.
That was basically Theranos’s defense against your story. And I realize that brought lawyers to you that wanted to sue the Journal, they went all out, but the core of the public defense was “We’re innovating, we’re taking risks, we’re going to fail. But if you believe in us, we’ll succeed.” How has that dynamic changed as we’ve entered the trial phase?
I think this is where this story is so important. This is where the trial is so important. There’s this culture of faking it until you make it in Silicon Valley. And, I’ll be the first to grant you that a little bit of that is necessary to raise money. You need to hype and perhaps exaggerate a little bit to get people excited. You need to be, if you’re an entrepreneur, you need to be super optimistic. You need to get your employees excited. You need to get investors excited about your vision, but I think there’s a line not to cross. And I think Elizabeth Holmes and Theranos crossed that line when the hyping and the exaggerating turned into outright lying. And it turned into outright lying for years and years. And it was lying to the point that she went live with blood tests that she knew were flawed. And she knew she was conducting a giant experiment on patients.
I think this trial’s going to be a referendum on whether entrepreneurs in Silicon Valley can keep getting away with that sort of behavior. If she’s convicted, I think it’ll be a wake-up call for the Valley that “No, that was taking things one step too far, and that if you do the same, then you’re looking at prison time.” If she’s acquitted, then I think all bets are off. I think you’ll have young entrepreneurs running around the Valley saying, “Yeah, I’m lying, I’m exaggerating, I’m pushing the envelope. But look at what Elizabeth Holmes got away with, and she didn’t spend a day in jail. So I think I’ll be okay.”
Where do you think the line specifically was? Was it, famously, they had bought other testing devices from Siemens and other companies and tried to modify them? They had signed a deal with Walgreens — where do you think the line was specifically?
The biggest line was going live, commercializing blood tests and having real patients use them, when you know that the tests are flawed and you know that your Edison machine is unreliable, that you’re only doing a handful of tests with that. And that, for the rest of the tests, you’ve hacked a third-party machine called the Siemens ADVIA 1800 and you’re diluting blood samples to make it work — because the Siemens ADVIA, being a regular commercial blood analyzer, requires a certain sample size. And you can’t meet that sample size unless you dilute the blood, and diluting the blood causes all sorts of problems because there’s already a dilution step in the Siemens ADVIA protocol. So then you’re double diluting and you’re increasing the chance for errors. And that’s exactly what happened.
A lot of patients got erroneous blood tests. And we’re now hearing from some of these patients at trial, I think it was earlier this week or late last week, from a patient who got an erroneous pregnancy result. Theranos told her twice that she was no longer pregnant when in fact her pregnancy was perfectly viable and she carried it to term. So that’s the big, bright red line not to cross when you’re lying to the point that you’re putting people’s lives in jeopardy. And I think that applies to other industries that Silicon Valley has set its sights on. It’s not just health care. It’s also self-driving; there have been car accidents involving Teslas, where it looks like drivers have been lulled into thinking that they can let the car drive itself.
When in fact, the software isn’t as reliable as [Elon] Musk would have you believe it is. And some of these accidents have been fatal. There’s also been a woman who was run over by an Uber self-driving vehicle in Tempe, Arizona, a couple years ago and she died. So, I think this has broader lessons for Silicon Valley, as it gets into these other areas, as it goes beyond just the bread-and-butter computer industry and sets its sights on artificial intelligence, health care, drones, driverless vehicles — there are lines not to cross.
The bright red line between hyping your product for investors in that stage and commercializing dangerous products or unreliable products, I understand. The step for Theranos to get to commercialization was to sign deals with pharmacies, famously Walgreens. General [James] Mattis was at the trial this week. He wanted to deploy the machines in the armed forces. That seems like, for me, a gating step where Walgreens should have seen if the machine worked, where Mattis should have had the machine tested more thoroughly. Why didn’t that happen here?
I mean, for sure Walgreens should have done its due diligence more. It did hire, as I wrote in my book, a lab consultant named Kevin Hunter who worked for a period of time for Walgreens full-time, vetting Theranos. Early on, he smelled a rat and he tried to alert the superiors at Walgreens. Elizabeth and Sunny [Balwani] were able to freeze them out of meetings. After a few months, he was no longer included in the weekly Zoom calls they had and then the in-person meetings they had.
And so, Walgreens was ignoring its own consultant whom it had hired and was paying decent money to look after its own interests. That’s one of the most unbelievable parts of the story when you look back. Then the investors should have done more due diligence, for sure. The board members were asleep at the switch — in some cases, they were literally asleep. I heard from people who attended board meetings that [Henry] Kissinger and George Shultz would sometimes doze off during board meetings. So, there’s a lot of blame to lay around, a lot of due diligence that should have been done by various parties that wasn’t done.
Is there a chance they could have figured this out, if this thing had just kept rolling? There’s an element of your story, the first one in the Journal, that has always felt inevitable. The tests are producing inaccurate results. The results are not the same for all kinds of people. Eventually, doctors, pharmacists, Walgreens, people are going to figure this out and maybe shut this down. And so, it would have come out, because the thing wasn’t working. But is there a chance they could have pulled it off?
I think the scandal would have exploded one way or another. I think I hastened it, but I think that within a year or two this would have come to light. There would have been more and more people getting tests from Theranos, more and more complaints and at some point, someone would have gone to another reporter or to a regulator. This house of cards would have come tumbling down. But I think Elizabeth’s bet was that she was eventually going to get there, she was going to get the last iteration of the device to work and that by then no one would be the wiser. The workaround with the hacked Siemens ADVIA, the malfunctioning Edison — no one would know about these things because she would have eventually gotten there.
I think she was deluded, because I don’t think she was ever going to get there. First, we talked about the technical limitations that to this day are still making this impossible — and believe me, there are a lot of people working on this problem, it’s not just Theranos trying to solve it. But then there’s also the culture of the company and the way she managed the company, the way she and Sunny Balwani managed the company. It was a completely dysfunctional place. There was a huge amount of turnover, Sunny was firing people all the time — it was a very toxic culture. And you don’t come up with great innovations, you don’t succeed as a company with that culture. I think this company was doomed no matter what.
Another constant thread of conversation in the Valley is that people are often harsher on female founders who are being demanding or tough. That to start a company and make things great and create a vision, you have to be really tough, you have to be extraordinarily demanding. I think maybe the scandal would have broken on its own because the test results weren’t accurate. What we would not have ever learned about was the culture of the company that was really explicated in your reporting, really came out in the book. Is it a case that she was just as demanding as everyone else, but her product was a fraud? Or is the case where she was that demanding to cover up the fraud?
She’s an interesting character if you try to psychoanalyze her. I’ve often said in interviews I really don’t believe that she dropped out of Stanford at age 19 in 2003, intending to commit a long con, intending to commit fraud. No. She dropped out because she idolized Steve Jobs and other Silicon Valley entrepreneurs, she wanted to follow in their footsteps, she had a vision, she pursued her vision, she hired people, and raised money, etc., did what entrepreneurs do. I think at a certain point, she did know that she was going too far. If you listen to my podcast, there’s an episode about this note she wrote to herself in 2014, as she’s being asked repeatedly by a prospective investor, Byron Trott, of BDT Capital, this big merchant bank in Chicago, for audited financials.
She knows she doesn’t have audited financial statements to show him and this stresses her out. Late one night at like 4 in the morning, she writes a note to herself, and in the middle of the note are these lines, “Smart people picked off Mado, not you.” If you listened to this episode of my podcast, I think I make a compelling case that this was a reference to Bernie Madoff, and that she’s comparing herself to Bernie Madoff. To me, that indicates consciousness of guilt. That she wasn’t just, at that point, an idealistic, hard-driving entrepreneur who was shooting for the moon and putting a lot of pressure on her employees to make her vision happen. I think she also knew at that point that she was lying to investors. That the gap between what she’d promised them and what she’d told them she did achieve, and what the truth was, was a yawning gap, and that it couldn’t be reconciled. I think she knew that.
There’s a story in the New York Times recently about other women founders in the hard sciences, biology, climate, etc., who are finding it harder to get funded because of the legacy of Elizabeth Holmes. How do you think this trial is going to affect that dynamic? Because I don’t think Elizabeth Holmes wanted that to happen, but it is a clear dynamic that is happening now. Investors in general have been burned. They are more skeptical, hopefully, as a result, but we are seeing in particular that skepticism pointed at other female founders.
Well, if that’s happening, I think it’s really unfair. Why should women be singled out? This was just one bad apple. I think we’ve been used to frauds being carried out by men because the history of capitalism is dominated by men. And it’s only been recently that women are taking a bigger role in business and entrepreneurship and that’s going to continue. We’re going to see more and more women become founders and CEOs and successful entrepreneurs. And there’s bound to be bad apples among women too, just like there are among men, but that doesn’t mean that it should penalize women as a gender. It certainly hasn’t penalized men. So, that really doesn’t make sense to me, and I really don’t think it should be happening.
Before this criminal trial that is occurring right now, there have been some civil lawsuits from investors. Give us the recap of those. It feels like investors are very reticent to sue. They obviously didn’t sue in this case. Do you think they provided any disincentive from this kind of lying?
Where did that money come from? I’ve always wondered this.
Well, when I came out with my first story in late 2015, Theranos still had something like $600 or $700 million in the bank, it had a ton of money left, and a lot of that money from that point on went to paying lawyers and went to paying for legal settlements. Another investor that brought suit was a former investment banker named Robert Coleman. His suit took longer to resolve. He eventually reached a settlement and was made whole. There was a lawsuit filed by Walgreens. Theranos also settled that one, I think for $30 million, but then ended up not paying the whole sum and was sued again. There were about a dozen suits filed by patients in Arizona that were consolidated into a class action. There were a lot of lawsuits. I think that they definitely helped the government investigation with all the discovery, and they very much called attention to what Theranos had done. I’m not sure that prosecutors would have brought the criminal case if it hadn’t been for all these other private actions, especially PFM’s lawsuit in Delaware. I think they got a ton of information from that lawsuit, and I think that lawsuit and PFM were instrumental in getting the criminal case off the ground.
That connection between the investors suing, the civil cases, the settlements, and the criminal case — why do you think the government wasn’t hot on the trail already? Why do you think it took that side of civil cases?
Well, the SEC subpoenaed Theranos within a week of my first story in October 2015, so it didn’t take them very long to start an investigation. It took the DOJ a little bit longer. The first subpoena landed in, I think, early January of 2016, right after another big expose I’d written on the front page of the Wall Street Journal. Then I think it took a while for those probes. This was a complex set of circumstances. It involves lab testing. It’s complicated.
This was also the San Francisco US attorney. This wasn’t the Southern District in Manhattan, which has huge resources and really smart and talented young prosecutors. They’re usually the ones that go after high-profile white-collar crime cases. This was the San Francisco US attorney’s office, which is much smaller, fewer resources, has had a mixed record. If you go back a decade and look at how they fared with option backdating investigations, they didn’t do very well. And so, this was a really high-profile case handled by a small office. I think they took their time to get it right, and eventually after three years of investigating, they did bring charges, they did bring criminal charges.
We’re a couple of weeks into the trial. The jury has been selected. There’ve been opening arguments. We’re starting to hear testimony from witnesses. Explain what this trial looks like. Elizabeth Holmes is having one trial. Her partner, in all senses of the word, Sunny Balwani, is having a different trial; they’re both being criminally prosecuted. What is Holmes on trial for? What is Sunny on trial for?
They’ve been charged with 10 counts of wire fraud and two counts of conspiracy to commit wire fraud. Why wire fraud? Because it’s actually a very easy charge to prove. Basically, all you need to show to the jury is that Elizabeth and Sunny were lying when they solicited money from investors and got them to wire this money across state lines to Theranos’s bank account. The other aspect of these wire charges is actually a little bit more unusual. It involves the blood test results that were wired electronically across state lines from California to Arizona. That’s something you don’t see as often.
So why is Elizabeth being tried now, and why is Sunny not there with her in the courtroom? Well, actually, that’s because, as we learned recently, part of her defense is going to involve blaming Sunny and alleging that he abused her, that he held her in his psychological grip, effectively depriving her of free will and agency. As a result, the judge had no choice but to sever their cases, and so Sunny is going to be tried early next year. This is going to be, I think, one of the pivotal aspects of the trial, and I think, by the way, she’s going to testify, because for the jury to believe this, I think they’re going to want to hear from more than just her psychologist. They’re going to want to hear from her. I think her defense team realizes that, and they’ve already pretty much telegraphed that she’s going to testify.
This is going to be a really pivotal moment at the trial, because she’s a great actress. She’s shown in spades that she can get people to believe her, and I expect her to go on the stand and play the part of this naive young woman who was manipulated by this older man. The question is going to be, is the jury going to go for it? Is the jury going to believe it? Is the jury going to go for it to the extent of excusing everything else, basically, to the extent of discarding all that mountain of evidence that the prosecution will have presented it? I think the trial could very much ride on that. It’s going to be fascinating.
You’ve been to the courthouse already, you’ve seen the trial take shape, over the first few days. What’s the mood of the trial? Does it feel like the prosecution is already ahead because the story is so famous, or is Holmes and her team mounting an effective defense?
It’s interesting, the trial’s taking place in San Jose, which, not to offend anyone in Silicon Valley, is kind of a sleepy city. It’s not San Francisco. It’s certainly not New York. I’ve covered white-collar criminal trials in New York, and you have these century-old court buildings and these cavernous courtrooms. This is like this modern courthouse that was built in 1990. The courtroom is pretty small. It feels very cramped in there. The jurors are not very far from Elizabeth. They were like a couple of arms’ lengths away from her. Some of the jury spills out of the jury box because of the COVID protocols, because of the social distancing. As far as how it’s going, I was there for opening statements. I thought the prosecution did a decent job of explaining what happened. I thought the defense lawyer, Lance Wade, was very polished in his opening statement, in humanizing Holmes and in raising some of the lines of defense, such as the fact that she never sold a single share of stock, so how could this be a fraud if the main perpetrator of this fraud never profited? He also planted the seeds of what I call the Svengali defense, which is going to be blaming Sunny, saying that Sunny was the villain, but in recent weeks since opening statements, I think if I had to handicap it right now, I think the prosecution is ahead because the evidence is beginning to mount.
We’ve heard from whistleblowers, we heard from Erica Cheung, who’s actually a source of mine at the Journal, who testified about how she tried to alert a lot of people to the unreliability of the blood test. We heard from another woman who was head of assay validation, who had worked there for eight years and who resigned right before they went live with the blood test because she had major misgivings about the reliability of the blood test and she told Elizabeth so in a one-on-one meeting. We’ve heard from General Mattis about how he initially thought that this had huge promise and gradually, he lost faith in Elizabeth and the company. And today on the stand, there’s the lab director. I think he’s going to be a really important witness. So I think that all the government’s evidence is really starting to amass and by the end of the trial, I think it’s going to be hard for the defense to account for all of it.
You have obviously been as deep in the story as anyone can possibly be for years. There’s a mountain of evidence, of texts, of notes. You’ve mentioned emails, marketing presentations, financial statements, whatever you can think of. Some of it’s allowed and some of it isn’t. How is that breaking down?
Most of it is coming in, actually. At one point a couple months ago, the defense had objected to the text messages coming in, saying that the government hadn’t proved that they were authentic. So the government went back and found the PricewaterhouseCoopers forensic security expert who’d actually taken Elizabeth Holmes and Sunny Balwani’s phones and basically made tapes of them. He was a witness who was called to the stand this week and the prosecutors had him read the texts to the jurors, and I’m told by my colleague, Emily Saul, who’s in the courtroom, that they were riveted by these texts.
So the texts are in. The defense also tried to repeatedly get the testimony from patients and from doctors excluded, to no avail. The only thing the judge agreed to do was to limit the patients’ testimony to the facts, to, basically, the blood test results that they got from Theranos and the subsequent blood tests they got from elsewhere that showed that the Theranos results were false. The patients are not able to testify about the emotional turmoil they experienced from their inaccurate tests. But other than that, the judge is letting a lot of what the prosecution wants to come in in, and that’s a real problem for the defense.
That limitation on the patients is so funny to me because it assumes the jury has no human empathy. If you hear a woman say, “This test told me my pregnancy was going to miscarry and that was a lie,” you don’t really need her to finish the thought with “and that made me feel bad.” Is there any reason why they fought over that?
Because the defense is deathly afraid that these patient sob stories are going to prejudice the jury against Elizabeth Holmes. They want to keep that testimony from each of those patients very short and they then want to counter it by saying that these are just a handful of patients and that Theranos conducted more than 8 million blood test results and that the government is only presenting 20 or so patients with erroneous results. Of course, the government will be able to rebut that by pointing to the fact that Theranos had to void nearly a million blood test results after the federal inspectors went in and found all the problems at the lab.
But, you’re right. I think the jurors are not dumb; they can read between the lines. One of the patients that is going to testify had a false HIV result from Theranos telling her she had AIDS when in fact, she didn’t. All it’s going to take for jurors to put themselves in her shoes, and to be appalled, is going to be just to hear that she got a false HIV result. They don’t need to hear her say how she spent weeks agonizing over this before she could afford to get retested. They’ll know that’s outrageous and I think that’s a real problem for the defense.
Do you anticipate being called as a witness? You’re a central character in this tale.
I actually do, but ironically, I don’t expect to be called by the prosecution because I’m not on their witness list. I am, however, on the defense’s witness list. I’m No. 6 on the defense’s witness list and so I’m expecting a subpoena any day, and I’m expecting the defense to call me during their case in chief, and if that happens, I think that one of the lines of defense will be that Carreyrou was this rabid reporter who had it in for Elizabeth Holmes. That this was a witch hunt, that he contacted regulatory agencies and biased them, that they went in and inspected and came down more harshly on Theranos than they might otherwise have because of my intervention and because of my reporting.
I think there’s only so far you can go with this line of defense because ultimately, when the regulators went in, they found what they found. I had nothing to do with what they found on the ground in that facility in Newark, California, and at Theranos’s headquarters in Palo Alto. So I’m skeptical that it’s going to work. And then if you’re the defense and you call me to the stand, then you open the door for the prosecution to ask me questions and to elicit from me testimony about what I went through when I tried to expose the scandal. The scorched earth campaign that Theranos conducted to try to quash my story: the way they hired private investigators to follow my sources; the way David Boies and Heather King, the Theranos general counsel, sent threatening letters to me and to the Journal threatening to sue us; the way Sunny flew out to Phoenix to intimidate doctors who’d spoken to me on the record to try to get them to recant; the way Elizabeth privately lobbied Rupert Murdoch — who owns the Journal and who was a big Theranos investor — to kill my story. I think the defense will open the door to all of that being talked about if they call me to the stand. So I think it’s risky.
It’s always been interesting to me that Rupert Murdoch, in the context of this story, comes off as having a very high set of ideals about journalism, because he was an investor in Theranos, but he did not do anything at the Journal as far as I’ve heard or has otherwise been reported.
That’s right. He had invested $125 million in Theranos. I actually didn’t know this when I was reporting my story. I only found out about it a year after my first Theranos story was published. And it’s true, he did not intervene. So this is not to absolve him completely, but certainly in the case of Theranos, he behaved really well as a steward of the paper.
I want to talk about Sunny. His name has come up several times because Holmes is going to make this Svengali defense. He’s being tried separately. Who is Sunny? What is he like, and do you buy this Svengali defense?
Sunny is a Pakistani guy who came to the US in the ’80s during college and stayed and made a career in Silicon Valley. He worked for 10 years at Lotus and Microsoft, and then he joined an e-commerce startup in the late ’90s, at the top of the dot-com bubble, and he and his partner sold it for a lot of money and he cashed out. A couple years later he met Elizabeth Holmes when they were both part of a Stanford Mandarin program. They met in Beijing on this program and then they kept in touch, and when she dropped out of Stanford a year and a half later in late 2003, she got back in touch with him and he gave her advice. He became sort of a mentor. Eventually, that morphed into a romantic relationship. In 2009, about five years into the life of Theranos, Theranos was running out of money. Sunny stepped in and guaranteed a bank loan with his personal wealth.
And at that point he joined the company and from 2009 onwards, he helped run the company and they really ran the company as a partnership. He was the COO and president while she was CEO. I don’t buy their line of defense that he was her Svengali, that he manipulated her, that she was under his psychological grip. The texts don’t back it up. The dozens and dozens of employees I interviewed for the book and for the podcast who worked with them say that this was a partnership of equals. If anyone had the last say, it was Elizabeth, and that she was firmly in control of the company. Let’s not forget, she had 99.7 percent of the voting rights. She was the founder and CEO. This was her company. Was Sunny influential? Sure. Did he help her run it? Sure. But was he the puppeteer and was she the puppet? No, I don’t buy that.
They were romantically involved as well, yeah?
They were romantically involved. They lived together in a big house Sunny owned in Atherton. So yeah, it was a partnership at work and it was a partnership at home. They were sleeping together.
And he’s much older than her.
He’s 19 years older.
So this is particularly dicey territory in the context of this trial, right? He is an older man, she’s a younger woman. There is an enormous amount of contextual strife about women founders, women executives, in tech in particular. Her defense cuts against the entire grain of women in leadership positions. She’s saying, “I was controlled by this older man.” Do you think that works here?
It completely contradicts her demeanor, and by the way, prosecutors are going to play videos of her at the height of her fame when she was speaking to audiences and looking incredibly confident and self-possessed. The jury’s going to see those videos and I think it’s going to be extremely hard to reconcile this new image she’s trying to put forth with what they’ll see on their video screen. The other really dicey thing about this is that she’s basically accusing a brown man of sexually and psychologically abusing her, and he’s not there to defend himself. Who knows how that plays with the jury? It’s really sensitive stuff.
One of the things that has occurred to us as we were preparing for this interview is that she is going to blame Sunny and say that it was all his fault and he was the puppet master, and she might get acquitted. And then Sunny’s going to have a trial and say, “I was under her spell. She was this radiant, compelling figure,” and then he’s going to get acquitted. And then no one is responsible. Is that a possibility here?
It’s certainly a possibility. You never know with a jury trial. I don’t think that’s going to happen. I still think the odds are that Elizabeth gets convicted. And I think in some ways the case is even stronger against Sunny because he directly oversaw the lab and he was the one who interacted directly with some of the whistleblowers, and so she’s a little bit more insulated than he is. I think he’s going to have a tougher time rebutting all the government’s evidence. So I think what would be more realistic is that she gets acquitted and he gets convicted, rather than both of them get acquitted. But when I look at all that government evidence, I still think that both of them get convicted.
So here is a question I’ve been dying to ask you this entire time. You started reporting the story in 2015. You have experienced every up and down, from high-powered lawyers marching into the offices of the Wall Street Journal to yell at your employers and try to shut this down, to the first story breaking, which must have been an emotional high, to the book coming out, to now there’s investigations and lawsuits. There’s a trial. Now you’re doing a podcast about it. Are you tired of this?
Part of me is tired of this story. It’s consumed the past six and a half years of my life and I am eager for it to be over. I want this trial to be over. I want to have closure. I want to see justice done. At the same time, I feel like I opened this can of worms, I started this, I felt like I owed it to myself to cover the story until the end. I felt like I owed it not just to myself, but to everyone who’s been following the story. I owed it to them to cover it.
Since I’d left the Wall Street Journal, I felt like the best medium to do that was a podcast. And so hence the podcast and hence the name of the podcast, Bad Blood: The Final Chapter. This is the final chapter of the story that I was not able to write when I wrote the book because its events hadn’t happened, and I’m writing it now, or rather I’m narrating it now, in the podcast.
Whathave you learned that has changed your opinion of the events of the book or has reinforced those things?
There’s nothing that’s materially changed the arc of the story that I told in the book. I have gotten my hands on a lot more documents and emails and texts, a lot of them are SEC case exhibits that I got my hands on. They only make it worse. They only make it clear to me that there was indeed fraud here and that she was indeed lying to investors. For instance, I’d heard a small investor who invested in Theranos — and actually, he was a character in the book — had told me that he heard from the head of the VC firm he invested in, Don Lucas, that Elizabeth was saying that the Theranos machines were being used by the military in the field. So I knew that from talking to him when I was writing the book, but I didn’t know she was saying this to virtually everyone. She was saying it to the CEO of Safeway, Steve Burd. She was saying this to the CFO of Walgreens, and Sunny was saying it too. There is government evidence now that shows that, at one point, they were walking around Theranos headquarters and Sunny points out one of the Edison devices to Wade Miquelon, the Walgreens CFO, and tells him, “That’s the model that’s on the Apache helicopters in Afghanistan.” She was telling this to investors, to Betsy DeVos’s people, to a hospital chain called Dignity Health. When I was writing the book, I didn’t quite know the extent of the lying. And it’s now become more apparent to me with all the evidence that’s come out.
You have an interesting podcast strategy here. There’s Bad Blood: The Final Chapter, which is a free podcast that everyone can go listen to. It’s great, you should listen to it. Then you have “This Week In Court,” which is a paid product. How’d you make that decision?
Early on, we decided that we wanted to do a narrative podcast with high production values. And we wanted not to just regurgitate the book, but to really add new elements, break news. And at the same time, we knew that people would want to know what happened during the trial. And so the system we came up with is a free podcast, that should be composed, by the end, of 12 episodes, that are scripted and that are narrative-based. And then bonus episodes that come out every Monday that are called “This Week In Court,” that recap what went on in court that week. That way you get the best of both worlds. And so far it’s been really successful.
Do you have any numbers to share with us? Are lots of people buying the paid podcast?
I don’t know if I’m supposed to say this, but I think the narrative podcast, the one that’s free, is approaching 2 million downloads and we’ve got about 6,000 subscribers to the bonus episodes, who are paying $3.99 a month for that premium content.
It’s tough being on the other side of a reporter’s questions, isn’t it?
Well, the reason I ask is because we talk to a lot of creators on the show. We’ve talked to a lot of media people. Adam McKay is making a movie starring Jennifer Lawrence based on your book, and you are one of the writers of this movie. What you have here is an extraordinarily valuable piece of intellectual property that just happens to be now becoming a true crime story. And I’m wondering if you are thinking about it that way, or if you are a journalist who, because the story is so sensational, is being thrust into a world of entertainment.
Yeah. You make a great point. This story has just fascinated people for five, six years now. It just seems to never stop fascinating people, and it also doesn’t seem to stop. I mean, the wheels of justice turn very slowly in this case, and it’s only now that the trial is happening. So that has sort of expanded the lifespan of the story. It’s been really strange. It’s good in many ways, but Bad Blood is sort of like a franchise at this point. But yeah, part of me is kind of hoping that it ends soon so that I can move on to something else finally.
Is that in your plan? One of the questions I’ve always had for people in this situation is: you have been very successful with Bad Blood. The book was successful. One anticipates the Jennifer Lawrence movie will be successful. The podcast seems like it’s successful. Are you done? Do you have a next project in your head after this? Or are you just moving to a place without blood testing at all and you’re just going to wrap it up?
After the podcast I’m done. I’m not doing any more Theranos-related projects. I’ll consult on the movie and I have high hopes for it. So I’ll be watching that closely. But after that, I’m done. I want to do something else. I don’t want to be pigeonholed as the Theranos reporter for my entire career. I’d like to do other things, and that may be, you know, writing another book, probably involves doing more journalism, but yeah, after this podcast I’m done.
So you were an investigative reporter at the Wall Street Journal, which I think is fair to characterize as one of the most traditional newsrooms in media, with literally one of the most traditional distribution channels, a print newspaper, and a paywalled digital product. When this is all over and you think about doing journalism again, are you going to go back to the traditional newsroom? Have you learned something about where journalism should go now? How does that look to you?
I don’t know what the future is made of at this point. I do feel like I am a journalist at heart. And I’d like to perhaps write another book. If I do another book, it’ll be a nonfiction book. It’ll be a journalistic book. If I do another podcast, it’ll be nonfiction, it will be journalism. So I feel like whatever it is that comes next will be an extension of my journalism career. It may not be as traditional as working for an online newspaper, but I think that training has served me well. And I think reporting is what I’m good at, so I intend on continuing to report.
Do you have any projects in the back of your mind that you’re thinking, “Oh, that’s the next one?”
I’ve got some ideas there. They’re not well-formed yet. And I think it would be premature to get into any of them, but I’ll talk about it when I’m ready.
You’re not trying to tip off your targets. I know what you’re doing. You’re being cagey.
What’s next in the Holmes trial, in the Holmes story? People are watching this, our deputy editor, Liz Lopatto, is at that trial — she’s going to be there for months, it seems like. You’re doing this podcast while we wait to see the conclusion. Then Sunny Balwani is going to be on trial. But for people who are kind of casually watching this, what are the moments to look out for?
This week, today, and potentially going into next week, the lab director testimony, I think he’s going to be a crucial government witness. I think it’s also going to be interesting to see how the defense tries to impeach him. I think one of the many lines of defense is going to be that he was the guy that Elizabeth trusted to make sure things in the lab were under control. And so to the extent that they weren’t, then it’s his fault. It’s not her fault. Another important moment, I think, is going to be when Brian Grossman takes the stand. He is the portfolio manager at Partner Fund, the San Francisco hedge fund that sued Theranos. He took notes during his meetings with Elizabeth and Sunny. And he actually did do a fair amount of due diligence. And I expect his testimony to potentially be devastating.
He’s a smart guy. I think he’s articulate. And I think he’s going to spell out to the jury exactly the ways in which Elizabeth lied. I’ll be interested to see if Rupert Murdoch is a witness. I’ll be fascinated to see whether David Boies gets called to the stand, whether Heather King, his former law firm partner, who for a year there was Theranos’s general counsel who I did battle with, whether she’s going to go on the stand, and what they all have to say. And then of course, the big moment is going to be if and when Elizabeth testifies. I think that is going to make for amazing theater. Speaking of Hollywood, that’s going to be a Hollywood moment.
Yeah. Well, John Carreyrou, it has been an absolute pleasure to talk to you. Thank you so much for coming on Decoder.
Almost a quarter of healthcare organizations that were hit with a ransomware attack in the last two years said they had increases in patient death rates in the aftermath, according to a new report sponsored by cybersecurity company Censinet. The finding adds to a growing pile ofdata showing that cyberattacks aren’t just causing financial or logistical problems — they could be major health risks, as well.
“There’s enough impact from ransomware on patient care that it’s undeniable” says Ed Gaudet, CEO and founder at Censinet. “We should not be afraid to look at this data, and to keep pushing on this question.”
The analysis, conducted by a research institute called the Ponemon Institute, collected survey responses from nearly 600 healthcare organizations across the United Statesranging from regional health systems to medical device manufacturers. Just over 40 percent said that they had a ransomware attack in the last two years — cyberattacks that freeze up computer systems and demand payment to unlock them. Those attacks disrupted the facilities’ ability to care for patients. Around 70 percent of the groups facing ransomware attacks said that those disruptionsled to longer hospital stays for patients and delayed tests or procedures. In addition, 36 percent said that they saw more complications from medical procedures, and 22 percent said they had increased death rates.
Those numbers come with some big caveats: they’re from a relatively small subset of healthcare organizations, and there’s no double-check on what the organizations reported.The survey didn’t ask organizations why or how they came to those conclusions — they didn’t say how they measured changes in death rates, for example. Without more details about those methods, it’s important to interpret the findings cautiously, Gaudet says. It’s probably too soon to say confidently that ransomware directly caused bad outcomes at those frequencies. “We have to be careful as an industry not to overreact,” he says. But it’s still something the industry should pay attention to and care about. “Even if it’s just one percent or half a percent, we should care about this data.”
Overall, over half of the healthcare groups responding to the survey said that they weren’t confident their organizations could handle the risks of ransomware attacks.
People working in healthcare have historically been reluctant to say ransomware harms patients. There have been very few efforts to quantify the relationship between cyberattacks and patient health, and hospitals tend to be reluctant to share much information about their experiences because of potential impacts on the hospital’s reputation. “I think as an industry, this is a question we almost don’t want to know the answer to,” Gaudet says. “Because if it’s true, then man, we really have our work cut out for us.”
Cyberattacks on healthcare facilities have increased over the past year, which brings new urgency to the question. And there have been recent pushes to take closer looks at the issue: one new analysis by the United States’ Cybersecurity and Infrastructure Security Agency (CISA), for example, showed hospitals in Vermont affected by ransomware attacks during the COVID-19 pandemic started to have excess deaths more quickly than hospitals not dealing with cyberattacks.
“I think this is reaching a level of criticality that is getting the attention of CEOs and board rooms,” Gaudet says. “Data like this is going to start factoring into how people think about areas of focus and investment. If ransomware is truly becoming a patient safety issue, they’re going to have to address it.”
Piaggio Fast Forward, a subsidiary of storied Italian automotive firm Piaggio, has launched its second robot, a compact version of its cargo-carrying bot Gita named Gitamini.
The form and function of Gitamini remain the same as that of full-sized Gita (the name is Italian for a small trip or outing). The robot consists of two large wheels, a central trunk, and a machine vision system that it uses to identify and follow its owner. Gitamini weighs 28 pounds and can carry up to 20 pounds in its interior for 21 miles. That makes an interesting comparison to Gita, which can carry more — 40 pounds but only for 12 miles.
Gitamini uses an array of cameras and sensors, including radar (not available for the original Gita), to navigate and follow its user. To activate this follow mode, you simply stand in front of the Gitamini and tap a pairing button. The robot will then lock on to you using vision only (no GPS or Bluetooth are utilized) and will follow you at speeds of up to 6mph.
The robot’s trunk can be locked and its follow mode disabled, but there are no active theft mitigation features. When asked about this, Piaggio Fast Forward’s CEO Greg Lynn told The Verge that it was “unlikely someone could get away with walking away with it unnoticed” as it’s such a noticeable object. “A stolen Gita isn’t of much use to anyone as it uses a secure connection to a phone to be unlocked, updated, and used,” says Lynn. “We have yet to learn of a Gita being stolen or broken into while being used or when parked.”
The Gita has always been a bit of an odd product. It certainly looks fantastic, and videos suggest it works more or less as advertised (though it’s noisier than you might expect). But it’s not clear exactly who’s going to spend thousands of dollars on something that only carries a few bags and is stymied by steps and stairs. Gitamini doesn’t change any of these basic annoyances, though it is at least a little cheaper — it costs $1,850 (and will be available to buy from October 15th at mygita.com) while the launch sees the price of the original Gita drop to $2,950.
When we asked CEO Greg Lynn about the robot, he declined to share any sales figures with us but said there were Gita robots operating in “half the states in the US […] with a focus on the Southern belt where outdoor weather is more friendly year-round.”
“Most of the consumer Gitas are being used to replace car trips for neighborhood errands in a variety of communities, and they are used outdoors for round trips of a mile or more,” said Lynn. Though, he noted that the company had some business customers, too. There are currently Gitas in eight airports in the US (including JFK and LAX) and a number more in planned communities, like Water Street Tampa in Florida and Ontario Ranch in California.
July 2021 was officially the hottest month humans have ever recorded. This July narrowly beat out three previous months in 2016, 2019, and 2020 that had tied for the previous title. The fact that all of this has happened so recently just screams climate change.
“In this case, first place is the worst place to be,” Rick Spinrad, administrator of the National Oceanic and Atmospheric Administration (NOAA), said in a statement. NOAA confirmed the new temperature record today, which Spinrad said, “adds to the disturbing and disruptive path that climate change has set for the globe.”
Scientists have more evidence than ever that links climate change to more extreme weather, especially when it comes to heat. By burning fossil fuels, humans have influenced the weather around the world, a major new United Nations climate report said definitively when it was published earlier this week. Almost every region of the world, apart from the polar regions, has seen a rise in extreme heat events since the 1950s, according to the new report.
“Climate change is a problem that is here now. Nobody’s safe, and it’s getting worse faster,” Inger Andersen, executive director of the United Nations Environment Programme, said in an August 9 press conference.
While last month was the hottest month in the books globally since records started 142 years ago, the heat was particularly bad in some regions. July absolutely smashed the land-surface temperature record for the entire Northern Hemisphere, according to NOAA. Asia also had its hottest July on record.
Such unprecedented heat can take a heavy toll even in typically cooler regions, especially since people and infrastructure there haven’t had to adapt to such hot summers — until now. Southwest Canada and the Pacific Northwest, for example, have suddenly suffered repeated heatwaves this summer that mangled roads, killed hundreds of people, sent thousands more to emergency departments, and fueled massive wildfires. The most severe heatwave to hit, which took place in late June, would have been “virtually impossible” without climate change, an international team of researchers determined. It was also declared the “most extreme” summer heatwave in North America since records began.
August has been scorching, too. Another heatwave is bearing down on the Pacific Northwest. Europe might have seen its hottest day on record on August 11, when the mercury rose to 48.8 degrees Celsius (119.8 degrees Fahrenheit) in Sicily, Italy. The World Meteorological Organization is still working to verify that record. But if greenhouse gas emissions continue to grow, the world is likely to see more and more temperature records fall.
AI research company OpenAI is releasing a new machine learning tool that translates the English language into code. The software is called Codex and is designed to speed up the work of professional programmers, as well as help amateurs get started coding.
In demos of Codex, OpenAI shows how the software can be used to build simple websites and rudimentary games using natural language, as well as translate between different programming languages and tackle data science queries. Users type English commands into the software, like “create a webpage with a menu on the side and title at the top,” and Codex translates this into code. The software is far from infallible and takes some patience to operate, but could prove invaluable in making coding faster and more accessible.
“We see this as a tool to multiply programmers,” OpenAI’s CTO and co-founder Greg Brockman told The Verge. “Programming has two parts to it: you have ‘think hard about a problem and try to understand it,’ and ‘map those small pieces to existing code, whether it’s a library, a function, or an API.’” The second part is tedious, he says, but it’s what Codex is best at. “It takes people who are already programmers and removes the drudge work.”
OpenAI used an earlier version of Codex to build a tool called Copilot for GitHub, a code repository owned by Microsoft, which is itself a close partner of OpenAI. Copilot is similar to the autocomplete tools found in Gmail, offering suggestions on how to finish lines of code as users type them out. OpenAI’s new version of Codex, though, is much more advanced and flexible, not just completing code, but creating it.
Codex is built on the top of GPT-3, OpenAI’s language generation model, which was trained on a sizable chunk of the internet, and as a result can generate and parse the written word in impressive ways. One application users found for GPT-3 was generating code, but Codex improves upon its predecessors’ abilities and is trained specifically on open-source code repositories scraped from the web.
This latter point has led many coders to complain that OpenAI is profiting unfairly from their work. OpenAI’s Copilot tool often suggests snippets of code written by others, for example, and the entire knowledge base of the program is ultimately derived from open-source work, shared to benefit individuals, not corporations. The same criticisms will likely be leveled against Codex, though OpenAI says its use of this data is legally protected under fair use.
When asked about these complaints, Brockman responds: “New technology is coming, we do need this debate, and there will be things we do that the community has great points on and we will take feedback and do things differently.” He argues, though, that the wider coding community will ultimately benefit from OpenAI’s work. “The real net effect is a lot of value for the ecosystem,” says Brockman. “At the end of the day, these types of technologies, I think, can reshape our economy and create a better world for all of us.”
Codex will also certainly create value for OpenAI and its investors. Although the company started life as a nonprofit lab in 2015, it switched to a “capped profit” model in 2019 to attract outside funding, and although Codex is initially being released as free API, OpenAI will start charging for access at some point in the future.
OpenAI says it doesn’t want to build its own tools using Codex, as it’s better placed to improve the core model. “We realized if we pursued any one of those, we would cut off any of our other routes,” says Brockman. “You can choose as a startup to be best at one thing. And for us, there’s no question that that’s making better versions of all these models.”
Of course, while Codex sounds extremely exciting, it’s difficult to judge the full scope of its capabilities before real programmers have got to grips with it. I’m no coder myself, but I did see Codex in action and have a few thoughts on the software.
OpenAI’s Brockman and Codex lead Wojciech Zaremba demonstrated the program to me online, using Codex to first create a simple website and then a rudimentary game. In the game demo, Brockman found a silhouette of a person on Google Images then told Codex to “add this image of a person from the page” before pasting in the URL. The silhouette appeared on-screen and Brockman then modified its size (“make the person a bit bigger”) before making it controllable (“now make it controllable with the left and right arrow keys”).
It all worked very smoothly. The figure started shuffling around the screen, but we soon ran into a problem: it kept disappearing off-screen. To stop this, Brockman gave the computer an additional instruction: “Constantly check if the person is off the page and put it back on the page if so.” This stopped it from moving out of sight, but I was curious how precise these instructions need to be. I suggested we try a different one: “Make sure the person can’t exit the page.” This worked, too, but for reasons neither Brockman nor Zaremba can explain, it also changed the width of the figure, squashing it flat on-screen.
“Sometimes it doesn’t quite know exactly what you’re asking,” laughs Brockman. He has a few more tries, then comes up with a command that works without this unwanted change. “So you had to think a little about what’s going on but not super deeply,” he says.
This is fine in our little demo, but it says a lot about the limitations of this sort of program. It’s not a magic genie that can read your brain, turning every command into flawless code — nor does OpenAI claim it is. Instead, it requires thought and a little trial and error to use. Codex won’t turn non-coders into expert programmers overnight, but it’s certainly much more accessible than any other programming language out there.
OpenAI is bullish about the potential of Codex to change programming and computing more generally. Brockman says it could help solve the programmer shortage in the US, while Zaremba sees it as the next step in the historical evolution of coding.
“What is happening with Codex has happened before a few times,” he says. In the early days of computing, programming was done by creating physical punch cards that had to be fed into machines, then people invented the first programming languages and began to refine these. “These programming languages, they started to resemble English, using vocabulary like ‘print’ or ‘exit’ and so more people became able to program.” The next part of this trajectory is doing away with specialized coding languages altogether and replacing it with English language commands.
Codex also has the ability to control other programs. In one demo, Brockman shows how the software can be used to create a voice interface for Microsoft Word. Because Word has its own API, Codex can feed it instructions in code created from the user’s spoken commands. Brockman copies a poem into a Word document and then tells Word (via Codex) to first remove all the indentations, then number the lines, then count the frequency of certain words, and so on. It’s extremely fluid, though hard to tell how well it would work outside the confines of a pre-arranged demo.
If it succeeds, Codex might not only help programmers but become a new interface between users and computers. OpenAI says it’s tested Codex’s ability to control not only Word but other programs like Spotify and Google Calendar. And while the Word demo is just a proof of concept, says Brockman, Microsoft is apparently already interested in exploring the software’s possibility. “They’re very excited about the model in general and you should expect to see lots of Codex applications be created,” he says.
A Tesla Megapack caught fire today during initial testing of a highly anticipated new utility-scale battery in Victoria, Australia. Luckily, there were no injuries or disruptions to the local electricity supply, CNBC reports. The blaze posed no risk of spreading to the nearby community, according to Bloomberg, but it did trigger a toxic smoke warning for residents who were told to stay indoors, the Sydney Morning Herald reported. The cause of the fire is still unclear.
The fire affected the aptly named “Victorian Big Battery.” Spanning an area nearly as big as a football stadium, it’s one of the largest in the world. It’s scheduled to be operational by the end of this year, and the 300MW battery should be able to store enough energy to power more than a million homes in Victoria for half an hour.
That’s supposed to help prevent blackouts that have affected hundreds of thousands of homes in the region in recent years, especially in the summer when demand for electricity spikes. Giant batteries are also crucial to meeting environmental and renewable energy goals. The state of Victoria aims to get half of its electricity from renewable sources like wind and solar power by 2030. Batteries can fill in the gaps in energy supply when the sun doesn’t shine and winds don’t blow.
French renewable energy company Neoen is developing the Victorian Big Battery alongside Tesla and energy company AusNet Services. Neoen and Tesla brought another grid-scale battery online in 2017, which was the largest lithium-ion battery in the world at the time. Neoen did not immediately respond to a request for comment from The Verge.
Amazon has updated the Alexa app on iOS so that you can access the voice assistant right from your home screen via a new widget. Everyone can use the assistant to remind specific members of your household to do tasks through a new “assign reminders” skill.
Due to the somewhat restrictive nature of the widgets on iOS, the new Ask Alexa widget isn’t so much Alexa itself as it is a link directly to the iOS app. But if you have the Alexa widget placed on any of your screens and you’ve already given the Alexa app permission to use your iPhone’s mic, you’ll be able to start making requests with a tap.
And now those requests can get a bit more granular. Amazon’s given Alexa the ability to assign reminders to specific members of your household if they have a Voice Profile set up on the same Amazon Alexa account. So if you say “Alexa, remind Jeff to take the lasagna out of the freezer at 10AM,” Alexa will be able to deliver the reminder to the right person, at the right time, through the Alexa app. You can add profiles to your Alexa account in Settings under Your Profile, and Amazon says you can assign relationship nicknames to each one, like mom, dad, daughter, etc.
Alexa picks up new features and skills on a monthly basis, but Amazon also announced plans in June to open up Alexa even further to third-party developers. Among many new APIs, developers will be able to create custom widgets for the Echo Show.