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Lux Take on News: Weekly Round-Up September 27, 2019

Lux Research
September 27, 2019

Every day Lux Analysts curate recent news, giving their opinion and analysis on selected developments. Our analysts evaluate news based on potential importance ranking developments from Truly Disruptive to Ignore. This week in innovation saw a lot of very important news, from Hyundai's autonomous vehicle joint venture to Facebook's acquisition of CTRL-labs. Check out our experts' thoughts below, on this week's top tech and innovation headlines.

Each Friday we will highlight our Lux Take on the news for the week

LTE-M expansion presages 5G coverage across North America with AT&T roaming agreement

13815-thumb-square Michael Sullivan, Analyst 
Lux Take: Very Important

"In a precursor to the 5G low-band coverage that will follow, AT&T and Canadian mobile network operators are quickly expanding LTE-M coverage throughout the continent through a recently announced roaming agreement, with AT&T extending coverage to Mexico in 2020. LTE-M expansion allows IoT devices to directly connect to a 4G network via an RF module rather than through a gateway. LTE-M caters to low-bandwidth devices with bidirectional functionality. The roaming agreement provides LTE-M with an advantage over other LPWAN protocols like Sigfox and LoRa. It also places LTE-M as co-leader with NB-IoT as regional players take sides, with North American operators choosing LTE-M and APAC ones choosing NB-IoT."

Hyundai Motor Group will form an autonomous vehicle joint venture with Aptiv valued at $4 billion

Lewie Roberts Lux ResearchLewie Roberts, Research Associate | @roberts_lewie Ico twitter
Lux Take: Very Important

"In a move reflective of VW's recent $2.6 billion investment in Argo AI, Hyundai will contribute $1.4 billion in cash and $0.4 billion in resources (vehicle engineering, R&D, and IP) to Aptiv's existing autonomous vehicle (AV) platform. This is a significantly larger sum than it allegedly contributed to AV software developer Aurora in June (rumored at less than $30 million), pointing to Aptiv as the OEM's primary partner for AV development. With this established partnership, expect Hyundai to pursue a timeline similar to Aptiv's recently released targets for AV deployment, which aims for the initial (but limited) removal of safety drivers in 2022, matching Lux's expectations in our report on AV applications."

San Jose bans natural gas from new buildings, promoting full electrification of the built environment

10028-thumb-squareJessica Hernandez, Senior Research Associate | @JessHernandezLR Ico twitter
Lux Take: Very Important

"While the federal government intends to relax vehichle greenhouse gas emmission standards in California, cities are taking other measures to reduce carbon emissions. Today, San Jose is demanding that new homes built from 2020 onward are completely electric. In addition, new constructions will also be responsible for supporting further adoption of electric mobility by adding electric vehicle charging capabilities to 70% of the parking spots in apartment buildings. Residential building electrification is spearheading decarbonization efforts worldwide and opening opportunities for energy management experts to provide services to enable efficient electrification of the built environment."

Medtronic and Novo Nordisk collaborate on digital diabetes solutions

13275-thumb-square (1)Nardev Ramanathan, Ph.D., Analyst | @Nardev_R Ico twitter
Lux Take: Very Important

"The two diabetes care giants have teamed up to integrate dosing data from Novo Nordisk's smart insulin pens with Medtronic's Guardian Connect continuous glucose monitors (CGMs). This landmark move is critical for enabling greater interoperability in a relatively fragmented diabetes ecosystem. Both these industry heavyweights command a significant market share of the trillion-dollar diabetes industry, and this partnership enables millions of diabetes patients to seamlessly connect two critical parameters in diabetes management, insulin and blood glucose data. This partnership also unlocks the potential to gain deeper insights by combining larger datasets, helping support new business opportunities and better outcomes for patients."

Agragene acquires exclusive license to precision insect sterilization technology

12744-thumb-square Joshua Haslun, Ph.D., Analyst | @JHaslun Ico twitter
Lux Take: Very Important

"The license, obtained from the University of California, provides Agragene the opportunity to develop these heavily debated technologies. The technology utilizes CRISPR to produce sterile male eggs that are released at sufficient densities to reduce wild populations. The technology is not a  "gene drive," moving lethal or chemical sensitivity traits into a population (see Oxitec), but does reduce the population's fecundity. Genetic manipulation of insects continues to experience relatively rapid development due to health needs to control vector insects (i.e., mosquitos). Companies should seriously consider this market, but must recognize that the ecological debate around selective extirpation of pests will be real and heated."

AI for drug discovery company BenevolentAI cuts $2 billion valuation in half in recent funding round

12191-thumb-squareCole McCollum, Research Associate
Lux Take: Very Important

"The company reportedly raised $90 million from Singapore-based Temasek at a $1 billion valuation, down from $2 billion in just 2018. As Lux previously described, the company made bold claims about its technology and overstated the current capabilities of AI. Companies should recognize the long-term promise of AI in drug discovery but note that while today's machine learning-based methods are useful for pattern recognition tasks, they are still many years away from outperforming human scientists in understanding disease, as the company claimed. Moreover, investors in this space should be wary of such high valuations without significant success in the clinic, as that is where most of the value in drug development is generated."

World Nuclear Industry Status Report highlights competition from renewables but misses the potential of small modular reactors

Lux-on-blue-c0c5685a7a44c3f1be499bb80dc7d4b57d9db9b867f694b956a8f28ea4989dd9Benjamin Torda, Research Associate
Lux Take: Very Important

"The annual report found that, compared to solar and wind technologies, traditional nuclear energy is at a disadvantage due to higher costs and longer deployment timelines. Most critically, costs rose 23% for nuclear over the past decade, compared to a decrease of 88% for utility-scale solar installations. We agree with the bleak outlook for conventional nuclear, though the report undervalues one potential bright spot for nuclear: small modular reactors (SMRs), which aim to cut costs and speed up reactor deployment. Companies should be aware that even these designs, with online dates starting in the late 2020s, are fighting a battle against time with the existential threat posed by energy storage's rapid growth."

Facebook taps deeper into computer neural interfaces by buying CTRL-labs

13890-thumb-squareVladimir Roznyatovskiy, Senior Analyst
Lux Take: Very Important

"As optics for better immersive experiences continue to evolve, so does user interface technology, which is currently limited to hand motion control. The strategy is evident from a series of events: Amazon-backed Thalmic Labs pivoted to AR glasses development, branded as North, and sold signal sensing IP (Myo armband technology) to CTRL-labs. Facebook, in addition to its own efforts in reading brain signals, acquired CTRL-labs, hoping to leap ahead in AR glasses development. Its approach relies on surface signal reading and decoding using AI models, unlike Elon Musk-funded Neuralink, which uses integrated chips to read brain signals directly. Such moves signify both the importance of and opportunities in neural interface innovations.

Apple Smartwatch noise alert quietly speaks to preventative care in aging

13261-thumb-square Danielle Bradnan, Research Associate | @DBradnan Ico twitter
Lux Take: Average Importance

"The new Smartwatch health apps offers some improvements on existing tools by finally incorporating period trackers and noise alerts. While the period tracker was hyped, the more interesting advancement is the noise monitoring alert. Hearing loss has a number of impacts on aging populations, including a higher likelihood of developing dementia, depression, and gait problems. By addressing risk of hearing loss through noise alerts in their target demographic of 20-45 year olds they are quietly adding an element of preventative care to their arsenal that will be most impactful as users age. Companies looking at aging in place should monitor the success of this alert mechanism, and incorporate noise awareness in products that support aging."

St1 opts for Honeywell UOP's Ecofining technology for renewable diesel production at its Gothenburg refinery

YuanSheng Yu Photo_edited

Yuan-Sheng Yu, Senior Analyst | @808sAndInnovate Ico twitter
Lux Take: Average Importance

"Previously signing an engineering agreement with Haldor Topsoe for its renewable diesel production technology in 2017, it appears that St1 will opt for Honeywell UOP's Ecofining technology instead. The capacity of this upgrade will also increase to 4,000 barrels per day, producing both renewable diesel and biojet fuel. While major renewable diesel producers continue to expand production capacity, activity among traditional refiners has continued to pick up in the past two years. While opting for the Ecofining technology is a safe choice given the numerous commercial projects that exist today, the decision to not go with Haldor Topsoe casts a small bit of doubt on other projects, such as SkyNRG's 100,000 MT facility in the Netherlands."

Toray partners with Kyoei Industry to produce fibers from recycled PET bottles

14215-thumb-square Tiffany Hua, Research Associate
Lux Take: Average Importance

"PatagoniaAdidasZara, and dozens of other brand owners have shown interest in exploring sustainable alternative fiber materials. Toray has adapted to this trend by adding high-quality rPET fibers under the brand name &+ (And Plus) to its product portfolio. While there is demand, brand owners are not willing to compromise on quality and have often complained about dyeability issues with regenerated and recycled fibers. Toray's rPET fibers are white, and removing all the pigments from these fibers is not possible using mechanical recycling methods. For companies, there is an opportunity here to develop recycling technologies that are capable of removing pigment."

Aquaconnect's $1.1 million seed round highlights agriculture e-commerce is applicable to aquaculture


Laura Krishfield, Research Associate | @LKrishfieldIco twitter
Lux Take: Average Importance

"The funding round was backed by the HATCH accelerator and venture capital firm Omnivore. Aquaconnect's digital agriculture platform, FarmMOJO, improves disease prediction and water quality monitoring, while its omnichannel marketplace facilitates transactions within the aquaculture supply chain. The funding will drive advancement of its products beyond its current 750 farms across India and Indonesia toward an estimated 3,750 by 2021. While the company's goal is aggressive, e-commerce is a significant opportunity for agriculture that we anticipate to expand in the next three years. With aquaculture's expansion and adjacent livestock marketplaces experiencing success, companies should engage in the Asian agriculture digital transformation."

Sidewalk Lab spinout Replica raises $11 million to digitize city movements in the physical environment

5771-thumb-square Alex Herceg, P.Eng., Analyst
Lux Take: Average Importance

"Sidewalk Labs is the smart city product group under Alphabet and is no stranger to spinouts. Last year, the company spun out Coord, a company that digitizes curb-level data and sells access to its platform to mobility service providers. Replica is attempting to digitize and model the movements of people through an urban area to help administrators make better decisions about mobility and land use. The tool uses mobile location data, coupled with a "synthetic population" based on census data. Others, such as Teralytics, have been active in this space for some time, and while Replica's competitive differentiation is unclear, it shows a continued interest in digitizing the physical environment."



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