It was another big year for tech, in Seattle and around the world. Amazon dominated headlines, this time with a high-profile HQ2 search and big acquisitions. Facebook came under scrutiny for its role in the 2016 election and other privacy problems. And the industry lost an icon as Microsoft co-founder Paul Allen passed away at the age of 65.
As we prepare to welcome 2019, here’s a look back the top GeekWire stories of 2018, selected by our Seattle-based news team based on overall significance and popularity among readers. Enjoy this look back, and Happy New Year from all of us at GeekWire.
Amazon HQ2
After more than a year of reconnaissance, frenzied speculation, and non-stop media coverage, Amazon’s remarkable “HQ2” search came to an end in November. Instead of the 50,000-person, $5 billion second headquarters Amazon promised when announcing the search for a second home more than a year ago, Amazon decided to split HQ2 in two with plans to open offices in the Crystal City neighborhood of Arlington, Va., and Queens in New York City, where the company is already facing backlash.
The remarkable competition had cities bidding against one another with government subsidies to lure the tech giant. Some experts believe Amazon leveraged its self-created sweepstakes primarily to get cities to hand over comprehensive data about potential locations for future, smaller Amazon sites.
GeekWire covered the HQ2 search closely, from the initial announcement in September 2017 to last month, when Civic Editor Monica Nickelsburg traveled east to report from Amazon’s future neighborhoods in Virginia and New York.
Paul G. Allen, 1953-2018
Paul G. Allen, who founded Microsoft with Bill Gates before making his mark in technology investing, sports ownership, commercial space, global philanthropy, the environment, museums and the arts, died at the age of 65 in November, two weeks after announcing that he was diagnosed with a recurrence of non-Hodgkin’s lymphoma.
His death brought reaction from the many worlds he touched, from the companies and institutions he created and owned to the people he interacted with during his life. Buildings and landmarks across the Seattle region were lit up in blue in honor of Allen, who had an outsized impact on his hometown.
Read GeekWire’s extended coverage of Allen’s passing here.
Seattle’s tech boom
The tech industry’s growth continued to impact Seattle in 2018, from fluctuating housing prices to a controversial “head tax” that would have collected nearly $50 million annually from the city’s biggest companies on a per-employee basis to fund affordable housing and homeless services.
After weeks of heated debate and outcry from many in the tech industry, most notably Amazon, the city passed the head tax on May 14. But less than a month later, councilmembers repealed the tax rather than fight a costly political battle with opponents. The dramatic defeat was seen as a victory by many in the business community. In November, San Francisco voters passed its own tax.
Seattle’s transformation was also the subject of GeekWire’s most-read story of 2018, featuring a three-year time-lapse video illustrating the city’s massive growth. The video shows hundreds of old buildings going down and new ones coming up in areas where Amazon, Facebook, Google and many other tech companies are expanding rapidly.
Four tech companies with roots in Washington state went public in 2018: e-signature powerhouse DocuSign; work collaboration technology company Smartsheet; Vancouver, Wash.-based laser-maker nLight; and tax automation startup Avalara. That was up from two Washington state companies that IPO’d in 2017, and three in 2016.
Shares of DocuSign and Smartsheet rose initially but have returned to their IPO range in the past few months, part of the fourth-quarter stock market downturn. Shares of Avalara and nLight are down about a third since their IPOs.
Many other tech giants, such as Uber and Airbnb, are reportedly gearing up to go public in 2019. Will any Seattle-area startups do the same? Check out our analysis of potential IPOs that could happen next year.
Equality financing
The past year brought a noticeable acceleration of efforts to address the funding gap and other challenges faced by women and minority startup founders.
In the Seattle region, the Female Founders Alliance launched a new accelerator program called Ready, Set, Raise for early stage startups led by women. The Riveter, a network of women-oriented co-working spaces that started in Seattle, raised a total of nearly $20 million in two financing rounds this year to fuel its national growth. Those are just two examples of the broader trend as the tech industry lays the groundwork for change. Currently, about 2.2 percent of venture funding goes to all-women founders, and 0.2 percent goes to black female founders.
“The tides are turning in general,” said venture capitalist Arlan Hamilton, the Backstage Capital founder, during an April appearance with Riveter CEO Amy Nelson in Seattle. Hamilton’s firm invests in startups led by women, minority and LGBT founders, as featured in a recent episode of our Numbers Geek podcast.
“This year seemed very different,” Hamilton said at the time. “So maybe that means 2019 looks really different. That’s what I have to hope.”
Falcon Heavy
After years of development work, SpaceX’s super-powerful triple-barreled Falcon Heavy rocket made a spectacularly successful debut in February’s test launch, which sent billionaire CEO Elon Musk’s Tesla Roadster and a mannequin driver named Starman into an orbit stretching out beyond Mars. Two of those three rocket barrels landed back on Earth intact after the launch.
GeekWire aerospace and science editor Alan Boyle and made the trek to Cape Canaveral, Fla., where GeekWire photographer Kevin Lisota captured some amazing photos near the launch pad. It was the latest milestone in the commercial space race that also includes Jeff Bezos’ Blue Origin, Richard Branson’s Virgin Galactic and the late Paul Allen’s Stratolaunch.
Read more in Alan’s Year in Space recap.
A self-driving scare
As part of our GeekWire HQ2 reporting project in Pittsburgh, Pa., this past February, we took a test ride in one of Uber’s self-driving vehicles — and what we experienced made us less confident in the future of autonomous vehicles.
Uber later halted operations in Pittsburgh and other pilot cities after one of its self-driving cars hit and killed a woman in Arizona. Earlier this month, the high-tech vehicles returned to the roads after approval from lawmakers and additional safety tests.
Read all our coverage from the Steel City here.
Amazon acquires Ring and opens Amazon Go
Amazon made one of the largest acquisitions in its history this year, scooping up smart home tech company Ring in a deal worth a reported $1 billion. GeekWire broke the news in February and interviewed Ring CEO Jamie Siminoff at the GeekWire Summit in October about his entrepreneurial journey.
Amazon’s other big acquisition of the year was its purchase of online pharmacy PillPack, another deal reported to be around $1 billion. It was part of Amazon’s big move into healthcare; the company this year also formed an independent healthcare company with JPMorgan Chase and Berkshire Hathaway.
In the realm of physical retail stores, Amazon followed up on its $13.7 billion acquisition of Whole Foods by expanding Prime Now delivery from Whole Foods stores and integrating its Prime membership program into the grocery chain. Amazon reportedly plans to build more Whole Foods stores where the upscale grocery chain doesn’t currently have a presence.
Another of the company’s retail initiatives, Amazon Go, finally opened its checkout-less technology to the public this January at the company’s Seattle headquarters. Amazon just opened its ninth Amazon Go store in San Francisco this month.
Meanwhile, the launch of Amazon’s Delivery Service Partners program promised to give Amazon new alternatives to FedEx and UPS for package delivery. And for our first-hand experience with another Amazon delivery initiative, check out one of the most-read GeekWire stories of 2018: I was an Amazon delivery driver: What it’s like to work in the tech giant’s citizen package brigade.
H-1B visas
In February, the federal government announced plans to require more information and documentation from companies applying for H-1B visas, commonly used to bring in skilled workers from other countries. The goal was to apply more scrutiny to third-party staffing agencies, a.k.a. “outsourcing firms,” which have been criticized for flooding the H-1B lottery system with applications.
That was the start of a series of changes to the H-1B process, designed to crack down on abuse and make the visa category more selective. That effort had an early impact in fiscal year 2017, when H-1B visas awarded to tech companies increased while IT staffing firms saw a decrease. Amazon’s H-1B visa approvals surged 78 percent that year.
On December 3, USCIS and DHS published a proposed rule that would prioritize H-1B applications for workers with advanced degrees from American universities. The agencies are accepting public comments on the proposal until Jan 2.
These changes aim to shift the program to a merit-based approach. Some tech leaders, like Microsoft CEO Satya Nadella, support the reforms. Others worry the changes will make it tougher to recruit talent internationally.
Horizon Air plane
In one of the wildest stories of 2018, a distressed Horizon Air employee stole one of the airline’s planes from Seattle-Tacoma International Airport and soared through the air with F-15 fighter jets in pursuit until crashing on an island near Seattle.
After a three-month investigation, the FBI concluded that Horizon Air employee Richard Russell acted alone when he crept into a secure area of the airport and stole the Bombardier Q400 turboprop plane.
After his death in the crash, authorities questioned how a ground service agent — whose job was to lug baggage, tidy up planes and tow them to and from runways — had the access and the acumen to pull off the stunt. The FBI said Russell apparently absorbed enough information from his job and from instructional flight videos online. Investigators found no signs that he went through any further flight training, formal or informal.
The incident led to a tightening of security at Sea-Tac, including increased security in maintenance areas, and closer monitoring.
Facebook troubles
No tech giant faced more scrutiny and criticism during 2018 than Facebook. The social networking giant was the subject of repeated controversy, including the Cambridge Analytica scandal, in which a Republican-backed political strategy firm accessed data from up to 87 million unwitting Facebook users. Facebook CEO Mark Zuckerberg testified before Congress and the company was investigated by the FTC, FBI, SEC, and Department of Justice. Its stock has fallen nearly 40 percent since July.
Facebook and other tech giants are also facing the looming prospect of a federal data privacy crackdown. Amazon, Apple, Google, Twitter, and other big tech companies sent representatives to Washington, D.C., in September for a hearing on privacy regulation.
In Seattle, Facebook continued to expand its presence with two new leases that will add another 1.13 million square feet of office space. Seattle has become a major engineering center for the social media giant, which is also rapidly expanding its Oculus virtual reality team in the area, mining the region’s gaming and software talent. The company first set up shop in Seattle in 2010, part of a wave of Silicon Valley tech giants that have set up offices in Seattle.
