CRAINS 20160425-NEWS--0001-NAT-CCI-CN_-- 4/22/2016 7:23 PM Page 1 Donald Trump’s bestie Steven Roth P. 7 | Give to the mayor, get from the city? P. 8 | Inside EmblemHealth’s layoffs P.12 ® APRIL 25-MAY 1, 2016 | PRICE $3.00 NEW YORK BUSINESS GAME OF DRONES Strict federal rules have grounded these flying machines in New York —and the businesses that use them. That’s about to change PAGE 13 VOL. XXXII, NO. 17 WWW.CRAINSNEWYORK.COM 0 71486 01068 5 17 NEWSPAPER 20160425-NEWS--0003-NAT-CCI-CN_-- 4/22/2016 7:20 PM Page 1 APRILCRAINS 25-MAY 1, 2016 FROM THE NEWSROOM | JEREMY SMERD Third Avenue in 3-D IN THIS ISSUE 4 AGENDA YOU MAY HAVE NOTICED that the next generation of pay phones 6 IN CASE YOU MISSED IT popping up around town look nothing like pay phones. 7 REAL ESTATE High-tech textile making That’s because they are much more than a place to make free 8 POLITICS gets a boost in Brooklyn calls (yes, free) anywhere in the United States. 9 SMALL BUSINESS The kiosks already dotting Third Avenue are Wi-Fi hot 10 VIEWPOINTS spots that are part of a $300 million network called 11 LinkNYC. Its backers, which include Google’s Sidewalk THE LIST Labs, believe that LinkNYC could usher in the next big FEATURES technological innovation. That’s 12 ANATOMY OF A LAYOFF because powering the network is a 1 gigabit broadband Bandwidth-intensive, 13 GAME OF DRONES connection, which is as much as 100 times faster than the average speed of a home network and far exceeds “graphically rich 19 EXECUTIVE MOVES anything else in New York. environments will 20 GOTHAM GIGS The makers of LinkNYC came to our office a few weeks become just as ago to give Crain’s a sense of the system’s potential. Sitting later in our 10th-floor newsroom overlooking indispensable as a web Third Avenue, I picked up the free Wi-Fi coming from a page is today kiosk on the corner of East 43rd Street a block away. Each kiosk’s Wi-Fi signal extends about one block, which means that I could potentially hop in a cab and ride up Third Avenue and stay P. 20 connected all the while. If I lived near one of these hot spots, I could imagine David Korins dropping my Time Warner subscription and just hitching a free ride thanks to 21 SNAPS the advertising that underwrites the system—and generates revenue for the city. 22 FOR THE RECORD “We don’t want to think of this as an advertising network,” said Colin O’Donnell, chief innovation officer at Intersection, the company that won the 23 PHOTO FINISH franchise agreement, “but as a service, paid for by advertising, that a lot of people CORRECTIONS use and love.” LOWELL PETERSON is executive director of the Writers Guild How this high-speed system is used is where New York’s innovators come in. of America. The organization’s name was misstated in “New York looks to remedy Hollywood’s diversity problem,” Oculus Rift is creating immersive 3-D experiences. The next step is to go mobile: published April 11. projecting holographic advertising on street corners, transmitting data from police body cameras to city servers that the public can access in real time, powering a network for driverless cars. “Bandwidth-intensive, graphically rich environments will probably become just as indispensable to our way of life as a web page is today,” O’Donnell said. What Sidewalk Labs has started, other entrepreneurs will expand. At our real ON THE COVER estate conference May 2, I’ll have the opportunity to ask Sidewalk Labs CEO Dan PHOTO COMPOSITE: Doctoroff what else the company has in store for this system. “This is something JENNIFER BALLONE the industry is going to figure out,” O’Donnell said. “The internet is going to evolve. Anytime we introduce new bandwidth it gets used up immediately.” DIGITAL DISPATCHES Go to CrainsNewYork.com READ A pair of apartment towers nearing CONFERENCE CALLOUT MAY 11 completion along the FDR Drive will be the ultimate New York luxury fortress: A pool on a CRAIN’S BUSINESS skybridge connects the two buildings, while BREAKFAST FORUM natural-gas-fired generators on the roof con- State Comptroller Thomas DiNapoli nect to a dedicated outlet in each unit that will discuss the will run when the next storm hits. state of the state’s ■ Houston developer Hines won the contest to finances and his manage the coveted 11-building portfolio of latest audits, office properties controlled by downtown’s and will field questions Trinity Church. from journalists. ■ How best to repair the L NEW YORK train’s East River tunnel? > ATHLETIC CLUB Take the fastest path to a cure: 8 a.m. to 9:30 a.m. Shut both tubes for 18 months [email protected] and get the job done. LISTEN to a discussion on the Vol. XXXII, No. 17, April 25, 2016—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for double business of drones in New York featuring an issues the weeks of June 27, July 11, July 25, Aug. 8, Aug. 22 and Dec. 19, by Crain Communications Inc., 685 Third Ave., executive who is trying to grow one here. New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address changes to: Crain’s New York Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. Also: our take on the growing scandal For subscriber service: Call (877) 824-9379. Fax (313) 446-6777. $3.00 a copy, $99.95 one year, $179.95 two years. (GST engulfing the mayor. Music by Kolker. No. 13676-0444-RT) CrainsNewYork.com/podcast BUCK ENNIS, AP IMAGES ©Entire contents copyright 2016 by Crain Communications Inc. All rights reserved. APRIL 25, 2016 | CRAIN’S NEW YORK BUSINESS | 3 20160425-NEWS--0004-NAT-CCI-CN_-- 4/22/2016 7:19 PM Page 1 AGENDAWHAT’S NEW APRIL 25, 2016 On plastic bags, nudge New Yorkers to do the right thing ome sights in New York City are so commonplace that we take them for granted. Pigeons on sidewalks. Garbage on the curb. Plastic bags everywhere. It doesn’t have to be this way—at least as far as plastic bags are concerned. SBags get stuck in storm drains, sewage plants and recycling equip- ment, too. They blow into gutters and gardens. The Department of Sanitation spends a good amount of time removing them from trees, as do a few civic-minded New Yorkers who set out with long poles. There’s a better way: Charge shoppers when they get disposable bags ENOUGH! at checkout. It wouldn’t take much. A nickel per bag would go a long Fees are way toward eliminating this hideous feature of our urban landscape. needed to change New A bill pending in the City Council would do just that. Originally it Yorkers’ habits. demanded 10 cents per bag, but some council members thought that would burden poor people, so the bill’s sponsors cut the fee in half. They Critics say it would wreak havoc on household budgets. Councilman also exempted purchases of restaurant meals, prescription drugs, and David Greenfield seems to think it will render families destitute. “The groceries bought with food stamps. plastic bag tax would have disastrous con- That satisfied most of the critics. A nickel per bag would go a long sequences for low-income families,” he The opponents who remain will be declared. “This is a tax that can cost fami- on the wrong side of history. Dozens way toward eliminating this hideous lies as much as $100 a year.” of municipalities have passed meas- feature of our urban landscape First, it’s not a tax—the fees will go to ures to discourage the use of plastic retailers, not the government. Second, it’s shopping bags. The most effective insulting to say a family will so continually ones rely on behavioral economics—that is, fees. Money is what best forget reusable bags that they’ll have to buy 2,000 plastic ones a year. motivates consumers to bring reusable bags when they go to the store. That’s 38 bags a week. Before long, the practice becomes second nature. But Greenfield is right about people using so many plastic bags. The Some folks cry “nanny state.” Well, if we had nannies reminding us city sends 9 billion of them to landfills annually—more than 1,000 for to pick up after ourselves, bags wouldn’t litter every street. Police can- every man, woman and child. So thank you, councilman, for providing not be nannies, and enforcement won’t rid us of the mentality that the an excellent reason to pass this bill. The council should do so world is disposable. A 5-cent fee will. next month. – THE EDITORS FINE PRINT Senior Wall Street executives wouldn’t be able to pocket their bonuses until four years after they’re granted if rules proposed last week by federal banking regulators are adopted. This could discourage Wall Streeters from taking the sorts of reckless risks that led to the financial crisis, but banker pay might go up in the short term to offset the risk that some of the money might be clawed back. BY GERALD SCHIFMAN STATS 25 WORDS OR LESS THE ROAD LESS TEXTED THANKS IN PART to the mayor’s Vision Zero safety initiative, New York City drivers have been slapped with far more summonses for cellphone use than the rest of the state’s motorists, [Labor leaders] despite doing a lot less driving.