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Crazy Aviators: The Eerie Similarities Between Billionaire Howard Hughes And Elon Musk

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He was a Los Angeles billionaire known worldwide for pushing the limits of engineering, safety and his bank account to achieve transportation breakthroughs, as well as for gossipy celebrity romances.

He churned through executives like a buzz saw, made puzzlingly costly business decisions and invited conflict by thumbing his nose at politicians and the law. Yet he was one of the great entrepreneurs of his time.

No, it isn’t Tesla’s mercurial billionaire CEO Elon Musk, who’s locked in a legal fight with the Securities & Exchange Commission that could lead to his ouster and must put the company on sound footing after burning through $5 billion since 2010 to popularize its electric cars and solar power.

We’re talking about billionaire Howard Hughes, who at his death was among the world’s richest people. Hughes’ machinery ushered in the oil age, his investments helped popularize commercial air travel, he ran Hollywood’s biggest studios, built an enormous gaming and real estate empire, and has an imprint that stretches from satellite television to the Las Vegas strip and biomedical research.

We’re talking about billionaire Howard Hughes, who at his death was among the world’s richest people. Hughes’ machinery ushered in the oil age, his investments helped popularize commercial air travel, he ran Hollywood’s biggest studios, built an enormous gaming and real estate empire, and has an imprint that stretches from satellite television to the Las Vegas strip and biomedical research.

READ MORE | Jeff Bezos To Give MacKenzie 25% Of His Amazon Stake, Worth Tens Of Billions, In Divorce

As federal judge Alison Nathan weighs the SEC’s charge that Musk violated a 2018 settlement arising from alleged share price manipulation with tweets about taking Tesla private, it’s instructive to look back at another mercurial entrepreneur’s career and fights with regulators, because even surprise victories didn’t guarantee long-term stability for Hughes.

Born in 1905, Hughes in the 1920s inherited Hughes Tool, which made drill bits used to burrow oil wells. Uninterested in oil, he let others run the company and moved to Los Angeles to spend Toolco cash on passion projects in two emerging technologies: aviation and moviemaking. Hughes’ silent filmTwo Arabian Knights won Academy awards. During the filming of his 1930 epic Hell’s Angels, pilots died and planes crashed.

The silver screen adventures made Hughes a celebrity. He dated Jane Russell and Katherine Hepburn and married actress Jean Peters. Likewise, Musk married British actress Talulah Riley following his divorce from author Justine (Wilson) Musk. He’s also dated actress Amber Heard and had a brief but sensational, relationship with indie singer Grimes.

Hughes’ aviation obsession led him in 1932 to create Hughes Aircraft as a division of Toolco, to siphon more profits and manufacture planes in the pursuit of flight records. By 1938 he flew around the world in record time, gaining global fame. In 1939, he paid $9 million to take control of Trans World Airlines.

Hughes’ aircraft unit was a big military contractor during World War II, and TWA, under his ownership, brought flying into the mainstream through expansion and enormous aircraft investments. The spending even supported burgeoning aerospace conglomerates like Boeing and McDonnell Douglas.

At the time of his death in 1976, Hughes had controlled TWA, RKO, Air West and owned multiple billion-dollar businesses, six casinos and most of the undeveloped land in Las Vegas. Though he spent his last days as a recluse at Xanadu, his Bahamian estate, Hughes’ fame was worldwide, and it carries on with his Howard Hughes Medical Institute, one of America’s biggest philanthropies. For all the success, Hughes also spent much of his public life fighting with politicians and regulators.

Like Musk, the SEC targeted Hughes for manipulative financial maneuvers in his publicly traded companies, and both faced shareholder lawsuits. Unlike Musk so far, Hughes’ reckless maneuvering also meant he was often forced to put his businesses into blind trust structures, shielded from his capricious management.

Born in South Africa, Musk came to the U.S. to study physics and economics at the University of Pennsylvania in 1992, arriving at the dawn of the internet era in search of big opportunities. Musk later dropped out of Stanford to create a software company he eventually sold to Compaq.

READ MORE | Not So Fast: Can Elon Musk Really Open Tesla’s China Gigafactory This Year?

Next he built X.Com, a Web payments company that became part of PayPal, and Musk was treated as a cofounder alongside Peter Thiel, Reid Hoffman and others. When eBay bought PayPal in 2002, Musk earned a $165 million payday that bootstrapped his push into new industries.

He began by founding the rocket company SpaceX in 2002, then in 2004 invested $6.35 million to transform Tesla from a concept on paper into the world’s leading electric car brand. He funded the residential solar energy startup SolarCity in 2006, which has since been integrated into Tesla, and in 2017 created the Boring Company as a way to advance his high-speed Hyperloop concept.

Like Hughes, Musk made daring, contrarian bets aimed at reshaping enormous industries. He, too, wanted to test the limits of corporate leadership to gain ground on incumbents like General Motors, electric utilities, oil companies and government-backed space endeavors.

Tesla competes with an oligopoly of carmakers specializing in petroleum-powered internal combustion engines. With SpaceX he saw an opportunity to ferry satellites, cargo and astronauts into space as NASA slimmed down. SolarCity’s goal is to accelerate clean energy use and curb dependence on fossil fuels.

All three have become high-profile, multibillion-dollar businesses, but none has produced meaningful profits. They’ve also been hamstrung by Musk’s driven, but often reckless, management style.

SpaceX, a wild success now worth $30 billion, has completed numerous launches for NASA and is the leader in private space travel. Musk also set a goal of not just getting to Mars but colonizing it. At the moment, SpaceX is also reportedly under review as a federal contractor, after Musk smoked pot on comedian Joe Rogan’s podcast.

Tesla acquired SolarCity in a 2016 merger that puzzled investors and led to accusations of self-dealing since most board members rubber-stamping the purchase were affiliated with Musk. It also triggered a class-action shareholder suit. SolarCity has disappointed so far, losing market share and moving slowly on ambitious plans to sell solar roofs and Powerwall battery storage systems. But none of Musk’s companies has become more valuable or problematic than Tesla.

Two years after its 2010 Nasdaq debut, Tesla and Musk dazzled with the electric Model S, a sleek sedan that won critical raves and blew away sales expectations. Tesla shares soared, and Musk began planning new vehicles including the Model X SUV and mass-market Model 3 sedan. But X was two years late to market, mainly because of the problematic “falcon wing” doors Musk insisted on, and the 3’s rollout was hamstrung by bottlenecks with the automated assembly line Musk envisioned.

Tesla mostly abandoned his robotic production dream, even building Model 3’s almost by hand in a tentlike assembly line in a lot at its plant in Fremont, California. Since 2016 dozens of top Tesla executives have left, and Wall Street has grown uncomfortable with its billions of dollars in spending but weak financial position.

READ MORE | The 10 Most Notable New Billionaires Of 2019

Over time, Hughes became known for increasingly erratic behavior. His fame transitioned from Hollywood showmanship to mystery as he spent his later years as a recluse in a suite in Las Vegas’s Desert Inn and then at his Bahamian Xanadu. “Hughes survived three major airplane crashes and an automobile crash that put him out for two days. His head was badly banged around in all of these, and I think his mental condition can be directly attributed to those crashes,” Noah Dietrich, Hughes’ longtime accountant and confidant, told Forbes in 1972. Dietrich recalled a 1944 episode when he told Hughes, “You better see some doctors and do it quick.” When Hughes returned, Dietrich recalled, he said, “Noah, thanks a lot. I had a consultation with three doctors this morning and they tell me I’m right on the verge of a complete mental collapse. They tell me if I don’t get away for a while and relax…”

In 2017, Musk tweeted that he might be bipolar, a surprisingly candid admission for such a public figure. But in the summer of 2018, he created unnecessary headaches with several head-scratching moves. He triggered a defamation lawsuit for recklessly calling a British man who aided the rescue of a Thai soccer team trapped in a cave a “pedo” on Twitter. In August, after receiving an investment from Public Investment Fund of Saudi Arabia, he dropped an even bigger Twitter bombshell. “Am considering taking Tesla private at $420. Funding secured,” he blared to 25 million followers. After a probe, the SEC found Musk had little basis to proclaim the buyout and charged him with stock manipulation. In September, after seeking his removal as CEO, the regulator fined Musk and Tesla $40 million, had him step down as chairman and agree to have tweets containing material information reviewed by Tesla officials. Musk agreed to the terms but neglected them and expressed contempt for the SEC. “I want to be clear. I do not respect the SEC. I do not respect them,” he told 60 Minutes’ Lesley Stahl in December 2018. That interview, combined with an inaccurate tweet about Tesla production, led the SEC to claim he had breached the settlement.

Now it’s up to Judge Nathan, who’s presiding over the case in the federal court for the Southern District of New York, to decide Musk’s fate. On Thursday, she asked that Musk and the SEC try to mediate a solution, which was an idea the entrepreneur seemed amenable to. But what if he again opts for a standoff? The most extreme outcome could force Musk out of Tesla management. Could his role at SpaceX also be curbed? Will banks who’ve lent billions to Musk pull their support? These are all scenarios that played out in Hughes’ half-century business career in aviation, film, gambling, real estate and energy.

Consider his deal to take control of Trans World Airlines, an investment that returned Hughes a fiftyfold profit. TWA also spent over a decade battling the billionaire. In 1961, it sued Hughes on antitrust grounds, accusing the mercurial businessman of using a crony as CEO to rubber-stamp $320 million in jet orders, which the airline leased from Hughes Tool and nearly caused the airline to go under. The buying binge propelled TWA into one of the world’s fastest growing airlines, but its cash needs proved to be a double-edged sword. When Hughes’ hand-picked CEO retired midway through a $265 million rescue financing, he was blindsided by a piece of fine print that allowed lenders to put his shares in trust if there were any executive departures. When the financing was completed, TWA was saved, but Hughes lost control. In came the professional management, which turned the tables by suing Hughes on antitrust grounds for the reckless aircraft orders. Hughes sold his TWA stock for $546.5 million in 1966.

Of Hughes’ management, Forbes said in a 1961 cover story, “On the whole, it is to be hoped that Howard Hughes will never again be able to exercise the absolute power he once held over TWA. The hope is not expressed from any high-flown considerations of economic morality or national interest. Rather, it is because Hughes is basically a distraction: No rational analysis of TWA and its prospects seems possible without soon being perverted into a discussion of this mysterious, magnetic, remarkable man.”

Even after Hughes’ sold his stake in TWA, the battle raged on, with the airline winning a $135 million judgment against the entrepreneur in 1963. For the better part of a decade, the nine-figure legal loss hung over Hughes’ empire. In 1972, an appeal by the billionaire made it to the Supreme Court, where Hughes prevailed.

That wasn’t the only airline conquest that resulted in legal trouble for Hughes. After exiting TWA, he set his sights on Air West, offering to buy the struggling airline for $81 million, or $22 a share, in a 1968 hostile takeover. Hughes won a lengthy battle and changed the airline’s name to Hughes Air West. However, in 1970 when shareholders were paid, they received just $8 a share. In 1973, Hughes and four associates were charged criminally for stock manipulation, conspiracy and wire fraud. In 1975 the SEC joined the legal battle. The suit raged on through Hughes’ death in 1976. His estate paid $30 million to the SEC in 1979 to settle the charges.

As a government contractor, Hughes invited particular scrutiny. Hughes Aircraft was notorious for missing deadlines and frustrating federal bureaucracies. During World War II, it was tasked with building a spy plane that was never delivered, though Hughes narrowly escaped death crashing a prototype in Beverly Hills. Then came notoriety. Hughes was contracted to build a plane to shuttle supplies and troops by air, instead of warships susceptible to German U-boats. His eight-engine, 750-person plywood H-4 Hercules, known nationwide as the Spruce Goose, was a marvel of ambition. But the war came and went, tens of millions were spent, and it wouldn’t fly.

In 1947, Owen Brewster, a U.S. senator from Maine who was an ally of infamous Senator Joseph McCarthy, brought Hughes to the Senate to testify on why the government spent $40 million on a plane that wasn’t delivered. To deflect accusations the was selling vaporware, Hughes organized a media event in Long Beach, California, in which he flew the Spruce Goose 33 feet in the air for about a minute, winning the public’s support and eventually ending Brewster’s political career. But to remain a government contractor, he was forced in 1953 to spin off Hughes Aircraft and put it in a trust, which was called the Howard Hughes Medical Institute. When Hughes died in 1976, he was among the world’s richest people, and nearly everything he owned was under a legal cloud.

Hughes’ divestiture of Hughes Aircraft in 1953, Forbes reported in a 1984 feature, wasn’t without upside. “The suspicion has been that the whole affair was a tax move designed to keep Howard Hughes in sole control while paying no taxes,” wrote reporter Allan Dodds Frank. The Hughes estate sold Hughes Aircraft–which evolved into a coveted giant in satellite TV that birthed DirecTV–to General Motors in 1985 for $5 billion.

The sale turned the institute into a top philanthropy and a leader in genetics and biomedical research: It has distributed $22 billion and 28 of its current and former scientists have been awarded Nobel prizes. In a 1972 exclusive interview with Forbes, Dietrich, Hughes’ accountant, revealed that the billionaire had probably paid just $20,000 a year in taxes.

Dietrich himself spent years in a legal battle over undelivered bonus pay Hughes promised him if he stayed amid constant turnover. And though Dietrich’s tell-all to Forbes was mostly critical, the loyal adviser conceded, “Hughes did have a certain amount of mechanical genius.”

While Musk received most of the credit for Tesla’s early breakthrough with Model S, he benefited from an able team that included veteran auto engineers Peter Rawlinson and Nick Sampson; battery expert Kurt Kelty; George Blankenship, who designed Tesla’s stores; and government affairs pro Diarmuid O’Connell. None of them are still with Tesla. And while Musk gained billions from SpaceX, it’s been ably run (with minimal turnover) by president and chief operating officer Gwynne Shotwell. It’s a contrast to Musk’s Model 3 “production hell” in 2018, when he spent many nights sleeping on a sofa in Tesla’s Fremont factory or jetting off to promote subterranean transit tunneling services by his Boring Co.

For all the similarities between the two men, there are also major differences. Hughes hardly ever relied on outside money to finance his whims. In his 20s, he smartly took 100% ownership of Hughes Tool and thus could plunder its cash without having to answer to anyone. Musk, on the other hand, magnified his PayPal windfall with enormous sums of other people’s money, on public stock markets and in private markets. He answers not only to public shareholders and venture capitalists in all of his endeavors but also to bankers, who’ve provided billions in margin debt to maintain large Tesla and SpaceX holdings as they’ve raised capital.

As much as Tesla and SpaceX’s combined $80 billion market cap is a marvel–and Musk’s newer ventures like Hyperloop and Boring Co. set impressive goals–they have yet to profit on their industry-changing intentions. Much of Musk’s empire is still based on undelivered promises anchored to time-bound investor expectations.

-Antoine Gara; Forbes Staff

-Alan Ohnsman; Forbes Staff

-With assistance from Susan Radlauer

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Facebook Is Still Leaking Data More Than One Year After Cambridge Analytica

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Facebook said late Tuesday that roughly 100 developers may have improperly accessed user data, which includes the names and profile pictures of individuals in certain Facebook Groups.

The company explained in a blog post that developers primarily of social media management and video-streaming apps retained the ability to access Facebook Group member information longer than the company intended.

The company did not detail the type of data that was improperly accessed beyond names and photos, and it did not disclose the number of users affected by the leak.

Facebook restricted its developer APIs—which provide a way for apps to interface with Facebook data—in April 2018, after the Cambridge Analytica scandal broke the month before. The goal was to reduce the way in which developers could gather large swaths of data from Facebook users.

But the company’s sweeping changes have been relatively ineffective. More than a year after the company restricted API access, the company continues to announce newly discovered data leaks.

“Although we’ve seen no evidence of abuse, we will ask them to delete any member data they may have retained and we will conduct audits to confirm that it has been deleted,” Facebook said in a statement.

The social media giant says in its announcement that it reached out to 100 developer partners who may have improperly accessed user data and says that at least 11 developer partners accessed the user data within the last 60 days.

Facebook has been reviewing the ways that companies are able to collect information and personal data about its users since the New York Times reported that political consulting firm Cambridge Analytica harvested data of millions of users. Facebook later said the firm connected to the Trump campaign may have improperly accessed data on 87 million users.

The Federal Trade Commission slapped Facebook with a $5 billion fine as a result of the breach. As part of the 20-year agreement both parties reached, Facebook now faces new guidelines for how it handles privacy leaks.

“The new framework under our agreement with the FTC means more accountability and transparency into how we build and maintain products,” Facebook’s director of platform partnerships, Konstantinos Papamiltiadis, wrote in a Facebook post.

“As we work through this process we expect to find examples like the Groups API of where we can improve; rest assured we are committed to this work and supporting the people on our platform.”

Michael Nuñez

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How A BlackBerry Wiretap Helped Crack A Multimillion-Dollar Cocaine Cartel

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On August 18, 2017, four men travelling in a dual-engine speedboat carrying 1,590 pounds of cocaine were intercepted by the U.S. Coast Guard northwest of the Galapagos Islands.

The federal agents manning the channel chose to launch a helicopter to hover over the boat. With this aggressive move, the men began to jettison the bales of coke, each with their own GPS tracker so they could be picked up at a later date, according to the government’s narrative. They attempted to flee, and when they ignored the warning shots from the helicopter, the chopper fired rounds directly at the boat, disabling it.

After the bales were collected, the government realized they had just stopped a huge amount of cocaine from entering the U.S. In total, it carried a street value of $25 million. The four men, all Ecuadorians, were swiftly arrested and charged.

Though the cartel had set up a sophisticated, multilayered operation that sought to slip coke into the country and up to Ohio via land, air and sea, they had made a crucial error: They used BlackBerry phones. As the drug barons chatted about shifting cocaine and how to avoid the narcs over BlackBerry Messenger, a wiretap on a server in Texas was quietly collecting all their communications.

In a case that’s Narcos meets The Wire, federal agents have, since June 2017, been listening in on that server. And beyond that interception, Forbes can exclusively reveal it is yielding results. On Friday, an Ohio court is unsealing charges against one of the crew’s top brass: Francisco Golon-Valenzuela, 40.

Known as El Toro, Spanish for The Bull, the Guatemalan was extradited from Panama earlier this week and is appearing before a magistrate judge today. (Forbes hasn’t yet made contact with his counsel for a response but will update if comment is forthcoming.)

Described as one of various organizers and leaders of the unnamed cartel, El Toro is charged with conspiring to distribute at least 5 kilograms or more of cocaine on the high seas. As a result, he’s facing between 10 years and life in prison.

A key to BlackBerry 

For any organized crime operation, BlackBerry has always been a poor choice. No longer extant since being decommissioned in spring this year, BlackBerry Messenger did encrypt messages, but the Canadian manufacturer of the once-ubiquitous smartphone had the key. And all messages went through a BlackBerry-owned server. If law enforcement could legally compel BlackBerry to hand over that key, they would get all the plain-text messages previously garbled into gibberish with that key.

Compare this to genuine, end-to-end encrypted messaging apps like WhatsApp or Signal; they create keys on the phone itself and the device owner controls them. To spy on those messages, governments either have to hack a target device or have physical access to the phone. Both are tricky to do, especially for investigations of multinational criminal outfits. Police can put a kind of tap on a WhatsApp server, known as a pen register.

This will tell them what numbers have called or messaged one another, and at what date and time, but won’t provide any message content. This makes those apps considerably more attractive to privacy-conscious folk than those where the developer holds the keys, though sometimes to the chagrin of law enforcement.

It’s unclear how or when the DEA got access to the BlackBerry server. A so-called Title III order was issued, granting them court approval to carry out the wiretap, though that remains under seal.

It proved vital to the investigation. “There would be no case without the without the Title III on BlackBerry Messenger,” said Dave DeVillers, who was recently nominated as U.S. Attorney for the Southern District of Ohio. “The defendants, the seizures, the conspiracy were all identified with the Title III.”

A spokesperson for BlackBerry said: “We do not speculate or comment upon individual matters of lawful access.” The company has, however, previously made its stance on encryption public: Unlike other major tech providers like Apple or Google, BlackBerry will hand over the keys if it’s served with a legitimate law enforcement request.

If the police did receive a key from BlackBerry, it wouldn’t be the first time. Back in 2016, it emerged that the Royal Canadian Mounted Police (RCMP) had decrypted more than one million BlackBerry messages as part of a homicide investigation dating back to 2010.

As per reports from that time, it’s possible to use one of BlackBerry’s keys to unlock not just one device’s messages, but those on other phones too. Forbes asked the DOJ whether investigators would’ve been able to access other, innocent people’s BlackBerry messages as part of this wiretap, but hadn’t received a response at the time of publication.

Fishermen and spies

However those BlackBerry messages were intercepted, they helped illuminate a dark criminal conspiracy constructed of myriad parts. As revealed in today’s indictment, made known to Forbes ahead of publication, the gang employed “load coordinators.” Think of them as project managers, helping locate drivers for trucks and boats while finding people to invest in the cocaine.

Fishermen and other maritime workers were also allegedly recruited. They would help both in refueling the drug baron’s ships, but also helping transport the powder, prosecutors said.

Other individuals became ad hoc spies, sharing information on the activities and locations of police and military personnel trying to intercept shipments, according to the government’s allegations. Other coconspirators sheltered individuals who were at risk of extradition—not that it saved El Toro.

Forbes first became aware of the investigation in 2017, when a search warrant detailed various BlackBerry intercepts. In one, a pair of cartel employees discussed having to put some cocaine transports on hold because of a multinational maritime exercise—the Unitas Pacifico 2017—taking place in their shipment lanes, according to the warrant. BlackBerry wasn’t the only major tech provider to help on the case; That search warrant was for a Google account linked to one of the suspects, which investigators believe was used for further logistics.

The investigation has revealed that the 2017 seizure wasn’t the only time the cops had disrupted what was evidently a criminal enterprise worth hundreds of millions. In May 2016, long before the BlackBerry wiretap went up and the investigation into the cartel had begun in earnest, U.S. authorities intercepted 1,940 pounds of coke near the Guatemalan-Mexico border, worth another $30 million.

Despite such successes, DeVillers told Forbes the American government will never interdict its way to ending the drug trade. “We can only disrupt it,” he added. “And if we turn the tools used by the cartels to run their organization against them, we do just that.”

-Thomas Brewster; Forbes

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How Virtual Therapy Apps Are Trying To Disrupt The Mental Health Industry

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Millions of Americans deal with mental illness each year, and more than half of them go untreated. As the mental health industry has grown in recent years, so has the number of tech startups offering virtual therapy, which range from online and app-based chatbots to video therapy sessions and messaging. 

Still a nascent industry, with most startups in the early seed-stage funding round, these companies say they aim to increase access to qualified mental health care providers and reduce the social stigma that comes with seeking help. 

While the efficacy of virtual therapy, compared with traditional in-person therapy, is still being hotly debated, its popularity is undeniable. Its most recognizable pioneers, BetterHelp and TalkSpace, have enrolled nearly 700,000 and more than 1 million users respectively. And investors are taking notice.

Funding for mental health tech startups has boomed in the past few years, jumping from roughly $100 million in 2014 to more than $500 million in 2018, according to Pitchbook. In May of this year, the subscription-based online therapy platform Talkspace raised an additional $50 million, bringing its total funding to just under $110 million since its 2012 inception.

The ubiquity of smartphones, coupled with the lessening of the stigma associated with mental health treatment have played a large role in the growing demand for virtual therapy. Of the various services offered on the Talkspace platform, “clients by far want asynchronous text messaging,” says Neil Leibowitz, the company’s chief medical officer.

Users seem to prefer back-and-forth messaging that isn’t restricted to a narrow window of time over face-to-face interactions. At BetterHelp, founder Alon Matas notes that older users are more likely to go for phone and video therapy sessions, whereas younger users favor text messaging.

“Each generation is getting progressively more mobile-native,” says John Prendergass, an associate director at Ben Franklin Technology Partners’ healthcare investment group, “so I think we’re going to see people become increasingly more accustomed, or predisposed, to a higher level of comfort in seeking care online.”

The ease and convenience of virtual therapy is another draw, particularly for busy people or those who live in rural areas with limited access to therapy and a range of care options.

Alison Darcy, founder and CEO of Woebot, a free automated chatbot that uses artificial intelligence to provide therapeutic services without the direct involvement of humans, says that with Woebot and other similar services, there is no need to schedule appointments weeks in advance and users can receive real-time coaching at the moment they need it, unlike traditional therapy. The sense of anonymity online can also lead to more openness and transparency and attracts people who normally wouldn’t seek therapy.

Along with stigma, the cost of therapy has historically acted as a barrier to accessing quality mental-health care. Health insurance is often unlikely to cover therapy sessions. In most cities, sessions run about $75 to $150 each, and can go as high as $200 or more in places like New York City. Web therapists don’t have to bear the expense of brick-and-mortar offices, filing paperwork or marketing their services, and these savings can be passed on to clients. 

BetterHelp offers a $200-a-month membership that includes weekly live sessions with a therapist and unlimited messaging in between, while Talkspace’s cheapest monthly subscription at $260-a-month, offers unlimited text, video and audio messaging.

But virtual therapy, particularly text-based therapy, is not suitable for everyone. Nor is it likely to make traditional therapy obsolete. “Online therapy isn’t good for people who have severe mental and relational health issues, or any kind of psychosis, deep depression or violence,” says Christiana Awosan, a licensed marriage and family therapist. 

At her New York and New Jersey offices, she works predominantly with black clients, a population that she says prefers face-to-face meetings. “This community is wary of mental health in general because of structural discrimination,” Awosan says. “They pay attention to nonverbal cues and so they need to first build trust in-person.”  

Virtual therapy apps can still be beneficial for people with low-level anxiety, stress or insomnia, and they can also help users become aware of harmful behaviors and obtain a higher sense of well-being. 

Sean Luo, a psychiatrist whose consultancy work focuses on machine learning techniques in mental health technology, says: “This why some of these companies are getting very high valuations. There are a lot of commercialization possibilities.” He adds that from a mental health treatment perspective, a virtual therapy app “isn’t going to solve your problems, because people who are truly ill will by definition require a lot more.”

Relying on digital therapy platforms might also provide a false sense of security for users who actually need more serious mental-health care, and many of these apps are ill-equipped to deal with emergencies like suicide, drug overdoses or the medical consequences of psychiatric illness. “The level of intervention simply isn’t strong enough,” says Luo, “and so these aspects still need to be evaluated by a trained professional.

Ruth Umoh, Diversity and Inclusion Writer, Forbes Staff.

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