Nikola founder bought truck designs from third party

A Nikola Badger pickup truck.

Enlarge / A Nikola Badger pickup truck. (credit: Nikola Motors)

The original design for Nikola’s flagship truck was purchased by founder Trevor Milton from a designer in Croatia, according to two people with knowledge of the matter, despite company claims in a 2018 lawsuit that the vehicle was initially designed by Mr. Milton “in his basement..

The truck, the Nikola One, is at the centre of a $2 billion lawsuit with Tesla, in which Nikola alleges its rival infringed on its patents. Nikola claims in that lawsuit that Mr. Milton began designing the model in 2013, with other company staff later working on it.

In a rebuttal to the lawsuit filed last week, Tesla alleged that Nikola could not protect the designs because they did not originate from the company itself, but from Adriano Mudri, a designer based in Croatia.

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#bev, #cars, #electric-cars, #electric-trucks, #nikola-truck, #policy

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TikTok’s fate to go down to the wire; judge will rule before midnight

TikTok’s fate to go down to the wire; judge will rule before midnight

Enlarge (credit: Getty Images)

TikTok will be gone from app stores tomorrow morning unless a federal judge acts to block the Trump administration’s ban on the app before midnight tonight.

Judge Carl Nichols of the US District Court for DC said today that he will determine whether to grant or reject TikTok’s request for an injunction on the ban before the deadline hits at the stroke of 12.

In a hearing on Thursday, Nichols gave the administration until Friday afternoon either to delay or defend the ban. The administration chose to file a response defending the ban but did so under seal, so the filings are not available to the public.

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#bans, #bytedance, #china, #national-security, #policy, #tiktok, #trump, #white-house

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FBI offers $10,000 reward for GirlsDoPorn mastermind Michael Pratt

FBI offers $10,000 reward for GirlsDoPorn mastermind Michael Pratt

Enlarge (credit: FBI)

The FBI is intensifying its worldwide search for Michael James Pratt, the New Zealand-born pornographer who created the controversial GirlsDoPorn website while living in the San Diego area. This week the FBI announced a $10,000 reward for information leading to his arrest.

Nearly two dozen women sued Pratt and his associates for using fraud and coercion to get them to appear in pornographic videos. The women won a $13 million judgment in January, but by the time the ruling was announced, Pratt had apparently fled the country.

Meanwhile, the federal government charged Pratt with conspiracy to commit sex trafficking by force, fraud, and coercion. Prosecutors later added child pornography charges because at least one of his victims was under 18.

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#fbi, #girlsdoporn, #michael-pratt, #policy, #pornography

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Alphabet, shareholders settle in lawsuits over sexual harassment at Google

Google's corporate headquarters.

Enlarge / Google’s corporate headquarters. (credit: Alex Tai | SOPA Images | LightRocket | Getty Images)

Alphabet, Google’s parent company, said today it has settled a set of shareholder lawsuits related to the company’s handling of sexual harassment claims. Alphabet will commit $310 million to corporate diversity programs over the next decade, and the company agreed to allow its board to take on a greater oversight role in misconduct cases.

As part of the new agreement, Alphabet will expand on its current policy of “prohibiting severance for anyone terminated for any form of misconduct,” to include anyone who is currently under investigation for “sexual misconduct or retaliation,” Google VP of People Operations Eileen Naughton said in a company blog post.

The settlement is the outcome of a consolidated set of lawsuits investor groups filed against Alphabet in California in 2018, alleging that the company breached its fiduciary duty to shareholders when it retained, and handsomely paid off, male executives credibly accused of sexual harassment. (Other shareholder suits, in federal court and in Delaware, are still in progress, according to the New York Times.)

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#alphabet, #biz-it, #google, #investors, #lawsuits, #policy, #settlements, #sexual-harassment, #shareholders

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Apple backs down on taking 30% cut of paid online events on Facebook

Apple backs down on taking 30% cut of paid online events on Facebook

Enlarge (credit: Facebook)

Facebook has temporarily shamed Apple out of taking a 30 percent cut of paid online events organized by small businesses and hosted on Facebook—things like cooking classes, workout sessions, and happy hours. Demand for these kinds of online events has soared during the COVID-19 pandemic.

Apple says that it has a longstanding policy that digital products must be purchased using Apple’s in-app payments system—and hence pay Apple’s 30 percent tax. In contrast, companies selling physical goods and services are not only allowed but required to use other payment methods (options here include Apple Pay, which doesn’t take such a big cut).

For example, an in-person cooking class is not a digital product, so a business selling cooking class tickets via an iPhone app wouldn’t have to give Apple a 30 percent cut. But if the same business offers a virtual cooking class, Apple considers that to be a digital product and demands a 30 percent cut—at least if the customer pays for the class using an iOS device.

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#airbnb, #apple, #apple-tax, #facebook, #policy, #tech

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Apple is (temporarily) waiving its App Store fee for Facebook’s online events

Last month, Facebook introduced support for paid online events — and since many of the businesses offering those events have struggled during the coronavirus pandemic, the company also said it would not collect fees for the next year. At the same time, it complained that Apple had “dismissed” its requests to waive the App Store’s customary 30% fee on in-app purchases.

Today, Facebook is announcing a reversal on Apple’s part: Online event fees will be processed through Facebook Pay, without Apple collecting its 30% cut, meaning businesses will receive all of the earnings from their online events, minus taxes. This arrangement will last until December 31 and will not apply to gaming creators.

The news comes after Facebook publicly pressured Apple to change its stance. It even submitted an iOS app update stating that “Apple takes 30% of this purchase” in the events payments flow. (Facebook said Apple rejected the update for including information that’s “irrelevant” to users.)

And while the two companies appear to have come to an agreement, today’s statements from Facebook are still a bit barbed.

“This is a difficult time for small businesses and creators, which is why we are not collecting any fees from paid online events while communities remain closed for the pandemic,” said Facebook spokesperson Joe Osborne. “Apple has agreed to provide a brief, three-month respite after which struggling businesses will have to, yet again, pay Apple the full 30% App Store tax.”

Similarly, in discussing the exception for gaming creators, Facebook Gaming Vice President Vivek Sharma said, “We unfortunately had to make this concession to get the temporary reprieve for other businesses.”

When asked about the change, Apple provided the following statement: “The App Store provides a great business opportunity for all developers, who use it to reach half a billion visitors visitors each week across 175 countries. To ensure every developer can create and grow a successful business, Apple maintains a clear, consistent set of guidelines that apply equally to everyone.”

More specifically, Apple said it’s giving Facebook until the end of the year to implement in-app payments for these events and bring them into compliance with App Store rules.

This also comes as Fortnite-maker Epic Games is waging a legal battle and publicity campaign against Apple’s App Store fees, with Fortnite removed Fortnite from the iOS App Store. Epic is also part of a just-announced group of publishers called the Coalition for App Fairness, which is pushing for app store changes or regulation.

#apple, #apps, #facebook, #mobile, #policy, #social

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Microsoft boots apps used by China-sponsored hackers out of Azure

A motherboard has been photoshopped to include a Chinese flag.

Enlarge / Computer chip with Chinese flag, 3d conceptual illustration. (credit: Steve McDowell / Agefotostock)

Fortune 500 companies aren’t the only ones flocking to cloud services like Microsoft Azure. Increasingly, hackers working on behalf of the Chinese government are also hosting their tools in the cloud, and that’s keeping people in Redmond busy.

Earlier this year, members of the Microsoft Threat Intelligence Center suspended 18 Azure Active Directory applications after determining they were part of a sprawling command-and-control network. Besides the cloud-hosted applications, the members of the hacking group Microsoft calls Gadolinium also stored ill-gotten data in a Microsoft OneDrive account and used the account to execute various parts of the campaign.

Microsoft, Amazon, and other cloud providers have long touted the speed, flexibility, and scale that comes from renting computing resources as needed rather than using dedicated servers in-house. Hackers seem to be realizing the same benefits. The shift to the cloud can be especially easy thanks to free trial services and one-time payment accounts, which allow hackers to quickly get up and running without having to have an established relationship or even a valid payment card on file.

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#azure, #biz-it, #china, #gadolinium, #hackers, #microsoft, #policy

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Writer Anand Giridharadas on tech’s billionaires: “Are they even on the same team as us?”

Since the start of the coronavirus pandemic, America’s roughly 640 billionaires have seen their fortunes soar by $845 billion in combined assets or 29% collectively, widening the already yawning gap between the very richest and the rest of the U.S.

Many of those billions were made by tech founders, including Mark Zuckerberg, Jeff Bezos, and Elon Musk, whose companies have soared in value and, in tandem, their net worth. In fact, so much has been made so fast and by so few relatively, that it’s easy to wonder if greater equality is now forever out of reach.

To talk about the question, we reached out earlier this week to Ananad Giridharadas, a former New York Times correspondent whose 2018 book, “Winners Take All: The Elite Charade of Changing the World,” became a best-seller

Giridharadas’s message at the time was largely that the generosity of the global elite is somewhat laughable — that many of the same players who say they want to help society are creating its most intractable problems. (Think, for example of Bezos, whose company paid zero in federal tax in 2017 and 2018 and who is now on the cusp of opening a tuition-free preschool called the Bezos Academy for underserved children.)

Given the aggressive escalation over the last six months of the same trends Giridharadas has tracked for years, we wondered how he views the current situation. Our chat has been edited for length and clarity.

TC: You have a weekly newsletter where you make the point that Jeff Bezos could give every one of Amazon’s 876,000 employees a ‘pandemic’ bonus of $105,000 and he would still have as much money as he did in March.

AG: There’s this way in which these crises are not merely things that rich and powerful survive. They’re things that they leverage and exploit, and it starts to raise the question of: are they even on the same team as us? Because when you have discussions about stimulus relief around what kind of policy responses you could have to something like the 2008 financial crisis or the pandemic, there’s initially some discussion and clamor for universal basic income, or substantial monthly checks for people, or even the French approach of nationalizing people salaries… and those things usually die. And they die thanks to corporate lobbyists and advocates of the rich and powerful, and are replaced by forms of relief that are upwardly redistributive that essentially exploit a crisis to transfer wealth and power to the top.

TC: Earlier in the 20th century, there was this perception that industry would contribute to solving a crisis with government. In this economy, we just didn’t see a lot of the major tech companies, or a lot of the companies that were benefiting from this crisis, really sacrificing something to help the U.S. Do you see things that way?

AG: I think that’s right. I’m always wary of idealizing certain periods in the past, and I think there were a lot of problems in that time. But I think there’s no question that it was not as difficult back then, as it is today, to summon some kind of sense of common purpose and even the need to sacrifice values like profit seeking for other values.

I mean, after 9/11, President George W. Bush told us all to go shopping as the way to advance the common good. Donald Trump is now 18 levels of hell further down that path, not even telling us that we need to do anything for each other and [instead describing earlier this week] a pandemic that has killed 200,000 people as being something that doesn’t really affect most people.

So there’s just been a coarsening. And that kind of selfish trajectory of our culture, after 40 years of being told that what we do alone is better than what we do together, that what we do to create wealth is more important than what we do to advance shared goals — that quite dismal, dull message has had its consequences. And when you get a pandemic like this, and you suddenly need to be able to summon people to all socially distance at a minimum or, more ambitiously, pull for the common good or pay higher taxes are things that might even cost them a little bit, it’s very hard to do because the groundwork isn’t there.

TC: You’ve talked quite a bit over the years about “fake change.”

AG: Silicon Valley is the new Rome of our time, meaning a place in the world that ends up deciding how a lot of the rest of the world lives. No matter where you lived on the planet Earth, when the Roman Empire started to rise, it had plans for you one way or another, through your legal system, or your language, or culture, or something else. The Roman Empire was coming for you.

Silicon Valley is that for our time. It’s the new Rome [in] that you can’t live on planet Earth and be unaffected, directly or indirectly, by the decisions made in this relatively small patch of [of the world]. So the question then becomes, what does that new Rome want? And my impression of having reported on that world is that it’s an incredibly homogeneous world of people at the top of this new Rome. It’s white male dominated in a way that even other white male dominated sectors of the American economy are not . . . and it’s a lot of a certain kind of man who often is actually more obtuse about understanding human society and sociological dynamics and human beings than the average person.

Maybe they didn’t spend a lot of time negotiating human dynamics at sleepovers, which is fine. But when you end up with a new Rome and it’s hyper dominated by people of one race and one gender, many of whom are disproportionately socially unintelligent, running the platforms through which most human sociality now occurs — democratic discourse, family community, so on and so forth — we all start to live in a world created by people who, frankly are just quite limited. They are smart at the thing they’re smart at and they’ve become in charge of a lot of how the world works. And there’s simply not up to the task. And we see evidence of that every day.

TC: Are you speaking about empathy?

AG: Empathy is absolutely one of [the factors]. The ability to understand the more amorphous, non technological, non quantifiable things . . . it’s so interesting, because it’s people who are clearly very smart in a certain area but  just honestly do not understand democratic theory. There’s just so much work that’s been done — deep, complicated thinking going back to Plato and Aristotle, but also modern sociological work, including why a safety net and welfare is complicated. And there’s a certain kind of personality type that I have found very dominant in Silicon Valley, where it’s these men who just don’t really have a lens for that.

They’re often geniuses. It’s a certain kind of particular personality type where you care a lot about one thing and you go deep on that one thing, and it’s probably the same personality type that Beethoven had. It’s a great thing, actually. It’s just not great for governing us, and what these people are doing is privately governing us, and they have no humility about the limitations of their worldview

TC: We’re talking largely about social media here. Is it reasonable to expect some kind of government action. Do you think that’s naive? 

AG: It’s absolutely essential that the tech industry be brought into the same kind of sensible regulatory regime. I mean, you have kids, I have kids. If you’ve ever read the side of their car seats or any of the other products in their lives, you understand how much regulation there is for our benefit. . . I often say that the government at its best is like a lawyer for all of us. The government is like ‘Why don’t we check out these car seats for you and create some rules around them and then you can just buy a car seat and not have to wonder whether it’s the kind that protects your child or crumbles?’ That’s what the government does for all kinds of things.

TC: You’ve talked about billionaires who don’t want to pay taxes yet don’t hesitate to make a donation because they have control over where their money is spent and they get their name on a building, and it’s true. Many companies whose founders also consider themselves philanthropists, like Salesforce and Netflix, paid no federal tax in 2018, which amounts to billions of dollars lost. If you had to prioritize between taking antitrust action or closing the tax loopholes, what would you choose?

AG: They’re both important. But I think I would prioritize taxation.

One way to think about it is this pre distribution and redistribution. The monopoly issue in a way is pre distribution, which is how much money you get to make in the first place. If you get to be a monopoly because we don’t enforce antitrust laws, you’re going to end up making pre tax a lot more money than you would otherwise have made if you had to compete in an actual free market.

Once you’ve made that money, the tax question comes up. So both are important, but I think you can’t overestimate the extent to which the tax thing is just totally foundational. If you look at the report that the 400 richest families in America pay a lower effective tax rate than the bottom half of families, it’s appalling.

We live in a complicated world. A lot of different things have been going on, including just in the last few months. But if you have to really summarize the drift and the shift of the last 40 years, it’s been a war on taxation. And it’s been a massive redistribution of wealth from the bottom to the top of American life through taxation. Since the ’80s, the top 1% has gained $21 trillion of wealth, and the bottom half of Americans have lost $900 billion of wealth on average —  and much of that was prosecuted through the tax code.

Awkward! Above, Giridharadas shaking hands with Amazon founder Jeff Bezos at a Wired event in 2018.

#amazon, #anand-giridharadas, #billionaires, #diversity, #elon-musk, #inequality, #jeff-bezos, #mark-zuckerberg, #opinion, #policy, #social-media, #tc, #technology, #wealth-disparity

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Judge gives Trump admin. Friday deadline to delay or defend TikTok ban

A stand of TikTok (Douyin) at The First International Artificial Products Expo Hangzhou on October 18, 2019, in Hangzhou, China.

Enlarge / A stand of TikTok (Douyin) at The First International Artificial Products Expo Hangzhou on October 18, 2019, in Hangzhou, China. (credit: Long Wei | VCG | Getty Images)

A federal judge today gave the Trump administration until Friday to either defend its planned ban of short-form-video app TikTok in court or hold off on it, adding one more wrinkle to the seemingly endless on-again, off-again saga.

If the government doesn’t voluntarily postpone the planned TikTok ban by 2:30pm (EDT) on Friday, then it will have to show up for a hearing on Sunday morning, where he will rule on TikTok’s request for an injunction on the ban, Judge Carl Nichols of the US District Court for DC said today.

Nichols said that the ban, if it takes effect, could prevent potentially hundreds of thousands of new users per day from signing up for TikTok. “I don’t think [a ban] merely preserves the status quo,” he said, according to The Wall Street Journal.

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#bans, #courts, #policy, #tiktok, #trump-administration, #white-house

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Former Facebook manager: “We took a page from Big Tobacco’s playbook”

Former Facebook manager: “We took a page from Big Tobacco’s playbook”

Enlarge (credit: Chesnot | Getty Images)

Speaking to Congress today, the former Facebook manager first tasked with making the company make money did not mince words about his role. He told lawmakers that the company “took a page from Big Tobacco’s playbook, working to make our offering addictive at the outset” and arguing that his former employer has been hugely detrimental to society.

Tim Kendall, who served as director of monetization for Facebook from 2006 through 2010, spoke to Congress today as part of a House Commerce subcommittee hearing examining how social media platforms contribute to the mainstreaming of extremist and radicalizing content.

“The social media services that I and others have built over the past 15 years have served to tear people apart with alarming speed and intensity,” Kendall said in his opening testimony (PDF). “At the very least, we have eroded our collective understanding—at worst, I fear we are pushing ourselves to the brink of a civil war.”

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#addiction, #facebook, #monetization, #policy, #social-media, #testimony

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Ex-eBay employees to plead guilty in “bloody pig mask” cyberstalking case

A bloody pig mask purchased on Amazon.

Enlarge / A bloody pig mask allegedly mailed to cyberstalking victims by then-eBay employees. (credit: FBI)

Four former eBay employees are expected to plead guilty to charges that they led a cyberstalking campaign against an online newsletter’s editor and publisher. In June, federal officials announced charges and said the harassment campaign “included sending the couple anonymous, threatening messages, disturbing deliveries—including a box of live cockroaches, a funeral wreath, and a bloody pig [Halloween] mask—and conducting covert surveillance of the victims.”

The four people who are scheduled to plead guilty are Stephanie Popp, eBay’s former senior manager of global intelligence; Stephanie Stockwell, former manager of eBay’s Global Intelligence Center (GIC); Veronica Zea, a former eBay contractor who worked as an intelligence analyst in the GIC; and Brian Gilbert, a former senior manager of special operations for eBay’s Global Security Team.

A hearing for a “waiver of indictment and plea to information” is scheduled for October 8, according to an entry in the court docket yesterday. The upcoming guilty pleas were also announced on Twitter by the US Attorney’s office in Massachusetts. The case is in US District Court for the District of Massachusetts.

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#ebay, #policy

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California bans new internal combustion engines, starting in 2035

The words Mad Gas 2035 are printed in a Mad Max Fury Road typeface.

Enlarge (credit: Aurich Lawson / Getty Images)

On Wednesday, California Governor Gavin Newsom signed an executive order requiring that all new passenger cars and trucks sold in the state from 2035 be zero-emissions vehicles. Additionally, all drayage trucks—the ones that move containers around at places like the Port of Los Angeles—must also go emissions free by this date, as well as off-road vehicles and equipment. Medium- and heavy-duty vehicles get an extra decade to comply, but by 2045 these too must ditch internal combustion engines.

Although this is the first such ICE ban in the United States, Governor Newsom is following in the footsteps of policymakers in Europe, China, and elsewhere. In 2016, Paris, Madrid, Athens, and Mexico City announced bans on new diesel vehicles from 2025. The same year, Germany’s Bundesrat voted to outlaw new ICE vehicles from 2030, although this was not a binding resolution.

The following year, France announced that new ICE vehicles would be banned from 2040. The UK also picked 2040 as the end of new gasoline and diesel vehicles within its borders, a timeline that in February was brought forward by five years to 2035, then this past Monday it was brought forward another five years, to 2030. And China is also phasing out internal combustion vehicles, albeit over a longer timeline.

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#california, #california-air-resources-board, #cars, #climate-change, #diesel, #gasoline, #policy, #zero-emissions-vehicle

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TikTok files for injunction against pending Trump app ban

TikTok’s fight with the Trump administration doesn’t yet appear to be over, regardless of what the deal that was signed between its parent company ByteDance and Oracle says over the weekend.

Earlier today, the company filed a motion to stop the Commerce Department from enforcing a ban against the popular social app. That ban was supposed to come into place on Sunday, but after the signing of the ByteDance/Oracle deal, it was delayed by a week, with additional delays expected as the deal closes in the coming weeks.

Now though, the company seems to be taking more aggressive action to stop the government. It’s perhaps looking at the plight of another app, WeChat, whose users successfully argued for an injunction in San Francisco federal court this weekend that blocked the app from being banned on Sunday by the Commerce Department. Unlike in WeChat’s case, where the lawsuit was brought by American citizens rather than its owner Tencent, TikTok itself filed its lawsuit against President Trump and the government, originally filing its lawsuit on September 18th, according to court records.

In its filing for an injunction, the company says that it has “made extraordinary efforts to try to satisfy the government’s ever-shifting demands and purported national security concerns, including through changes in the ownership and structure of [its] business, and [we] are continuing to do so.”

In particular, the company noted that the damage of the ban could be significant, arguing that “hundreds of millions of Americans who have not yet downloaded TikTok will be shut out … six weeks before a national election.” The company argues that President Trump and the Commerce Department exceeded its authority under existing legislation to enforce a ban, which mirror arguments made in the WeChat case this weekend.

It’s just the latest challenge in a sprawling situation that changes by the hour. Overnight, my colleague Rita Liao noted that China itself may not even approve the ByteDance/Oracle deal, calling it “extortion” and putting the whole framework for TikTok moving forward in doubt.

#apps, #asia, #bytedance, #government, #policy, #president-trump, #tencent-holdings, #tiktok, #wechat

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Justice Dep’t. sends its Section 230 rewrite to Congress

Cartoon hands hold out a band-aid over the words Section 230.

Enlarge (credit: Aurich Lawson / Getty Images)

The Department of Justice today dropped a proposed “recalibration” of one of the most important laws governing the US Internet into Congress’s lap and urged legislators to act to remove a liability protection on which nearly every website and app currently relies.

Attorney General Bill Barr sent the proposed legislation—an extension of his June wish list—to Speaker of the House Nancy Pelosi and Vice President Mike Pence (in his role as President of the Senate) this morning.

“For too long Section 230 has provided a shield for online platforms to operate with impunity,” Barr said in a written statement. “Ensuring that the internet is a safe, but also vibrant, open, and competitive environment is vitally important to America,” he added. “We therefore urge Congress to make these necessary reforms to Section 230 and begin to hold online platforms accountable both when they unlawfully censor speech and when they knowingly facilitate criminal activity online.”

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#congress, #department-of-justice, #doj, #justice-department, #laws, #legislative-proposal, #policy, #section-230

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T-Mobile hits back at AT&T and Verizon after spectrum-hoarding accusations

T-Mobile CEO Mike Sievert speaks during a keynote at CES 2020 in Las Vegas on Wednesday, Jan. 8, 2020.

Enlarge / T-Mobile CEO Mike Sievert speaks during a keynote at CES 2020 in Las Vegas on Wednesday, Jan. 8, 2020. (credit: Getty Images | Bloomberg)

T-Mobile US CEO Mike Sievert yesterday fired back at AT&T and Verizon, saying the carriers’ complaints about T-Mobile obtaining more spectrum licenses show that they are afraid of competition.

“The duopolists are scrambling to block this new competition any way they can… Suddenly in the unfamiliar position of not having a dominant stranglehold on the wireless market, and preferring not to meet the competitive challenge in the marketplace, AT&T and Verizon are urging the FCC to slow T-Mobile down and choke off our ability to compete fairly for added radio spectrum,” Sievert wrote in a blog post.

As we wrote Monday, Verizon and AT&T have urged the Federal Communications Commission to impose limits on T-Mobile’s ability to obtain more spectrum licenses. AT&T complained that T-Mobile’s acquisition of Sprint allowed it to amass “an unprecedented concentration of spectrum.”

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#att, #biz-it, #mike-sievert, #policy, #spectrum, #t-mobile, #verizon

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EU’s antitrust probe of Google-Fitbit gets more time

European antitrust regulators now have until almost the end of the year to take a decision on whether to green light Google’s planned acquisition of Fitbit.

The tech giant announced its intention to buy the fitness tracking wearable maker in November 2019, saying it would shell out $2.1 billion in cash to make off with Fitbit and the health data it holds on some 28M+ users.

EU regulators were quick to sound the alarm about letting the tech giant go shopping for such a major cache of sensitive personal data, with the European Data Protection Board warned in February that the proposed purchase poses a huge risk to privacy.

There is also a parallel concern that Fitbit’s fitness data could further consolidate Google’s regional dominance in the ad market. And last month EU competition regulators announced a full antitrust probe — saying then they would take a decision within 90 working days. That deadline has now been extended by a further two weeks.

A Commission spokeswoman confirmed the earlier provisional December 9 deadline has been pushed on “in agreement with the parties” — citing Article 10(3) of the EU’s Merger Regulation.

“The provisional legal deadline for a final decision in this case is now December 23, 2020,” she added.

The Commission has not offered any detail on the reason for allocating more time to take a decision.

When EU regulators announced the in-depth probe, the Commission said it was concerned data gathered by Fitbit could lead to a distortion of competition if Google was allowed to assimilate the wearable maker and “further entrench” its dominance in online ad markets.

Other concerns include the impact on the nascent digital healthcare sector, and whether Google might be incentivised to degrade the interoperability of rival wearables with its Android OS once it has its own hardware skin in the game.

The tech giant, meanwhile, has offered assurances around the deal in an attempt to get it cleared — claiming ahead of the Commission’s probe announcement it would not use Fitbit health data for ad targeting, and suggesting that it would create a ‘data silo’ for Fitbit data to keep it separate from other data holdings.

However regulators have expressed scepticism — with the Commission writing last month that the “data silo commitment proposed by Google is insufficient to clearly dismiss the serious doubts identified at this stage as to the effects of the transaction”.

It remains to be seen what the bloc’s competition regulators conclude after taking a longer and harder look at the deal — and it’s worth noting they are simultaneously consulting on whether to give themselves new powers to be able to intervene faster to regulate digital markets — but Google’s hopes of friction-free regulatory clearance and being able to hit the ground running in 2020 with Fitbit’s data in its pocket have certainly not come to pass. 

#antitrust, #europe, #european-commission, #european-union, #fitbit, #google, #health, #health-data, #policy, #privacy, #wearables

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Dear Sophie: Possible to still get through I-751 and citizenship after divorce?

Here’s another edition of “Dear Sophie,” the advice column that answers immigration-related questions about working at technology companies.

“Your questions are vital to the spread of knowledge that allows people all over the world to rise above borders and pursue their dreams,” says Sophie Alcorn, a Silicon Valley immigration attorney. “Whether you’re in people ops, a founder or seeking a job in Silicon Valley, I would love to answer your questions in my next column.”

“Dear Sophie” columns are accessible for Extra Crunch subscribers; use promo code ALCORN to purchase a one- or two-year subscription for 50% off.


Dear Sophie:

I work at a tech company, married a U.S. citizen two years ago and got a two-year green card. The relationship went south and I needed to leave to protect my daughter and me. I want to get divorced, but can we keep our green cards?

Will we be able to apply for U.S. citizenship?

— Hopeful in Hayward

Dear Hopeful,

Thank you for reaching out and sharing the story of your courage to do the right thing for yourself and your child. Good news — U.S. immigration laws have been designed to protect individuals who have been subject to abuse or extreme cruelty, which is not limited to physical harm but can also include emotional abuse. So, yes, you and your daughter can apply for a permanent green card even if you divorce your U.S.-citizen spouse. And yes, you can also apply for U.S. citizenship when you are eligible. My law partner, Anita Koumriqian, and I discuss the naturalization and citizenship process in more detail in this podcast.

You will need to file a petition (Form I-751) with U.S. Citizenship and Immigration Services (USCIS) to seek to have the conditions on your and your daughter’s two-year conditional green card removed. Usually, individuals with a conditional green card must file a petition within 90 days of when the conditional card is set to expire. However, an abused spouse or the parent of an abused child can file this petition at any time. I recommend consulting with an experienced immigration lawyer before filing this petition. You will be allowed to have your attorney go with you to the USCIS interview that will be required as part of this process.

Conditional green cards cannot be renewed. Individuals who fail to file a petition to remove the conditions run the risk of being deported. Once the conditions are removed, a green card will be valid for 10 years. This process can involve extensive documentation and the possibility of attending an in-person interview. One of the reasons that it’s important to speak to an immigration attorney about this process, especially in California, is because divorce can take at least six months and the timing of the legal processes can affect the outcome of your green card.

Down the road, when the time comes for citizenship, here are the requirements to apply for the naturalization process. You must have:

#column, #diversity, #government, #green-card, #immigration-law, #lawyers, #policy, #sophie-alcorn, #startups, #tc, #verified-experts

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Facebook denies it will pull service in Europe over data transfer ban

Facebook’s head of global policy has denied the tech giant could close its service to Europeans if local regulators order it to suspend data transfers to the US following a landmark Court of Justice ruling in July that has cemented the schism between US surveillance laws and EU privacy rights.

Press reports emerged this week of a Dublin court filing by Facebook, which is seeking a stay to a preliminary suspension order on its EU-US data transfers, that suggested the tech giant could pull out of the region if regulators enforce a ban against its use of a data transfer mechanism known as Standard Contractual Clauses.

The court filing is attached to Facebook’s application for a judicial review of a preliminary suspension order from Ireland’s Data Protection Commission earlier this month, as Facebook’s lead EU data supervisor responded to the implications of the CJEU ruling.

“We of course won’t [shut down in Europe] — and the reason we won’t of course is precisely because we want to continue to serve customer and small and medium sized businesses in Europe,” said Facebook VP Nick Clegg during a livestreamed EU policy debate yesterday.

However he also warned of “profound effects” on scores of digital businesses if a way is not found by lawmakers on both sides of the pond to resolve the legal uncertainty around US data transfers — making a pitch to politicians to come up with a new legal ‘sticking plaster’ for EU-US data transfers now that a flagship arrangement, called Privacy Shield, is dead.

“We have a major issue — which is that for various complex, legal, political and other reasons question marks are being raised about the current legal basis under which data transfers occur. If those legal means of data transfer are removed — not by us, but by regulators — then of course that will have a profound effect on how, not just our services, but countless other companies operate. We’re trying to avoid that.”

The Facebook VP was speaking during an EBS panel debate on rebooting the regional economy “towards a green, digital and resilient union” — which included the EU’s commissioner for the economy, Paolo Gentiloni, and others.

Discussing the Dublin legal filing, Clegg suggested that an overenthusiastic reporter “slightly overwrote” in their interpretation of the document. “We’ve taken legal action in the Dublin courts to — in a sense — to try to send a signal that this is a really big issue for the whole European economy, for all small and large companies that rely on data transfers,” he said.

Clegg went on to claim that while Facebook being forced to suspend data transfers from the EU to the US “would of course be very bad for Facebook” the impact of such an order “would be absolutely disastrous for the economy as a whole”.

“What is at stake here is quite a big issue that in the end can only be resolved politically between a continued negotiation between the US and the EU that clearly is not going to happen until there’s a new US administration in place after the transition period in the early part of next year,” he said, indicating Facebook is using Ireland’s courts to try to buy time for a political fix.

“We need the time and the space for the political process between the EU and the US to work out so that companies can have confidence going fwd that they’re able to transfer data going forward,” he added.

Clegg also sought to present Facebook’s platform as a vital component of any regional economy recovery — talking up its utility to European SMEs for reaching customers.

Some 25M European companies use its apps and tools, he said — impressing that the “vast majority” do so for free and further claiming activity on Facebook’s ad platform could be linked to sales of 208BN, and 3M+ jobs, per independent estimates.

“In terms of the economic recovery, our most important role is to continue to provide that extraordinary capacity for small businesses to do something which in the past only big businesses could do,” he said. “In the past only big businesses had the fancy marketing budgets and could take out bill boards and television and radio ads. The transformational effect of social media and Facebook in part economically speaking is that it’s levelled the playing field.”

Clegg went further on this point — linking the mass exploitation of Internet users’ personal data to the economic value generated by regional businesses via what he badged “personalized advertising” — aka “Facebook’s business model”.

“The personalized advertising model allows us to do that — allows us to level the playing field,” he claimed.

The tech giant’s processing of Europeans’ personal data remains under investigation on multiple fronts by EU regulators — meaning that as well as the clear threat to its US transfers Facebook’s core business model risks being unpicked by regulators if it faces enforcement action over multiple claimed data protection violations in future.

“I’m acutely aware that it is a business model that has plenty of criticism aimed at it and there’s a totally legitimate debate which rages in Brussels and elsewhere about how Facebook gathers, stores and monetizes data — and that is a totally legitimate and ongoing debate — but I hope people will not overlook that that business model has one ingenious benefit, amongst others, which is that it allows small businesses to operate on the same basis as big businesses in reaching their customers,” he said.

Never one to waste a lobbying opportunity, Clegg argued the pandemic has made this capacity “even more important” with EU populations under lockdown and fewer opportunities for businesses to engage in face to face selling.

Taxing times

The knotty issue of digital tax reform also came up during the debate.

Gentiloni reiterated the Commission position that it wants to see global agreement on reforming tax rules to take account of the shift to online business but he said the bloc is willing to go ahead with a European digital tax if that effort fails.

“We can’t remain with the model of the previous century,” he said, before going on to flesh out the challenges facing global accord on the issue. “We don’t want to be the one breaking this OECD process. To be honest, there was a lot of progress in this thing that we call ‘inclusive framework’ — more than dozens of countries working together and reaching something like an agreement on a new form of digital tax but then one single country — but a very important one — is not agreeing with this solution, is proposing a different one. But this different solution, the so called ‘Safe Harbor’, appears a little bit like an optional solution and it’s a bit difficult to conceive of an optional solution because of course you don’t pay ‘optional taxes’, I don’t think so. But we are still committed towards the end of this year to try to find this solution.

“My absolute preferred solution would be a global one. For many reasons — for avoiding tensions among different countries, and for facilitating for business the payment of taxes — but I want to say very clearly that we have a second best solution which is a European digital taxation because the alternative to this would be to have, as we already have in legislation, a French one, an Italian one, a Spanish one and I don’t think this is a good solution for Facebook or other companies. So we’re working for global but if global is not possible we will go European.”

Facebook’s Clegg said the company “will pay the taxes that are due under the rules that operate”, adding that if there is a European digital tax it will “of course” abide by it. But he too said Facebook’s preference is for a global arrangement.

#data-transfers, #digital-tax-reform, #europe, #facebook, #nick-clegg, #policy, #privacy, #privacy-shield, #schrems-ii, #social

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The fight over the fight for California’s privacy future

The fight over the fight for California’s privacy future

Enlarge (credit: Aurich Lawson / Getty Images)

When state Senator Bob Hertzberg learned that an ambitious privacy initiative had gotten enough signatures to qualify for the ballot in California, he knew he had to act quickly.

“My objective,” he says, “was to get the damn thing off the ballot.”

It was the spring of 2018. Facebook’s emerging Cambridge Analytica scandal had cast a harsh light on the tech giants’ data-gathering practices, spurring calls for more consumer privacy protections. The initiative was the brainchild of Alastair Mactaggart, a wealthy San Francisco real estate developer, who had the idea in the shower in 2015 and funded the effort out of pocket. Mactaggart enlisted his neighbor Rick Arney and Mary Stone Ross, a former CIA analyst and lawyer, to help craft the ballot measure. None had any background in data privacy or, for that matter, anything related to the tech industry.

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#california, #ccpa, #policy, #privacy, #proposition-24

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“LokiBot,” the malware that steals your most sensitive data, is on the rise

The words

Enlarge (credit: Christiaan Colen / Flickr)

Federal and state officials are seeing a big uptick in infections coming from LokiBot, an open source DIY malware package for Windows that’s openly sold or traded for free in underground forums. It steals passwords and cryptocurrency wallets, and it can also download and install new malware.

In an alert published on Tuesday, the Department of Homeland Security’s Cybersecurity and Infrastructure Agency and the Multi-State Information Sharing & Analysis Center said LokiBot activity has scaled up dramatically in the past two months. The increase was measured by “EINSTEIN,” an automated intrusion-detection system for collecting, correlating, analyzing, and sharing computer security information across the federal civilian departments and agencies.

“CISA has observed a notable increase in the use of LokiBot malware by malicious cyber actors since July 2020,” Tuesday’s alert stated. “Throughout this period, CISA’s EINSTEIN Intrusion Detection System, which protects federal, civilian executive branch networks, has detected persistent malicious LokiBot activity.”

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#biz-it, #cisa, #cybersecurity-and-infrastructure-agency, #lokibot, #malware, #policy

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Blogger who trashed Fauci online “retires” after being ID’d as NIH staffer

A man in a suit and a face mask stands in a wood-paneled room.

Enlarge / Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, wears a Washington Nationals protective mask after a House Energy and Commerce Committee hearing in Washington, DC, on Tuesday, June 23, 2020. (credit: Getty | Bloomberg)

A public affairs officer at the National Institute of Allergy and Infectious Diseases is out of a day job after a report found he was moonlighting pseudonymously as an editor for a conservative website, where he regularly trashed his agency and its director, Dr. Anthony Fauci.

The RedState managing editor known as “streiff” is actually William Crews, The Daily Beast reported yesterday. Crews was, until this week, a public affairs specialist at NIAID, which is one of the 27 institutes and centers that comprise the National Institute of Health.

As streiff, Crews “derided his own colleagues as part of a left-wing anti-Trump conspiracy and vehemently criticized the man who leads his agency,” according to The Daily Beast. Additionally, he described his boss as “attention-grubbing and media-whoring Anthony Fauci” and “a mask nazi.”

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#anthony-fauci, #covid-19, #dr-anthony-fauci, #national-institute-of-allergy-and-infectious-diseases, #niaid, #nih, #policy, #redstate, #sabotage, #science

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Tech must radically rethink how it treats independent contractors

Despite a surging stock market and many major tech players having record quarters, we’re still seeing layoffs throughout tech and the rest of corporate America. Salesforce recorded a huge quarter, passing $5 billion in revenue, only to lay off around 1000 people. LinkedIn is laying off 960 people one day after reporting a 10% increase in revenue.

These layoffs may seem like a contraction in size for these huge enterprises, but it’s actually the beginning of something I call The Great Unbundling of Corporate America. They still need to grow, they still need to innovate, they still need to get work done and they’re not simply canceling projects and giving up on contracts.

Just as COVID-19 has accelerated the move to remote work, our current crisis has accelerated the trend toward hiring independent contractors. Back in 2019 a New York Times report found that Google had a shadow workforce of 121,000 temporary workers and contractors, overshadowing their 102,000 full-timers. ZipRecruiter reported in 2018 that tech, along with its record employment growth, was showing an increasing share of listings for independent contractors.

A study from the Bureau of Labor Statistics found that between 6.9% and 9.6% of all workers are now independent contractors, and according to Upwork, that may be as high as 35%. Mark my words — companies are using this time as an opportunity to swing the pendulum toward independent contractors and trimming the fat, justifying it with a vague gesture toward “an unprecedented time.”

That’s why, in my opinion, you’re seeing the NASDAQ hitting record highs despite everyone’s turmoil — depressingly, investors can see that large companies are tightening up and cleaning up waste, while finding an affordable workforce at will. As they have unbundled themselves from our physical offices, large enterprises are going to unbundle themselves from having to have a set number of employees.

When Square allowed its entire workforce to work remotely permanently. It wasn’t just because they wanted them to feel more creative and productive, but was likely a move away from having quite as much expensive, needless office space.

Similarly, if there is work that a full-time employee does that could be done by a flexible, independent contractor, why not make that change too? And it’ll be a lot easier to make without as many people at the office.

The argument I’m making is not anti-contractor, though.

I can’t think of any point in history where it’s been better to create a freelance business — the startup costs are significantly lower, and as companies move toward remote work, you can theoretically take business nationally (or internationally) like never before. Companies’ moves toward replacing W-2 workers with contractors is an opportunity for people to create their own miniature freelance empires, unbundling themselves from corporate America’s required hours, and potentially creating a way to weather future storms by taking away any single company’s leverage on their income.

The rush to remote work is also likely to push more workers into the freelance economy too. By having to create a remote office, with a remote presence in meetings and having to manage and organize our days, the average worker has all but adjusted to the life of a freelancer.

Where some might have gone to an office and had things simply happen to them, the remote world requires an attention to your calendar and active outreach to colleagues that, well, models how one might run a freelance business. Those with core skillsets that can be marketed and sold to multiple clients should be thinking about whether being a wage slave is necessary anymore, and with good reason.

That said — corporate America, and especially tech, has to treat this essential workforce with a great deal more empathy and respect than they have thus far.

Uber and Lyft were ordered to treat drivers as employees in part due to the fact that they never treated their contractors like parts of the company. Other than the obvious lack of benefits (paid time off, health insurance, etc.), Uber, like many large enterprises, treats contractors as disposable rather than flexible, despite them being the literal driving force of the company. When Uber went public, they gave a nominal bonus for drivers that had completed 2500 to 40,000 trips, with a chance to buy up to $10,000 of stock — at the IPO price. These drivers, that had been the very reason that many people became millionaires and billionaires when Uber went public, were given the chance to maybe make money, if they sold the stock quickly enough.

It’s an abject lesson on how to not build loyalty with independent contractors. It’s also a lesson on what the next big company that wants to build themselves off the back of the 1099’er should do.

What I’m suggesting is a radical rethinking of freelance contracting. I want you to see independent contractors as a different kind of worker, not as a way of skirting getting a full-time employee. A freelancer, by definition, is someone that you don’t monopolize, and someone that you should actively give agency and, indeed, part of the network you’re building. One of the issues of corporate America’s approach to freelance work is an us-versus-them approach to employment — you’re either part of us or you’re simply a thing we pick up and put down. What I’m suggesting is treating your freelancers as an essential part of your strategy, and compensating them as such. Freelancers should own equity and should have skin in the game — they may be working with you on a number of projects and take literal ownership of vast successes throughout your history.

Contracted work has only become mercenary through the treatment of the freelance worker. Where tech has succeeded in creating hundreds of thousands of independent contractor positions, it also has to lead the way in reimagining how we may treat them and reward them for their work. And corporate America needs to take a step beyond simply seeing them as a cheaper, easier way to do business. They’re so much more.

#column, #covid-19, #employment, #freelancer, #gig-economy, #government, #labor, #opinion, #policy, #remote-work, #startups, #tc

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Facebook warns privacy rules could force it to exit European market

Facebook's European headquarters in Dublin.

Enlarge / Facebook’s European headquarters in Dublin. (credit: Brian Lawless – PA Images / Getty)

Facebook has warned that it could be forced to pull out of the European market if European regulators push forward with limits on data sharing between the European Union and the United States.

Until this year, an arrangement called Privacy Shield allowed US technology companies to move data easily between the two jurisdictions. But Europe’s highest court nixed that arrangement in July, arguing that US law lacks robust protections against surveillance by the US government.

In the wake of that ruling, Ireland’s privacy regulator ordered Facebook to stop sending data on European users to its US data centers. Ireland’s Data Protection Commission (DPC) leads enforcement of European privacy regulations with respect to Facebook because Facebook’s official European headquarters is in Dublin.

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#data-protection-commission, #facebook, #ireland, #policy, #privacy-shield

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Big tech has 2 elephants in the room: Privacy and competition

The question of how policymakers should respond to the power of big tech didn’t get a great deal of airtime at TechCrunch Disrupt last week, despite a number of investigations now underway in the United States (hi, Google).

It’s also clear that attention- and data-monopolizing platforms compel many startups to use their comparatively slender resources to find ways to compete with the giants — or hope to be acquired by them.

But there’s clearly a nervousness among even well-established tech firms to discuss this topic, given how much their profits rely on frictionless access to users of some of the gatekeepers in question.

Dropbox founder and CEO Drew Houston evinced this dilemma when TechCrunch Editor-in-Chief Matthew Panzarino asked him if Apple’s control of the iOS App Store should be “reexamined” by regulators or whether it’s just legit competition.

“I think it’s an important conversation on a bunch of dimensions,” said Houston, before offering a circular and scrupulously balanced reply in which he mentioned the “ton of opportunity” app stores have unlocked for third-party developers, checking off some of Apple’s preferred talking points like “being able to trust your device” and the distribution the App Store affords startups.

“They also are a huge competitive advantage,” Houston added. “And so I think the question of … how do we make sure that there’s still a level playing field and so that owning an app store isn’t too much of an advantage? I don’t know where it’s all going to end up. I do think it’s an important conversation to be had.”

Rep. Zoe Lofgren (D-CA) said the question of whether large tech companies are too powerful needs to be reframed.

“Big per se is not bad,” she told TC’s Zack Whittaker. “We need to focus on whether competitors and consumers are being harmed. And, if that’s the case, what are the remedies?”

In recent years, U.S. lawmakers have advanced their understanding of digital business models — making great strides since Facebook’s Mark Zuckerberg answered a question two years ago about how his platform makes money: “Senator, we sell ads.”

A House antitrust subcommittee hearing in July 2020 that saw the CEOs of Google, Facebook, Amazon and Apple answer awkward questions and achieved a higher dimension of detail than the big tech hearings of 2018.

Nonetheless, there still seems to be a lack of consensus among lawmakers over how exactly to grapple with big tech, even though the issue elicits bipartisan support, as was in plain view during a Senate Judiciary Committee interrogation of Google’s ad business earlier this month.

On stage, Lofgren demonstrated some of this tension by discouraging what she called “bulky” and “lengthy” antitrust investigations, making a general statement in favor of “innovation” and suggesting a harder push for overarching privacy legislation. She also advocated at length for inalienable rights for U.S. citizens so platform manipulators can’t circumvent rules with their own big data holdings and some dark pattern design.

#antitrust, #big-tech, #data-protection, #digital-regulation, #disrupt-2020, #europe, #gdpr, #government, #platforms, #policy, #privacy

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States, DOJ reportedly meeting this week to plan Google antitrust suit

Google's in everything. Perhaps too much everything, regulators now worry.

Enlarge / Google’s in everything. Perhaps too much everything, regulators now worry. (credit: Omar Marques | SOPA Images | LightRocket | Getty Images)

Multiple investigations into Google parent Alphabet’s competition practices may finally be reaching a head, as state and federal regulators meet today to plan next steps for one or more lawsuits against the company.

Attorneys from the Department of Justice are meeting today with attorneys general from several different states about imminent plans to file an antitrust suit against Google, the Washington Post and Bloomberg report.

The DOJ began its antitrust probe of “market-leading online platforms” a little more than a year ago, without naming names. Google was widely assumed to be one of the targets, and the company confirmed last September that it was indeed under investigation.

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#alphabet, #antitrust, #department-of-justice, #doj, #google, #justice-department, #lawsuits, #policy

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156 countries commit to fair COVID-19 vaccine access, but US won’t join

World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus attends a press conference organized by the Geneva Association of United Nations Correspondents (ACANU) amid the COVID-19 outbreak, caused by the novel coronavirus, on July 3, 2020 at the WHO headquarters in Geneva.

Enlarge / World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus attends a press conference organized by the Geneva Association of United Nations Correspondents (ACANU) amid the COVID-19 outbreak, caused by the novel coronavirus, on July 3, 2020 at the WHO headquarters in Geneva. (credit: Getty | Fabrice Cof)

A total of 156 countries—representing about 64 percent of the world’s population—have committed to pooling resources to help develop, buy, and equitably distribute two billion doses of a COVID-19 vaccine by the end of 2021.

“This isn’t just the right thing to do, it’s the smart thing to do,” said Dr. Tedros Adhanom Ghebreyesus, director-general of the World Health Organization, which is co-leading the effort along with the Coalition for Epidemic Preparedness Innovations (CEPI) and Gavi, the Vaccine Alliance.

So far, 64 high-income countries have signed on to the effort, as well as 92 low- and middle-income countries, which would be eligible for support in procuring vaccine doses. Gavi CEO Seth Berkley said in a WHO press conference on Monday that he expects 38 more countries to sign up in the coming days.

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#china, #covax, #covid-19, #infectious-disease, #pandemic, #policy, #public-health, #russia, #sars-cov-2, #science, #us, #vaccine, #who

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Facebook vows to restrict users if US election descends into chaos

United States Map - State with glow with malicious code background in a 1970 dot matrix font on a computer screen. 8K Resolution ready.

Enlarge / United States Map – State with glow with malicious code background in a 1970 dot matrix font on a computer screen. 8K Resolution ready. (credit: Matt Anderson Photography | Getty Images)

Facebook has said it will take aggressive and exceptional measures to “restrict the circulation of content” on its platform if November’s presidential election descends into chaos or violent civic unrest.

In an interview with the Financial Times, Nick Clegg, the company’s head of global affairs, said it had drawn up plans for how to handle a range of outcomes, including widespread civic unrest or “the political dilemmas” of having in-person votes counted more rapidly than mail-in ballots, which will play a larger role in this election due to the coronavirus pandemic.

“There are some break-glass options available to us if there really is an extremely chaotic and, worse still, violent set of circumstances,” Mr Clegg said, though he stopped short of elaborating further on what measures were on the table.

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#election, #facebook, #policy, #us

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TikTok, WeChat and the growing digital divide between the U.S. and China

Over the past decade, the dynamic between Chinese and United States tech companies has undergone dramatic shifts. Once seen as a promising market for American companies, that narrative flipped as China’s tech innovation and investment power became increasingly evident, and the expanding reach of the Chinese Communist Party’s cybersecurity regulations fueled concerns about data privacy. For years, however, there still seemed to be room for a flow of ideas between the two countries. But that promise has eroded, against the backdrop of the tariff wars and, most recently, the Trump administration’s executive orders against TikTok and WeChat.

The U.S. Commerce Department was set to enforce the shutdown of TikTok and WeChat in the United States last weekend, but both apps got reprieves. In WeChat’s case, a U.S. district court judge issued a temporary stay against the ban, while TikTok owner ByteDance is in the process of finalizing a complicated deal with Oracle.

The TikTok and WeChat imbroglios underline how much America’s perception of Chinese tech has evolved. Not only is TikTok the first consumer app by a Chinese company to gain a major foothold in the United States, but it’s also had a significant impact on popular culture there. This would have been almost unimaginable just ten, or even five, years ago.

China as a target for expansion

For a long time, China, with its population of 1.4 billion people, was seen as a lucrative market by many foreign tech companies, even as government censorship began to expand. In 2003, China’s Ministry of Public Security launched the Golden Shield Project, commonly referred to as the Great Firewall of China, the apparatus that controls what overseas sites and apps Chinese internet users have access to. At first the Great Firewall mainly targeted access to Chinese-language sites with anti-Chinese Communist Party content. Then it began blocking more services.

A laptop computer screen in Beijing shows the homepage of Google.cn, 26 January 2006, a day after its debut in mainland China where the US online search engine launched a new service after agreeing to censor websites and content banned by the Beijing authorities (AFP PHOTO/Frederic J. BROWN)

A laptop computer screen in Beijing shows the homepage of Google.cn, 26 January 2006, a day after its debut in mainland China where the US online search engine launched a new service after agreeing to censor websites and content banned by the Beijing authorities (AFP PHOTO/Frederic J. BROWN)

Even as the Communist Party’s online censorship became more stringent, many American internet companies were still keen to expand into China. Perhaps the most prominent example from that era is Google, which added Chinese support to Google.com in 2000.

Though access to the search engine was spotty (according to a 2010 timeline from the Financial Times, this may have been because of “extensive filtering” by China’s licensed internet service providers) and it was briefly blocked in 2002, Google continued launching new services targeted to users in China, including a simplified Chinese language version of Google News.

Then in 2005, the company announced plans to set up a research and development center in China. The next year, it officially launched Google.cn. In order to do so, Google agreed to exclude search results on sensitive political topics, causing controversy.

Despite its concessions to the Chinese government, Google’s relationship with China began deteriorating, foreshadowing what other foreign tech companies, particularly those offering online services, would deal with when they tried to enter China. After being blocked on and off, access to YouTube was completely cut off in 2009 after footage was uploaded that appeared to show the brutal beatings of Tibetan protestors in Lhasa. That year, China also blocked access to Facebook and Twitter.

In January 2010, Google announced it was no longer willing to censor searches in China and would withdraw from the country if necessary. It also began redirecting all search queries on Google.cn to Google.com.hk.

But the company continued its R&D operations there and maintained a sales team. (In 2018, an investigation by The Intercept found that Google had started to work on a censored search engine for China again, code-named “Project Dragonfly”). Other big U.S. tech companies also continued courting China, even though their services were blocked there.

For example, Facebook chief executive Mark Zuckerberg made several trips to China in the mid-2010s, including a 2015 visit to Tsinghua University, a leading research university. Zuckerberg had joined the university’s board the previous year, and delivered several public talks in Mandarin. Speculation mostly focused on Facebook’s efforts to get a version of its service into China, but China-based companies were, and continue to be, one of Facebook’s most important sources of advertising revenue.

Chinese government policies designed to help domestic companies become more competitive also began to have an impact and by 2015, many American tech firms needed to find a local partner to enter China. The narrative that China needed American tech innovation began to turn on its head.

A shifting dynamic

Since Google Play was also blocked in China, that led the way for the rise of third-party Android app stores, including Chinese internet giant Tencent’s My App.

But Tencent’s most influential product is WeChat, the messenger that launched in 2011. Two years later, Tencent added mobile payments by integrating it with TenPay. In less than five years, WeChat became a vital part of daily life for hundreds of millions of users in China. WeChat Pay and Alibaba’s Alipay, its main competitor, have revolutionized payments in China, where about one-third of consumer payments are now cashless, according to research by think tank CGAP.

BEIJING, CHINA - SEPTEMBER 19: A Chinese customer uses his mobile to pay via a QR code with the WeChat app at a local market on September 19, 2020 in Beijing, China. (Photo by Kevin Frayer/Getty Images)

BEIJING, CHINA – SEPTEMBER 19: A Chinese customer uses his mobile to pay via a QR code with the WeChat app at a local market on September 19, 2020 in Beijing, China. (Photo by Kevin Frayer/Getty Images)

In 2017, Wechat launched “mini-programs,” that allows developers to create “apps within an app” that run on WeChat. The program took off quickly, and within less than two years, Tencent said it had reached one million mini-programs and 200 million daily users. Even Google quietly launched its own mini-program in 2018.

Despite its ubiquity in China, WeChat’s international presence is relatively small, especially when compared to other messengers like WhatsApp. WeChat claims more than one billion monthly active users in total, but only an estimated 100 million to 200 million are international users. Many are members of the Chinese diaspora who use it to keep in touch with family and associates in mainland China since many other popular messengers, including WhatsApp, Facebook Messenger and Line, are blocked there.

In the meantime, another company was gaining ascendancy, and would eventually succeed where Tencent hadn’t.

Founded in 2012 by Microsoft veteran Zhang Yiming, ByteDance had its own early run-ins with the Chinese government. The first app it launched, a social media platform called Neihan Duanzi that reached 200 million users by 2017, was shut down the next year after the National Radio and Television Administration accused it of hosting inappropriate content. Despite that early setback, ByteDance continued to grow, releasing apps like Toutiao, one of China’s top news aggregators.

But the product it is best known for launched in 2016. Called Douyin in China, ByteDance always planned to expand the short video-sharing app overseas. In an interview with Chinese tech news site 36Kr, Zhang said, “China is home to only one-fifth of the world’s internet users. If we don’t expand globally, we are bound to lose to our peers eyeing the rest of the world” — both echoing and contravening the viewpoint of U.S. internet companies that had seen China as a crucial market.

TikTok, the international version of Douyin, was launched in 2017. That year, ByteDance also bought Musical.ly, a lip-syncing app popular with teens, in a deal worth between $800 million to $1 billion. ByteDance merged Musical.ly with TikTok, consolidating their audiences.

By early 2019, TikTok had become popular among teens and people in their early 20s, though many older people still struggled to understand its appeal. But as TikTok was turning into a mainstay of Gen Z culture, it also began to face scrutiny by the U.S. government. In February 2019, the Federal Trade Commission fined TikTok $5.7 million for violating children’s privacy laws.

Then a few months later, the U.S. government reportedly began a national security review of TikTok, marking the first in a chain of events that led to Trump’s August executive order against the company, and ByteDance’s new, but confusing, agreement with “trusted technology partner” Oracle.

The impact of China’s 2017 cybersecurity law

The United States is not the only country where TikTok has been deemed a national security threat. In June, it was among 59 apps developed by Chinese companies banned in India for threatening the country’s “national security and defence.” It’s also under investigation by French data security watchdog CNIL over how it handles user data.

While some cybersecurity experts believe that TikTok’s data collection practices are similar to other social media apps that depend on targeted ads for revenue, the heart of the issue is a Chinese law, implemented in June 2017, that requires companies to comply with government requests for data stored in China. ByteDance has insisted repeatedly it would resist attempts by the Chinese government to access U.S. users’ data, which it says is stored in the United States and Singapore.

“Our data centers are located entirely outside of China, and none of our data is subject to Chinese law,” TikTok wrote in a October 2019 statement. “Further, we have a dedicated technical team focused on adhering to robust cybersecurity policies, and data privacy and security practices.”

In the same post, TikTok also addressed concerns that it censors content, including videos about the Hong Kong protests and China’s treatment of Uighurs and other Muslim groups. “We have never been asked by the Chinese government to remove any content and we would not do so if asked. Period,” the company said.

WeChat and TikTok’s uncertain future in the U.S.

But as a Chinese company, ByteDance is ultimately still beholden to Chinese laws. Earlier this week, ByteDance said it will retain an 80% stake in TikTok, after selling a total of 20% to Oracle and Walmart. Then Oracle executive vice president Ken Glueck said that Oracle and Walmart would make their investment upon the creation of a new entity called TikTok Global. He added that ByteDance will have no ownership in TikTok Global.

This creates more questions, but doesn’t answer the most pressing one: how close will the U.S. version of TikTok remain to ByteDance, and will it still be subject to the Chinese cybersecurity regulations that cause so much concern?

Around the same time that ByteDance’s proposed deal with Oracle and Walmart was announced, a U.S. district court judge temporarily stayed the nationwide ban on WeChat, as part of a case brought against the U.S. government by the U.S. WeChat Users Alliance, a nonprofit organization initiated by attorneys who want to preserve access to WeChat for users in America. In her opinion, Judge Laurel Beeler wrote, “while the government has established that China’s activities raise significant national-security concerns—it has put in scant little evidence that its effective ban of WeChat for all U.S. users addresses those concerns.”

On its site, the U.S. WeChat Users Alliance said it believes Trump’s August 6 executive order against WeChat “violates many provisions of the U.S. Constitution and the Administrative Procedure Act.” Furthermore, the group argued that a WeChat ban would “severely affect the lives and the work of millions of people in the U.S.” who use WeChat to talk to family, friends and business associates in China.

While WeChat is heavily censored, users have often found ingenious ways to bypass bans on topics deemed sensitive by the Chinese government. For example, people used emojis, PDFs and fictional languages like Klingon to share an interview with Ai Fen, the director of Wuhan Central Hospital’s emergency department and one of the first whistleblowers to sound the alarm about COVID-19 even as the government attempted to stifle information about the disease.

The growing divide

The U.S. government’s actions against TikTok and WeChat are taking place against an increasingly fraught political landscape. Huawei and ZTE were first identified as potential threats to U.S. national security in a 2012 bipartisan House committee report, but legal actions against Huawei, one of the world’s biggest telecom equipment suppliers, escalated under the Trump administration. These include criminal charges brought against Huawei by the Department of Justice, and the arrest and indictment of chief financial officer Meng Wanzhou.

The U.S. government’s actions in the name of national security doesn’t just affect the Chinese government or China’s biggest companies. It also impacts individuals, as in the case of increasingly stringent visa restrictions for Chinese students.

At the same time, the Great Firewall has become more restrictive under President Xi Jinping’s regime and China’s cybersecurity laws are becoming increasingly invasive, granting the government even more access to citizens’ data. Increasingly sophisticated surveillance technology has been used to monitor Uighurs and other ethnic minorities, and a crackdown on VPN services that began escalating in 2017 is making it harder for people in China to circumvent the Great Firewall.

When compared to these social issues, the future of a video-sharing app might seem relatively minor. But it underscores one of the most unsettling developments in the relationship between U.S. and China over the past ten years.

In a prescient 2016 Washington Post article titled “America wants to believe China can’t innovate. Tech tells a different story,” Emily Rauhala wrote “China’s tech scene is flourishing in a parallel universe.” TikTok’s deep cultural impact gave a glimpse of what is possible when two parallel universes connect. Along with geopolitical tensions, the furore over TikTok and WeChat uncovers something else: that the exchange of ideas and information between people in two of the world’s most powerful countries is becoming increasingly restricted due to circumstances beyond their control.

#apps, #bytedance, #china, #policy, #tc, #tencent, #tiktok, #united-states, #wechat

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T-Mobile amassed “unprecedented concentration of spectrum,” AT&T complains

A bird sits on top of a T-Mobile sign outside a mobile phone store,

Enlarge / A pigeon rests on a T-Mobile logo outside a mobile phone store, operated by Deutsche Telekom AG, in Munich, Germany, on Monday, Feb. 6, 2017. (credit: Getty Images | Bloomberg)

AT&T and Verizon are worried about T-Mobile’s vast spectrum holdings and have asked the Federal Communications Commission to impose limits on the carrier’s ability to obtain more spectrum licenses. Verizon kicked things off in August when it petitioned the FCC to reconsider its acceptance of a new lease that would give T-Mobile another 10MHz to 30MHz of spectrum in the 600MHz band in 204 counties. AT&T followed that up on Friday with a filing that supports many of the points made in Verizon’s petition.

T-Mobile was once the smallest of four national carriers and complained that it didn’t have enough low-band spectrum to match AT&T and Verizon’s superior coverage. But T-Mobile surged past Sprint in recent years and then bought the company, making T-Mobile one of three big nationwide carriers along with AT&T and Verizon. T-Mobile also bolstered its low-band spectrum holdings by dominating a 600MHz auction in 2017.

“The combination of Sprint and T-Mobile has resulted in an unprecedented concentration of spectrum in the hands of one carrier,” AT&T wrote in its filing to the FCC on Friday. “In fact, the combined company exceeds the Commission’s spectrum screen, often by a wide margin, in Cellular Market Areas representing 82 percent of the US population, including all major markets.”

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#att, #fcc, #policy, #spectrum, #t-mobile, #verizon

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Everything we know so far about Oracle not actually buying TikTok

A casually dressed young woman shrugs while holding the logos of two competing companies.

Enlarge / ¯\_(ツ)_/¯ (credit: Aurich Lawson / Getty Images)

It was a weird weekend to end a weird summer for one of the country’s most poular social media apps, TikTok. First, in August, the Trump administration threatened to ban TikTok unless it found a US buyer. Then last weekend, one-time dark horse Oracle emerged victorious in a federally mandated contest to acquire TikTok. Except, it turns out, Oracle isn’t actually acquiring TikTok at all—and Oracle and TikTok’s current parent company, ByteDance, disagree on who is going to be in charge.

If you’re confused, you’re in good company. Here’s our attempt to lay out everything we know about TikTok, Oracle, and their mysterious deal so far.

What is TikTok? Who owns it?

TikTok is an extremely popular short-form video app used worldwide. The app appeared in its current incarnation after its parent company, Beijing-based ByteDance, acquired US startup Musical.ly in 2017 and integrated it with its existing TikTok product under the TikTok name.

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#bans, #china, #explainers, #policy, #tiktok, #trade-war, #trump, #trump-administration, #wechat, #white-house

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EU seeks new powers to penalize tech giants

Belgien, Brussel, Europaische Kommission, Berlaymont-Gebaude, Europa-Flaggen

Enlarge / Belgien, Brussel, Europaische Kommission, Berlaymont-Gebaude, Europa-Flaggen (credit: Westend61 | Getty Images)

The EU wants to arm itself with new powers to take on big technology companies, including the ability to force them to break up or sell some of their European operations if their market dominance is deemed to threaten the interests of customers and smaller rivals.

EU commissioner Thierry Breton told the Financial Times that the proposed remedies, which he said would only be used in extreme circumstances, also include the ability to exclude large tech groups from the single market altogether.

In addition, Brussels is considering a rating system that would allow the public and stakeholders to assess companies’ behavior in areas such as tax compliance and the speed with which they take down illegal content.

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#apple, #eu, #facebook, #google, #policy, #social-media

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ByteDance says it will own a majority of TikTok. Oracle says ByteDance will own 0%. WTF is this deal?

You know a deal is signed and going to close when the parties keep fact checking each other and no one can agree on what the deal actually says.

We’ve been following the TikTok / Oracle deal for sometime here on TechCrunch, and over the weekend, it seemed like we finally got to the finish line of one of the strangest M&A processes we’ve seen. But the last 48 hours have made everything so confused, I am not sure we even know what the deal is despite it being approved.

Overnight, my colleague Rita Liao put together a nice fact check on what we know now about the TikTok deal, based on ByteDance’s official statements. The key is that “China’s ByteDance confirms it will retain an 80% stake in TikTok after selling a total of 20% to Oracle, its ‘trusted technology partner,’ and Walmart, its ‘commercial partner.’”

That’s been our assumption, that Oracle is taking 12.5% in TikTok Global, and Walmart will take 7.5%. The deal terms would value TikTok at about $60 billion by some estimates.

That’s a simple story, but apparently not the full one, because now there is another wrinkle happening here.

In a new statement attributed to its executive vice president Ken Glueck, Oracle said that “Upon creation of TikTok Global, Oracle/Walmart will make their investment and the TikTok Global shares will be distributed to their owners, Americans will be the majority and ByteDance will have no ownership in TikTok Global.”

President Donald Trump has spoken out about the deal himself in places like CNBC, arguing that TikTok must be completely controlled by Americans.

From what I can glean (and to be honest, given the shifting landscape and war of words, it’s not clear that even the participants know what is going on), “TikTok” the app is going to be housed in a new company called TikTok Global, that will be located outside of China proper. There appears to be no other “TikTok” entity. ByteDance will continue to own its China-centric apps Douyin (which also is a short video social service targeting the Chinese market), Toutiao, and others and obviously keep running them.

So how can a company simultaneously own a majority of the company and 0% of a company? TechCrunch is investigating, or at least, combing through the rubble of this deal and trying to make heads or tails of it.

#apps, #bytedance, #douyin, #government, #oracle, #policy, #tiktok, #toutiao

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Trump administration’s WeChat ban is blocked by U.S. district court

A few days ago, the U.S. Commerce Department published a series of rules that aimed to block the downloading of TikTok and WeChat by American users, following an executive order signed by President Trump back in August. TikTok got a last minute reprieve yesterday following its signing of an investment and cloud services deal with Oracle and Walmart, which delayed the implementation of its download ban at least for a week. However, WeChat was effectively going to be shut down today, with a ban on downloads and a ban on any services that powered the service.

Now, there is a new wrinkle in the battle over the future of the social app, which is widely used in Chinese-speaking communities and is owned by China-based Tencent. A district court judge in San Francisco has temporarily stayed the nationwide ban, following a lawsuit of WeChat users arguing that the ban undermined the free speech rights of American citizens. That court case, U.S. WeChat Users Alliance v. Trump, will be allowed to proceed.

In her short opinion published yesterday, United States magistrate judge Laurel Beeler, argued that the government’s case showed weaknesses on First Amendment grounds, its authority to act within existing legislation to allow the government to control industry, and its overall vagueness compared to the damage a ban would likely have on the Chinese-speaking community in the United States.

From her opinion:

Certainly the government’s overarching national-security interest is significant. But on this record — while the government has established that China’s activities raise significant national- security concerns — it has put in scant little evidence that its effective ban of WeChat for all U.S. users addresses those concerns. And, as the plaintiffs point out, there are obvious alternatives to a complete ban, such as barring WeChat from government devices, as Australia has done, or taking other steps to address data security.

Given the likelihood of a lawsuit proceeding and the immediate damage a ban would have if implemented, the judge initiated a nationwide injunction against implementation of the Commerce Department’s order to ban the app.

Commerce will have a chance to respond to this development, and whether it chooses to edit its order, pursue other avenues through the courts, or just rescind the order entirely, we will see in the coming days.

#apps, #government, #oracle, #policy, #tencent-holdings, #tiktok, #walmart, #wechat

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Court blocks Trump’s WeChat ban from taking effect today

There both is and is not a ban in effect on WeChat.

Enlarge / There both is and is not a ban in effect on WeChat. (credit: Budrul Chukrut | SOPA Images | LightRocket | Getty Images)

A federal judge in California put a temporary halt on the White House’s efforts to ban WeChat inside the United States, preventing that ban from going into effect at midnight tonight.

“The plaintiffs have shown serious questions going to the merits of their First Amendment Claim,” US Magistrate Judge Laurel Beeler wrote in her ruling (PDF) early this morning.

The ruling came in response to a lawsuit filed by a group of WeChat users inside the US. The group, organized as the US WeChat Users Alliance, argued in their complaint that the ban violated their First and Fifth Amendment rights as well as the Religious Freedom Restoration Act and the Administrative Procedures Act. The group also argues that the law cited in the executive order banning WeChat does not in fact give President Donald Trump the authority claimed in the order.

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#bytedance, #courts, #policy, #rulings, #tencent, #tiktok, #trump, #wechat, #white-house

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Gangster capitalism and the American theft of Chinese innovation

It used to be “easy” to tell the American and Chinese economies apart. One was innovative, one made clones. One was a free market while the other demanded payments to a political party and its leadership, a corrupt wealth generating scam that by some estimates has netted top leaders billions of dollars. One kept the talent borders porous acting as a magnet for the world’s top brains while the other interviewed you in a backroom at the airport before imprisoning you on sedition charges (okay, that might have been both).

The comparison was always facile yes, but it was easy and at least directionally accurate if failing on the specifics.

Now though, the country that exported exploding batteries is pioneering quantum computing, while the country that pioneered the internet now builds planes that fall out of the sky (and good news, we’ve identified even more planes that might fall out of the sky at an airport near you!)

TikTok’s success is many things, but it is quite frankly just an embarrassment for the United States. There are thousands of entrepreneurs and hundreds of venture capitalists swarming Silicon Valley and the other American innovation hubs looking for the next great social app or building it themselves. But the power law of user growth and investor returns happens to reside in Haidian, Beijing. ByteDance through its local apps in China and overseas apps like TikTok is the consumer investor return of the past decade (there’s a reason why all the IPOs this seasons are enterprise SaaS).

It’s a win that you can’t chalk up just to industrial policy. Unlike in semiconductors or other capital-intensive industries where Beijing can offer billions in incentives to spur development, ByteDance builds apps. It distributes them on app stores across the world. It has exactly the same tools available to it that every entrepreneur with an Apple Developer account has access to. There is no Made in China 2025 plan to build and popularize a consumer app like TikTok (you literally can’t plan for consumer success like that). Instead, it’s a well-executed product that’s addictive to hundreds of millions of people.

So much as China protected its industry from overseas competitors like Google and Amazon through market-entry barriers, America is now protecting its entrenched incumbents from overseas competitors like TikTok. We’re demanding joint ventures and local cloud data sovereignty just as the Communist Party has demanded for years.

Hell, we’re apparently demanding a $5 billion tax payment from ByteDance, which the president says will fund patriotic education for youth. The president says a lot of things of course, but at least the $5 billion price point has been confirmed by Oracle in its press release over night (what the tax revenue will actually be used for is anyone’s guess). If you followed the recent Hong Kong protests for a long time, you will remember that patriotic youth education was some of the original tinder for those demonstrations back in 2012. What comes around, goes around, I guess.

Development economists like to talk about “catch-up” strategies, tactics that countries can take to avoid the middle income trap and cut the gap between the West and the rest. But what we need now are developed economists to explain America’s “fall behind” strategy. Because we are falling behind, in pretty much everything.

As the TikTok process and the earlier Huawei imbroglio show, America is no longer on the leading edge of technology in many key strategic markets. Mainland Chinese companies are globally winning in areas as diverse as 5G and social networks, and without direct government intervention to kill that innovation, American and European tech purveyors would have lost those markets entirely (and even with those interventions, they may still lose them). In Taiwan, TSMC has come from behind Intel to take a year or two lead in the fabrication of the most advanced semiconductors.

I mean, we can’t even pilfer Chinese history and mythology and turn it into a decent god damn film these days.

And the fall-behind strategy continues. Immigration restrictions from an administration hell-bent on destroying the single greatest source of American innovation, coupled with the COVID-19 pandemic, have fused into the largest single drop in international student migration in American history.

Why does that matter? In the U.S. according to relatively recent data, 81% of electrical engineering grad students are international, 79% in computer science are, and in most engineering and technical fields, the number hovers above a majority.

It’s great to believe the fantasy that if only these international grad students would stay home, then “real” Americans would somehow take these slots. But what’s true of the strawberry pickers and food service workers is also true for EE grad students: proverbial “Americans” don’t want these jobs. They are hard jobs, thankless jobs, and require a ridiculous tenacity that American workers and students by and large don’t have. These industries have huge contingents of foreign workers precisely because no one domestic wants to take these roles.

So goes the talent, so goes the innovation. Without this wellspring of brainpower lodging itself in America’s top innovation hubs, where exactly do we think it will go? That former aspiring Stanford or MIT computer scientist with ideas in his or her brain isn’t just going to sit by the window gazing at the horizon waiting for the moment when they can enter the gilded halls of the U.S. of A. It’s the internet era, and they are just going to get started on their dreams wherever they are, using whatever tools and resources they have available to them.

All you have to do is look at the recent YC batches and realize that the future cohorts of great startups are going to increasingly come from outside the continental 48. Dozens of smart, brilliant entrepreneurs aren’t even trying to migrate, instead rightfully seeing their home markets as more open to innovation and technological progress than the vaunted superpower. The frontier is closed here, and it has moved elsewhere.

So what are we left with here in the U.S. and increasingly Europe? A narrow-minded policy of blocking external tech innovation to ensure that our sclerotic and entrenched incumbents don’t have to compete with the best in the world. If that isn’t a recipe for economic disaster, I don’t know what is.

But hey: at least the youth will be patriotic.

#apps, #asia, #bytedance, #government, #policy, #tiktok

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The TikTok deal solves quite literally nothing

Well… that was pointless.

After debasing the idea of free commerce in the U.S in the name of a misplaced security concern, stringing along several multi-billion dollar companies that embarrassed themselves in the interest of naked greed, and demanding that the U.S. government get a cut of the profits, the TikTok saga we’ve been watching the past few weeks finally appears to be over.

A flurry of announcement late Saturday night indicate that the TikTok deal was actually a politically-oriented shakedown to boost the cloud infrastructure business of key supporters of the President of the United States.

Oracle, whose cloud infrastructure services run a laughable fourth to AWS, Alphabet*, and Microsoft, will be taking a 20 percent stake in TikTok alongside partner Walmart in what will be an investment round before TikTok Global (as the new entity will be called) goes public on an American stock exchange.

According to a statement from TikTok, Oracle will become TikTok’s “trusted technology partner” and will be responsible for hosting all U.S. user data and securing associated computer systems to ensure U.S. national security requirements are fully satisfied. “We are currently working with Walmart on a commercial partnership as well,” according to the statement from TikTok.

Meanwhile, Oracle indicated that all the concerns from the White House, U.S. Treasury, and Congress over TikTok had nothing to do with the service’s selection of Oracle as its cloud provider. In its statement, Oracle said that “This technical decision by TikTok was heavily influenced by Zoom’s recent success in moving a large portion of its video conferencing capacity to the Oracle Public Cloud.”

Here’s how CNBC reporter Alex Sherman has the ownership structure breaking down, per “a person familiar with the matter. Oracle gets 12.5%, Walmart gets 7.5% and ByteDance gets the remaining 80%. The Trump administration is claiming that US investors will own 53% of TikTok because ByteDance (TikTok’s parent) is backed by venture capital investors that hold a 40% stake in the parent company.

 

The deal benefits everyone except U.S. consumers and people who have actual security concerns about TikTok’s algorithms and the ways they can be used to influence opinion in the U.S.

TikTok’s parent company ByteDance gets to maintain ownership of the U.S. entity, Oracle gets a huge new cloud customer to boost its ailing business, Walmart gets access to teens to sell stuff, and U.S. customer data is no safer (it’s just now in the hands of U.S. predators instead of foreign ones).

To be clear, data privacy and security is a major concern, but it’s not one that’s a concern when it comes to TikTok necessarily (and besides, the Chinese government has likely already acquired whatever data they want to on U.S. customers).

For many observers, the real concern with TikTok was that the company’s Chinese owners may be pressured by Beijing to manipulate its algorithm to promote or suppress content. Companies in China — including its internet giants — are required to follow the country’s intelligence and cloud security law mandating complete adherence with all government orders for data.

The Commerce Department in its statement said that “In light of recent positive developments, Secretary of Commerce Wilbur Ross, at the direction of President Trump, will delay the prohibition of identified transactions pursuant to Executive Order 13942, related to the TikTok mobile application that would have been effective on Sunday, September 20, 2020, until September 27, 2020 at 11:59 p.m.” So that’s a week reprieve.

So all this sound and fury … for what? The best investment return in all of these shenanigans is almost certainly Oracle co-CEO Safra Catz’ investment into Trump, who in addition to being a heavy donor to the Trump administration, also joined the presidential transition committee back in 2016. Thank god the U.S. saved TikTok from the crony capitalism of China. Let’s just hope they enjoy the crony capitalism of Washington DC.

*An earlier version of this article referred to AWS, Amazon and Microsoft. AWS and Amazon are the same company. I was typing fast. I’ve corrected the error.

#asia, #bytedance, #donald-trump, #government, #oracle, #policy, #safra-catz, #tc, #tiktok

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Trump approves Oracle, TikTok deal “in concept”

It's official... kind of.

Enlarge / It’s official… kind of. (credit: Chesnot | Getty Images)

President Donald Trump has reportedly granted his personal approval of Oracle’s proposal to invest in TikTok, moving the entire saga one step closer to an end.

The president told reporters this afternoon he approved the deal “in concept,” according to Bloomberg News.

“I have given the deal my blessing,” Trump said. “I approved the deal in concept.”

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#deals, #mergers-and-acquisitions, #oracle, #policy, #politics, #tiktok, #walmart

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Telegram messages are a focus in newly uncovered hack campaign from Iran

Rampant Kitty has been targeting Telegram like a feline to twine.

Enlarge / Rampant Kitty has been targeting Telegram like a feline to twine. (credit: Check Point)

Researchers said they have uncovered an ongoing surveillance campaign that for years has been stealing a wide range of data on Windows and Android devices used by Iranian expatriates and dissidents.

The campaign, which security firm Check Point has named Rampant Kitten, comprises two main components, one for Windows and the other for Android. Rampant Kitten’s objective is to steal Telegram messages, passwords, and two-factor authentication codes sent by SMS and then also take screenshots and record sounds within earshot of an infected phone, the researchers said in a post published on Friday.

The Windows infostealer is installed through a Microsoft Office document with a title that roughly translates to “The Regime Fears the Spread of the Revolutionary Cannons.docx.” Once opened, it urges readers to enable macros. If a user complies, a malicious macro downloads and installs the malware. The Android infostealer is installed through an app that masquerades as a service to help Persian-language speakers in Sweden get their driver’s license.

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#biz-it, #policy

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$100,000 in bribes helped fraudulent Amazon sellers earn $100 million, DOJ says

A pile of Amazon boxes in front of the door of a house.

Enlarge / Amazon boxes. (credit: Getty Images | Julie Clopper)

Six people were indicted on allegations of paying over $100,000 in bribes to Amazon employees and contractors as part of a scheme to give third-party sellers unfair advantages on the Amazon marketplace. Among other things, the indictment says that Amazon workers who accepted bribes reinstated sellers whose accounts had been suspended for offering dangerous products, and these workers suspended the seller accounts of fraudulent sellers’ competitors.

The US Department of Justice today announced the indictment handed down by a grand jury in the Western District of Washington. The “defendants paid bribes to at least ten different Amazon employees and contractors,” the DOJ said. In one case, a 31-year-old defendant named Nishad Kunju “accepted bribes as a seller-support associate in Hyderabad, India, before becoming an outside consultant who recruited and paid bribes to his former colleagues,” the DOJ said.

In exchange for bribes, Amazon workers “baselessly and fraudulently conferred tens of millions of dollars of competitive benefits upon hundreds of [third-party] seller accounts that the Defendants purported to represent,” the indictment said. The DOJ said that workers “helped reinstate products and merchant accounts that Amazon had suspended or blocked entirely from doing business on the Amazon Marketplace,” and that “the fraudulently reinstated products included dietary supplements that had been suspended because of customer-safety complaints, household electronics that had been flagged as flammable, consumer goods that had been flagged for intellectual-property violations, and other goods.” These fraudulently reinstated seller accounts included ones Amazon had “suspended for manipulating product reviews to deceive consumers, making improper contact with consumers, and other violations of Amazon’s seller policies and codes of conduct,” the DOJ said.

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#amazon, #policy

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Comcast shut off Internet to hundreds, saying they were illegally connected

A Comcast/NBC logo.

(credit: Comcast)

Comcast says that a broadband reseller illegally sold Comcast Internet service in residential buildings in the Denver area and has terminated the connections to those buildings.

As reported by Denver7 this week, the shutoff affected hundreds of people who live in buildings serviced by AlphaWiFi, “which installs and services Internet in approximately 90 apartment buildings across Denver.” The shutoff came as a surprise to residents, including Kaley Warren, who has been working at home during the pandemic:

“It is my entire lifeline,” said Warren, who said that without warning last Friday, her Internet service disappeared. “I felt lost. It was truly the first time during the pandemic that I was had the feeling of ‘What am I supposed to do?'”

When contacted by Ars, a Comcast spokesperson said that “AlphaWiFi is under a standard commercial agreement which expressly prohibits the resale of Comcast services.” Comcast did not answer questions about how many people were affected and when they will get service restored, but it did provide us with the same statement it previously gave to Denver7, which says:

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#biz-it, #comcast, #policy

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