Feb 7, 2019

Axios Login

Situational awareness: Germany's competition regulator took steps towards banning Facebook from collecting certain types of consumer data without users' consent within the country, Axios' David McCabe reports. Facebook said it will fight the move.

1 big thing: Big Tech's civil wars

Illustration: Rebecca Zisser/Axios

For a few moments last week it might have looked like the tech industry's very own World War III was breaking out, as Apple briefly kicked iPhone users who work at Facebook and Google off much of their own software as part of a privacy dispute.

Hostilities ended as quickly as they began — but the flareup reminded the world of just how completely, and complexly, the technologies and businesses of these giants are connected.

Why it matters: The most valuable companies in the world — Apple, Google, Facebook, Amazon — mostly stayed in their own lanes as they grew into giants. But now they’re increasingly clashing as their growing ambitions bump into one another.

Driving the news: Apple was furious when it learned Facebook was abusing rules governing internal apps and quickly kicked the company out of the program, breaking Facebook's ability to test new apps and use internal iPhone apps.

  • When it became clear Google was doing the same thing, Apple was in a bind. Facebook and Apple have few business ties. But Apple gets billions of dollars per year from Google for making it the default search engine on iPhones and Mac — an arrangement that Apple CEO Tim Cook has had to defend while promoting the company's strong pro-privacy stance.
  • In the end, Apple briefly banned Google, too — then quickly lifted both sentences.

The big picture: Once upon a time, Amazon was largely a retail store, Apple sold hardware, Google was a search engine, and Facebook was an online social network.

  • None of the companies are confined by those definitions any more. They spill over into one another's territory even as they depend on each other to greater and lesser degrees.
  • Facebook and Amazon, for example, both distribute their consumer apps through the Google Play and Apple app stores.
  • Google, Facebook and Apple all rely to some degree on their products being sold through Amazon, despite each also having tensions with the retail giant.

Google and Amazon had vastly different origins but are increasingly rivals.

  • They compete in cloud computing, advertising and other areas.
  • The two companies are now warring in the automated assistant/smart speaker arena.

Amazon and Apple have fought but are finding more common ground.

Google and Facebook together control the lion's share of the online ad business.

  • As Facebook faces scandal after privacy scandal, Google has tried, with some success, to keep its head down, although critics point out it has even more data on consumers than Facebook.

Facebook and Amazon have the least interplay among the tech giants.

The bottom line: Tension is likely to outweigh cooperation, especially as each of the 4 companies seeks to convince regulators that the others are the ones in need of reining in.

  • The interdependencies won't vanish, though — so expect more skirmishes like the one Apple fought with Google and Facebook last week.

Read more of the full story for more on the companies' relationships and history.

2. Twitter's earnings report lists daily users for first time

Twitter disclosed its daily active user (DAU) count for the first time this morning. (The company previously reported only percent growth in users.)

By the numbers: The platform reported 126 million DAUs — or 60 million fewer than Snapchat, and less than a tenth of Facebook's flagship app, Axios' Kia Kokalitcheva reports.

Yes, but: Twitter's 2018 Q4 revenue and earnings reported this morning beat analyst expectations, showing $3 billion in annual revenue.

Read more of Kia's story here.

Meanwhile: T-Mobile also reports a total revenue of $43.3 billion in 2018. Reuters says Q4 beat Wall Street expectations mainly due to adding "more than expected phone subscribers who pay a monthly bill."

  • T-Mobile said it expects to add 2.6 million to 3.6 million subscribers in FY 2019, not including the possible merger with Sprint, per Reuters.
3. Bail app Appolition seeks acquirer
Appolition's Kortney Ziegler (l) and Tiffany Mikell (r). Photo: Diane Poindexter for Appolition

Appolition, an app to help crowdsource bail for those who can't afford it, is looking for someone to acquire the product, according to co-founder Kortney Ziegler.

Why it matters: Many people are stuck in jail pending trials because they can't afford cash bail or a bail bond. Appolition and others are trying to blend technology and crowdsourcing to help address the issue.

What's new: Ziegler, who announced his desire in a Tweet last week, told Axios he believes the app can help more people if it were under the auspices of a larger organization. Appolition currently is a mix of volunteers and part-time staff, when what's really needed is at least 3 people full time, he said.

"We have capped onboarding users to manage a few thousand so that we can provide the best experience from our small team," Ziegler said.

Details: Appolition, which keeps 15% of pledges to fund itself, is set up as a public-interest B corporation, so Ziegler is looking for a buyer that aligns with the company's mission.

"I know that with the right support in the form of dedicated engineering, product and marketing resources, Appolition could become the ActBlue or GoFundMe for fighting mass incarceration," he said.
4. Sonos weighs supply chains amid trade war

Patrick Spence. Photo: Sonos

Sonos is the latest hardware maker to say it is looking at ways to diversify its manufacturing amid the ongoing trade war with China.


  • "We are actively evaluating ways to increase the flexibility of our manufacturing footprint and supply chain, including sourcing and producing products outside of China," Sonos CEO Patrick Spence told my Axios colleague Courtenay Brown.
  • Spence said it could take "up to one year" to shift manufacturing and its supply chain out of China to avoid feeling the effect from a potential escalation of tariffs.

The big picture: GoPro previously said it was looking to move manufacturing of U.S.-bound products outside of China by this summer, while Nokia and others have said they are eyeing similar moves.

Go deeper: Courtenay has more from her interview here. Sign up for Axios Markets here.

5. Take Note

On Tap

  • Earnings reports include IAC.

Trading Places

  • Longtime Facebook PR chief Caryn Marooney is leaving the company, as first reported by Recode.
  • Richard Kerris, who has served in developer relations roles at Apple, Palm, Nokia and Amazon, among others, is joining Nvidia to oversee its developer relations, Axios has learned.
  • Andrew Ng's Landing.ai has hired Gopi Prashanth as VP of engineering. Prashanth previously led the AI and data science teams that helped Amazon launch its Amazon Go cashier-less convenience stores.


  • Instacart agreed to make changes to how it pays its workers amid publicity over how it sometimes paid workers less when they received tips from a customer. (TechCrunch)
  • A detailed look at the shadowy world of those who try to get iCloud passwords in order to unlock stolen iPhones. (Motherboard)
6. After you Login

A Texas zoo has an unusual offer for Valentine's Day. You can send in the name of your ex and the zoo will name a cockroach after them and then feed it to a meerkat. As a bonus, you can watch the whole thing on Facebook Live.

"This is a fun way to get the community involved in our daily enrichment activities," El Paso Zoo event coordinator Sarah Borrego told CBS News.