May 20, 2020

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Today's Login is 1,295 words, a 5-minute read.

1 big thing: Big Tech's aid to small business comes with a catch

Illustration: Aïda Amer/Axios

Big Tech efforts to help small businesses hurting from the pandemic could end up separating those businesses from their customers and ultimately hand even more power over to the tech giants.

Why it matters: Lockdowns imposed to prevent the spread of the coronavirus have devastated America's small businesses, and the fate of any economic recovery following the crisis will hang on whether they can be revived.

Driving the news:

  • Facebook's latest marketplace effort announced Tuesday, Facebook Shops, aims to create an e-commerce platform for businesses within Facebook's social media environments.
  • DoorDash and other delivery services bill themselves as a way to help struggling restaurants, but critics say they are charging excessive fees, leaving precious little for already cash-strapped restaurants. Some efforts, like Help Main Street, have emerged to help restaurants get more business directly.
  • Google and Yelp have offered help to small business, but mainly in the form of ad credits. Yelp has seen a strong drop-off in business as restaurants and shops shut their doors temporarily. Facebook has distributed ad credits as well, but it has also made $100 million in cash available to 30,000 small businesses.

Between the lines: Tech companies have challenges of their own, and their actions are guided at least as much by their own business-preservation imperatives as by altruism.

  • Many efforts to bring business into Big Tech companies' platform ecosystems start out free or inexpensive, but costs often rise as the businesses become dependent on the platforms.

The Amazon effect: Amazon has been a thorn in the side of many small businesses for well more than a decade. Some learned how to compete online, while others went after the portion of sales that weren't going online.

  • The coronavirus changed the rules again, forcing much of the business that had remained the provenance of local shops to also move online, at least temporarily.
  • Amazon itself offers a way for small businesses to sell through its marketplace.
  • However, that has proven to be a tricky proposition: Regulators are investigating whether Amazon is using sales data from third-party sellers to develop its own brands and products.

What they're saying:

  • Facebook CEO Mark Zuckerberg told CBS Evening News, "A lot of small businesses are moving more of their business online, and we want to make it easier for them," contending Facebook Shops "will be a very fast experience for people to discover their products and be able to buy things directly."
  • Republican Rep. Ken Buck, a member of the House Judiciary antitrust subcommittee, said at an event Tuesday that Washington should be "looking at antitrust laws" to "make sure that the large businesses don’t use their their platforms and their position to disincentivize the kind of innovation that comes from small businesses."
  • Mike Blumenthal, director of local research for GatherUp, an online customer review engine, warned of long-term consequences of relying on Google or Facebook. "Any time there is a monopoly situation, if you are little and they are big, it can get painful," he said.

Our thought bubble: One need only look at the news industry to see the potential downsides of businesses becoming too reliant on tech companies.

2. Scoop: Google lands a cloud deal with DOD

Photo: Google

Google Cloud has landed a deal to help the Defense Department detect, protect against, and respond to cyber threats, Axios has learned. The deal, with the Defense Innovation Unit (DIU), is in the "seven figures," Google said, declining to be more specific.

Why it matters: It's a far cry from the controversial $10 billion JEDI deal, but Google hopes the win will lead to a broader deal down the road, as the Pentagon seeks to securely work with multiple public cloud providers.

What they're saying: "Multi-cloud is the future," Google Cloud VP of public sector Mike Daniels told Axios, noting that most businesses use a mix of clouds, including Google, Amazon's AWS and Microsoft Azure. "This is now coming to the federal government as well."

For DIU, Google is helping the agency move to what's known as a "zero trust" environment in which devices are not allocated network resources based on their physical location, but rather granted access based on other factors, such as identity and behavior.

The big picture: The deal comes as Amazon contests the Pentagon's award of the giant JEDI contract to Microsoft last year.

  • Google dropped out of vying for that wide-ranging contract before bidding began in earnest, but has been stepping up its public-sector effort, for which it aims to triple staffing over the next few years.
3. Google drops future AI oil extraction projects

Illustration: Aïda Amer/Axios

Speaking of Google, the company said Tuesday that it will no longer develop new artificial intelligence tools to help oil and gas companies extract crude, Axios' Orion Rummler reports.

Why it matters: The search giant is breaking away from Microsoft and Amazon, which have also developed AI in recent years to expedite oil production and make services more efficient for companies like Chevron and GE Oil & Gas. Google's 2018 contract with Total was in place as of February, a Total spokesperson confirmed to Axios at the time.

What they're saying: Google Cloud "will not, for instance, build custom AI/ML algorithms to facilitate upstream extraction in the oil and gas industry," a Google spokesperson told Axios on Tuesday.

The big picture: The company, along with other tech giants, has been under pressure from environmental activists and its own employees to stop this work.

  • Yes, but: The company will honor its current contracts. The spokesperson declined to say if Google's work with Total would continue, noting that customer contracts are confidential. Total did not respond to a request for comment.
  • Google's 2019 revenue from oil and gas came out to roughly $65 million, which accounted for less than 1% of the company's total revenue in that period, the spokesperson said.
  • On renewable energy, Google says it is applying algorithms from its own data centers to improve efficiency in buildings.

Of note: Google's announcement dropped alongside a Greenpeace report released Tuesday that detailed cloud computing and AI contracts between Google, Microsoft and Amazon.

Between the lines: Microsoft and Amazon have said that working with the oil industry isn't at odds with their climate commitments. In some cases, they're working with Big Oil on clean energy plans — like BP giving AWS renewable power.

What we're watching, via Axios' Amy Harder: It's too soon to tell whether Google proves to be an outlier or an early indicator of a trend, but one thing is clear now: Environmentalists will be ramping up the pressure on other tech giants and companies in other sectors to sever ties with oil and gas firms now that they've had success with one.

Go deeper: Climate activists target Big Tech over fossil fuel work

4. Joe Rogan to move podcast exclusively to Spotify

Joe Rogan. Photo: Douglas P. DeFelice/Getty Images

Joe Rogan announced Tuesday that he's moving his popular podcast, "The Joe Rogan Experience," exclusively to Spotify this year in what the company says is a multi-year deal.

Why it matters: The move could be a watershed moment for the medium, Axios' Sara Fischer and Fadel Allassan report.

  • Most Americans subscribe to only one audio subscription service, according to Nielsen. But that could soon change if more podcasts begin to be offered exclusively on certain services.

Context: "The Joe Rogan Experience," which features hours-long conversations between Rogan and a wide variety of celebrities, comedians, subject-matter experts, and more, is currently the No. 2 most popular show on Apple Podcasts.

  • Launched in 2009, the podcast has built one of the biggest and most loyal fan bases in the country and is popular around the world.

Details: The podcast will be available on Spotify on Sept. 1 and become exclusive to the platform later in the year. Rogan said it will remain free. There will also be video episodes available from within Spotify's app.

5. Take Note

On Tap

Trading Places

  • Game engine maker Unity Technologies has hired veteran HR executive Scott Pitasky as its chief people officer. Pitasky, who previously worked at Microsoft and Starbucks, was most recently VP of human resources for Amazon's consumer business.


6. After you Login

Well, it's certainly not the easiest way to enter text, but check out this keyboard which works by inserting a different floppy disk for each letter into a Raspberry Pi computer.