Aug 27, 2020

Axios Login

By Ina Fried
Ina Fried

RNC week: Join me tomorrow at 12:30pm ET for a live, virtual event on the future of transportation, featuring former Transportation Secretary Ray LaHood and Chicago Department of Transportation commissioner Gia Biagi.

Situational awareness: TikTok CEO Kevin Mayer has resigned, he announced late Wednesday, telling colleagues in a letter the "political environment has sharply changed," casting uncertainty on the "global role I signed up for." TikTok's U.S. operations either being banned or sold to an American company by next month meant Mayer was facing the prospect of a diminished role or a non-existent one.

Today's Login is 1,323 words, a 5-minute read.

1 big thing: Tech's deepening split over ads and privacy

Illustration: Eniola Odetunde/Axios

A new fight between Facebook and Apple over the mechanics of ad tech is surfacing an industry divide over user privacy and spotlighting longstanding dilemmas about the tracking and use of personal information online, Axios' Kyle Daly reports.

Why it matters: Privacy advocates have been sounding alarms for years about tech firms' expansive, sometimes inescapable data harvesting without making much headway in the U.S. But the game could change if major industry players start taking opposite sides.

What's happening: Facebook warned advertisers Wednesday that a coming change to Apple's iOS could devastate revenue for ads that sends users straight to the App Store to install an app — an approach that's used widely by developers including mobile game makers.

  • Apple has pitched the change, aimed at giving users clearer choices over who is allowed to track them across different apps, as a bid to better protect iPhone users' privacy.

Meanwhile, Palantir CEO Alex Karp pilloried Big Tech in a letter to investors included in his company's Tuesday filing to go public.

  • Writing that Palantir shares "fewer and fewer of the technology sector's values and commitments," Karp suggested that collecting data to target advertising is morally and ethically inferior to Palantir's use of data to support U.S. military and government functions.

Reality check: Self-interest is at work here on all sides.

  • Apple, which gets only a tiny fraction of its revenue from ads, has for some time made privacy a key part of its pitch to consumers (even though it does know plenty about its users). With every major tech company now under greater regulatory scrutiny over alleged monopolistic practices, Apple wants to play to its strength.
  • Facebook is looking to make itself the friend of smaller developers, just as it's doing with small businesses in another fight with Apple over App Store commissions.
  • Palantir competes with firms its CEO implicitly criticized, like Google and Amazon, for the government contracts that are the core of its business.

Our thought bubble: Silicon Valley's businesses are all so intertwined and interdependent that it's hard to know what's really at stake in this kind of conflict and how serious the parties are.

  • Case in point: Palantir chairman Peter Thiel is a longstanding member of Facebook's board.
  • Yes, but: Companies' motivations don't matter if the battles bring the issue to center stage.

The big picture: Both these conflicts — Facebook vs. Apple and Palantir vs. the rest of the industry — point to the dilemma underlying Silicon Valley's free, ad-supported business model.

  • People love not paying for services they depend on, like search and social networking.
  • But they're often uncomfortable when they realize how much data about them is being tracked and stored.
  • Rarely do they act on that discomfort, however.

The catch: While users and policymakers can make changes at the edges, it's not clear user actions or government remedies can fundamentally change the business model at the root of the problem.

  • Policymakers looking to put tighter controls on privacy practices have come up with answers like Europe's GDPR or California's CCPA. Those largely amount to requiring tech companies to be more transparent about data collection and to highlight tools they mostly already offered that let users download and delete their data.
  • Former presidential candidate Andrew Yang proposed a "data dividend" that would place a dollar value on people's data and return it to them through a tax on tech companies. Such ideas reach farther than existing regulations but remain speculative and fraught with practical questions.
  • More narrowly targeted legislation in various forms remains stalled in Congress.

What to watch: Twitter is mulling a paid subscription option, but it's unclear how it will fare in testing and is unlikely to replace ads.

  • Facebook and Google have both done so fantastically well with their existing models that it's hard to imagine them taking this road. 
2. Facebook criticized for slow action on militia

An armed civilian stands in the streets of Kenosha during the third day of protests over a police shooting. Photo: Tayfun Coskun/Anadolu Agency via Getty Images

After initially taking no action on militia pages organizing an armed counter-protest in Kenosha, Wisconsin, Facebook said Wednesday that the pages violate a just-enacted policy that imposes stricter limits on QAnon, militia and other extremist groups.

Why it matters: Facebook's handling of the issue raises fresh questions about its ability and willingness to enforce policies in time to prevent violence rather than after the fact.

Driving the news:

  • Even before Tuesday’s deadly shooting in Kenosha, Facebook received complaints about a group called Kenosha Guard, as first reported by The Verge Wednesday. The group encouraged "a call to arms," with comments urging supporters to come to a counter-protest “locked and loaded.” Their event was in reaction to widespread protests in the city after police shot Jacob Blake.
  • Facebook initially took no action on complaints about the page and specific comments, but then took down the group Wednesday, saying a more thorough review found it had violated the new policy
  • As is standard after a mass shooting, Facebook also took down pages belonging to the accused shooter.

Between the lines: The issue is complicated by a number of factors, including the fact that the militia policy was only put in place last week.

What they're saying: Facebook notes that the small team focused on this issue did not review the initial complaints about the group, and that it has yet to find evidence the shooter saw or was motivated by the Facebook group's posting.

  • "At this time, we have not found evidence on Facebook that suggests the shooter followed the Kenosha Guard Page or that he was invited on the Event Page they organized," the company said in a statement. "However, the Kenosha Guard Page and their Event Page violated our new policy addressing militia organizations and have been removed on that basis."

Color of Change, meanwhile, blasted Facebook in a statement, saying that far-right militia and white nationalist groups continue to organize, communicate and recruit new members on the social network.

  • "We have long warned that Facebook's cultivation of white supremacy and hate groups on its platform is a deadly threat to Black Americans and our allies," Color of Change president Rashad Robinson said.
3. Navy taps Google machine learning for repairs

The U.S. Navy plans to tap Google's cloud and machine learning technology, combined with drone imagery, to modernize its process for determining when vessels and facilities are in need of repair.

Why it matters: The move comes amid internal and external scrutiny over the ties between Big Tech and the U.S. military. Google ended its work on a previous Defense Department deal — Project Maven — amid pressure from employees and did not put in a bid for JEDI, a huge cloud computing contract covering much of the Pentagon's needs.

Details:

  • Google is working with Simple Technology Solutions, a Google Cloud partner that handles federal contracts.
  • In a press release, Google notes that the Navy "currently spends billions per year on maintaining and repairing its fleet of vessels and other platforms like aircraft and facilities."
  • The goal is to transform a largely manual, labor-intensive process into one where computers help identify corrosion and other causes for repair.
4. Salesforce to cut 1,000 jobs

Salesforce announced on Wednesday it is cutting roughly 1,000 jobs, though it said it continues to hire for some growth areas.

Why it matters: The move comes just a day after the company announced blowout earnings and raised its guidance, sending shares up 26% on Wednesday. Salesforce had also pledged in March not to lay off employees for at least 90 days, but that was five months ago.

Between the lines: If even tech companies that are doing well are pruning their ranks, these cuts could portend widespread job losses in the coming months, with steeper losses at those companies whose business has been more directly hit by the pandemic.

What they're saying: "We're reallocating resources to position the company for continued growth. This includes continuing to hire and redirecting some employees to fuel our strategic areas, and eliminating some positions that no longer map to our business priorities," a Salesforce statement said.

5. Take Note

On Tap

  • Earnings reports include VMWare, along with printer and computer maker HP.

Trading Places

  • Digital freight firm Convoy named former Expedia CEO Mark Okerstrom as president and operating chief, a new role for the company, reporting to CEO Dan Lewis.

ICYMI

6. After you Login

Working from home allowed this tech worker to find out who was attacking her strawberry patch.

Ina Fried