I recognize that not all my readers are sports fans, so for today's intro I want to serve something up for them. It's no slam dunk to figure out what to say, but thanks for being part of my team.
1 big thing: How the past is shaping Big Tech's future
In trying to understand the future of tech regulation, it's worth looking back at recent history, David McCabe reports. That may provide the best clues to how companies like Google, Facebook and Amazon might be ultimately reined in.
What's happening: Major tech executives have urged regulators to adopt approaches from the past to regulate their businesses, including self-regulation, that have previously helped industries avoid the toughest penalties. Meanwhile, lawmakers are turning to history for lessons in how to cut Big Tech down to size.
Driving the news: Facebook CEO Mark Zuckerberg has said that the moderation of malicious content online could be overseen by an industry standards body similar to the Hollywood system for rating movies established in the 1960s.
- Another potential model is the body with roots in the 1930s that polices the securities industry, according to Zuckerberg’s top U.S. policy executive, Kevin Martin.
- The communications chief Zuckerberg hired last month, John Pinette, was a spokesman for Microsoft during its 1990s antitrust fight with the federal government.
Snap CEO Evan Spiegel said in December that social media could be regulated like broadcast television. “If you’re broadcasting to millions of people, you need to serve the public interest,” he told the Financial Times.
Tech critics are also finding inspiration in history.
- Facebook co-founder Chris Hughes referenced antitrust cases against Microsoft and IBM in his Thursday NYT op-ed calling to break up the company.
- A recent bipartisan bill to ban “dark pattern" design features that manipulate users, and police them via industry-set standards under the Federal Trade Commission's oversight, was based in part on a 1938 law establishing the self-regulation of the securities industry.
- "Just over a century ago, it was both Republicans and Democrats who fought back and broke up big monopolies,” Sen. Elizabeth Warren said in a statement. “In the 1990s, the federal government stepped up and sued Microsoft for bulldozing the competition.”
- “America has a long tradition of breaking up companies that get too powerful,” Warren continued. “We need to use that same political courage and real muscle again — this time to break up big tech.”
What they’re saying: “The question of how do you mass people and capital and these technologies together in ways that keep us free instead of imprison us is a question that I think we’ve had really going back to the founding of the country with the East India Company,” said Matt Stoller, a fellow at the anti-monopoly Open Markets Institute. (His history of battles over monopoly power is being released in October.)
Yes, but: Many lawmakers say that grappling with the tech giants is still a largely unprecedented challenge.
- While Republican Sen. Josh Hawley said that there are examples of “trusts and corporations that exerted similar market power and had similar social power” as the Big Tech companies, their data-hungry business models set them apart.
- “The size, the market power, and then coupled with the access to personal, private information, the privacy concerns — it’s really a unique combination,” he said.
2. Uber IPO values company north of $75 billion
Uber starts trading this morning, after pricing shares on Thursday at $45 apiece, at the low end of its expected range.
By the numbers: The company itself raised $8.6 billion, inclusive of a concurrent $500 million investment from PayPal. Insiders are expected to sell another 27 million shares in the offering, generating another $1.2 billion. This puts Uber's initial market cap at around $75.5 billion, and its fully diluted value just north of $82 billion.
- The lower valuation comes as rival Lyft has also struggled in its the public market debut, with investors fretting over the company's large losses.
- Just ahead of its IPO, Uber said in a regulatory filing it had reached settlements with the majority of the 60,000 drivers who filed arbitration complaints over their employment status. The settlements should cost between $146 million and $170 million.
Our thought bubble: Investors are likely trying to weigh the tough economics of today's ride-hailing business with the prospect that the game changes once autonomous vehicles arrive en masse.
- That said, it will be quite a while before autonomous vehicles are able to replace human drivers on a large-scale basis.
- Even then, it's not clear that Uber's network advantage will be as important as having the best and most efficient vehicle technology, which could advantage Waymo or even traditional car makers.
If you want to hear even more from me on Uber's IPO, I shared a ton of thoughts in an interview with CNBC's Jon Fortt.
Meanwhile: According to an Axios/SurveyMonkey poll, people feel surprisingly upbeat about the impacts of ride-hailing services, despite the many controversies over how they affect drivers and cities.
3. Commerce official resigns amid 5G tensions
Kim Hart reports that federal staffers were caught off guard Thursday by the abrupt departure of David Redl, the Trump appointee running the National Telecommunications and Information Administration. For those unfamiliar, that's the Commerce Department's telecom policy shop.
Why it matters: Officials are under intense pressure to make more airwaves available for the private sector to build 5G networks. Divvying up government airwaves amid the "race" to beat China has led to spats between agencies.
The intrigue: In an email to colleagues, Redl said it was with "a heavy heart" that he announced his resignation. Three sources familiar with the situation said his departure comes after internal disagreements about 5G policies.
- Redl and FCC Chairman Ajit Pai were at odds over the auction of millimeter-wave spectrum due to NOAA and NASA concerns about possible interference with sensors used for weather data collection. (Politico reported details last month.)
- Internally, there was friction between Redl and Earl Comstock, deputy chief of staff to Secretary Wilbur Ross, as well as tensions surrounding the administration's 5G announcement last month, two sources said. (NTIA declined to comment.)
What's next: Diane Rinaldo is now the acting NTIA administrator.
Go deeper: Read Axios' deep dive on the 5G future.
4. Alexa's memory is a little too good
A coalition of groups filed an FTC complaint on Thursday, saying the kids' version of the Echo Dot violates child privacy law in several ways, including by retaining information even after a consumer has tried to delete it. (Amazon says that was a bug that has now been fixed, and published a blog post defending its overall policies when it comes to kids and Alexa.)
Meanwhile, separate reports say that parts of Amazon retain transcripts of Alexa conversations even after consumers delete the related audio clips. Amazon told CNET it is working to change its processes.
The bottom line: Amazon actually has a pretty good track record of offering curated services for kids. But with privacy issues front and center, and Congress weighing further action, the latest developments are not a good look for the company.
Go deeper: What Amazon knows about you
5. Take Note
- Uber is expected to begin trading.
- Microsoft's GitHub plans to announce a new product at 1:30 p.m. PT, per a tweet from its CEO.
- Symantec CEO Greg Clark has stepped down. The security software firm is looking for a permanent replacement, with board member and former Novellus CEO Richard Hill stepping in as interim chief executive.
- Facebook has named former Android product leader Erick Tseng as head of product management for its AR and VR products, succeeding Hugo Barra, who will shift to a new role leading partnerships for AR and VR.
- The FCC blocked China Mobile from operating a network in the U.S., citing security concerns. (Axios)
- Jeff Bezos unveiled Blue Origin's plans to land on the moon. (Axios)
- A look at the non-binary emoji coming to Android later this year. (Fast Company)
- Oracle is reportedly planning to cut its China R&D operation. (ZDNet)
6. After you Login
Making the youths try to dial a number in under four minutes using a rotary phone is awesome, but to be fair, I'd have a tough time making a TikTok video in that time.