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1 big thing: Apple grapples with FaceTime bug
A day ahead of earnings — and on Data Privacy Day no less — Apple found itself with a major bug on its hands.
What's happening: The latest version of FaceTime allows some users to hear audio or see video even if a user hasn't answered or, in some cases, has declined a call. The bug kicks in when you add add people to a two-party call.
Apple's reaction: A solution is nearly ready, an Apple representative told Axios. "We’re aware of this issue and we have identified a fix that will be released in a software update later this week,” Apple said in a statement to Axios. As of late Monday, the company had temporarily disabled the function.
Why it matters: The timing of the bug is terrible, reminding customers that even with the company's pro-privacy stance, its technology is still entirely capable of fulfilling nightmarish surveillance scenarios.
- On Monday before news of the bug had spread, CEO Tim Cook tweeted: "We must keep fighting for the kind of world we want to live in. On this #DataPrivacyDay let us all insist on action and reform for vital privacy protections. The dangers are real and the consequences are too important."
What they're saying: Apple faced criticism from a number of corners in the wake of the bug's disclosure.
- Twitter CEO Jack Dorsey tweeted: "Disable FaceTime for now until Apple fixes."
- New York Governor Andrew Cuomo also urged people to disable FaceTime. "The FaceTime bug is an egregious breach of privacy that puts New Yorkers at risk," he said. "In New York, we take consumer rights very seriously and I am deeply concerned by this irresponsible bug that can be exploited for unscrupulous purposes."
Our thought bubble: The bug is obviously separate from Apple's positions on privacy issues, but comes as the company is increasingly trying to make the case that its products are more private than those of its rivals.
- The bug also highlights a broader concern among privacy advocates: As we increase the number of microphones and cameras around our homes, the devices could be used to record people without their consent, accidentally or intentionally.
2. Apple earnings also in the spotlight
It's not just the FaceTime bug that has all eyes on Apple. The iPhone maker has already warned its quarterly earnings won't meet estimates, but there are still a lot of unanswered questions for the company when it reports full financial results later today.
Why it matters: Apple is one of the most watched companies in tech and a rare earnings miss means there will be even more attention on the iPhone maker.
What we're watching:
- Apple's outlook: Of particular note will be its comments on both smartphone demand and the broader economy. Also closely watched will be what the company has to say about China. Apple cited China as a big reason for its revenue shortfall and a number of other companies have since blamed China for lower-than-expected sales.
- Subscription services: If recent reports are to be believed, Apple is readying subscriptions for all manner of content from TV shows to video games to magazines. Apple hasn't talked about its plans, but it's signed a number of big, expensive video deals and bought the assets of Texture, a "Netflix for magazines." The real question now is what will the business model be that underlies such services.
3. Koch operation wary of tech regulation
The influence network led by billionaire Charles Koch is watching a growing push to regulate big tech firms with alarm, Axios' David McCabe reports.
The big picture: For the libertarian-oriented network of political and philanthropic groups, regulation is the enemy, and even though many others on the right bristle at what they see as anti-conservative bias by Google and Facebook, the Koch crowd is not ready to cheer government intervention.
Why it matters: Though the Koch network has seen its influence wax and wane under President Trump, whom it did not back, it nonetheless possesses powerful tools to shape policy debates and influence elections.
The big picture: The Koch network has tried to reinvent itself as less bluntly partisan, and more focused on building coalitions and pursuing philanthropy — an approach modeled in its tech work.
- It supports projects like OpenStax, which creates open source textbooks and can be distributed digitally, on the grounds it can increase access to education.
- It has collaborated with left-leaning groups on tech issues, like free speech online, where common ground exists.
- It backs a venture capital firm, called Trust Ventures, that works with startups in highly-regulated industries.
Go deeper: David has more here.
4. U.S. files criminal charges against Huawei
Huawei, already under fire from the U.S. government on a number of fronts, is now the subject of criminal charges.
Details: The charges against the Chinese telecom giant cover two broad areas.
- The alleged evasion of U.S. sanctions, for which the government is currently seeking the extradition from Canada of CFO Meng Wanzhou. She was arrested in December.
- Issues related to the theft of T-Mobile's cellphone testing robot, Tappy. T-Mobile sued Huawei several years back and was awarded millions by a jury in 2017.
Why it matters: While many of the allegations themselves aren't new, the fact that the government is charging Huawei criminally further ratchets up the tension between the U.S. and China.
Huawei's response: In a statement to Axios, Huawei said it is "disappointed" by the charges and "denies that it or its subsidiary or affiliate have committed any of the asserted violations of U.S. law set forth in each of the indictments, is not aware of any wrongdoing by Ms. Meng, and believes the U.S. courts will ultimately reach the same conclusion."
5. Take Note
- Earnings reports include Apple, eBay and AMD.
- Closing arguments are scheduled for this afternoon in the FTC's case against Qualcomm.
- SoftBank hired former McKinsey & Co. partner Michelle Horn, as SVP and chief people officer.
- Snap named chief accounting officer Lara Sweet as interim CFO; current CFO Tim Stone's last day will be Feb. 5.
- Nvidia became the latest company to warn of lower-than expected fourth-quarter sales, sending shares plummeting 14% on Monday. (CNBC)
- Ireland's data regulator asked for an "urgent briefing" on Facebook's plan to integrate its various messaging apps. (Axios)
- Facebook shared a draft of how its outside content oversight board might work. (TechCrunch)
6. After you Login
If you are met with this greeting at the airport, it might be time to call an Uber.