July 06, 2022
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🔍 Situational awareness: The U.K.’s Competition and Markets Authority has opened an antitrust investigation into Microsoft’s proposed $69 billion purchase of gaming giant Activision Blizzard, CNBC reports.
Today's newsletter is 1,193 words, a 4.5-minute read.
1 big thing: EU's regulatory iceberg bears down on tech's big ships
Final European Parliament approval of sweeping, stringent tech regulations Tuesday put European regulators and tech-platform giants on a slow but inevitable collision course, as Axios' Ashley Gold reports.
Driving the news: Europe's two new laws — the Digital Markets Act (DMA) and the Digital Services Act (DSA) — place tough constraints on how big tech standard-bearers like Apple, Amazon, Alphabet and Meta handle competition and online content.
Why it matters: U.S. efforts to pass similar laws have so far failed to gain traction. That leaves the EU's rules as the most significant efforts yet to rein in the companies' power, which critics charge has grown at the expense of smaller rivals, users' freedom and privacy, and the reliability of online information.
Details: The DMA lays out obligations and punishments for digital service "gatekeepers" who break the law's rules for promoting competition, as Axios previously reported.
- The law says these companies must obtain "explicit consent" to target ads based on personal data.
- It requires interoperability between messaging platforms like Apple's iMessage and Meta's WhatsApp.
- It mandates that large platforms let users select a browser, search engine and personal voice assistant of their choice.
The DSA puts more responsibility on large platforms to police and take down illegal content, with fines if they fail to comply.
- It generally states that whatever is considered illegal speech in Europe should also be considered illegal speech online.
Here are some of the laws' likely impacts on users:
- Apple will be required to let iPhone users in the EU make purchases outside of its official App Store via third-party app stores.
- Tech giants won't be allowed to give their own their own products, apps or services preferential treatment within the EU.
- Companies will have to get consumer consent before moving the personal data of EU citizens around.
- Through the DSA, companies will have more obligations to take down and report illegal content in the EU.
The penalties: Companies face a fine of up to 10% of annual global turnover for violations of the DMA and 6% for violations of the DSA.
- "In the event of serious and repeated breaches, national courts can go as far as a ban on operating on European territory," Thierry Breton, EU commissioner for the internal market, wrote.
What they're saying: "With size comes responsibility — as a big platform, there are things you must do and things you cannot do," EU executive vice president Margrethe Vestager said in a statement.
- "We're turning the page on 'too big to care' platforms," Breton wrote. "The same predictable rules will apply, everywhere in the EU, for our 450 million citizens, bringing everyone a safer and fairer digital space."
Tech firms lobbied hard against both laws, especially on provisions around tracking-based advertising.
- Apple said the EU requirement that allows "sideloading" — the ability to download and use apps from sources other than its own App Store — would have devastating consequences for users' security.
Yes, but: Experts expect implementation and enforcement of these laws to take additional time and demand more personnel resources and money from the EU, and critics of the laws say European officials will come up short of what they need.
- In a blog post, Breton detailed enforcement, saying teams from the European Commission will "supervise" large platforms, and platforms covered under the new laws must have a "legal representative" in Europe to call if there's a compliance question. The largest platforms will pay a fee "to cover the additional costs needed for their supervision."
- European officials will also set up a "European Centre for Algorithmic Transparency" to help enforce the DSA.
What to watch: Tech companies are likely to try to abide by the letter of the new laws while changing their products and practices as little as possible.
- One strategy: they could offer DSA- and DMA-compliant versions of their platforms in Europe, and keep their offerings the same elsewhere.
What's next: The Council of the European Union will adopt the laws, a formality expected by fall, and from then their provisions will kick in on a schedule that stretches through 2024.
2. Meta AI translator now handles 200 languages
Facebook parent Meta says an updated version of its machine learning-based language translation engine can now handle 200 languages.
Why it matters: In a world that is increasingly online, many people are excluded from important information resources because of limited translation availability.
Details: The technology, dubbed NLB-200, is part of Facebook's "No Language Left Behind" initiative. A prior version could translate among 100 languages.
- Meta will use the system to help with more than 25 billion translations a day, while also open-sourcing both the model and other resources as well as providing grants to nonprofits with ideas for how to use the technology.
- Meta has also partnered with the Wikimedia Foundation, which is using the technology to translate articles in 20 languages for which few or no machine-language resources exist.
What they're saying: "The AI modeling techniques we used are helping make high quality translations for languages spoken by billions of people around the world," CEO Mark Zuckerberg said in a Facebook post.
Go deeper: Meta plans AI-driven universal translator
3. Quick bits: Senators want TikTok probe
1. The bipartisan leadership of the Senate's Intelligence Committee sent a letter Tuesday urging the FTC to formally investigate TikTok and parent company ByteDance for allegedly misrepresenting the role that Chinese employees and authorities could play in accessing U.S. user data.
- Between the lines: The letter follows reports that TikTok has allowed engineers and executives in China to access user data, allegedly contradicting the company's prior statements.
2. The National Institute of Standards and Technology, a Commerce Department unit, announced four algorithms as the first group chosen in a six-year contest to develop encryption methods capable of withstanding quantum computer attacks.
- Why it matters: Quantum computers, with their differing approach to calculating answers to problems, have the potential to crack today's standard encryption. While machines fully capable of this feat are still several years off, at least, the industry will also need advance time to adopt less vulnerable encryption schemes.
4. Take note
- Microsoft president Brad Smith is launching a podcast series, "Tools and Weapons," looking at the power and impact of technology on issues ranging from journalism to climate change, with the first two episodes posting today.
- The Department of Justice has recruited former Microsoft economist and Stanford professor Susan Athey to the agency as it continues its probes into a number of large tech firms, Bloomberg reported, noting she will likely recuse herself from inquiries into Google and Apple.
- Meta0 (a blockchain startup not to be confused with Facebook's parent company) has hired former TikTok gaming head Jason Fung as its CEO.
- The U.S. is pushing the Dutch government to restrict chip equipment maker ASML from selling even some older chipmaking gear to China, as part of an effort to slow China's expansion into semiconductor manufacturing. The U.S. already bars sales of the most advanced chipmaking gear. (Bloomberg)