Sep 24, 2020

Axios Login

Ina Fried

Void if detached.

Situational awareness: Critics of Apple's App Store policies including Epic Games, Spotify, Match Group and Basecamp today launched a new organization, the Coalition for App Fairness, to lobby for lower fees and less restrictive rules for developers.

Today's Login is 1,514 words, a 6-minute read.

1 big thing: DOJ has Big Tech surrounded with regulatory threats

Illustration: Annelise Capossela/Axios

The Department of Justice proposed legislation to curb liability protections for tech platforms and moved a step closer toward an antitrust lawsuit against Google Wednesday, Axios' Ashley Gold reports.

The big picture: As President Trump faces re-election, lawmakers and regulators are hurriedly wrapping up investigations and circling Big Tech with regulatory threats.

Driving the news: The Justice Department's Wednesday proposal would curb protections for online platforms that host third-party content provided by Section 230 of the Communications Decency Act that have been in place for nearly a quarter century.

  • The DOJ also briefed a group of state attorneys general on the status of its long-awaited case against Google for monopolistic behavior, sources familiar with the situation told Axios.

What's happening: U.S. Attorney General William Barr promised he'd send a Section 230 proposal to Congress and said he wanted to see a Google suit filed by the end of September. He appears to have achieved the first goal and moved toward the second.

Yes, but: Although efforts to change Section 230 have garnered bipartisan support, Congress is preoccupied with the election, the pandemic, and a Supreme Court vacancy. Any Google suit will likely take years to play out. These projects' fate will almost certainly be determined in the next administration.

How it works: In an unusual move, the DOJ released the text of its own proposed legislation to revamp the Section 230 rules.

  • The proposal would remove legal immunity when platforms facilitate criminal activity or fail to report unlawful conduct, or when platforms don't follow their own content moderation principles "consistently." The proposal would also allow civil suits to be brought against platforms relating to content that promotes online child exploitation and terrorism.
  • Industry groups quickly raised alarms. "Amid a pandemic and an election, undermining the tools social media companies use to respond to problematic content like disinformation is more dangerous than ever," said Matt Schruers, president of the Computer and Communications Industry Association, a trade group that represents major tech companies like Google and Facebook. "The U.S. government should be enabling efforts to address nefarious content and behavior, not hamstringing them in misguided pursuit of political gain." 

Details: Wednesday afternoon, at a White House gathering for Republican state attorneys, President Trump said his administration was weighing further "concrete legal steps" against platforms it believes censor conservatives.

  • Trump said companies "rig" their terms of service to "mislead or defraud," and urged the AGs to investigate social media companies in their states.
  • "I'm learning what role we can play as state AGs" to support Trump's executive order on social media and the DOJ's proposed Section 230 policy change, South Carolina attorney general Alan Wilson told Axios after the meeting. "We're not all treated fairly in the new virtual town square."
  • "We discussed with the President our commitment to combating platforms that are unlawfully censoring speech or stifling the voices of individuals based on personal political ideology," said Louisiana Attorney General Jeff Landry.

What's next: The DOJ Section 230 proposal will join a host of other bills circulating in Congress to regulate tech platforms. Barr has reportedly pushed for the delivery of a Google suit by the end of September, which is fast approaching, while prosecutors have sought additional time to strengthen the case.

2. Ex-Apple employees' chipmaker raise $240M more

Nuvia co-founders John Bruno, Gerard Williams and Manu Gulati. Photo: Nuvia

Nuvia, a server chip start-up founded by three former Apple employees, is announcing today it has raised $240 million in fresh funding.

The big picture: The move comes amid increased interest in server chips that, like Nuvia's are Arm-based. It's also happening as Arm is being sold to Nvidia and Nuvia itself is being sued by Apple.

Details: The Series B round, led by Mithril Capital, follows $53 million raised in a November round. Other investors in the latest round include Atlantic Bridge, Redline Capital, Capricorn Investment Group, Dell Technologies Capital, Mayfield, Nepenthe LLC and WRVI Capital.

The big picture: Nuvia is targeting all the major server categories: Devices sold commercially by companies like Dell, companies like Google and Facebook that build custom servers for their data centers, and high-performance computing (the kinds of one-off supercomputers that are built for governments, universities and research institutions).

Nuvia co-founder and engineering head Manu Gulati told Axios that the big web service providers could be the easiest market for Nuvia to gain traction in since they design their own custom servers.

Between the lines: While the Apple lawsuit was a distraction initially, Gulati said it has also helped the company gain notice.

  • "There were two parties who told us point blank they were talking to us because of the lawsuit," he said.

Meanwhile: Gulati said Intel's well-publicized manufacturing challenges have boosted Nuvia's fundraising efforts.

  • "The fact Intel is struggling so much it makes it easier for everybody else who is investing to understand this is something worth taking on," he said.

What's next: The company hopes to finalize its first chip design some time next year, with the goal of getting the first samples in customer hands the following year.

3. Pandemic spurs writers to go it alone via email

Illustration: Aïda Amer/Axios

A slew of high-profile journalists have recently announced they are leaving newsrooms to launch their own independent brands, mostly via email newsletters, Axios' Sara Fischer reports.

Context: Many of those writers, working with new technology companies like Substack, TinyLetter, Lede or Ghost, have made the transition amid the pandemic, which strained the finances of traditional newsrooms and publications and sent most journalists to work from home.

"I think many people in the journalism world saw how quickly their business fortunes can change during COVID and decided they would rather run their own business as opposed to be dependent on another businesses' ebbs and flows," says Alex Kantrowitz, former Buzzfeed reporter turned author of the Big Technology newsletter on Substack.

Driving the news: Several prominent businesses and technology or political journalists have left their news companies to launch their own newsletters, including:

  • Kantrowitz, Casey Newton (formerly of The Verge), Josh Constine (formerly of TechCrunch), Andrew Sullivan (formerly of New York Magazine), Emily Atkin (formerly of the New Republic), and Matt Taibbi (formerly of Rolling Stone).
  • They join a wider cohort of journalists and pundits operating independent newsletters, including Ben Thompson (Stratechery), Anne Helen Petersen (Culture Study) and Bill Bishop (Sinocism).

By the numbers: Substack today has more than 250,000 paying subscribers across its network, and its top 10 publishers bring in $7 million collectively in annualized revenue, according to co-founder Hamish McKenzie.

Of note: The majority of these independent writers are white men working in topic areas like technology, business or politics where they can blend punditry and analysis with some original reporting.

  • The independent model doesn't work as well for journalists who cover topics that require in-depth reporting, technical support or legal resources.
  • Giving up a regular salary and health insurance is harder for those who lack savings.

It can take writers months to develop large and loyal enough audiences to make a decent living — but once they do, the payoff can be substantial.

  • "Building an audience is probably the trickiest part for most folks. Especially getting your first thousand subscribers," says Judd Legum, author of the "Popular Information" newsletter and formerly the editor-in-chief of ThinkProgress.
  • Substack has been trying in recent months to provide writers with more institutional support, including advance payment and legal support.

How it works: Most newsletters charge subscribers $60 to $100 annually, meaning they can assemble a personal income without building a huge list. Substack typically takes a 10% cut.

  • "A paid newsletter provides the right incentives for writers because it's not about gaming the Google algorithm or the Facebook algorithm," says Legum. "You actually have to provide something that a reader finds valuable enough to pull out their credit card."

The big picture: The independent model recalls the early days of blogging, with authors free to write in their own voice on topics they have expertise in, but absent newsroom support and editing.

Our thought bubble: For tech, email is ancient, but for media, there's nothing like knowing how to directly reach your audience.

4. TikTok asks court for temporary halt of U.S. ban

Illustration: Sarah Grillo/Axios

TikTok has asked a federal court for a preliminary injunction to prevent President Trump from banning the app, Axios' Kia Kokalitcheva reports.

Why it matters: The Chinese-owned TikTok is in the crosshairs of mounting tensions between the U.S. and Beijing, culminating in Trump issuing an executive order banning the app unless it's sold to American owners. The result has been a messy process leading to a complex deal involving TikTok owner ByteDance, Oracle and Walmart that's awaiting approval.

The big picture: The move comes on the heels of fellow Chinese app WeChat successfully obtaining a similar halt in court.

TikTok declined to comment beyond the court filing.

5. Take Note

On Tap

Trading Places

  • Lyft said Wednesday that Nilka Thomas is rejoining the company as chief people officer, a role she recently held at SeatGeek. She joined Lyft the first time in 2018 as VP of talent acquisition and inclusion after spending more than 10 years at Google.

ICYMI

  • Google has added COVID-19 case data to Google Maps. (Google)
  • A major supplier of software to county governments has been hacked, creating fresh concerns ahead of the election. (Reuters)
  • Two members of Congress are asking for an investigation into the government's alleged cell phone surveillance of Portland protesters. (Rep. Anna Eshoo)
  • Online resale specialist Goat Group raised $100 million in Series E funding, valuing the company at $1.75 billion, up from $550 million in its last round. (TechCrunch)
6. After you Login

As for the notion that everyone is leaving San Francisco, apparently no one told this group of more than a dozen raccoons spotted together in Golden Gate Park.

Ina Fried