November 13, 2019

Good morning.

Situational awareness: Apple released a new 16-inch MacBook Pro with, among other upgrades, a more reliable keyboard, according to the Verge.

Today's Login is 1,293 words, a 5-minute read.

1 big thing: Data is the new antitrust battleground

Illustration: Aïda Amer/Axios

Regulators on both sides of the Atlantic are beginning to probe whether the biggest tech companies' handling of consumer data represents an unfair form of competition, Axios' Margaret Harding McGill reports.

Why it matters: Consumer data is the fuel of the digital economy and the key to tech giants' market leverage. It is also challenging antitrust regulators’ ability to investigate competition issues, because today’s antitrust laws don’t specifically address data dynamics.

Driving the news: Justice Department antitrust chief Makan Delrahim, in a speech Friday at an antitrust conference in Cambridge, Mass., said that the way tech firms amass data could raise concerns about competition.

  • The DOJ is conducting an antitrust review of big tech companies, and Delrahim told the crowd that includes studying the role data plays in market power.

Context: The amount of data Google will collect in its $2.1 billion acquisition of Fitbit is already drawing the attention of privacy advocates and competition enforcers.

  • EU antitrust chief Margrethe Vestager said deals that involve combining user data will get a close look because of their potential to hamper competition or create privacy issues, in response to questions about the Google deal at the Web Summit in Lisbon last week, according to Bloomberg.
  • Marc Rotenberg, president of the Electronic Privacy Information Center, said the organization will oppose the deal in part because of privacy issues. (Google has said it will not use Fitbit data for ads.)
  • EPIC is also urging lawmakers to press the FTC on data collection in merger reviews ahead of a House Judiciary antitrust subcommittee hearing Wednesday with Delrahim and FTC chairman Joe Simons.
  • In a statement for Axios, House antitrust subcommittee Chairman David Cicilline (D-R.I.) said, "The immense amount of data that dominant firms have collected has given them a tremendous advantage over potential competitors whose ability to attract investment and compete effectively often depends on their access to data."

Yes, but: Fitbit is not the dominant player in the wearables health device market — that honor goes to the Apple Watch.

More broadly, experts question whether antitrust laws are the right tool to remedy concerns about growing data collection.

"The only thing you can say in the antitrust realm in regard to companies' increasing possession of data is 'big is bad,' and 'big is bad' is a disreputable antitrust principle and has been for decades."
— Joel Mitnick, an antitrust lawyer with Cadwalader, Wickersham & Taft

Meanwhile, Congress is looking at new data portability legislation as a way to boost competition in the tech industry by allowing users to take information like friends lists from one platform to another.

  • Democratic Sens. Mark Warner (Va.) and Richard Blumenthal (Conn.), and Republican Sen. Josh Hawley (Mo.) introduced a bill last month that would require social media companies to provide a way for customers to move their personal information to another platform.
  • Rules requiring phone companies to allow customers to keep their number when switching providers are credited with increasing competition among wireless carriers.
  • But that approach might be a tougher fit for personal information on digital platforms, where there's no standard format of exchange.

2. Facebook gets deeper into payments

Illustration: Sarah Grillo/Axios

Facebook on Tuesday announced Facebook Pay, an online payment system that will allow users across its services to send payments to one another. The new product, separate from its Libra cryptocurrency effort, puts the social network giant in competition with Venmo and others.

Why it matters: Once again, Facebook will be asking users to hand over more sensitive information when it is under fire for how it manages the information and access it already has.

Between the lines: Facebook CEO Mark Zuckerberg said at F8 last year that the company wasn't going to slow down on developing new products even as it works to restore trust.

  • Since then, the company has announced plans for its own cryptocurrency and launched Portal, which puts a camera and microphone inside users' home.

Details: Facebook said it will roll out Facebook Pay on Facebook and Messenger this week in the U.S. for "fundraisers, in-game purchases, event tickets, person-to-person payments on Messenger" as well as some businesses on Facebook Marketplace. The service will later expand to WhatsApp and Instagram, the company said.

What they're saying:

  • Facebook VP Deborah Liu: "People already use payments across our apps to shop, donate to causes and send money to each other. Facebook Pay will make these transactions easier while continuing to ensure your payment information is secure and protected."
  • The Intercept's Sam Biddle: "Have you ever used Venmo and thought to yourself, 'this is extremely easy and completely ubiquitous but I wish Facebook knew about this transaction for some reason?'"
  • Recode's Peter Kafka: "The story I'd like to read is the one with the compelling argument that late 2019 is the perfect time for Facebook to ask users to hand over their credit card info."

History lesson: This isn't Facebook's first try at this space. Back in 2015, it launched a free, peer-to-peer payments system within Facebook Messenger.

Our thought bubble: Facebook's move into payments comes shortly after Venmo owner PayPal backed out of the consortium backing Libra.

3. Feds probe Google over patient data sharing

Google's headquarters in Mountain View, Calif. Photo: Smith Collection/Gado/Getty Images

The Office for Civil Rights in the Department of Health and Human Services told the Wall Street Journal Tuesday it is investigating the data-sharing relationship between Google and not-for-profit hospital system Ascension.

  • That relationship, part of an effort at Google called Project Nightingale, was the subject of a Journal investigation published Monday.

Why it matters: Per Axios health care business reporter Bob Herman, exchanging patients’ health information is legal under federal privacy law, and this data sharing is common, even when patients aren’t aware. The government is making sure Google is contracted as a "business associate" with Ascension.

What they're saying: Civil Rights Office director Roger Severino said in a statement to the WSJ the federal regulator "will seek to learn more information about this mass collection of individuals' medical records to ensure that HIPAA protections were fully implemented."

The other side: Following the announcement, Google updated its blog post on its partnership with Ascension with the additional FAQ, "Do Google employees have access to Protected Health Information (PHI)? If so, why?"

  • "A limited number of Google employees have been approved by Ascension to potentially handle PHI, in order to provide the services to Ascension," the FAQ answer states. "Because every health system is different, and the data is very complex and non-standardized, we need to configure and tune our processing systems to ensure correct product operations and patient safety."

Go deeper: What your hospital knows about you

4. Court limits border searches of devices

A federal judge ruled on Tuesday that U.S. border authorities don't have unlimited power to search phones and other electronic devices of those entering the country.

Why it matters: While not going as far as some privacy and civil rights groups had hoped, the court did find that authorities need a reasonable suspicion before performing certain device searches.

What they're saying:

  • Esha Bhandari, ACLU staff attorney: "By putting an end to the government's ability to conduct suspicionless fishing expeditions, the court reaffirms that the border is not a lawless place and that we don't lose our privacy rights when we travel."
  • Sophia Cope, Electronic Frontier Foundation senior staff attorney: "This is a great day for travelers who now can cross the international border without fear that the government will, in the absence of any suspicion, ransack the extraordinarily sensitive information we all carry in our electronic devices."

What's next: The EFF filed suit on Tuesday over another controversial technique being used at the border, the DNA testing of migrants.

5. Take Note

On Tap

  • If you happen to be in the Bay Area and free tonight, I'm part of a panel of tech journalists taking part in the PRSA Silicon Valley's annual Media Predicts event. As for predictions, I strongly suspect I will lob a few zingers in Mike Isaac's direction.
  • Cisco is set to report earnings after the markets close.

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6. After you Login

The annual performance of "Thriller" at a senior home is a thing of beauty.