How video games are reshaping tech, culture, politics and the way we interact with each other.

Gaming

How companies like Amazon, Google and Facebook are shaping our world.

Big Tech

How false information is seeping into our daily interactions.

Misinformation

What to know about the next generation network that will revolutionize the way we live and work.

All about the treasure trove of data collected at every turn.

Data privacy

Who's watching you and what they're seeing.

Surveillance

The latest developments in the robot revolution.

Automation and AI

From the Valley to D.C., Big Tech players like Facebook, Google and Amazon are under more scrutiny than ever as new technology develops and privacy and antitrust concerns grow in lockstep with companies’ ambitions.

Technology

National

Axios Media Trends

Data: Pew Research Center; Note: The 2014/2015 survey did not ask about TikTok, which launched globally in 2018, or YouTube; Chart: Nicki Camberg/Axios

Nearly half of all U.S. teens (46%) say they use the internet "almost constantly," according to a new poll, around double the percentage (24%) that reported the same usage in 2014-15. 

Why it matters: Today's teens don't balance their real-world lives with their virtual experiences, they blend them. 

This is especially true for minority populations, who — according to a new Pew Research Center poll — are much more likely to say they are always online than white teens.  

State of play: The internet has changed dramatically in the past few years, creating new opportunities and risks for teens. 

Today's teens, who nearly all (97%) say they use the internet daily, are visual communicators, and have more tools at their disposal for self-expression. 

Video apps like YouTube, TikTok and Snapchat are the primary networks used by teens now, compared to platforms like Facebook, Twitter and Tumblr.

Most of the main networks teens use to create and consume content have built in photo and video editing tools. Algorithms that prioritize virality over popularity make it easier for teens to discover new interests and ideas. 

Yes, but: Constant connection also means that real-world problems — like bullying, harassment, and abuse — can be a bigger part of teens' lives. 

Under pressure from parents and regulators, tech companies have begun to introduce parental controls and safety policies. 

But teens are more aware now than ever about the risks of being constantly connected. More than half (53%) of teens who almost constantly use at least one social network say they are on social media too much. 

Most teens (75%) say they visit YouTube daily, and around half say they use TikTok daily, Snapchat and Instagram at least daily. 

The big picture:  The pandemic forced most teens to double down on social relationships online. It also made aspects of their real-world experiences, like school and extra-curricular activities, available remotely. 

While new efforts by tech platforms can help to curb some of the tactics used to exacerbate harm online, they can't protect teens from the same dynamics they would otherwise experience in the world.

Internet usage skyrocketing among U.S. teens

Today's teens don't balance their real-world lives with their virtual experiences, they blend them.

Internet

Axios Closer

Peloton's stock shot up more than 13% Friday, after the company said it would lay off more people and begin "aggressive" cost cutting measures that will include store closures.

Why it matters: Peloton shot to prominence during the pandemic lockdowns,  quickly becoming a poster child of the stay-at-home rally among technology stocks. 

With that effect long gone, the company is now in the midst of a turnaround strategy: In the past year it's already replaced its CEO and laid off at least 2,800 people. 

Details: Peloton is now cutting approximately 780 jobs in areas including delivery, and customer support, CNBC and Bloomberg first reported.

At the same time, CEO Barry McCarthy wrote in a company memo reviewed by Axios that the company will continue to recruit for people in "key" roles such as software engineering. 

The big picture: Peloton has admitted to being overly optimistic about how many people were interested in its products and services.

The fitness equipment maker and platform has been facing an inventory glut, as consumer demand diminished after the height of the pandemic.

The brand has halted production of its bikes and treadmills, canceled plans to open a manufacturing facility, and outsourced delivery and logistics of its products.

What to watch: The company is also reversing its April decision to cut the price of some of its products in an effort to generate free cash flow. 

The price of the Bike+ is now back to $2,495 in the United States and its Tread machine is now $3,495, a $650 increase from its initial price.

The changes are designed to "maintain [Peloton's] position as the undisputed premium brand in the Connected Fitness category,"  McCarthy wrote.

Our thought bubble: Most people who wanted a Peloton likely already have one. To try to sell the equipment now to new customers, when they are like now also more interested in spending on experiences than goods, seems like yet another uphill battle.

Read the email that Peloton CEO Barry McCarthy shared with the company:

Peloton CEO memo

Peloton stock soars after reports of new layoffs

Investors cheered new efforts in Peloton's turnaround strategy.

Layoffs

Economy & Business

Social media interactions on articles published about <span style="background:#d93b17; padding:3px 5px;color:white;">Mehmet Oz</span> and <span style="background:#15a0ff; padding:3px 5px;color:white;">John Fetterman</span>

Data: NewsWhip; Chart: Simran Parwani/Axios

The number of online news articles and social media interactions about Mehmet Oz, the Republican nominee for U.S. Senate in Pennsylvania, has exceeded his Democratic rival John Fetterman's metrics for most of the year.

Why it matters: That's not necessarily a good thing. Oz is polling at an average of 10 points below Fetterman in what should be one of the most closely contested Senate seats in the nation.

The celebrity doctor's vulnerabilities as a candidate — including a stream of opposition research pushed by Democrats — has Republicans fearing they may have fumbled a golden opportunity to help retake the Senate in November.

In an otherwise favorable year for Republicans, the nomination of flawed or extremist candidates — including several backed by former President Trump — is threatening to disrupt the "red wave."

The intrigue: Fetterman's campaign has demonstrated a unique level of social media savvy, a major asset for a candidate who has been unable to keep a robust in-person campaigning schedule since suffering a stroke in May. 

He recently launched a campaign to induct Oz into the New Jersey Hall of Fame and has enlisted New Jersey celebrities (such as Snooki of "Jersey Shore" fame) to troll his opponent for moving from the Garden State to run in Pennsylvania. 

The petition was the 11th-most shared article about Oz on social media, while more than a dozen of the top 100 articles about Fetterman reference his trolling efforts.

By the numbers: From January through July, there were more than 22,000 articles shared on social media about Oz, compared to over 9,000 shared about Fetterman, according to data from social analysis firm NewsWhip. 

Oz stories yielded 2.6 million interactions, while Fetterman's received just under one million.

Fetterman started gaining traction in May when he won the Democratic primary and even surpassed Oz's interactions in late June.

Dr. Oz calls Fauci a 'petty tyrant,' challenges him to debate

Biden requests Mehmet Oz and Herschel Walker resign from presidential council or be terminated

Dr. Mehmet Oz challenges Dr. Anthony Fauci to a debate, calls him 'a petty tyrant' and 'the J. Edgar Hoover of public health'

Progressives Want To Make Airlines Give You A Refund For Delays And Cancellations

Pennsylvania Lt. Gov. John Fetterman Wins Democratic Senate Nomination

Fetterman wins Pennsylvania Democratic Senate primary, GOP race is too close to call

What to watch: Media coverage and anticipation have been building for Fetterman's rally on Friday in Erie.

Charted: The social media hype of Oz vs. Fetterman

Fetterman has honed his social media savvy as he's been away from the campaign trail.

Social media

President Biden has made the COVID-19 crisis and a post-Trump return to national unity and traditional democratic ideals his top priorities. From vaccinations to stimulus to schools, Biden is seeking bipartisan compromise while showing a willingness to use executive authority and bare Democratic majorities in the U.S. House and Senate to implement his policies. Republican leaders are navigating deep party divisions over if and how to move beyond former President Trump.

Politics & Policy

Axios Gaming

Web3 gaming still has its upsides, if done right with more focus on game quality, veteran developer Simon Davis tells Axios. 

Why it matters: The NFT/Web3/blockchain part of the games industry has billions of dollars of investment but is surrounded by skeptics. 

For some, a lack of hits — and players — is proof that the sector is a dead end, offering a technology that doesn’t inherently make games better.

For others, including Davis — whose company Mighty Bear just announced a $10 million investment to make a Web3 game — that’s just proof it’s early days.

What they’re saying: “When we get the first genuinely world-class experience in Web3 with a low enough barrier to entry and a low level of friction, we'll be there,” Davis tells Axios.

Reminder: Web3 gaming is another way of saying gaming that is tied to cryptocurrencies. These games often involve the ability to buy and sell in-game items, characters and land in the form of non-fungible tokens, or NFTs.

Some key problems hold Web3 games back, Davis says.

Many such games assume everyone wants to get into crypto or cares about it, requiring sign-ups for wallets and acquiring tokens before you’re playing. The game from Davis’ team, a battle royale called Mighty Action Heroes, will let people access it as a standard free-to-play game, with the chance to play with NFT-based gear as an additional option.

NFT-based games tend to focus on their marketplace and draw players who are thinking of investment first, Davis has observed. “To me, that's not healthy,” Davis says, emphasizing the need for the players to have fun playing them. 

Davis is hopeful that Web3 could change the financing of games and even improve the dev-player relationship.  

Teams making standard free-to-play games constantly need to turn out new content that they then pressure players to buy, he says. That “basically puts the studio in conflict with the players.” (Davis has worked in free-to-play for years).

For a Web3 game like his, Davis believes a team can forgo that model and sustain itself by taking a cut of sales of in-game items that players sell to each other. For his game, those items might be cosmetics or rewards otherwise earned through playing the battle royale’s seasons.

Could that be done without crypto, given years of experiments with in-game marketplaces in games such as Diablo? Davis argues that tracking transactions and divvying up profits are ideally done with Web 3 tech. “I could send a postcard instead of sending an email,” he said. “But it's not necessarily the best tool for it.”

What’s next: A playable build of Mighty Action Heroes should launch by year’s end. 

Sign up for the Axios Gaming newsletter here.

More focus on fun, less on investment for upcoming NFT game

More focus on fun and letting players opt to play without crypto

Illustration of video game character styled to look like Rambo and other action movie heroes

Video games

Sales of PlayStation products have migrated along with the U.S. population, out of large metro areas to smaller cities, according to a Sony executive who believes the migration is tied to pandemic-related population shifts.

Why it matters: One way to understand what has happened in the country over the past few years is to see where people are buying stuff.

But input on that topic from the games industry — as opposed to, say, Shake Shack — is surprising. 

Game companies are stingy about publicly announcing sales performance in individual countries, let alone sharing insights about movement in U.S. states. 

What they’re saying: “There is a geographic shift in sales,” said Sony Interactive Entertainment’s director of business insights Doug Evans, in a webinar with the logistics firm Alloy late last month that has not been previously reported.

“I have to attribute that to the migration because of the pandemic."

Evans wasn't necessarily talking PS5s here, which he noted are flying off the shelves wherever Sony is able to stock them.

But store-level tracking can still be useful for Sony to learn how accessories and other products sell. 

His findings: Evans said he compared PlayStation sales data from the first half of 2019 to the first half of 2022.

⬇️ There was a “significant drop” in “New York, Brooklyn, The Bronx, Chicago and Miami” that took increases in 33 other cities to fill. (It was unclear if “New York” means Manhattan; Sony didn’t reply to a request for comment on this story.)

⬆️ This contrasts with an increase in sales in smaller metro areas, “places like Fayetteville and Memphis and Jacksonville and a lot of small cities in Florida and Texas and so on.”

Those shifts match the U.S. Census Bureau’s reports on population migration from 2019 to 2021.

The New York and Chicago areas both made the top 10 U.S. regions with the largest domestic migration to other parts of the country.

Fayetteville, North Carolina, and Jacksonville, Florida, both made the census' list of regions with the largest net domestic migration.

The big picture: The games industry is increasingly digital as players who once bought games on discs show an increased preference for downloading them.

It still plays a big role in physical retail, though, through the sale of consoles, controllers and other devices that just can't be downloaded, no matter your bandwidth speeds.

PlayStation sales migrate from big cities, following pandemic pattern

The move matches population migrations brought on by COVID-19.

Illustration of a PS5 controller and moving boxes in the bed of a pixellated truck.

 Illustration: Lindsey Bailey/Axios. Photo: Bloomberg/Getty Images

HanesBrands suffered a $100 million blow from a ransomware attack that temporarily devastated its supply chain and orders, the company said Thursday.

Why it matters: These cyber attacks pose a serious financial threat to companies in which bad actors seize control of their target's systems and then threaten to delete data, release information or refuse to relinquish control until payment is received.

Quick take: The event came during an already bruising quarter for the apparel company as its sales from continuing operations declined by 14% to $1.51 billion.

Between the lines: Hanes had disclosed the ransomware attack in an SEC filing in late May but had not previously discussed the breadth of its impact.

In today's earnings report, the company said the attack crippled its "global supply chain network and limited its ability to fulfill customer orders for approximately three weeks."

The impact: The company estimated that the attack resulted in a $100 million reduction in net sales and a $35 million hit to adjusted operating profit.

HanesBrands stock fell 6.2% to $10.84 at 2:20pm Thursday.

Of note: It's unclear whether Hanes paid a ransom to free up its systems.

Threat level: The company said in a statement that it "believes the cyber event has been contained" and "there is no ongoing operational impact."

Ransomware attack costs HanesBrands $100 million in net sales

HanesBrands lost $100 million in net sales while its systems were crippled due to a ransomware attack.

Giant letters h, b and i are illuminated in front of a corporate building

A HanesBrands corporate facility. Photo courtesy of HanesBrands

Ransomware

The Federal Election Commission voted 4-1 Thursday to approve a Google pilot program that would keep campaign emails out from automatically going to Gmail's spam folders, unless a user directs them there themselves.

The big picture: The program was roundly panned by FEC commenters begging the commission not to open up their email inboxes to even more spam. Now Google has to decide whether to go ahead with it.

Catch up quick: Early this summer, Google asked the Federal Election Commission to greenlight a program that could keep campaign emails from ending up in spam folders, responding to backlash from Republican leaders who accused Gmail of being biased, Axios previously reported. 

In June, Republican leadership introduced a bill that would require platforms to share how their filtering techniques work and make it illegal to put campaign emails into spam unless a user asks.

What's happening: Google in June asked the commission to rule on whether its plan would be considered a sort of contribution to political campaigns, as Axios reported.

The FEC's draft answer says it would be lawful for Google to offer the pilot program to eligible participants. The commission voted to adopt this draft, giving Google the green light to roll it out, though the company could still decide not to.

Between the lines: Google's effort is motivated by accusations of bias from Republicans, who hold that the company's Gmail service disproportionately marks their campaign emails as spam. 

During today's FEC meeting, Commissioner James Trainor referenced a North Carolina State University study Republican leaders in Congress have pointed to as proof that Gmail filters out GOP campaign emails more often than others.

Claire Rajan, the lawyer representing Google before the FEC, said that the authors of that study have said its conclusions have been misstated. She claimed the tech giant pursued the program because "Google is constantly iterating, and looking at ways to improve all of its products, including Gmail."

What they're saying: "We appreciate the FEC’s speedy review of our request and we will reflect on the positive and negative feedback received during the public comment period," José Castañeda, Google Spokesperson.  

"Our goal during this pilot program is to assess alternative ways of addressing concerns from bulk senders, while giving users clear controls over their inboxes to minimize unwanted email."

FEC OKs Google plan to keep campaign emails out of spam folders

Google's effort is motivated by accusations of bias from Republicans.

Google logo with a spotlight on part of it

Gmail

The Federal Trade Commission on Thursday began an effort to regulate data privacy practices, the first major regulatory undertaking by FTC chair and Big Tech antagonist Lina Khan.

Why it matters: The FTC rulemaking could lead to strict regulations on how firms collect and use people's personal information online — a threat to the Big Tech business model that relies on targeted advertising.

Driving the news: The FTC voted 3-2 along party lines to seek feedback on "the harms stemming from commercial surveillance and whether new rules are needed to protect people’s privacy and information."

The FTC, which has taken action in the past against companies for lax data security or misleading privacy promises, says it needs more regulatory firepower to fully protect consumers' privacy in the digital age.

"Rules that establish clear privacy and data security requirements across the board and provide the Commission the authority to seek financial penalties for first-time violations could incentivize all companies to invest more consistently in compliant practices," the agency said in a press release.

Yes, but: The FTC's ability to pass regulations is legally fraught, and the recent Supreme Court decision in an emissions case indicates the federal judiciary will be hostile to what it views as agency overreach.

The FTC's Republican commissioners, Noah Phillips and Christine Wilson both pointed to the need for a federal privacy law to protect consumers.

"What the (advance notice of proposed rulemaking) does accomplish is to recast the commission as a legislature, with virtually limitless rulemaking authority where personal data are concerned," Phillips wrote in his dissent.

What they're saying: "The growing digitization of our economy—coupled with business models that can incentivize endless hoovering up of sensitive user data and a vast expansion of how this data is used—means that potentially unlawful practices may be prevalent," Khan said in a statement.

"Our goal today is to begin building a robust public record to inform whether the FTC should issue rules to address commercial surveillance and data security practices and what those rules should potentially look like.”

Democratic Commissioners Rebecca Kelly Slaughter and Alvaro Bedoya also highlighted the need for a federal privacy law, with Bedoya saying, "There are no grounds to point to this process as reason to delay passage of that legislation."

Meanwhile, a bipartisan privacy bill has advanced farther than similar proposals but still faces obstacles in its path to becoming law.

FTC kicks off major effort to craft data privacy rules

The FTC voted 3-2 along party lines to seek feedback.

Illustration of a laptop with an open lock at the top

Federal Trade Commission (FTC)

Axios Crypto

Digital asset exchange FTX has launched a web campaign to bring the public around on cryptocurrency, called "Get to Know Crypto."

Why it matters: Starting with the White House's executive order this spring, 2022 has become the year policymakers have moved beyond holding the odd hearing about the industry and actually started drafting laws. They are more likely to actually enact laws if they have informed voters.

Driving the news:  "Get to Know Crypto" is both a simple website designed to explain some basics about blockchain technology and an embedded video (that's 1/3 ad for FTX).

According to a spokesperson, it's an extension of a community education program announced last year. 

Between the lines: While the world probably doesn't need another crypto explainer, "Get to Know Crypto" looks like it might be the leading edge of a broader   education campaign by FTX to move the country toward enacting any sort of law or regulation.

As of now, there's no crypto specific rules or laws, just the occasional enforcement action, usually out of the U.S. Securities and Exchange Commission. 

Visitors to the site who click "Learn more" get taken to FTX's policy page. 

What they're saying: In a statement from FTX's policy chief, Mark Wetjen, the company expresses support for legislation on both the House and the Senate side, saying, "The U.S. urgently needs cryptocurrency legislation that puts American innovation, job creation, and economic opportunity back in the driver’s seat."

Details: Each piece of legislation named by the company seem to favor the Commodities Futures Trading Commission. 

The House has the Digital Commodities Exchange Act, which came out in April. 

The Senate has the the Responsible Financial Innovation Act, which came out in June.

The Digital Commodities Consumer Protection act, which came out in August.

Our thought bubble: As far as explainers go for those truly interested in what crypt is? We've said before, you'll never understand crypto from videos and reading. You just have to try it (just like you can't learn to swim without swimming). 

FTX launches crypto public education campaign

It may look like another crypto explainer, but it feels more like the start of a broader political campaign for action in Washington.

Illustration of a lit lightbulb with glass shaped like a cube

Cryptocurrencies

Homeowners interested in adding rooftop solar panels, installing heat pumps and otherwise green-ifying their houses have plenty to like in the big climate, health and tax package likely to pass Congress in the coming days.

Why it matters: For consumers, the bill — called the Inflation Reduction Act (IRA) — has an array of rebates and tax breaks that will reduce green tech's upfront costs. That tech, in turn, generally leads to lower long-term energy bills, among other benefits.

More broadly, for every home that goes green, our communities get just a little cleaner — and fewer greenhouse gases are emitted, helping to curb the climate crisis.

Among the IRA's most important green home provisions: It extends a 30% federal tax break for rooftop solar installations for 10 years. 

That incentive has been repeatedly left teetering on the legislative edge over the last few years. Guaranteeing its existence for another decade adds certainty for homeowners and the rooftop solar industry alike.

Plus, home battery systems — which store energy generated by rooftop solar systems for later use, say, during a blackout — will qualify for the 30% credit for the first time. 

Such systems also allow homeowners to sell excess power back to the electric grid, further reducing their energy costs.

Rebates and tax credits for installing new, energy-efficient appliances — including heat pumps, electric stoves and electric dryers — as well as new circuit breaker boxes, which sometimes need to be replaced when retrofitting older homes.

New incentives for developers to build energy-efficient homes, or to retrofit older ones.

And $40 billion to jump-start the U.S. solar panel, battery and other green tech industries.

What they're saying: "In transitioning from a fossil fuel economy to a clean energy-powered, efficient electric economy," says Ari Matusiak, CEO of electrification advocacy nonprofit Rewiring America, "what we will be doing is effectively transferring wealth back from energy producers to energy consumers."

Matusiak adds that the IRA will help homeowners go electric whole cloth rather than piecemeal.

"If you have a fossil fuel operating system in your home, it makes sense" to have gas-powered appliances like stoves and water heaters, he says. "But as you electrify, it doesn't make sense for you to have half of one and half of the other."

The IRA's tax breaks and rebates will also benefit companies that do the actual work of modernizing homes. 

Donnel Baird, CEO and founder of retrofitting startup BlocPower, says the low- and moderate-income customers he works with "want to shift to clean energy for a variety of reasons, but they often can't afford the upfront costs — they don't have the budget." 

The IRA's incentives, he says, will "make it so much easier and so much cheaper for working people and low-income people to access clean energy."

Baird also argues that electrification will have big public health benefits, citing recent research saying gas stoves emit pollutants that can worsen or cause respiratory illnesses.

"Cooking with gas in our homes is going to end up being like lead paint," he says. "It's this thing that we all thought was fine. And then it turns out that lead paint causes  neurological disasters in kids," he says.

Yes, but: Modernizing homes will still be expensive, even with the IRA's rebates and tax breaks — yet options like leasing equipment can reduce up-front costs for many.

Green-ifying your home is about to get lots cheaper

The Democrats' climate bill has tax breaks for homeowners looking to modernize

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