The wallet comes before the launch of GameStop’s NFT marketplace.
GameStop can’t seem to stop its metaverse investments.
GameStop is all about Web3: The company announced on Monday that it will launch a digital wallet for crypto and NFTs.
The GameStop wallet can be used across apps without users needing to leave their browsers, the company said in a statement. The self-custodial Ethereum wallet gives users access to the keys to their digital assets rather than trusting them with a third party, and is available for download as an extension on Google Chrome’s web store as well as on web browser Brave. The wallet will also be available as an iPhone app down the line, according to the GameStop wallet website. The wallet uses Loopring for transactions, a Layer 2 solution that’s meant to lower transaction fees.
The timing is certainly less than ideal, given that the crypto market is crashing, and GameStop cautioned users to be responsible (i.e., if you’re buying the dip, don’t bet your life savings).
“This is a beta launch. Please use responsibly, and do not add more funds than you are comfortable with,” GameStop said in a tweet.
The move is another shift in GameStop’s strategy to focus on digital sales rather than brick-and-mortar locations. The launch of the wallet follows the company’s announcement earlier this year that it will launch its own NFT marketplace in partnership with Australian company Immutable X by the second fiscal quarter of this year, or around July. The company also launched a $100 million fund for NFT gaming with Immutable X, which promises zero transaction fees for minting and trading. The wallet will be compatible with the GameStop’s marketplace.
GameStop has been stingy on other details about its upcoming NFT marketplace, but did previously say it has hired “dozens” of people for the project, “with experience in areas such as blockchain gaming, e-commerce and technology, product refurbishment and operations.”
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Nat Rubio-Licht is a Los Angeles-based news writer at Protocol. They graduated from Syracuse University with a degree in newspaper and online journalism in May 2020. Prior to joining the team, they worked at the Los Angeles Business Journal as a technology and aerospace reporter.
Spotify stopped hosting political ads on its services in early 2020, citing a lack of “robustness” in its systems, ahead of what turned out to be the ugliest U.S. election in recent history.
Less than two years later, as the midterm primaries get going, the company is courting political advertisers once again, according to a company presentation and marketing email viewed by Protocol.
Spotify confirmed to Protocol that it is slowly bringing back political ads for candidates, political parties, PACs and elected officials in the U.S. “Following our pause of political ads in early 2020, we have spent the past two years strengthening and enhancing our processes, systems and tools to responsibly validate and review this content,” spokesperson Erin Styles said in a statement.
In an email the company sent out to potential partners this week, Spotify said that political ads will appear “across thousands of podcasts on and off Spotify.” An accompanying presentation promises political advertisers the ability to target niche audiences and tap into AI-driven “contextual targeting,” which allows advertisers to place ads in podcasts when they are discussing issues relevant to their target audiences.
But the company is approaching its reentry to the often-ugly world of political advertising with caution. Spotify will only host ads from known political entities, and it won’t accept ads from the much broader bucket of issue-related groups. The ads will also only run on Spotify’s podcast network for now, not its free music-streaming network. Podcasts will also have the option of turning off political ads if they want to. Since 2020, the company has strengthened its advertiser verification system. Its political sales team is triple its previous size.
Spotify has not, however, developed a political ad archive similar to the ones Meta and Google offer. After the Russian troll scandal in 2016, both of those companies set up ad archives that, while imperfect, have grown more robust by the year, giving the public a window into the previously opaque world of online political ads. This week, Meta announced that it would add aggregate ad targeting data to its political ad archive.
But the absence of legislation forcing social networks to create these archives — and the absence of firm federal election disclosure requirements for digital ads — has created an imbalanced situation, where some companies require political advertisers to show their work and others, well, don’t. Styles said Spotify may consider creating a political ad archive in the future.
Bringing political ads back to Spotify is bound to raise uncomfortable questions for a company that has already been at the center of so much political turmoil over Joe Rogan’s podcast. But Spotify isn’t the only company that needs to be mulling what to do about political ads as the U.S. midterms near. Twitter similarly stopped allowing them in late 2019 after initially attempting to build an archive of its own. Meanwhile, Netflix may offer ads by the end of the year, forcing that company to make a similar choice. Disney+, for one, has already said it won’t offer political ads for the ad-supported version of its service.
Quality assurance testers at Call of Duty studio Raven Software have voted overwhelmingly to form a union with the Communications Workers of America, marking a historic labor victory for the video game industry. The vote, with the Milwaukee office of the National Labor Relations Board, was 19-3.
Until today, not a single major American game developer had a unionized work force of any kind. Only a single indie studio of remote workers, called Vodeo Games, voted to a form a union last year, though some game industry unions and cooperative do exist in Canada and overseas.
The union at Raven Software is known as Game Workers Alliance, and it marks a rare union win for the CWA, which has been working for years now to try to unionize game studios and combat worker exploitation.
“Five months ago, we formed the Game Workers Alliance-CWA on the principles of solidarity, sustainability, transparency, equity, and diversity. Activision Blizzard worked tirelessly to undermine our efforts to establish our union, but we persevered,” the GWA said in a statement. “Now that we’ve won our election, it is our duty to protect these foundational values on which our union stands. Our biggest hope is that our union serves as inspiration for the growing movement of workers organizing at video game studios to create better games and build workplaces that reflect our values and empower all of us. We look forward to working with management to positively shape our working conditions and the future of Activision Blizzard through a strong union contract.”
The union at Raven was spurred by both layoffs at the QA department in December and by parent company Activision Blizzard’s ongoing sexual harassment and discrimination crisis. A California lawsuit filed last summer has kicked off a reckoning at the game publisher, leading to numerous other lawsuits, high-level firings and resignations, management reshuffles, employee protests and a growing unionization movement.
Earlier Monday, the NLRB found that Activision Blizzard had illegally threatened employees and violated their rights through intimidation and an overly broad social media policy prohibiting them from discussing labor organizing, the lawsuit and other related matters. The NLRB plans to sue the company if it does not settle the charges.
It’s been more than four months since quality assurance testers at Activision-owned Raven Software said they had formed a union following a five-week strike to protest layoffs. Since the QA testers formed GWA in late January, Activision Blizzard has waged a lengthy anti-union campaign at Raven.
Management split up the team and distributed members across various divisions at Raven, a tactic GWA members felt was designed to stifle organizing efforts. Activision Blizzard said in April it would convert thousands of contract workers to full-time and hand out pay raises, but it excluded Raven’s union members from the bump. Later that same month, the company tried to include all of Raven’s roughly 350 employees on the union vote; the NLRB struck the measure down, as well as future appeals trying to stall the vote.
“Activision did everything it could, including breaking the law, to try to prevent the Raven QA workers from forming their union. It didn’t work, and we are thrilled to welcome them as CWA members,” said Sara Steffens, the CWA secretary-treasurer, in a statement. “Quality assurance workers at Raven Software are bringing much-needed change to Activision and to the video game industry. At this critical time for the company and its employees, these workers will soon have an enforceable union contract and a voice on the job.”
Correction: An earlier version off this story misstated the length of time since Raven’s QA testers formed their union. This story was updated on May 23, 2022.
Federal labor prosecutors in California plan to file a complaint against Activision Blizzard for illegally threatening workers if the company doesn’t agree to a settlement, according to National Labor Relations Board spokesperson Kayla Blado.
The NLRB found merit in charges filed against the company by the Communications Workers of America union in November 2021, according to Blado. The original charge from CWA attorneys alleged that Activision Blizzard tried to prevent employees from talking about wages, hours and working conditions and also tried to control their social media communications, both of which could violate labor laws.
The company has been hit with additional labor complaints from CWA attorneys, including an April 2022 filing that also claimed the company was threatening workers who spoke publicly about protected issues.
“These allegations are false. Employees may and do talk freely about these workplace issues without retaliation, and our social media policy expressly incorporates employees’ NLRA rights,” an Activision Blizzard spokesperson wrote in an email to Protocol. “Our social media policy explicitly says that it ‘does not restrict employees from engaging in the communication of information protected by law, including for example, rights of employees in the United States protected by the National Labor Relations Act.'” The company also said that it has not yet been informed of the director’s findings.
Activision Blizzard has been mired in legal battles with shareholders and federal and state regulators since parallel state and federal investigations found that the company fostered a “frat house” culture that tolerated sexual harassment, assault and gender discrimination. The lawsuits in turn spurred a wave of worker activism, walkouts, protests and a union campaign from the CWA.
Activision Blizzard settled one lawsuit with federal regulators at the Equal Employment and Opportunity Commission in March 2022 against the wishes of state investigators at the California Department of Fair Employment and Housing, who have been leading a parallel investigation. Former Activision Blizzard employee Jessica Gonzalez filed an appeal against that settlement Monday.
“Under the current EEOC settlement, workers who apply to be claimants would be barred from suing Activision Blizzard for future settlements — essentially protecting the company from any future legal accountability,” a CWA spokesperson wrote in a press release announcing the appeal.
Swedish “buy now, pay later” company Klarna is laying off 10% of its workforce, CEO Sebastian Siemiatkowski told staff via a pre-recorded video call Monday. Interest in pay-later products has sagged somewhat as consumers have felt more financially strapped and advocates in the U.S. began investigating the deferred payment plans last year. Klarna has reportedly been looking for more funding, potentially at a lower valuation.
“When we set our business plans for 2022 in the autumn of last year, it was a very different world than the one we are in today,” Siemiatkowski said in the video, according to a company-provided transcript.
Tech valuations generally are down. But “buy now, pay later” companies, which became particularly popular during the pandemic ecommerce boom, have been particularly battered; Affirm, which went public last year, has seen its shares drop 75%.
A few “buy now, pay later” startups are still announcing large funding rounds, but an investigation from the Consumer Financial Protection Bureau has elevated the argument that the increased buying power can be risky for some consumers, and raised scrutiny.
Investors, too, are taking a hard look at their portfolios. The Wall Street Journal reported last week that Klarna was seeking another $1 billion in funding at a $30 billion valuation. That’s a decrease of over one-third from Klarna’s peak valuation of $46 billion last year. SoftBank, a prominent Klarna investor, just posted an annual loss of $13 billion and has said it will pare back on investments.
Laid-off European employees will be compensated, Siemiatkowski said, though it’s unclear how. Severance for employees in other regions will vary. Klarna has about 5,000 employees, according to the company’s website.
The New York State Common Retirement Fund, one of the nation’s largest pension funds, announced that it will vote to remove all of Twitter’s directors at this week’s annual shareholder meeting. The vote against the directors is unlikely to result in change, but it shows mounting institutional pressure for Twitter to resist Elon Musk’s vision for relaxed content moderation policies.
Thomas DiNapoli, the New York state comptroller and trustee to the estimated $279.7 billion fund, said the Twitter board of directors had repeatedly failed to enforce the company’s own content moderation policies.
“Allowing this content on social media platforms facilitates the radicalization of individuals through repeated exposure to violent rhetoric, hate speech and examples of previous violence,” DiNapoli wrote in the public letter to Twitter’s directors. DiNapoli placed particular emphasis on Twitter’s failure to remove footage from a livestreamed mass shooting that took place in Buffalo, New York, last weekend. The alleged shooter espoused white supremacy ideology and pointed to social media sites including 4chan as the source of his radicalization.
DiNapoli called on other investors to join the vote against the board. Twitter’s largest institutional investors recently included Vanguard, State Street Global Advisors, BlackRock, Morgan Stanley and Fidelity. The New York pension fund was not among the top 10 largest investors.
Twitter shareholders still have to vote on whether to approve Elon Musk’s $44 billion acquisition bid. A self-described “free speech absolutist,” Musk has indicated his intention to revamp Twitter’s content moderation policies.
Since the initial takeover bid, however, Musk has strayed away from the free-speech-at-all-costs stance: “If they say something that is illegal or otherwise just destructive to the world, then there should be perhaps a timeout, a temporary suspension, or that particular tweet should be made invisible or have very limited traction,” he said earlier this month at the Financial Times’ Future of the Car conference.
Musk recently said the deal cannot “move forward” until Twitter provides more information on the number of fake accounts on the platform. That calls into question whether the deal would proceed, even if shareholders vote in favor of an acquisition. Twitter executives told employees last week that they would not be open to renegotiating the agreed-upon acquisition price.
This story was updated on May 23 to clarify that there is no date yet set for Twitter’s acquisition shareholder vote.
Apple is looking to boost global production outside of China as the country’s “zero-COVID” strategy cripples production facilities, the Wall Street Journal reported.
The strict lockdown, which has been described by the WHO as “not sustainable,” has shut down large cities, including Shanghai, as the highly infectious omicron variant spreads.
Currently, about 90% of Apple products are made in China, with a small number made in India and Vietnam. Apple is looking at factories in India and Vietnam to shore up its supply chain at a time when demand is high.
India is expected to increase its production of iPhones from about 3% last year to between 6% and 7% this year, according to the Wall Street Journal. Low labor costs and a large market make it an attractive destination. Taiwanese companies have already set up facilities in India to make iPhones for the local market, the Journal reported. However, neither India nor Vietnam is expected to radically overtake China as Apple’s main global supplier.
The over-reliance on China has been problematic for Apple in a variety of ways. The company was thrust into a trade war initiated under Donald Trump, then became vulnerable to supply chain shocks during the first wave of the COVID-19 pandemic in early 2020.
The company has also faced intense scrutiny for its human rights record in China, especially on the use of Uyghur labor in its supply chain. Apple was among other leading companies that lobbied Congress against passing the Uyghur Forced Labor Prevention Act.
“They were benefiting from forced labor or sourcing from suppliers that were suspected of using forced labor,” Sen. Marco Rubio said at a Senate Foreign Relations Committee hearing last year. “These companies, sadly, were making all of us complicit in these crimes.”
A 2020 report found that one of its main suppliers, Lens Technology, had used forced Uyghur labor, a claim Apple denied. Facing renewed criticism, the company announced a new human rights policy aimed at its suppliers.
As the Supreme Court weighs whether to block Texas’ social media “censorship” law, a court of appeals has decided to uphold the injunction on a similar Florida law, finding that social media companies “are ‘private actors’ whose rights the First Amendment protects.”
The 11th Circuit ruling comes in response to a lawsuit brought by NetChoice and CCIA, the same trade groups who filed an emergency application with Supreme Court Justice Samuel Alito after a similar Texas social media law went into effect earlier this month. The court found that Florida’s argument that social media giants are not entitled to First Amendment rights doesn’t hold up.
“Not in their wildest dreams could anyone in the Founding generation have imagined Facebook, Twitter, YouTube, or TikTok,” the court wrote in its opinion. “But ‘whatever the challenges of applying the Constitution to ever-advancing technology, the basic principles of freedom of speech and the press, like the First Amendment’s command, do not vary when a new and different medium for communication appears.’”
The opinion stands in stark contrast to the Fifth Circuit’s decision to lift an injunction on Texas’ law earlier this month without so much as a sentence of explanation. That decision created potentially catastrophic consequences for the tech industry, leading NetChoice and CCIA to file an emergency application asking the Supreme Court to stay the Fifth Circuit’s decision. The Supreme Court has yet to issue its decision, which could come any day now.
The 11th Circuit’s decision on the Florida law upheld an injunction on parts of the law that would prohibit companies from “deplatforming” political candidates, prioritizing or deprioritizing posts “by or about” political candidates and removing any content by a “journalistic enterprise.” It also blocks provisions that require companies to provide a “thorough rationale” for every content moderation decision.
But the court did allow the other disclosure provisions in the law — which includes having clear content standards and allowing users to access their data — to stand, finding that they are “far less burdensome” and unlikely to violate the First Amendment.
Whatever the Supreme Court decides with regard to the emergency application in Texas, the Florida decision tees up a possible circuit split in the event that the Texas law, which is still awaiting appeal, is upheld. That could create an opportunity for the Supreme Court to decide once and for all whether social media platforms enjoy First Amendment rights or whether they should be, as Justice Clarence Thomas has suggested, considered common carriers of a new age.
The tech groups behind both lawsuits were encouraged by the Florida decision and what it could mean for the Supreme Court’s forthcoming decision. “The First Amendment protects platforms and their right to moderate content as they see fit—and the government can’t force them to host content they don’t want,” NetChoice Vice President Carl Szabo said in a statement. “This makes it even more likely that the US Supreme Court will overturn the 5th Circuit’s split decision on the similar Texas law.”
D.C. Attorney General Karl Racine is suing Mark Zuckerberg, alleging the Meta CEO was responsible for decisions that opened the door for the Cambridge Analytica scandal.
Racine filed the suit on Monday, according to a news release, alleging, “Zuckerberg contributed to Facebook’s lax oversight of user data and implementation of misleading privacy agreements.” The complaint cited in particular Zuckerberg’s work to give third-party developers access to Facebook user data despite the company’s prior privacy pledges.
That move enabled a seemingly innocuous personality quiz to vacuum up extensive user data, which it ultimately transferred to Cambridge Analytica, a political consultancy used by Trump’s 2016 presidential campaign. The ensuing scandal resulted in a $5 billion fine for Facebook in 2019 and helped kick off the techlash, but some critics suggested it did little to bring accountability to Zuckerberg for the actions of a company he controls.
Racine is separately suing Facebook over the incident, and the latest complaint comes after a judge earlier this year rejected his office’s attempt to add Zuckerberg to that suit. He said Monday’s filing was based in “hundreds of thousands of pages of documents produced during” the litigation against the company.
Racine has repeatedly gone after powerful tech companies: He is currently trying to resurrect an antitrust lawsuit against Amazon, suing Google over location tracking and engaging gig companies including Grubhub in a suit over “deceptive” practices.
Facebook spokesperson Andy Stone declined to comment on Monday.
The U.K.’s Information Commissioner’s Office, the country’s privacy watchdog, has ordered facial recognition company Clearview AI to delete all data belonging to the country’s residents.
Clearview has also been ordered to stop collecting additional data from U.K. residents and will pay a fine of roughly $9.4 million for violating the country’s data protection laws, the office said Monday. This is the fourth time the company has been ordered to wipe data of an entire country’s residents, following orders from Australia, France and Italy in recent months.
The enforcement notice and fine follow an investigation of Clearview AI with the Office of the Australian Information Commissioner, which wrapped up in November and discovered that the company breached protection laws. The investigation found the company failed to use the data it collected in a “fair and transparent” way, collected it without a lawful reason and didn’t meet the data protection standards required for biometric data.
“People expect that their personal information will be respected, regardless of where in the world their data is being used,” John Edwards, U.K. Information Commissioner, said in a statement. “That is why global companies need international enforcement.”
Clearview claims to have a database of more than 20 billion photos collected from across the internet. In the U.K., the company’s database had been used by law enforcement, such as the Metropolitan Police, the Ministry of Defence and the National Crime Agency, a report published by The Register last year revealed.
The controversial company also recently got in trouble in the U.S., reaching a settlement with the ACLU that restricted it from selling its database of faceprints to most private entities. In a lawsuit, the nonprofit alleged that the company of violated the Illinois Biometric Information Privacy Act, which prohibits companies from taking and using Illinois residents’ “biometric identifiers,” such as faceprints and fingerprints, without their permission.
Correction: An earlier version of this story misstated the amount Clearview AI was fined. This story was updated on May 23, 2022.
Meta will finally give researchers access to targeting data for political ads — information that academics have been clamoring for and using legally risky workarounds to collect on their own for years.
The company had argued in the past that sharing targeting information would risk violating user privacy. Last year, it went so far as to permanently shut down a widely used ad transparency project run out of New York University after serving researchers there with a cease and desist.
In a blog post published Monday, Meta said it would share targeting data on individual ads with pre-vetted researchers who are part of its Facebook Open Research and Transparency project. The company piloted this type of data-sharing last year with a subset of 2020 election ads. Now, it’s expanding that work for researchers in its network.
The company is also offering more information about political ads in its Ad Library, which anyone can access. Rather than sharing targeting data on individual ads, the Ad Library will show aggregate data about the number of ads a page has run targeting a given demographic and how much that page has spent targeting that demographic. “For example, the Ad Library could show that over the last 30 days, a Page ran 2,000 ads about social issues, elections or politics, and that 40% of their spend on these ads was targeted to ‘people who live in Pennsylvania’ or ‘people who are interested in politics,'” the blog post reads.
One reason Meta has been reluctant to widely share more granular targeting data is because the company believes it would be too easy to reverse engineer who saw what ads and infer certain characteristics about individual users. “If you combine those two data sets, you could potentially learn things about the people who engaged with the ad,” Steve Satterfield, Facebook’s director of privacy and public policy, told Protocol last year.
In the absence of that information, researchers at NYU developed a browser extension through which Facebook users could opt-in to share political ads they saw in their own feeds with researchers. The extension also scraped the information Facebook shared with those users about why they were seeing the ad — information that, collected en masse, amounts to targeting data. The researchers then published that information in a public archive. That work came to an end last summer, however, when Facebook suspended the researchers’ accounts following a months-long legal standoff.
Targeting data is critical to understanding a political ad’s underlying motivation. By bringing that data to more researchers, which will begin later this month, Meta could significantly contribute to the public understanding of how political campaigns and groups are operating. It will also undoubtedly lead to more scrutiny of Meta and the way it enables political actors to manipulate and microtarget users.
Meta’s FORT program also hasn’t been without issue. Last year, the company admitted that it had sent a flawed dataset to researchers in the program, leading to potentially erroneous results for the academics who had been relying on it.
Meta also opened up additional data to an even more selective group of outside researchers, who studied the platform’s impact on the 2020 election through the Jan. 6 riot. But the results of that research, due last year, were postponed and have yet to be released.
Coinbase just celebrated its 10th birthday. And the crypto powerhouse marked the milestone on a defiant note, with a snarky TV ad clapping back at crypto bashers.
“Crypto is dead. Long live crypto,” said the 30-second ad which aired Friday during the NBA Western Conference finals game between the Golden State Warriors and the Dallas Mavericks.
The ad showed tweets dating back to 2012, with the authors’ names blurred out, declaring “Crypto is dead.”
At a time when crypto is reeling from a severe downturn and Coinbase is making spending cutbacks, the reactions were understandably mixed.
Michael Fasanello, chief compliance officer of LVL, called the ad “classic and minimalist, yet effective.”
“It drives home the message that just like so many other emerging technologies and emerging markets, blockchain and crypto will have their ups and downs — but they are here to stay,” he told Protocol.
Jef Loeb, creative director at Brainchild Creative, agreed it was “effective if the objective is to let the market know Coinbase isn’t heading for the life rafts quite yet.”
“It’s also effective in preaching to an increasingly small choir not to abandon the Titanic quite yet,” he told Protocol, quipping, “Hey, the sopranos and altos may have headed for the exits, but the bros in the bass [section] are hanging in.”
Coinbase recently included a warning in its regulatory filings that in a bankruptcy scenario, customers’ crypto holdings were at risk. Coinbase CEO Brian Armstrong hastened to reassure customers that it wasn’t actually facing bankruptcy.
Loeb noted the dramatic shift in tone in the ad from the “celebrity-driven ‘don’t miss out’ [messages] in February’s Super Bowl” from other crypto companies “to a spin on Mark Twain’s aphorism four months later” about how ““reports of crypto’s death are both frequent and exaggerated.” Coinbase’s Super Bowl ad featured a floating QR code which succeeded in bringing so many people to its website that it crashed.
The choice of the Warriors game was symbolic. Former Warriors player Kevin Durant invested in Coinbase, and Coinbase and the NBA struck the league’s first cryptocurrency sponsorship deal last year, in flusher times.
The crypto exchange posted disappointing results recently amid the sharp slump in crypto prices epitomized by the UST stablecoin meltdown. In a sign of growing uncertainty, Coinbase also announced that it was freezing hiring and cutting back on other spending a week after declaring that it was pushing forward with expansion plans.
The crypto market has shed roughly $1 trillion in value the past month, while Coinbase shares have tanked more than 50%.
Google is allowing some Android apps to use their own payment systems after getting into battles with both Match Group and Epic Games’ Bandcamp, but the move might be temporary. The company is facing legal action for requiring apps in the Google Play Store to use its billing, and the interim solution Google came up with is to let those apps use their own payments — with a catch.
Match Group withdrew its temporary restraining order against Google on Friday, according to TechCrunch, which it had filed amid its antitrust lawsuit against the company. Match eked out some “concessions” from Google, including making sure its apps would not be ousted from the Play Store for using alternative payment options, TechCrunch reported. Rather than pay Google, Match is putting aside $40 million in an escrow account, maintaining that the fees are illegal and awaiting a judge’s ruling.
The lawsuit, which alleges that Google has “illegally monopolized” the app market for Android with its Play Store policy, is still ongoing. Google’s Play Store policy requires app developers use the company’s billing system, then takes a cut of the revenue. In the original complaint, Match claimed Google holding it “hostage,” while Google responded that it charges for services “like any business,” and that its commission is the “lowest rate among major app platforms.”
“We plan to rebut Match’s unfounded complaint and will be counter-suing for damages and breach of our developer contract,” a Google spokesperson told Protocol. “Match has agreed to put up to $40 million in escrow as a reserve against damages and to work to integrate Google Play’s billing system.”
Google also settled its differences with Epic Games on Friday, and won’t kick Epic subsidiary Bandcamp off of Google Play Store for using its own payment system, Music Business Worldwide reported. Under the agreement, Bandcamp will also start an escrow account for Google’s fees, setting aside 10% of its revenue generated from digital sales until Epic’s case against Google is resolved, the company said in a blog post.
Epic acquired online music platform Bandcamp, which has used its own billing system on Android since 2015, in March. Bandcamp was threatened with being booted from the Google Play Store if it didn’t begin using Google’s proprietary billing system by June 1. Bandcamp was able to use its own system for so long because Google has an exemption from its billing rule for digital music companies, according to the blog post.
“We’ll continue to defend our business against Epic’s campaign to not pay for the value they get from Google Play,” the Google spokesperson said. “Epic has now agreed to pay a standard 10% service fee into escrow as a reserve against potential damages.”
Epic, parent company of Fortnite, sued Apple for similar anti-competitive behavior.
This story was updated May 20, 2022, with comments from a Google spokesperson.
Larry Ellison was among the participants on a call in November 2020, during which top Trump allies discussed ways to contest the election results, according to The Washington Post. It’s unclear what role Ellison played on the call, but The Post found evidence of Ellison’s apparent involvement in court records and confirmed with one of the call’s other participants.
An Oracle spokesperson didn’t immediately respond to Protocol’s request for comment.
The records are part of an ongoing legal case involving True the Vote, a conservative group focused on stopping supposed voter fraud, and Fair Fight, a progressive voting rights group founded by Stacey Abrams. According to documents revealed in that case, True the Vote’s founder Catherine Engelbrecht described the call in a note to a donor.
“Jim was on a call this evening with Jay Sekulow, Lindsey O. Graham, Sean Hannity and Larry Ellison,” Engelbrecht wrote, according to the Post. Jim, in this case, describes Jim Bopp, True the Vote’s lawyer. “He explained the work we were doing and they asked for a preliminary report asap, to be used to rally their troops internally, so that’s what I’m working on now.”
The donor, Fred Eshelman, replied days later, according to the Post, curious about Ellison’s involvement. “Why was he on call with Senator Graham? Is he part of data/analysis solution, is he a potential large donor, other?” Eshelman’s message read.
Bopp confirmed his participation in the call, but told the Post he couldn’t recall its participants and shared a different recollection about the substance of the call. “The question that I think was being discussed was whether or not congressional hearings on how the 2020 election was being conducted would be beneficial to whatever people were doing,” he told the Post.
Ellison’s support for former President Trump is, by now, well known. He was among Trump’s most prominent allies in the tech industry during his time in office and held a fundraiser for him during the 2020 election. Trump, likewise, praised Oracle and looped the software giant in on the much-anticipated, but ultimately scuttled, deal to acquire TikTok in September 2020. His administration also backed Oracle in its copyright fight with Google.
Ellison, who is now chair of Oracle’s board, is also part of the group of financiers who recently joined Elon Musk in his bid to take Twitter private. Musk has said if the deal goes through (and that’s still a big if) that he would reinstate Trump’s account.
Microsoft Bing has exported Chinese censorship abroad, according to a new report by The University of Toronto’s Citizen Lab.
Bing searches for national figures, leaders within the Chinese Communist Party, dissidents and topics that Beijing considers politically sensitive did not appear in auto-suggest in North America, according to the report. Among the search terms that didn’t generate autocomplete suggestions were searches for President Xi Jinping, the late human rights activist Liu Xiaobo and searches related to the Tiananmen Square massacre.
“We consistently found that Bing censors politically sensitive Chinese names over time, that their censorship spans multiple Chinese political topics, consists of at least two languages, English and Chinese, and applies to different world regions, including China, the United States and Canada,” the report said.
In response, a spokesperson for Microsoft told The Wall Street Journal said the results were unintentional. “A small number of users may have experienced a misconfiguration that prevented surfacing some valid autosuggest terms, and we thank Citizen Lab for bringing this to our attention,” the spokesperson said.
The report raises questions about the long reach of Chinese official censorship and its infamous Great Firewall, which clamps down on discussions Beijing considers destructive. “If Microsoft had never engaged in Chinese censorship operations in the first place, there would be no way for them to spill into other regions,” Jeffrey Knockel, a senior research associate at Citizen Lab, told the Journal.
While other major American tech companies such as Facebook and Twitter have decided to stay out of China because of their refusal to comply with strict censorship rules, Microsoft has continued to do business there. That has led to frequent accusations that the company is acquiescing to censorship demands, including on LinkedIn, which began operating in China in 2014. In the past, the company has been found blocking the profiles of U.S. journalists in China due to “prohibited content” in their profiles.
Last year, however, the company announced that LinkedIn would be pulling out of China, citing what it described as “greater compliance requirements.” In its place, the company said it would launch a stripped-down job seeking site that did not include LinkedIn’s social features.
In an interview with Protocol last year, LinkedIn founder Reid Hoffman discussed that decision, saying, “[The] conflicts between society, Western society and China try to put you in the crossfire. Between them, you end up in a lot of controversy when you’re trying to navigate this line.”
Google had its “best year yet” for hiring Black and Latinx employees in the U.S. as well as women globally, according to its 2022 Diversity Annual Report. The hiring rate increased for Black, Latinx, Native American and female employees, although these identities are still very underrepresented compared to white and male employees.
The number of Black employees increased from 4.4% in 2021 to a little over 5% in 2022, while Latinx employees increased from 6.4% to 6.9%. White employees still make up almost half of the workforce, and Asian employees make up around 43%. Native American employees make up less than 1%. Men make up two-thirds of the company’s workforce nationally and globally. Attrition rates went down among almost every demographic compared to 2021, with the exception of growing attrition among Asian employees and Native American men.
Former Black Google employees have accused the company of racism in recent years, leading to an investigation from the California Department of Fair Employment and Housing. April Curley, a former recruiter, is suing Google for allegedly underpaying and undervaluing its Black employees. Timnit Gebru, a prominent AI research ethicist, was fired by the company in 2020 after she refused to remove her name from a research paper and wrote an internal note about her concerns with Google’s diversity efforts.
Protocol’s diversity tracker displays diversity data across Big Tech, allowing you to look at companies’ efforts side by side.
Correction: An earlier version of this story misstated the percentage of Black employees at Google in 2021. This story was updated on May 20, 2022.
Tech companies are figuring out how to handle the upcoming historic Supreme Court decision that could overturn abortion rights. In the case of Meta, that includes telling employees to not talk about it at work. Meta VP of HR Janelle Gale told workers during an all-hands on Thursday not to talk about abortion on Workplace, the company’s internal messaging platform.
She said that it’s the “most divisive and reported topic” by employees on the platform, according to recordings obtained by the Verge. Meta has had a policy in place since 2019 that prevents employees from talking about abortion, but the policy hasn’t been too much of an issue until recent weeks, after a Supreme Court draft opinion that would reverse Roe v. Wade was leaked.
Gale told employees that the issue is a “unique topic that kind of trips that line on a protected class.” Rather than talking among employees about the issue in a public, written forum, executives said the issue can be discussed with a “trusted colleague in a private setting” or in a group with up to five “like-minded people.”
“Even if people are respectful, and they’re attempting to be respectful about their view on abortion, it can still leave people feeling like they’re being targeted based on their gender or religion,” Gale said, according to the Verge.
The message is seen as contradictory among employees. Some Meta employees argued that if they can talk “respectfully” about issues like Black Lives Matter, immigration and trans rights on Workplace, then they should be able to discuss abortion as well. One employee wrote in an internal message earlier this month that she felt a “strong sense of silence and isolation” at work because of the policy, and others have shared frustrations about their posts on the topic being taken down.
The policy is also at odds with public stances executives have taken on the upcoming court decision; Meta’s Sheryl Sandberg publicly criticized the Supreme Court draft opinion, calling it a “scary day for women all across our country” when the opinion leaked.
A Meta spokesperson did not immediately return Protocol’s request for comment.
How employees can — and can’t — talk about abortion at work is only one facet of the evolving landscape for tech companies on women’s reproductive health. Some, including Amazon and Bumble, have offered to pay for abortion-related travel costs ahead of the likely overturning of abortion rights in states where many tech companies operate. User data could also become a battleground in states that end up criminalizing abortion.
As many tech companies face a slump and crypto looks set for a deep freeze, Coinbase is facing reality and hitting the brakes on spending. The company is halting some business projects, freezing hiring for two weeks and cutting its spending on Amazon Web Services, the Information reported Thursday.
Coinbase is also giving employees stock grants to boost compensation, according to internal emails viewed by the Information. The company’s stock tumbled more than 75% in the last year. Employees will receive grants that offset half the difference between grants made earlier in the year and the company’s closing share price on Friday, the Information reported.
In a plan codenamed “Plutus,” Coinbase will focus its efforts on products such as retail trading, institutional trading and custody, and staking, as well as focus on international expansion.
The plan also includes several cost-cutting measures, such as trimming spending on AWS and Datadog and reducing gas fees for validating crypto transactions, according to the Information. The company also paused initiatives including business banking and a months-old pilot program for remittances. Though Coinbase will honor job offers sent to candidates as of this past Monday, further hiring has been paused.
The news follows a Monday blog post from President and COO Emilie Choi, noting that the company was planning to slow hiring amid the market downturn, and will “reassess our headcount needs against our highest-priority business goals.” Coinbase had previously planned to triple the size of the company, which now has more than 5,000 employees.
“This slow down will also force us to be more rigorous in our prioritization,” said Choi. “We’re in a strong position — we have a solid balance sheet and we’ve been through several market downturns before, and we’ve emerged stronger every time.”
Coinbase stock is down this month, closing at $67.42 on Thursday. Its shares are down 80% since its direct listing in April 2021.
AWS reached a private settlement with a female employee who accused now-former executive Joshua Burgin of discrimination and harrasement, Protocol has learned.
The cloud giant agreed to pay the employee $10 million with the mandate that she leave the organization, according to a source familiar with the deliberations, which she did in January. Burgin, who previously led AWS Outposts, left the company in December for VMware, a move harshly criticized by employees of the virtualization software provider.
An AWS spokesperson confirmed the settlement but said the figure was “wildly inaccurate” and declined to comment further. The employee, whom Protocol is not identifying in order to stave off further harassment, declined to comment, citing a confidentiality agreement with Amazon.
Amazon is facing several discrimination and harassment cases. In 2021, at least five female employees filed suits against the company alleging, among other claims, that executives made racist remarks and withheld promotions as a result of their activism.
Amazon previously said it found no evidence to support the claims. Last year, however, the company tapped an outside law firm to conduct a review into how it investigates such allegations.
“We engaged Oppenheimer Investigations Group (OIG) to work directly with employees and conduct an independent investigation of the ProServe organization’s culture. We committed to that being a thorough review, and will continue to communicate with employees about the investigation,” an AWS spokesperson said in an emailed statement.
The Federal Trade Commission on Thursday unanimously reminded providers of education technology to follow federal limits on the collection and use of kids’ data in an attempt to ensure that common practices in the data economy don’t become the norm in schools.
During its open meeting, the commission voted to approve a policy emphasizing that ed tech providers shouldn’t collect more data on kids under 13 than they reasonably need for their services, can’t use the data for advertising without parental consent and have to maintain appropriate security, among other measures.
In a statement, President Joe Biden, who had called for children’s privacy protections in his State of the Union address, applauded the vote and said that “the agency will be cracking down on companies that persist in exploiting our children to make money.”
The vote, which comes after the COVID-19 pandemic accelerated the reliance on education technology, highlighted the bipartisan interest in protecting kids’ privacy. The commissioners enunciated their worries about companies forcing parents to accept overly vast data collection so kids can do homework, firms getting sign-off only from schools for practices that go beyond students’ work and the long-term retention of educational data for use in advertising or other commercial contexts.
Democratic Commissioner Rebecca Kelly Slaughter, who spoke about her daughter learning to read online during the pandemic, said she was glad that federal law requires parental consent for collecting kids’ data, but praised the new FTC statement’s reliance on the additional limits that the law places on companies’ use and collection of kids’ data even if they do have consent. “While I appreciate being in the driver’s seat, I also understand that I actually can’t drive all the things that my children are doing on a day-to-day basis,” she said. “There just aren’t enough hours in the day to do all of that micromanaging of my children’s use of technology.”
While the policy closely follows existing law on kids’ privacy, known as COPPA, the statement signaled that the commissioners are turning their attention to tools that kids may use every day and that parents rely on for their children’s development.
In a separate vote, the commissioners also voted unanimously to seek public input on their stance that social media sites may not be providing sufficient tools to let influencers disclose endorsements and that other businesses may be violating advertising rules when they hide negative reviews.
The votes also represented one of the first public moves as a commissioner for Alvaro Bedoya. His confirmation earlier this month gave the FTC a Democratic majority that can begin to work on far-reaching enforcement actions and regulation of tech companies, as envisioned by the agency’s chair, Lina Khan.
At the same time, the two Republican commissioners, who have criticized Khan’s agenda as well as procedural changes she’s put in place, went out of their way on Thursday to praise the process that went into some of the day’s votes. All commissioners also highlighted the work of staff as surveys have revealed plummeting morale at the agency.
The apocalypse is coming, at least according to one of the world’s biggest startup accelerators.
Y Combinator sent an email to portfolio founders this week, obtained by TechCrunch, advising the startups to “plan for the worst” as the market turbulence has prompted many companies to initiate layoffs, cost-cutting measures and hiring slowdowns.
“If your plan is to raise money in the next 6-12 months, you might be raising at the peak of the downturn,” said the email, which was titled “Economic Downturn.” “Remember that your chances of success are extremely low even if your company is doing well. We recommend you change your plan.”
The note advised founders to “cut costs and extend your runway within the next 30 days.”
The famed startup accelerator is falling squarely into the camp that believes the hot funding environment of the last couple of years is decidedly over, and early-stage startups will have to prepare to hunker down and live off of “lower valuations, lower round sizes and many fewer deals completed.”
They also predicted that the downturn will disproportionately impact “international companies, asset heavy companies, low margin companies, hardtech, and other companies with high burn and long time to revenue.“
Finally, the note ended with a link to a 35-minute YouTube video from Y Combinator called, “Save Your Startup during an Economic Downturn.”
This month has seen a slew of privately backed startups announcing layoffs, most notably Cameo and Mural.
Even the big tech giants are feeling the cost-cutting pressure amid rising inflation, rising interest rates and a looming bear market. Netflix laid off 150 employees this week amid stalled growth, a month after laying off Tudum staff. Meta, Robinhood, Salesforce and Uber all initiated hiring freezes or layoffs as well.
PSA: If you’re going to do a mass layoff, don’t do it like Carvana.
Apple just hit an important milestone in developing its mixed-reality headset as rivals like Meta are making strides in developing similar devices. Executives showed off an AR/VR device to Apple’s board last week, according to Bloomberg, a sign that the product is really happening and it’s inching closer to a public launch.
Sources with knowledge of the matter told Bloomberg that a version of Apple’s AR/VR headset was demonstrated to the company’s board members at their latest meeting last week. The board meets four times per year. Apple is also reportedly making progress on the operating system that will power the headset, called rOS (reality operating system) for now. Combined, the developments make clear that Apple is closer to releasing the first device in the first new product category since it launched the Apple Watch in 2015. According to Bloomberg, the company might show off the headset this year and is targeting a 2023 release date for the public.
The first iteration of the mixed-reality headset will offer both AR and VR capabilities, using advanced processors and ultra-high-resolution screens. The company has also been working on AR versions of apps that are currently on the market, and also plans for the headset to be used to stream content and hold virtual meetings. The company is also reportedly working on a separate pair of AR glasses, but those are years away.
The headset won’t come cheap: Bloomberg has reported that it will cost about $2,000. The company last year believed it would sell one unit per day at Apple stores, for a total of 200,000 per year. That’s underwhelming for a company like Apple, which doesn’t tend to sell small quantities of products, but signals that the company believes the first device will be a game-changer.
Apple was originally going to debut the product at the Worldwide Developers Conference in June, but that plan was delayed due to issues including content and overheating, according to Bloomberg.
The SEC is pushing back on Ripple’s bid for access to emails and other documents that the crypto giant believes could bolster its case against the regulator.
The SEC, which sued Ripple in 2020 for failing to register $1.4 billion worth of XRP as securities, has refused to release emails related to a 2018 speech by former director William Hinman in which he argued the ether cryptocurrency was not a security. The speech sparked a rally in ether’s price and was interpreted as an endorsement of the industry’s view that cryptocurrencies are not securities.
A federal judge had ordered the SEC to release drafts of the speech and related emails, documents which Ripple says could shed more light on the agency’s deliberations on cryptocurrencies.
But the SEC on Wednesday argued in a letter to the judge that the communications were protected by “attorney-client” privilege, arguing that Hinman “communicated with the SEC staff to obtain their legal advice.”
“The question of ‘whether offers and sales of ether constitute securities transactions’ is indisputably a legal question,” the SEC wrote.
In a May 13 court filing, Ripple had argued that Hinman, who stepped down as the director of SEC’s Division of Corporate Finance in late 2020, “was not a ‘client’ of the SEC’s lawyers for purposes of his outside personal activities.” In its letter, the SEC argued that Hinman delivered the speech in his role as a senior SEC leader, not in any “personal capacity.”
The legal battle is expected to drag on into 2023 as the case enters its next phase. Filings and hearings on motions for summary judgment will extend to December. At that point, the judge will either decide the case or have it go to trial.
Tesla’s autopilot system is being investigated by the U.S. National Highway Traffic Safety Administration following a fatal crash in California that killed three passengers this month. It is the 35th accident the agency has investigated since 2016 related to Tesla’s Autopilot feature, according to Reuters. Those accidents have resulted in a total of 14 deaths.
It is unclear whether Autopilot was in use during the crash in California, and earlier investigations have ruled out the use of Autopilot in three of the 35 investigations the agency has undertaken.
But the NHTSA isn’t the only one taking a harder look at Tesla’s Autopilot promises. Senators have also called on the FTC to investigate Tesla’s statements with regard to Autopilot.
One big issue is the way Tesla has promised “full self-driving capabilities.” Last September, Jennifer Homendy, the head of the National Transportation Safety Board, described the use of such language in advertising as “misleading and irresponsible” and prone to abuse by drivers. In a letter to FTC chair Lina Khan last year, Democratic senators made much the same case, writing, “Their claims put Tesla drivers — and all of the traveling public — at risk of serious injury or death.”
When in Autopilot mode, Tesla says the car can suggest lane changes and steer itself in “tighter, more complex roads.” The company warns that Autopilot does “require active driver supervision” and says that the feature does not “make the vehicle autonomous.”
The investigations are yet another burden for Tesla CEO Elon Musk, whose company has also faced mounting recalls over everything from Tesla vehicles’ rolling stop feature to concerns about windshield defrosting. That’s in addition to Tesla’s falling stock price in the wake of Musk’s bid to takeover Twitter.
Google has reportedly pulled out of Russia, and many employees there have moved to Dubai.
The Wall Street Journal reported Wednesday that most of Google’s Russia-based employees had chosen to leave the country, and that the company will soon have no workforce presence in Russia amid the country’s ongoing war in Ukraine.
Russian authorities reportedly emptied Google’s main Russian bank account after a court froze it in March. Unnamed sources declined to tell the Journal how much the government took, but it left Google without the money to pay its Russia-based employees and vendors. As a result, Google’s Russian subsidiary will file for bankruptcy, Reuters reported Wednesday.
Google told Reuters and the Journal that it will continue to offer free services in Russia, including Search, YouTube, Gmail and Maps. But Google hasn’t brought back advertising operations in Russia since suspending them in March. Russia also banned Facebook and Instagram in March after calling Meta “extremist.”
“The Russian authorities’ seizure of Google Russia’s bank account has made it untenable for our Russia office to function, including employing and paying Russia-based employees, paying suppliers and vendors, and meeting other financial obligations,” a spokesperson from Google told Protocol. “People in Russia rely on our services to access quality information.”
This story was updated on May 19 to include a statement from Google.
Add lawmakers to the growing list of people, companies and trade groups that are ticked off about the Commerce Department’s solar probe.
This week, a collection of 85 House Democrats wrote to the White House saying that they’re concerned “about the devastating economic and environmental impacts” of the probe, which began in April and has already had already stunted the clean energy transition in the U.S. While the probe has not resulted in any changes to the U.S. tariff structure so far, the chance that it could has the industry upset. Lawmakers have heard those concerns, and they’re turning up the pressure on the Biden administration to wrap the probe up as quickly as possible.
“Many of us have repeatedly cautioned against the severe negative consequences this inquiry would have on the U.S. solar industry, and now that this investigation has been initiated, those consequences are playing out across the United States,” the lawmakers wrote, adding that it “threatens to completely derail” the country’s renewable energy progress. The letter signatories include progressives like Rep. Alexandria Ocasio-Cortez and centrists like Rep. Tom O’Halleran, reflecting the broad range of lawmakers invested in a rapid resolution.
The inquiry came about following a petition from Auxin Solar, a small California solar company, that asked the agency to look into whether Chinese companies are skirting tariffs by building panels in Southeast Asia. The resulting investigation is expected to last roughly a year.
In addition to the House Democrats trying to speed up the timetable, a bipartisan group of 19 governors weighed in. They also sent a letter to President Joe Biden on Monday saying the uncertainty caused by the probe threatens clean energy jobs and project deployments nationwide.
“The current market disruption jeopardizes much of the progress achieved by the domestic solar industry and we fear this will only continue for the duration of the investigation,” the group wrote. Neither Texas Governor Greg Abbott nor California Governor Gavin Newsom signed the letter, despite representing the two largest states for solar deployment in the country. (Newsom sent a separate letter to the Commerce Department earlier this month.)
For her part, Commerce Secretary Gina Raimondo said in a Senate hearing last week that the department is “going to go as fast as possible” to complete the probe. She also said that the inquiry is being carried out by an investigative body that is entirely isolated from political considerations, something the agency has reiterated repeatedly over the past month. But White House officials reportedly told a group of Democrats that the administration is working to limit the uncertainty that the industry is faced with, according to Axios.
This post has been updated with info about the letter that Governor Gavin Newsom sent. This story was updated May 19, 2022.
