Tech Brew Ride Home - Fri. 10/12 - Facebook Reports on its Breach Investigation

Episode Date: October 12, 2018

Facebook announces the results of their investigation into that data breach, the market downturn is biting some tech companies, has Spotify ruined music, and, of course, the Weekend Longreads suggestions. Links: An Update on the Security Issue (Facebook) Facebook rolls out 3D photos that use AI to simulate depth (TechCrunch) Tencent Music Pauses IPO Amid Market Turmoil (WSJ) FAANG stocks have seen $600 billion of market value wiped out — here's how much each one is on sale (Business Insider) Tesla sets deadline on new orders to get delivery and full tax credit by end of the year (Electrek) Who Needs German Engineering? Tesla Outsells Mercedes-Benz For The First Time—And Has a Plan to Pass BMW Too (Fortune) Has 10 years of Spotify ruined music? (The Guardian) The Betterment Weekend Longreads Suggestions: This Is How Amazon Loses (NewCo Shift) The Pentagon’s Push to Program Soldiers’ Brains (The Atlantic) Alexa, Should We Trust You? (The Atlantic) Fear and loathing in venture capital (Max Niederhofer) The First Rule of Microsoft Excel—Don’t Tell Anyone You’re Good at It (WSJ) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. guys, Brian again. Another quick plug to pre-order my book, How the Internet Happened from Netscape to the iPhone, which comes out October 23rd. I want to tell you real quick why I'm pushing you to pre-order the book now. This was not an easy book to sell. Publisher after publisher told us that internet and technology books

just don't sell very well. And my argument was, well, that's because you've only ever done individual pieces of the story, you know, a book about Amazon or Twitter here, a book about Steve Jobs or Elon Musk there. And so my argument was nobody has done the whole thing in one comprehensive volume until now. All those people, all those companies, don't you get it, the whole story in one shot? Well, Norton finally did get it and agreed with me, thankfully, but wouldn't it be great if this were a bestseller, not only because, I mean, of course, It would be great if any book you write is a bestseller, but also because it would be a sort of smug,

I Told You So for all those other publishers who didn't get it. So if we get some heavy pre-orders now, maybe we can graze the bottom reaches of the bestseller list that first week, and I can get that sweet, sweet I told you so. I'll admit it. I'm not above that. How the Internet happened, wherever books are sold. Thanks, guys.

Welcome to the Tech Meme Right Home for Friday, October 12th, 2018. I'm Brian McCullough. Today, Facebook announced the results of their investigation into that data breach. The market downturn is biting some tech companies hard, has Spotify ruined music, and, of course, the weekend long reads suggestions. Here's what you missed today in the world of tech. Facebook today announced the results of their investigation into that security issue that they announced back on September 28th.

Quick bullet point summary. Facebook says this was one large-scale attack exploiting the vulnerability, which ran from September 14th through the 27th of this year. There may have been, they say, smaller, more targeted attacks while the vulnerability was active, but that's not definitive yet.

The vulnerability was introduced into Facebook code in July of 2017, by the way. So this was, in fact, a malicious attack, and that was not clear at the beginning of this. But the good news is fewer people were impacted than Facebook originally thought was possible. Attackers made API calls and accessed information for around 30 million people out of the 50 million that Facebook originally feared could have been exposed. All of those accounts, Facebook said, were secured on September 28th when they reset logins and passwords. Facebook said in a statement, quote, This attack did not include Messenger, Messenger Kids, Instagram, WhatsApp, Oculus, workplace, pages, payments,

third-party apps, or advertising or developer accounts. As we look for other ways, the people behind this attack used Facebook, as well as the possibility of smaller-scale attacks, will continue to cooperate with the FBI, the U.S. Federal Trade Commission, Irish Data Protection Commission, and other authorities, end quote. And more details came from Guy Rosen, Facebook's VP of Product Management. Quote, here's how we found the attack that exploited this vulnerability. We saw an unusual spike of activity that began on September 14th, 2018, and we started an investigation.

On September 25th, we determined this was actually an attack and identified the vulnerability. Within two days, we closed the vulnerability, stopped the attack, and secured people's accounts by restoring the access tokens for people who were potentially exposed. As a precaution, we also turned off view as, and we're cooperating with the FBI, which is actively investigating and asked us not to discuss who may be behind the attack, end quote. And about that 30 million people number, quote, for 15 million people attackers accessed two sets of information, name and contact details, phone numbers, email, or both, depending on what people had on. their profiles. For 14 million people, the attackers accessed the same two sets of information as well as other details people had on their profiles. This included username, gender, locale, language, relationship status, religion, hometown, self-reported current city, birth date, device types used to access Facebook, education, work, the last 10 places they checked into or were

tagged in website, people or pages they follow, and the 15 most recent searches. For one million people, the attackers did not access any information, end quote. Slightly lighter Facebook news, and maybe you've already seen this in your feed, but Facebook has rolled out Facebook 3D photos that use artificial intelligence to add depth effects to iPhone portrait mode pictures. This was a feature that was announced at F8 back in May, but not everyone is going to be able to use it right now. As of right now, you can only take these photos

if you have an iPhone with dual rear cameras. That's because this trick uses those two cameras to create a depth map. Facebook has just added some customer software tweaks to the depth mapping. Most people will be able to view this effect in their Facebook apps, but again, you can only produce the effect

with an iPhone sporting dual rear cameras, and apparently only iPhones are capable of doing this right now. So if you have a dual camera Android phone, sorry? How do you know if you can produce a 3D photo? Well, shoot a shot in the Facebook app and you'll see a new 3D photos option in the status update composer. Tap that. These effects are also viewable on the Oculus Go VR headset

or the Oculus Rift. Indeed, this is another effort to try to get people excited about VR. According to Josh Konstien, quote, to create the best 3D photos with your iPhone 7 plus, 8 plus 10, or 10S, more phones will work with the feature in the future. Facebook recommends you keep your subject three to four feet away and have things in the foreground and background. Distinct colors will make the layers separate better

and transparent or shiny objects like glass or plastic can throw off the AI, end quote. I've held off covering the recent bloodbath in tech stocks this week because, well, I mean, you could be listening to this show tomorrow or next week, so it's hard for me to be definitive about the machinations of the stock market from day to day. But there has been a bloodbath in tech stocks this week. By the time you hear this, they could have all roared back to health. But the turmoil in the market has claimed one high-profile tech victim.

The Wall Street Journal is reporting that Tencent Music Entertainment Group is postponing its initial public offering, at least until November, because the sell-off in global markets generally has made things difficult for new tech IPOs, especially coming from China. Tencent Music was expected to get a valuation of between $25 and $30 billion, which would have made it one of the largest tech IPOs of all time. Tencent Music is the music service spinoff of the giant Tencent Holdings and operates several apps popular in China, including QQ Music, which is a popular karaoke platform. But by the way, that bloodbath in tech stocks, how bad has it been? With the caveat that I'm writing these words at 10.30 a.m. Friday morning, the so-called fang stocks, or fang stocks, Facebook, Amazon, Apple, Netflix, and Google have had more than $600 billion of market value wiped out from their recent peaks. The hardest hit is Facebook, whose shares have fallen 30% since its July peak, wiping out $188 billion in market cap. second hardest hit Netflix, which has lost 23% in value or $42 billion.

Least affected has been Apple, which has only lost 7.5% in percentage value. But when you're a $1.1 trillion company at your peak, that means a market cap loss of $85 billion, or more than the entire market cap of Starbucks, give or take. Of course, as I said, and this is why I've not been mentioning it, at the time of this writing, the NASDAQ, was up more than 2% today. So maybe all of those losses have been erased by the time this reaches your ears. Public service announcement there has been a flood of fake Adobe Flash installers who are reportedly installing XM rig, which is an open source crypto mining malware program that steals your computers processing and graphics cycles to mine cryptocurrencies,

and then deposits the funds generated into a Monero wallet. If you're not familiar with Monero, it's one of those so-called privacy coins that is to a large degree untraceable. Helpfully, though, apparently the malware actually does install an updated version of Flash while it's at it. How do you avoid falling victim to this? Don't install pop-up flash updates from sites you don't have 100% trust in. If you do click to install from one of these pop-ups and you get a warning about installing software from an unknown publisher, That's probably a red flag as well. Or, you know, you could join the movement to get flash out of our lives completely.

And all of this could go away forever, hopefully. Tesla outsold Mercedes-Benz in the U.S. for the first time ever last quarter. Atherton Research says the company sold 69,925 vehicles, while Mercedes-Benz sold only 66,542 vehicles excluding commercial vans. and Tesla is on path to possibly take over BMW in the U.S. in the final quarter of this year as well. But by the way, Tesla wants you to know that if you want to get in on owning a Tesla and still get that full federal tax credit of $7,500 for doing so, you're going to need to get your order in by October 15th.

In case you weren't aware, Tesla this year became the first car company to deliver 200,000 electric vehicles. By doing so, it triggered the... phase out of the federal tax credit for buyers of electric vehicles. If you miss the October 15th deadline, you'll only get a $3,750 credit if you buy a Tesla through the first half of 2019, and a mere $1,875 credit through the second half of next year. After that, the tax credit goes away completely. As Electric points out, the loss of the tax credit probably doesn't mean much to the sticker price of a Model S or Model X, but it can make five to eight percent difference in the price of the Model 3, depending on the configuration.

Happy birthday to Spotify, which turns 10 years old this Sunday. The music editors at The Guardian have celebrated by debating whether or not Spotify has created a post-compact disc paradise for music lovers, or, as they term it, turned music into gray goo. From the case for Spotify, it's made music more democratic, quote, Spotify speaks to this silent majority of music fans. Audio files, object fetishists,

anti-capitalist musicians, these groups noisily protest Spotify, but are marginal compared to the number of ordinary listeners who never read the liner notes in the first place. For many people, music is just for mood, something to exercise or have sex to, situations that Spotify usefully caters to

with playlists such as productive morning, extreme metal workout, and 90s baby makers, end quote. Why do I feel like that's kind of damning with faint praise?

Maybe because this is from the case against Spotify. Quote, setting aside the issues of money, Spotify playlists have fundamentally changed the listening experience. Spotify prides itself

on its personalized recommendations which work by connecting dots between data points, assigned to songs from rap, indie, and so on to infinite microgenre permutations, to determine new music you might like. Its model doesn't code for surprise, but perpetuates lean-back passivity. There's no context on the platform, merely entreaties to enjoy more of the same. You liked bread? Try toast.

It limits music discovery and the sound of music itself. Singles are tailored to beat the skip rate that hinders a song. chances of making it onto a popular playlist. Hooks and choruses hit more quickly. Homogenous mid-tempo pop drawing from rap and EDM has become dominant. New York Times pop critic John Caramanica regularly disparages this sound as Spotify core. Now it's time for the weekend Long Reads brought to you, of course, by Betterment, but this week by Betterment's Resource Center, which has great articles in there about the future of the gig economy,

how to think about retirement, and what goes into saving for your kids' education, or buying a house or whatever, much, much more. Check it out at betterment.com slash resources. First up this week, the great John Battell is up in arms about both Amazon's new sponsored advertisements and Amazon's increasing use of private label Amazon brands. He has a very detailed description of a recent Amazon shopping experience that had him tearing his hair out. Quote, Caching. Amazon just made a nearly 7% markup on my purchase. It took five clicks, 15 seconds, and a vast architecture of data and algorithmic mastery to make that profit.

Each and every time we purchase something on Amazon, that machinery is engaged in the background guiding us through choices, which ensure the company remains the trillion-dollar behemoth we know and love, end. In the end, Patel felt manipulated by Amazon's algorithms, nickel and dimingham. The title of the piece is This is How Amazon Loses. The Atlantic has a piece up about how the Pentagon wants soldiers of the future to be able to control robots with their thoughts. That's both fascinating and frightening,

because it's essentially about weaponizing soldiers' brains. The work is being done by DARPA, of course, which gave us the Internet in a roundabout way. Soldiers having no physical, psychological, or cognitive limitations will be key to survival and operational. operational dominance in the future, predicted Michael Goldblatt, who had been the Science and Technology Officer at McDonald's before joining DARPA in 1999, to enlarge humanity's capacity to, quote, control evolution. He assembled a portfolio of programs with names that sounded like they'd been

taken from video games or sci-fi movies. Metabolic dominance, persistence in combat, continuous assisted performance, augmented cognition, peak soldier performance. brain machine interface, end quote. The Atlantic has a deep dive on the possible implications of bringing smart assistance into our homes, which is pretty timely this week, wouldn't you say? A piece is called Alexa, should we trust you? Quote, within our lifetimes, these devices will likely become much more adroit conversationalists. By the time they do, they will have fully insinuated themselves into our lives.

With their perfect cloud-based memories, they will be omniscient. With their occupation of most of our intimate spaces, they'll be omnipresent. And with their eerie ability to elicit confessions, they could acquire a remarkable power over our emotional lives. What will that be like? End quote. Next, if you can muster some empathy for venture capitalists, V.C. Max Niederhofer has a fascinating blog post up about the psychological challenges of actually being a venture capitalist.

There's obviously the psychological burden of most of the companies you back probably failing to one degree or another. But, quote, conversely, all of your companies that do great will take forever to get there. I know VCs that had three children before their star company sold. That got married twice. And sure, that's okay. Let your winners run. all I'm noting is that the good ones take a long time

while the bad ones fail pretty fast relatively. So you don't really know how you're doing until you've spent around five to ten years of your life as a venture capitalist. Imagine doing something for a decade before you know whether you're any good at it, end quote. Again, I realize it's easy to be cynical about VCs if you're always on this side of the table from them.

To be cynical about what they're. do and the decisions they make, but stopping to actually think about the pressures and incentives they operate under could help you understand how to work with them better. And finally, a short, fun little piece from the Wall Street Journal about how if you're a wizard at Excel, the spreadsheet Excel, you should probably keep that to yourself and not tell anyone in the office about it, because if you do, your life will basically become a never-ending stream of help requests. That's been the weekend long reads brought to you as always by betterment investment involves risk but tech meme right home listeners can get up to one year of investment money managed free for more

information visit betterment.com slash ride that's betterment dot com slash r i d'e betterment outsmart average so yeah as you can imagine the book promotion starts in earnest next week all sorts of radio and podcasts and other shows already booked. And I don't know if you can hear it in my voice, but I've come down with a bit of a cold. It's not a bad cold yet, knock wood. But that's what having a two-year-old and a four-year-old in your house will do to you. Thankfully, I had already engaged Chris Higgins to help me out these next two weeks. So hopefully we'll be able to soldier through.

But yeah, perfect timing, right? Talk to you all on Monday. Thank you.