Tech Brew Ride Home - Fri. 11/20 – Facebook And Apple Trade Schoolyard Taunts

Starting point is 00:00:00 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. Welcome to the Tech meme right home for Friday, November 20th, 2020. I'm Brian McCullough today. Facebook and Apple are calling each other names again. Privacy Thief, Monopolis, and why we might see more of this sort of thing in the coming years. Roblox files may be the most exciting S-1 of this IPO batch. Stadia is going to work around the App Store 2,

Starting point is 00:00:55 another big milestone crust for self-driving cars, and of course the weekend long read suggestions. Here's what you miss today in the world of tech. another case of Mommy and Daddy are fighting again. It's just this time a different Mommy and Daddy are fighting. It's complicated, but it breaks down like this. In an open letter, Apple yesterday defended its decision to delay those IDFA changes in iOS 14 that would block the sort of tracking data ads that Facebook and Google used to follow you around the internet. In that open letter, Apple basically slammed Facebook, quoting 9 to 5 Mac. In a letter sent to the ranking digital rights organization, Apple's Jane Horvath, senior director of global privacy, reiterated that the company

Starting point is 00:01:40 believes that, quote, privacy is a fundamental human right, end quote. Horvath explains that Apple delayed the app tracking transparency ATT feature in an effort to give developers more time to prepare for the changes. The letter also confirms that the app tracking transparency feature, which is designed to allow users to disable tracking between different applications, is still coming next year. Once in effect, developers will also be required to ask for permission before tracking a user across apps or websites. Furthermore, Horvath has sharp criticism for Facebook, saying that the social network has made clear that its intent is to, quote, collect as much data as possible on its users, quote, by contrast Facebook and others have a very different approach to targeting. Not only do they allow the grouping of users into smaller segments, they use detailed data about online browsing activity to target ads.

Starting point is 00:02:31 Facebook executives have made clear their intent is to collect as much data as possible across both first and third-party products to develop and monetize detailed profiles of their users and this disregard for user privacy continues to expand to include more of their products, end quote. On the flip side, Facebook has criticized the app tracking transparency feature and said it could cause ad revenue to drop by as much as 40%.

Starting point is 00:02:54 Facebook has reportedly met with advertising partners to discuss the impact the change will have on advertising when users have the ability to easily opt out of cross-platform tracking, end quote. And indeed, Facebook was quick to hit back at Apple's open letter, sticking them with the convenient antitrust shiv, quoting Business Insider. Facebook hit back hard in a statement sent to Business Insider, accusing Apple of abusing its dominance to benefit itself. It also accused Apple of sending the letter as a distraction from privacy concerns

Starting point is 00:03:24 that emerged last week after a series of Mac computers had difficulties opening apps. Security researcher Jeffrey Paul claimed in a blog this was because macOS has started harvesting data from users. Quote, the truth is Apple has expanded its business into advertising and through its upcoming iOS 14 changes is trying to move the free internet into paid apps and services where they profit, Facebook said. As a result, they are using their dominant market position to self-preference their own data collection while making it nearly impossible for their competitors to use the same data. They claim it's about privacy, but it's about profit, the statement read. This is all part of a

Starting point is 00:04:01 transformation of Apple's business away from innovative hardware products to data-driven software and media, end quote. There's a part in our discussion on this weekend's bonus episode where Christmasina suggests that the long sort of detente between the major tech platforms that has held for the most part for the last decade might soon be coming to an end. And I suggested that That might be because all of the Virgin territory has been claimed. Everyone has their stakes now. The fences are up. It's a zero-sum game.

Starting point is 00:04:31 You can only win now by having a rival lose. Thus, we'll probably see prison yard tactics like this going forward. You hit me with a blunt argument of privacy. I shiv you in the back with the antitrust knife. Torturing metaphors a bit here, but this is the sort of thing I was talking about. And we have yet another one, but this is the IPO that I think behind the scenes might be the one that tech people are most excited to see play out. Gaming Platform Roblox has filed the S-1 for its IPO, reporting losses of $206 million on $589 million in revenue. But more importantly, they reported 31.1 million daily active users and 22.2 billion engaged.

Starting point is 00:05:24 hours, i.e. people actively playing or creating on the Roblox platform. And that last data point is up 122% year over year. So what did I say about going public at the peak of your growth? But also, what have we said about getting out the door before a vaccine comes? Quoting Dan Premack in Axios. Roblox was big business before the pandemic, but it really skyrocketed once kids were stuck at home due to the coronavirus outbreak. Free cash flow was $292.92.6 million for the nine-month period in 2020, up from just $6 million in the 2019 period, and $49.5 million for all of 2019 and 2018 combined, end quote. Quoting from TechCrunch, on a cash basis, Roblox appears to be in much better shape than its gap numbers would have you initially estimate. The firms operating cash flow grew from $62.6 million in the first nine months of 2019 to $345.3 million in the same period of this year. Over the same period, the company's free cash flow was $6 million and then $292.6 million, respectively. The Unicorn Gaming Company also warned that in future periods, it anticipates growth rates for our revenue to decline. Going on to warn that it, quote, may not experience any growth in bookings or our

Starting point is 00:06:46 user base during periods that are later compared to its COVID-boasted 2020 results. How investors weigh that warning against the company's growth remains to be seen, but Roblox has had an extraordinary 2020. For example, the company's bookings, what it defines as sales activity in a given period without giving effect to certain non-cash adjustments, grew 62% in 2018 and 171% to $1.24 billion in the first three quarters of 2020 when compared to the same period of 2019. That growth is downright impressive, end quote. And one more segment pointing to my gaming could break the App Store hypothesis. Google says that Stadia is indeed coming to iOS in a mere matter of weeks, and yes, it's going to come as a Safari PWA workaround,

Starting point is 00:07:40 quoting 9 to 5 Google. This upcoming Google Stadia app on iOS will not be an app in the traditional sense, as it will arrive as a progressive web application or PWA, which is similar to that of Amazon's Luna Cloud Gaming platform. This allows Google to effectively dodge the App Store rules and regulations by being a direct web browser link that is optimized for iOS players. The Stadia Progressive Web app on iOS may actually come missing some certain features during the initial beta phase, but is likely to gain features as this testing phase expands. No word was shared on which regions will be first to get access to the Stadia PWA for iOS, with several weeks from now being the only indication, end quote. So perhaps I should go ahead and elucidate my hypothesis more clearly. It's not that I think

Starting point is 00:08:26 gaming has the potential to completely break the app store, to force Apple to take all the shackles off. It's more that, number one, these workarounds are just teaching everyone how to work around the app store and make it increasingly irrelevant. And number two, All of this has the potential to peel gaming out of the App Store, to carve it out in a meaningful way. So let's say five to ten years from now, cloud gaming really is the next big thing. It's how most gaming is done. Well, in that scenario, it might be done completely outside of the App Store. We've taken for granted that the App Store is the orifice through which most of us do what we do on iOS. But what if gaming, a huge use case for mobile for a lot of folks, sees the App Store.

Starting point is 00:09:13 store increasingly as an irrelevancy. That might cause people to think of the whole app store as an irrelevancy as not a fun creative gateway, but as a dumb, boring, again, orifice, through which the cool stuff does not flow and instead is just home to mundane tools like some sort of glorified, I don't know, Microsoft Office-style productivity suite and app store. In other words, gaming could break the app store by taking the significance and sexiness away from it, because who wants to deal with boring orifices? I wasn't. using that phrase lightly. Google the phrase Steve Jobs working with orifice. Far from scary pictures, what you'll find is that orifice was a favorite term of scorn for Steve Jobs, like in this

Starting point is 00:09:56 quote. The problem with a phone, Steve Jobs said in 2005, is that we're not very good at getting through orifices to get to end users. By orifices, he meant carriers like Verizon and AT&T, which had final say over which phones could access their networks, end quote. Yeah, no one likes working with orifices. And finally, self-driving wager update for you. California's Public Utilities Commission has officially approved two new programs that will allow companies to offer commercial autonomous ride-hailing services in the state of California pending a state-approved process which could take around two years to go through,

Starting point is 00:10:37 quoting TechCrunch. Companies won't be able to start charging for rides tomorrow. Instead, these potential robotaxy operators will have to receive the proper permits from the CPUC and the California Department of Motor Vehicles, as well as meet several reporting requirements. Companies that apply can offer driverless service with or without shared rides. Participating companies also have to submit a safety plan and quarterly reports to the CPUC with aggregated and anonymized information about the pickup and drop-off locations for individual trips, the availability and volume of wheelchair-accessible rides, and service levels

Starting point is 00:11:11 to disadvantaged communities. Companies also have to supply data such as as the fuel type used by the vehicles, miles traveled, and passenger miles traveled, end quote. So that seems like a bit of regulation and some of the companies trying to get self-driving cars and robotaxies going are sort of pushing back on all of the hoops they have to jump through. Still, it's worth noting the fact that whenever the technology is finally ready, the pieces of the regulatory framework for self-driving cars are finally coming into place as well. Time for the weekend long read suggestions. First up, as I've said, I've been waiting for 20 years now for a new Silicon Valley to spawn somewhere across the country. New Silicon's Valley, I guess. And I'm still waiting, but I never give up looking to spot them if they are truly going to arise. And I think to that end, we've spoken about Atlanta before. And Protocol has another look at the startup scene in Hotlanta, as we used to call it back in the day, quote, for more than a decade, Atlanta's leaders have liked to call the region the tech capital of the South. This year, the

Starting point is 00:12:20 tech industry is starting to see it the same way. VCs and companies like Google and Microsoft have recently made serious commitments to invest in the region publicly acknowledging that the country's, quote, Black Mecca is also the place where the industry can begin to fulfill its promises to create a more diverse, inclusive, and innovative future. Quote, we've got the critical mass already, and we've got the never-ending pipeline by way of the universities, said David Cummings, a key player in the Atlanta Tech scene, and the founder of Atlanta Tech Village, one of the startup incubators launched during the recovery from the 2008 crisis. Quote, it's one of those overnight successes 10 years in the making. It takes so long for success to emerge, and now we have a lot of results

Starting point is 00:12:57 to point to. That's a really big difference, end quote. Next, we've asked before, how did Huawei essentially take over the entire telecoms infrastructure industry globally? Well, Wired suggests that it was actually a breakthrough by an obscure Turkish scientist that gave Huawei the technical leg up, quote. This honored guest is not a world leader, a billionaire magnate, or a war hero. He is a relatively unknown Turkish academic named Erdal Erichan. Throughout the ceremony, he has been sitting stiffly, frozen in his ill-fitting suit, as if he were an ordinary theater goer, suddenly thrust onto the leading role of a Broadway stage play. Erichan isn't exactly ordinary, though. Ten years earlier, he made a major discovery in the field.

Starting point is 00:13:39 of information theory. Huawei then plucked his theoretical breakthrough from academic obscurity, and with large investments and top engineering talent, fashioned it into something of value in the realm of commerce. The company then muscled and negotiated to get that innovation into something so big it could not be denied. The basic 5G technology now being rolled out all over the world, end quote. Next, Columbia Journalism Review has a look at the whole Substack Newsletter phenomenon, and I love Substack. Full disclosure, we've met with them for business. business purposes before. And listen, I love the story. Read the whole thing for a fascinating startup story, but this graph in the piece brings up something that I've thought about with

Starting point is 00:14:19 Substack before, quote, if you visit Substack's website, you'll see leaderboards of the top 25 paid and free newsletters. The writer's names are accompanied by their little circular avatars. The intention is declarative. You too can make it on Substack. But as you peruse the list, something becomes clear. The most successful people on Substack are the who have already been well served by existing media power structures. Most are white and male, several are conservative, Matt Taibi, Andrew Sullivan, and most recently Glenn Greenwald, who offer similar screeds about the dangers of cancel culture and the left, all land in the top 10. Greenwald's arrival bumped the like-minded Yasha Monk to 11th position. Soon Matthew Iglesias

Starting point is 00:15:02 signed up for Substack 2, end quote. So I was there for the birth of blogging, and blogging did eventually create its own superstars, and a lot of them, I will admit, tended to be the folks who got there first. There was a strong first mover advantage. But at the same time, those first stars, the people who were the first ones to break out of the blogging firmament, were by and large not well known beforehand. Will Substack only function for people who already have a megaphone? I mean, that's cool and all, but what becomes of a platform that only gives a home to people who already are stars? Can Substack create its own out-of-nowhere phenomenons, time will have to tell us. I thought of doing this one as a full segment this week, but I figured we've talked a lot about this, so I'll just leave this to those

Starting point is 00:15:50 of you that want more behind the scenes of the whole Ant Group IPO implosion. Check out this Niki Asian review piece. TLDR. Jack Ma basically miscalculated how big he had gotten and how many toes he had stepped on in the process. Quote, why did he make this aggressive speech? Asked Chen Jewu, a professor at the University of Hong Kong. For months, he laid low and kept his head down. When he got approval to List in China, he thought it was okay to be aggressive. He miscalculated. The message will be negative for Ant's future business and for all private business on the mainland, end quote. In some ways, the decision to at least postpone, but more likely cancel Ant's listing, represents the revenge taken by traditional financial institutions who have long regarded Internet finance,

Starting point is 00:16:35 known in the industry as fintech, with suspicion and loathing for being able to skirt the same regulations that chain those banks down. This was why Ant had been able to grow so fast. Quote, a big hole in the system allowed Ant to grow into a monster, said the head of Asian economics for one major international bank in Hong Kong with deep connections to the central bank's thinking, end quote. And then a quick modest proposal from cryptographer Matthew Green, whom I think I have selected for long reads in the past. Helpfully for this one, he wrote a summary of the piece for me, which I'll quote right now. This post is about the situation with domain keys identified mail, or DKIM,

Starting point is 00:17:16 a harmless little spam protocol that has somehow become a monster. My request is simple and can be summarized as follows. Dear Google, would you mind rotating and publishing your DKIM secret keys on a periodic basis? This would make the entire internet quite a bit more secure by removing a strong, incentive for criminals to steal and leak emails. The fix would cost you basically nothing and would remove a powerful tool from hands of thieves. That's the short version, read on for the long, end quote. And finally, speaking of mitigating risks in a digital sense, Jameson Rich has an implanted cardioverter defibrillator, or ICD, installed in his body to prevent heart

Starting point is 00:17:57 arrhythmias. The ICD can save his life in a pinch, but the problem is it can also be In the past 13 years, these devices have been fully integrated into the so-called Internet of Things. Millions of everyday consumer items being programmed for and connected to the Internet. Once connected to the Internet, the devices ease the work of physicians and hospitals who can now manage the device and monitor the patient's condition remotely. Patients are typically charged each time their device sends data to the hospital. Think of it as a subscription for your heart. ICDs are just one increasingly popular medical gadget in a rising sea of clinical and commercial

Starting point is 00:18:32 wireless health devices, whether it is the growing suite of cardiac monitoring devices available at home and on the go or an Apple Watch outfitted with diagnostic software, we are outsourcing more and more of our health-to-internet-enabled machines. Having now lived with an ICD for more than three years and a pacemaker for the preceding 14, I understand intimately the consequences of being a body paired to the grid. If your smart fridge loses connectivity, maybe your food goes bad a few days early, but if a wireless ICD experiences a failure, the result could be lethal. I am stalked by the fear of the device misfiring and have wondered endlessly whether the documented security risks posed by these devices could end up harming me, end quote. So this weekend, enjoy our first office hours bonus episode experiment with Chris Messina.

Starting point is 00:19:29 I haven't listened back to it yet, but I think we got into some really interesting corners that we've never been able to explore on this show, for. Curious for your feedback. Someone start a thread on the subreddit at R-slash right home, and please share your thoughts. Tell me how we can do this better if we do this again. Talk to you on Monday.

Tech Brew Ride Home - Fri. 11/20 – Facebook And Apple Trade Schoolyard Taunts

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