Tech Brew Ride Home - Thu. 02/07 - Facebook Dinged In Germany; Killin' It In China

Episode Date: February 7, 2019

Germany is this week’s headache for Facebook, Twitter mixes up its MAU and DAU game, Cluno is subscriptions but for cars and Optimus Ride is what we mean by starting small with autonomous vehicles. Sponsors: Metalab.co DataDogHQ.com/ridehome Links: Facebook ordered by Germany to gather and mix less data (BBC) How Facebook’s Tiny China Sales Floor Helps Generate Big Ad Money (NYTimes) Twitter Q4 Earnings (TechCrunch) Skype Can Now Blur Your Background So You Don't Have to Frantically Tidy Your Room (Gizmodo) Car subscription service Cluno scores $28M in Series B funding (TechCrunch) Another self-driving car startup is starting small, and that’s a good thing (The Verge) Original WWII German message decrypts to go on display at National Museum of Computing (The Register) 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. Welcome to the Tech Meme ride home for Thursday, February 7th, 2019. I'm Brian McCullough today. Germany is this week's headache for Facebook.

Twitter mixes up its Mao and Dow game. Cluno is subscriptions but for cars. An Optimus Ride is what we mean by starting small with autonomous vehicles. Here's what you miss today in the world of tech. Germany's antitrust watchdog has ordered Facebook to stop combining WhatsApp and Instagram data with its Facebook data unless it obtained. specific user consent to do so. Quoting from the BBC, Facebook's various services, including WhatsApp and Instagram, can continue to collect data, but they cannot combine the information with a user's main Facebook

account unless the member gives their voluntary consent. Collecting data from third-party websites and assigning it to a Facebook's user account is likewise only allowed if that member has given the firm permission. The watchdog added that an obligatory tick in the box to agree. to all the company's terms was not a sufficient basis for, quote, such intensive data processing, end quote. The ruling only applies to the firm's activities in Germany, but it is likely to influence other regulators, end quote.

Facebook says it will appeal the decision, and in fact it has one month to do so to challenge the ruling or it automatically becomes legally effective. Now, this is not GDPR stuff, but actually Germany's competition watchdog, which has a name I will not even try to pronounce in a statement. Andreas Mundt, president of that same watchdog agency, said, quote, in future, Facebook will no longer be allowed to force its users to agree to the practically unrestricted collection and assigning of non-Facebook data to their Facebook user accounts.

The combination of data sources substantially contributed to the fact that Facebook was able to build a unique database for each individual user and thus gain market power. In future, consumers can prevent Facebook from unrestrictedly collecting and using their data. The previous practice of combining all data in a Facebook user account, practically without any restriction, will now be subject to voluntary consent given by users. Voluntary consent means that the use of Facebook services must not be subject to the user's consent to their data being collected and combined in this way. If users do not consent, Facebook may not exclude them from its services.

and must refrain from collecting and merging data from different sources, end quote. So this is a problem for Facebook in the here and now, but also for its near-future plans to unify all of its data sources to make it easier for advertisers to target people across platforms. But this is also a different shade of problem for Facebook because this is an actual anti-competitive, read anti-monopoly ruling. Essentially, the German authorities are,

saying Facebook is abusing its market power by pulling all its user profile information from all its platforms into one monster platform. Much better news for Facebook in China because it's making a ton of money in China. In fact, it's estimated that China-based advertisers purchased around $5 billion in ads in 2018 representing about 10% of Facebook's total sales. But wait a minute, Brian, isn't Facebook banned in China? It is. In fact, Facebook has no offices in China at all. But apparently, Facebook has arrangements with local advertising resellers who help Chinese advertisers who want to reach users outside of China buy ads to do so.

Quoting the New York Times, The desire by Chinese companies and other entities to get in front of people internationally has unexpectedly turned China into one of Facebook's largest sources of advertising revenue, even though the social network itself is not available in the country. Charles Shen, chief executive of Meet Social, a advertising broker said his company anticipated doing $1 billion to $2 billion in ad sales on Facebook and Instagram this year. Each day, he added, Meet Social Software puts up about 20,000 Chinese ads on Facebook, end quote. The Times piece goes on to describe what it calls an experience center in Shenzhen's Fuchian district, a 5,000 square foot facility where prospective clients who,

wish to advertise on Facebook are walked through, given examples, and educated generally on how Facebook works and what the ads look like since, of course, these local Chinese ad buyers can't actually log on to Facebook themselves. The local ad brokers then buy the ads on behalf of their clients. And apparently a lot of the back and forth arrangements between the ad buyers and the ad brokers are done, like most everything else in China is done via WeChat. Ah, I forgot about Twitter. Next tech earnings Fortnite. Remind me that Twitter brings up the rear and not to forget that they're coming down the pike. Twitter's Q4 beat expectations with revenue of $909 million, up 24% year over year,

and net income was $244 million, with ad revenue up 23% year over year to $791 million. But here's the interesting part. Monthly active users came in at $321 million, down $9 million year over. year and down 5 million quarter over quarter. But to try to paper over that the fact that its mouths are dropping, it's going to just stop giving mal numbers completely and instead focus on what it is calling monetizable daily active users, or maybe MDOWs, which it tallies at 126 million up from 124 million people in the previous quarter. That's apparently up 9% year over year. But interestingly, that is 60 million fewer Dow's than even Snapchat has. And of course,

it's much, much, much, much less than the Dow's that any Facebook property gets. On a bright note, quoting Ingrid London from TechCrunch, Twitter noted that there has been a 16% year-over-year decrease in abuse reports on its platform. And it highlighted how it has improved security, updated rules for hateful conduct, and ramped up monitoring behavior-based signals. to better manage what tweets are viewed. Twitter said that it will focus on this in 2019 with a more proactive approach to reducing abuse and its effect on Twitter

with the goal of reducing the burden on victims of abuse and where possible taking action before abuse is reported. Specifically, it said it would focus on abuse that could cause severe or immediate harm and a better sign-up process to screen for bad actors, end quote. Also, hey, 2018 was Twitter's first official year, of Gap profitability. It tallied net income of $1.2 billion, which is a net margin of 40%.

So as Jay Yarrow might say, not a bad business, it just looks puny compared to its peer group. Twitter shares were down 10% this morning. And maybe they were listening to me yesterday. Just moments ago, iOS 12.1.4 was released to specific. fix the group FaceTime security flaw. No word on what delayed the fix that Apple had said would be addressed last week. But whatever the case, update your devices now because that was a pretty, pretty big security hole. Although you could wait until this episode is over before doing so.

Microsoft has introduced a background blur feature for Skype, which uses AI to blur the background of your Skype chats while keeping your face, hands, and arms sharply in focus. Quoting Victoria's Song and Gizmodo, To activate the feature, you can hover over the Skype video button and select Blur My Background. It should subtly conceal your surroundings while leaving you in focus, but don't go bonkers throwing your dirty laundry everywhere just yet. Background blur is available on desktops and laptops running the latest version of Skype,

but the feature is still somewhat experimental. At the very bottom of Skype's announcement is some fine print. We do our best to make sure that your background is always blurred, but we cannot guarantee that your background will always be blurred, end quote. Song joked that this came too late to save that professor who was giving that famous interview on BBC over Skype when his kids sauntered into the room and into the background of the video. But I once heard a worse story about a guy who got fired because there was a whiteboard behind him in a Skype call, and there were some not nice things said about a client on that whiteboard that the client could see in the background.

So maybe this would have saved that person. Better safe than sorry, kids. Even with this new feature, check the background before Skyping. A couple of interesting startup raises. Cluno is a startup based in Munich that has just raised a $28 million series B round led by Peter Thiel's Valar Ventures. Cluno operates what it calls a car subscription service. Here's how TechCrunch describes it.

Quote, Cluno offers an alternative to car ownership or a more restrictive lease by enabling you to subscribe to a car for an all-inclusive monthly fee. Available in Germany only you book your car online or via the Cluno app with the monthly fee covering all costs except fuel. After a minimum term of six months, subscribers can return or switch their car with three months notice. In terms of car choice, the startup offers almost 50 models from nine different car companies, including BMW, Volkswagen, Audi, and Ford. Models span small cars to SUVs, including hybrid and electric vehicles, end quote.

Cluno also does everything, including credit checks, credit scoring, buying and financing the cars, insurance, the whole nine yards. And that sounds pretty cool, the idea of switching your car up almost seasonally. Maybe if you're feeling flush, you go high end for the warm months, or switch to a rugged SUV for winter. and the next step, according to Cluno, is to get access to car dealer inventory to grow the supply side, and I'm assuming get the dealers some additional revenue as well. And on one of the recent interviews with either Timothy B. Lee or Chris Mims, we talked about self-driving companies starting on a smaller, safer scale than just throwing taxis into city streets. We mentioned, I think, starting self-driving car services in more tame areas like college campuses or retirement

communities. Well, a startup called Optimus Ride said it will be providing self-driving golf car-sized vehicles for a mixed-use development in Reston, Virginia later this year. It will be three vehicles operating on a loop between the development and a nearby parking facility. Quote, an MIT spin-off, Optimus Ride, said its vehicles would be confined to the private development site called Halle Rise, and it will be geofenced, meaning they can't operate outside of a specific geographic area. Human safety drivers will be in each vehicle in case anything goes wrong, though the company claims its technology is level four capable or able to handle all of the driving duties within the geofence and under specific conditions. The vehicles won't exceed

30 miles per hour. Optimus rides robot taxi service is the result of a deal struck with real estate giant Brookfield Properties, which owns numerous commercial and residential sites across the globe. If all goes well, Optimus Ride will deploy autonomous vehicles and other Brookfield owned properties in the future. Hallie Rise, a new 1.4 billion mixed-use district will transform a 36-acre office park in Reston into 3.5 million square feet of housing, retail offices, public green spaces, and year-round cultural activities. It is also the future home of a Wegman's food market in Fairfax County, end quote.

This sort of thing is increasingly making sense to me. I can see a use case for self-driving trams or whatnot at amusement parks or airs or air. airports, just doing the regular loop back and forth to get you to your car. There was another story from recent weeks that I never got to do about a startup that wants to operate essentially self-driving forklift-like vehicles inside big parking garages. You would essentially drive up to the entrance, leave your vehicle valet style, although you could take your keys with you, because the forklift would come and just pick up your car, sort of just put it on a sled, basically, then drive off with it and put it in a parking space somewhere in the

garage. The advantage would be when you're ready for your car, you could order up ahead of time on your app and the self-driving forklift thingy would go fetch your vehicle and have it waiting for you. But the extra advantage would be, since you don't have to leave room for doors to open and people to get in and out of the vehicles, cars could be packed much closer together in your average parking garage, thus much more capacity. Also, garages could theoretically cut down on insurance costs because there would be less dings and fender benders. This is assuming. of course that the robots don't do those themselves, but still, I'm getting bullish on self-driving technologies in these smaller self-contained use cases and conditions. I feel like we really might be

on the point where the technology is good enough to make stuff like this happen. And finally today, a bit of deep technology history news. Some of the original World War II German message decrypts that were decoded by the earliest proto-computers like the Colossus at Bletchley Park are going on display at Bletchley Park's National Museum of Computing in Britain to coincide with the 75th anniversary of D-Day this June. The museum currently houses the only working replica of the Colossus Code Breaking Machine. Coincidentally, earlier this week, February 5th,

marked the first time the Colossus machine decrypted a Nazi message. How did the Colossus machine earn its name? It was 7 foot tall, 17 feet wide, and weighed 5 tons. Quoting from Wikipedia, Colossus is regarded as the world's first programmable electronic digital computer, although it was programmed by switches and plugs and not by a stored program. So listeners in Britain, worth a trip to Bletchley Park, and if you go,

snap some picks of the Colossus and post them to the subreddit. That's all for today. Hey, Microsoft. Today, I officially abandoned Word for podcast production because I still couldn't save files to OneDrive reliably from Word on my desktop. Congratulations. I'm now on Google Docs, though I don't like it nearly as much. And you know, I was just saying that you guys were good in cloud stuff, but oh well. Talk to you tomorrow.