Tech Brew Ride Home - Thu. 10/31 - Twitter Takes A Stand (And Subtweets Facebook)

Episode Date: October 31, 2019

Twitter says it will ban ALL political advertising, Cognizant says it is getting out of the content moderation business, Facebook earnings are good, Apple earnings are good… and evolving, and can the Chinese monitor SMS messages at the provider level, at scale? Sponsors: Tiny Capital Leap.FidelityCareers.com Links: Jack Dorsey's Twitter Thread Zuckerberg defends politician ads that will be 0.5% of 2020 revenue (TechCrunch) Aaron Sorkin: An Open Letter to Mark Zuckerberg (NYTimes) Facebook shares rise on strong Q3, users up 2% to 2.45B (TechCrunch) A Facebook content moderation vendor is quitting the business after two Verge investigations (The Verge) Apple is laying the groundwork for an iPhone subscription (CNBC) Researchers unearth malware that siphoned SMS texts out of telco’s network (ArsTechnica) Unraveling the Secret Origins of an AmazonBasics Battery (OneZero) 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 right home for Thursday, October 31st, 2019. I'm Brian McCullough today. Twitter says it will ban all political advertising. Cognizant says it is getting out of the content moderation business. Facebook earnings are good. Apple earnings are good and evolving. And can the Chinese

monitor SMS messages at the provider level at scale? Here's what you miss today in the world of tech. Well, I'm super glad I finally mentioned that whole letting politics. politicians lie in Facebook ads thing yesterday because now I get to look like I'm clairvoyant. Narrator's voiceover, he's not. Last night in a thread on Twitter, just like I suggested Facebook should consider doing, Jack Dorsey said, Twitter will stop accepting all political and social issue ads on its platform globally, starting November 22nd. And Jack made some points that it's not hard to read as at least oblique shots at Facebook and its policies around political ads.

I'm going to jump around from Jack's thread, but I am quoting here, we believe political message reach should be earned, not bought. Why? A few reasons. A political message earns reach when people decide to follow an account or retweet. Paying for reach removes that. decision, forcing highly optimized and targeted political messages on people. We believe this decision should not be compromised by money. While internet advertising is incredibly powerful and very effective for commercial advertisers, that power brings significant risks to politics, where it can be used to influence votes to affect the lives of millions. Internet political ads present entirely new challenges to civic discourse. Machine learning-based optimization of messaging and

micro-targeting, unchecked, misleading information, and deep fakes. All at increasing velocity, sophistication, and overwhelming scale. These challenges will affect all internet communication, not just political ads. Best to focus our efforts on the root problems without the additional burden and complexity taking money brings. Trying to fix both means fixing neither well and harms our credibility. For instance, it's not credible for us to say, we're working hard to stop people from gaming our systems to spread misleading info, but if somebody pays us to target and force people to see their political ad, well, they can say whatever they want. And then skipping to the end of Jack's tweet storm, quote, a final note, this isn't about free expression. This is about paying for

reach. And paying to increase the reach of political speech has significant ramifications that today's democratic infrastructure may not be prepared to handle. It's worth stepping back in order to address, end quote. So, this certainly increases the pressure on Facebook, for reasons I outlined yesterday. Actually, on Facebook's earnings call yesterday, more on that in a second, Mark Zuckerberg claimed that ads from politicians will probably represent less than one-half of one percent of the company's revenue in 2020, which is a ton of money in isolation, $300 to $400 million, but still a hit the company could take if it chose to do so.

However, Zuckerberg yesterday doubled down on the policy decision around ads from politicians. On the call, Zuckerberg said, quote, At times of social tension, there has often been an urge to pull back on free expression. We will be best served over the long term by resisting this urge and defending free expression. In a democracy, I don't think it's right for private companies to censor politicians or the news. And although I've considered whether we should not carry these ads in the past, and I'll continue to do so on balance so far I've thought we should continue, end quote. And I'm going to quote from Josh Constine here.

Instead of banning political ads, Zuckerberg voiced support for increasing transparency about how ads look, how much is spent on them, and where they run. Quote, I believe that the better approach is to work to increase transparency. Ads on Facebook are already more transparent than anywhere else. We have a political ads archive so anyone can scrutinize every ad that's run, end quote. He mentioned that political ads are run by, quote, Google, YouTube, and most internet platforms, end quote, seeming to stumble for a second as he was likely prepared to cite Twitter to, until it announced it would drop all political ads an hour earlier. He omitted that Pinterest and TikTok have also banned political ads, end quote. So funny enough, we have a situation here where Twitter has taken a principled stance with no prevarication, no attempts to split the baby or equivocate. As you know, I've long criticized them for being so mealy-mouthed in the past, so this is a bit shocking. But hey, credit when and where do.

Though prepare for the whirlwind when people realize that things like, I don't know, climate change or combating domestic abuse might be part of this. blanket issue ad ban. Still, if the point is that even if you throw some babies out with the bathwater, but that maybe on the whole you get a net positive for society, then it is a brave stand for Twitter to take, quite honestly. Oh, and yes, Aaron Sorkin published an open letter to Mark Zuckerberg in the New York Times this morning. And yes, it is eye-roly and really just confused. As Andrew Cunningham tweeted, quote, Sorkin remains a dude who thinks everyone is one inspiring lecture away from having their mind changed. And, of course, he is the perfect vessel to deliver this lecture, thanks for asking, end quote.

But I'm going to quote, just this bit from the op-ed. He's referring, of course, to the movie The Social Network, which, of course, Sorkin himself wrote. quote, after we'd shot the movie, we arranged a private screening of an early cut for your chief operating officer, Cheryl Sandberg. Ms. Sandberg stood up in the middle of the screening, turned to the producers who were standing in the back of the room and said, How can you do this to a kid? You were 27 years old at the time, but all right, I get it. I hope your C.O. walks into your office, leans in, as she suggested we do in her best-selling book, and says, how can we do this to tens of millions of kids?

Are we really going to run an ad that claims Kamala Harris ran dogfights out of the basement of a pizza place, while Elizabeth Warren destroyed evidence that climate change is a hoax and the deep state sold meth to Rashida Talab and Colin Kaepernick, end quote. Not sure it will matter, but again, pressure certainly mounting on Facebook on this issue. Real quick, Facebook reported Q3 revenue last night of $17.7 billion, up 29%. year-over-year, daily active users rose 9% year-over-year to 1.62 billion, and monthly active users rose 8% year-over-year to 2.45 billion. And countering a narrative from recent quarters, Facebook actually gained 2 million users in each of its U.S., Canada, and Europe markets, with revenue per user growing at a healthy clip and the company's overall profits at $6 billion were up 19% year over year. And quoting Josh Constine again. The company did spin up some new

revenue sources, including taking a 30% cut of fan patronage subscriptions to content creators. It's also trying to sell video subscriptions for publishers and it up the price of its workplace collaboration suite. But gains were likely offset as the company continued to rapidly hire to address abusive content on its platform, which saw headcount grow 28% year over year to 43,000. There are still problems with how it treats content moderators and Facebook has had to repeatedly remove coordinated misinformation campaigns from abroad. Appearing concerned about its waning brand, Facebook moved to add from Facebook to the names of Instagram and WhatsApp, end quote.

Speaking of folks being hired to do content moderation, remember cognizant? They were that contract firm that Casey Newton profiled in his pieces earlier this year about the absurd working conditions that Facebook. contract content moderators had to endure. Cognizant has provided moderation services, not just to Facebook, but for Google and Twitter as well, except not for much longer. It seems Cognizant will be getting out of the content moderation business after current contracts run out in 2020, quoting Casey again in The Verge. We have determined that certain content work in our digital operations practice is not in line

with our strategic vision for the company, and we intend to exit this work over time, the company told the verge in a statement. This work is largely focused on determining whether certain content violates client standards and can involve objectionable materials, end quote. Cognizant said that people who lose their jobs would be offered, quote, retention bonuses, severance packages, and the opportunity to participate in various reskilling programs, end quote. It's unclear whether they will be offered other jobs within Cognizant. Cognizant, quote, makes up a small percentage of Facebook's global content review efforts, the spokesman said. Facebook said it would increase the number of moderators it has working at a site in Texas,

which is operated by GenPact, end quote. Apple also reported earnings last night, reporting Q4 revenue of $64 billion, up 2% year over year, of which $51.5 billion came from products, and $12.5 billion came from from services. It was sort of a by the numbers earnings report, really, but it's worth going into the weeds a bit to measure how much Apple's business is shifting beyond just, you know, we sell iPhones. For example, wearables generated $6.5 billion in revenue, meaning the wearable category actually saw more year-over-year growth than services. But Tim Cook also made a super aggressive goal of doubling services revenue by 2020. And based on the recent numbers, it looks like Apple will hit that goal.

Apple crowed that Apple pay is used more than PayPal is. Apple pay transactions more than doubled year over year, and they're growing four times faster than PayPal, according to Apple. And services revenue in China grew double digits. iPhone revenue did decline 9% year over year, but that's the point, right? Apple is all about now using the iPhone as a sort of bludgeon to shake loose all sorts of other money. Also, Tim Cook announced that Apple card users will soon be able to find. iPhone purchases over 24 months at 0% interest rates. One wonders why the Apple card didn't launch with that. And actually, some of the things Cook said around iPhone upgrade plans do seem to be nudging expectations towards some sort of Apple Prime or whatever super bundle, super subscription of Apple services sometime in the near future, quoting CNBC. During Wednesday's earnings call when analyst Tony Sakanagi asked about the idea of a prime suburb. subscription, Apple CEO Tim Cook did not shoot down the idea. In fact, he suggested that something like it was already in effect. Quote, in terms of hardware as a service or as a bundle, if you will,

there are customers today that essentially view the hardware like that because they're on upgrade plans and so forth, Cook said during an earnings call. So to some degree that exists today, end quote. Cook went on to say that Apple sees it as a major growth area using bullish language, quote, my perspective is that will grow in the future to larger numbers. it will grow disproportionately, he continued, end quote. This is disturbing. Fire Eye says that Chinese state-backed hacker group APT-41 is using malware called MessageTap to parse and save SMS traffic from a major telecom network at scale, quoting Ars Technica,

dubbed message tap by researchers from the Mandiant Division of Security for, firm FireI, the recently discovered malware infects Linux servers that route SMS messages through a telecoms network. Once in place, message tap monitors the network for messages containing either a preset list of phone or IMSI numbers or a preset list of keywords. Messages that meet the criteria are then Zor encoded and saved for harvesting later. FireI said it found the malware infecting an undisclosed telecom provider. The company researchers said the malware is loaded by an installation script but didn't otherwise explain how infections take place, end quote. The wow here seems to be that the malware is allowing the hackers to process SMS traffic

at the provider level, quoting Dan Perez. MessageTap uses two config files containing IMSI slash phone numbers and a keyword list. It uses lip cap to process all traffic being routed through the servers looking for the very specific IMSI slash phone numbers to then same off that data for later collection. Why does this matter? Two things. It shows intent to target rather than just bulk collection of CDRs. It also shows that APT 41 is able to collect and process hundreds of thousands of text messages for specific keywords and IMSI slash phone numbers at scale. Hashtag unprecedented. In theory, this means they can can use this tool at other telecoms without issue.

There wouldn't be any reason APT-41 wouldn't use this tool elsewhere if they are looking to do this same activity in other regions, end quote. Finally, today, an interesting investigation into the supply chain that allows Amazon to offer those Amazon Basics private label products, like, for example, the Amazon basics batteries. The thing is, Amazon is super paranoid about how it sources this stuff, super secretive about it. And it turns out that it might be worth finding out how they source this stuff because,

well, here's the lead from the story. Quote, I heard the pop from my living room as a brand new pack of Amazon batteries spontaneously exploded on the kitchen counter, oozing a gritty black substance in fits and spurts. The small, unassuming item is one of Amazon's most popular in-house product sold under the Amazon Basics label. With nearly 20,000 customer reviews, its popularity dwarves that of most other Amazon basics items, which include electronics, homewares, and random odds and ends.

The batteries are also highly rated. Had I received a defective set? I scoured the comments page for the alkaline battery for reviews containing the word explode, revealing dozens of experiences like mine. One person said the batteries had burst in their wife's breast pump. Others had toys and appliances ruined by leaky fluid. Some customers blame this on alleged Chinese manufacturing, but Amazon vaguely claims in the product's description that they are made in Indonesia using Japanese technology, end quote. Over the past month, I have tried to uncover the hidden life cycle of this simple Amazon Basics battery. Amazon is fiercely secretive about its corporate footprint and masks its operations through a discrete network of outsourcing, making its supply chain

hard to unravel. Its AA battery is no different. The product is indeed made in Indonesia, but not by Amazon, I learned. The company buys the batteries from a supplier and re-skins them as its own, much like Trader Joe's and its eponymous food brand. Amazon has never voluntarily divulged the sources of Amazon Basics items, but it confirmed one zero's reporting on where its AA batteries come from, end quote. So, this interested me because even though I've never had Amazon basics batteries explode on me, take this bit of advice from old Uncle Brian. Never buy Amazon Basics batteries. They literally last four days. I used to buy them for an old Apple Mouse that still took batteries, and they would run out. This is just a mouse, mind you, not a huge juice suck.

They would run out within a week when other batteries would last months. It wasn't just the mouse. When you have kids, there's a million toys that need batteries endlessly. And with the Amazon basics batteries. Sometimes they wouldn't even work in the toys at all. I would take them out of the package, put them in the toy, batteries already dead. So I don't know where Amazon does source their materials from. Read the piece for more info. But I can confirm that wherever they're sourcing from, they're sourcing absolute garbage.

Again, not much to say today to close. I've got to head home to shepherd a Spider-Man and a Kion to trick some. some treats. Kyan, by the way, is Simba's son. He's part of the Lion Guard. It's a whole Lion King spin-off thing. It's complicated. Anyway, allow me to leave you with this fun trick or treat of a podcast classified ad. This is a classified ad from an engineer, John Paul May, and I'm going to just read it verbatim. This could well be the first time an individual software engineer has run an ad on a podcast. You know Johnny? He led the iOS side of Verizon's recent Bleeding Edge Skunk Project. He did by far the biggest money-making celebrity game for Viacom.

He did the finger coaster. Far and away, the world's most advanced VR ride with millions in sales. You might remember JP's novelty app Pad Racer, which made six figures in a few weeks when the iPad first came out. And you may know his hugely popular long answers on Stack Overflow, or indeed have argued with Johnny on Stack Overflow when he's not banned for swearing. He takes on only the most difficult and challenging real-time, low-level projects. More importantly, he has three, count them three S rankings on Splatoon. Anyway, JP is a new listener to this show and could not resist buying a classified ad himself. Unfortunately, at the moment, there is totally insane demand for engineers at the high end.

JP is completely booked out as usual. He is currently doing the iOS side for the ridiculously tasty Bitcast startup, which is a lot of fun. So this is just a big classified ad shout out from JP May to all my tasty clients and colleagues, boo-ya. Love you ride home. And love you right back, JP.