Tech Brew Ride Home - Tue. 05/03 – No More Podcasting On Facebook

Episode Date: May 3, 2022

What do you know? Facebook got bored of something and left the market in a bit of a mess. The SEC seems to be staffing up to get serious about crypto. Apple accuses a rival of stealing trade secrets. And it seems like Meta wants to start getting those Metaverse enabling headsets in our hands sooner rather than later. Sponsors: Smith.ai promocode techmeme for $100 off signup CreditKarma.com Links: Facebook Pulls the Plug on Podcast Business After a Year (Bloomberg) SEC to Hire More Crypto Cops to Fight Digital Frauds (WSJ) PayPal Helped Spur EU Antitrust Complaint Against Apple Payments (Bloomberg) UK ministers ditch plans to empower tech regulator (FT) Apple accuses engineers of stealing chip secrets with AirDrop and Time Machine (9to5Mac) Meta Plots Ambitious VR Release Schedule of Four Headsets by 2024 (The Information) Rocket Lab captures booster in mid-air with a helicopter for the first time (Engadget) 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 Techmeme ride home for Tuesday, May 3, 2022. I'm Brian McCullough today. What do you know? Facebook got bored of something and left the market in a bit of a mess. The SEC seems to be staffing up to get serious about crypto. Apple accuses arrival of stealing trade secrets. And it seems like meta wants to start getting those Metaverse enabling headsets into our hands sooner rather than later. Here's what you miss today in the world of tech. Almost exactly a year ago, I titled an episode, I guess you should. should listen to this episode on Facebook now, although I guess not. Facebook apparently plans to stop letting users add podcasts to its podcasting service this week, and we'll begin removing all podcasts from

its platform on June 3rd, and will discontinue sound bites and its central audio hub, which, if you'll recall, about a year ago, Mark Zuckerberg was all hot on, quoting Bloomberg. Facebook announced various audio efforts last April during a hot market for podcasting and audio in general. But the company's interest has waned Bloomberg News reported last month, and it's now focused on other initiatives disappointing some providers. We're constantly evaluating the features we offer so we can focus on the most meaningful experiences, a meta-spokesperson said in an email. The person added that they didn't have a specific date on when sound bites and the audio hub would shut down, but it will be in quote the coming weeks. In the note to partners, Facebook

said it doesn't plan to alert users to the fact that podcasts will no longer be available, leaving it up to the publishers to decide how they want to disclose that information. Live audio rooms will be integrated into Facebook Live, meaning users can choose to go live with just audio or audio and video, end quote. Yeah, remember a year ago, before the big Metaverse unveiling, Mark Zuckerberg, briefly was all about audio experiences on his various platforms. How great short form audio would be wherever he could stick it in. That's what Soundbites was all about.

Mark himself showed up in a clubhouse room. Remember clubhouse? A little behind the scenes about all this. Facebook counted only five seconds of autoplay in your feed as a podcast download. So this as much as double download counts for some podcasts and some podcast hosts. This upset advertisers because they feared they were getting billed for downloads of podcasts where there was no chance their ads were actually heard. And this upset podcast hosts because suddenly their bandwidth bills. doubled like overnight. So I guess same as it ever was. Facebook waded into an industry, shook the foundations of that industry, got bored, and left, and left the mess behind them. The SEC plans to add 20 investigators and litigators to its crypto assets and cyber unit, which was created back in

2017 to monitor crypto fraud, taking it to a grand total of 50 personnel in this department. Seems like crypto and cyber are now priorities over at the SEC, quoting the Wall Street Journal. The Commission has positioned itself as the chief government bulwark against fraud in the $1.7 trillion market, which so far has sidestepped most federal consumer and investor protection rules. SEC Chairman Gary Gensler says the crypto industry is rife with fraud and abuse, liking it to the Wild West. The SEC filed nearly 100 crypto-related enforcement actions from 2013 to 2021, according to Cornerstone

research, with most of those targeting new sales of digital coins. Crypto markets have exploded in recent years with retail investors bearing the brunt of abuses in the space. SEC enforcement director Gerbier S. Grewell said in a written statement, The bolstered crypto assets and cyber unit will be at the forefront of protecting investors and ensuring fair and orderly markets in the face of these critical challenges, end quote. The SEC has so far resolved most cryptocurrency investigations through settlements, although it is litigating with Ripple Labs and two of its executives over the sale of a well-known

digital coin XRP. It is also investigating binance.us, an affiliate of Binance, the world's largest cryptocurrency exchange. As the agency pursues cases against bigger and more successful companies, regulators might need to take more claims to federal court. With the addition of 20 enforcers, the SEC's special cryptocurrency unit would have 50 lawyers and other personnel. It will also get a new leader. Christina Littman, the unit's current chief has announced in terms of that she plans to leave the agency in June, and SEC spokesmen said. In addition to cryptocurrency issuers and trading platforms, the SEC said the unit will scrutinize newer assets such as non-fungible tokens or NFTs, which are digital proofs of

purchase for items such as art, baseball cards, or digital music. NFTs are stored and traded on computer networks using the same technology that powers Bitcoin and other cryptocurrencies. In some cases, lawyers argue tradable NFTs can meet the legal definition of securities, which could bring them under the SEC's oversight. Mr. Gensler, a longtime regulator who carved out a niche teaching about Bitcoin at the Massachusetts Institute of Technology, has struggled to persuade major crypto firms to voluntarily adopt the SEC's investor protections. He has urged cryptocurrency trading platforms to register with the SEC as exchanges, saying many of the digital tokens they list are securities,

and the activity might be illegal if done without any federal oversight, and quote. We just have a whole bunch of regulatory details in the news today and legal stuff. Real quick, how did that recent EU regulatory move against Apple happen? Well, sources say PayPal and others made informal complaints about Apple's NFC restrictions to the European Commission, spurring the EU's formal antitrust complaint, which came out yesterday, quoting Bloomberg. PayPal, which has its own payment service, was one of the multiple companies making informal complaints about the situation to the commission, said the people who asked not to be identified because the discussions were private. PayPal offers a tap-to-pay option on Android phones and wants to be able to offer the same feature on Apple's iPhone. This year, Apple will begin letting third parties use the iPhone's NFC chip to accept payments, a feature geared towards small businesses, but it still won't allow consumers with rival services to make payments that way. That situation creates an unequal playing field the commission alleged in its complaint. Apple has defended its approach by saying that Apple pay rivals, including PayPal, are still popular

on the iPhone even without a tap-to-pay option. It also said that Apple Pay Pay already supports 2,500 banks in Europe. However, the company said it will, quote, continue to engage with the commission to ensure European consumers have access to the payment options of their choice in a safe and secure environment, end quote. Meanwhile, on another side of the regulatory front, might there be a bit of a breather for tech companies, at least in one jurisdiction. Sources say that the United Kingdom has shelved plans to empower its CMA digital markets unit, announced in 20, 20 hampering its ability to set rules and impose fines, quoting the Financial Times. The government's new legislative program is not expected to include a bill to provide statutory

underpinnings to the Digital Markets Unit that is based within the Competition and Markets Authority, said people briefed on the situation. Without the legislation, the UK Tech regulator will not be able to set rules for leading internet companies and impose fines on them for breaking those rules. The government announced plans to set up the Digital Markets Unit in 2020 and said it would be given powers to devise codes of conduct for tech companies and find those that did not comply up to 10% of annual turnover. The unit was established in shadow form last year and is operating with around 60 staff but has no powers beyond the competition and market authorities' existing capabilities. The Queen's speech due on May 10th, which will outline the government's legislative program

for the coming year, is not expected to include a bill that would provide the unit with statutory powers. It comes after the government dropped a bill from the Queen's speech on long-delayed reform to audit and corporate governance following several corporate scandals. Tory officials said Boris Johnson was going cold on state intervention in the economy. David Kanzini, the prime minister's deputy chief of staff, has told colleagues to scale back their legislative demands. He's told us that conservative governments don't legislate their way to prosperity and growth, said one conservative official.

Julian Knight, Tory chair of the Commons Digital Culture, Media, and Sport Committee, said if legislation to empower the tech regulator was not in the Queen's speech, it would, quote, damage the credibility of the whole enterprise. It would be a hammer blow to the capability of the UK to regulate these sectors, he added, end quote. And in a lawsuit, Apple has alleged that system-on-a-chip startup Rivas stole trade secrets after poaching more than 40 engineers from Apple, and that at least two of those departing employees took gigabytes of confidential information from Apple, quoting 9 to 5 Mac. Apple is suing a stealth startup called RIVOS for poaching engineers with access to secret company information.

According to the complaint, Apple believes former employees stole proprietary information at the request of RIVOS as part of the recruiting process. While much isn't known about RIVOS for now, the startup primarily target silicon engineers in job listings. Apple says the startup wants to design chips that will compete with their own, but the company believes RIVOS is doing that with proprietary Apple information. Starting in June 2021, RIVA began a coordinated campaign. campaign to target Apple employees with access to Apple proprietary and trade secret information about Apple's system-on-a-chip designs, Apple says in the complaint.

Prior to the lawsuit, Apple sent Ribos a letter to explain the confidentiality agreements to which its former employees were bound, but the startup had no response. Apple accuses outgoing employees poached by Ribos of stealing, quote, gigabytes of sensitive system-on-chip specifications and design files in the lawsuit as well. The filing explains, quote, Some used multiple USB storage drives to offload material to personal devices, accessed Apple's most proprietary specifications stored within collaboration applications, and used Airdrop to transfer files to personal devices. Others saved voluminous presentations on existing and unreleased Apple systems on a chip,

marked Apple proprietary and confidential, to their personal cloud storage drives. One even made a full-time machine backup of his entire Apple device onto a personal external drive, end quote. In the lawsuit against Rivas, Apple names two former engineers who previously worked on its chip team who joined Rivas last fall. Apple's lawsuit aims, quote, to recover its trade secrets, to protect them from further disclosure, and to uncover the full extent of their use to try to mitigate the harm that has and will occur, end quote. And maybe a fire really has been lit under Mark Zuckerberg. He knows investors might not want to wait a decade for his whole Metaverse play to pay off.

Seems like he wants to show the fruits of these efforts sooner rather than later, because the information is reporting that META plans four VR headsets by 2024. A source says a high-end mixed-reality headset called Cambria, once set for 2021, could debut in September. Quote, Meta is planning to release Project Cambria, a high-end VR and mixed-reality headset. It is billing as a device for the future of work around September, according to a person from with the matter. Cambria was originally supposed to come out last year, but its launch was delayed by supply chain and other pandemic-related issues, which could again push back the launch date, the person said. A second version of Cambria code named Funston is slated to come out in 2024. Meanwhile, Metaplan's two new versions of its less expensive Quest headset, internally codenamed Stinson and Cardiff, for release in 2023 and 2024, the roadmap shows. All four code names for the

devices on Metas, Cambria and Quest lines refer to locations in California, following the pattern of the earliest Quest prototypes made under the name Project Santa Cruz. In other words, Meta's plan is to release a high-end VR headset and a lower-cost one on alternating years. While Quest 2 retails at $299 for the 128-gabyte version and $399 for the 256-gigabyte version, Cambria is expected to cost around $799, according to two people familiar with the matter. A meta spokesperson said, however, the price would be significantly higher. Meta's long-awaited augmented reality glasses were also supposed to be. to come out in 2024 with a more advanced version due in 2026, according to The Verge.

A meta spokesperson said that hardware development typically operates on long timelines, and it is common for target ship dates to change during the course of development. The ambitious plans show how meta is hoping to reinforce its early lead in the VR market, established through its ownership of headset maker Oculus, whose devices now carry the Quest brand, as competition is about to increase. Several companies including Apple, bite dance-owned Pico interactive, and French mixed reality startup links are racing to launch new VR and mixed reality headsets within the next year, end quote. And finally today, we know that SpaceX has reusable space vehicles because its rockets

return to Earth and land on their own. But get this, quoting and gadget. Rocket Lab has taken a huge step towards making its electron orbital launch vehicle a reusable rocket. The company has successfully captured electrons first stage mid-air with a helicopter for the first time upon its return to Earth after deploying 34 satellites to orbit. To ensure that the first stage will survive its re-entry into the atmosphere, Rocket Lab reoriented it into the ideal angle that would give it the best chances to withstand tremendous heat and pressure, a drogue parachute then deployed to increase drag before the main parachute opened up in the final part of its descent. The company sent a Sikorsky S-92 helicopter to rendezvous with the returning stage at 6,500 feet in the air,

using a hook on a cable to capture the booster's parachute line. While the catch was a success, Rocket Lab CEO Peter Beck said on Twitter that the pilots weren't happy with the way the booster was hanging below the helicopter and opted to drop it into the ocean. It was eventually retrieved and loaded onto a vessel for transport back to Rocket Labs HQ for reflight assessment. Rocket Lab said the test gave its helicopter pilot, quote, different load characteristics than previously experienced in testing and will provide important information for future helicopter captures. The goal is to be able to grab the booster mid-air and bring it straight back to land instead of having to drop it into the sea, since saltwater could damage the booster.

If the company successfully proves it can reuse its boosters similar to what SpaceX can do, it can ramp up launch frequency and reduce mission costs for small satellites. The company has another launch scheduled for May, but it's unclear if it will attempt another helicopter recovery, end quote. Nothing for you today, but we do have this classified. One more bit of news from our ride home fund portfolio company, Grupa. Grupa is raising their next round. They're getting a lot of traction, and this round is likely going to close in a week.

They've been talking to some top VCs right now, and you know I participated in the first round. So if you're a VC or an investor and you want to jump in on this new round, I'll put you in touch with the team to score some allocation. If you're a VC or investor interested in joining the group. around, DM me on Twitter, or email Brian at ridehomefund.com.