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Tech Monopolists

Is America Becoming an Oligarchy?

Wait, does this have to do with Information Technology? A lot. Industrial concentration examples can be seen in Telecoms, ISP/Content, online retail, and social media.

Growing inequality threatens our most basic democratic principles.

Pete Buttigieg, who’s shown an impressive knack for putting matters well in these early days of the 2020 presidential race, nailed it recently when Chuck Todd of NBC asked him about capitalism. Of course I’m a capitalist, he said; America “is a capitalist society.”

But, he continued: “It’s got to be democratic capitalism.”

Mr. Buttigieg said that when capitalism becomes unrestrained by democratic checks and impulses, that’s no longer the kind of capitalism that once produced broad prosperity in this country. “If you want to see what happens when you have capitalism without democracy, you can see it very clearly in Russia,” he said. “It turns into crony capitalism, and that turns into oligarchy.”

Aside from enabling Mr. Buttigieg, the South Bend, Ind., mayor, to swat away a question that has bedeviled some others, his rhetoric reminds us of a crucial point: There is, or should be, a democratic element to capitalism — and an economic element to how we define democracy.

After all, oligarchy does have an economic element to it; in fact, it is explicitly economic. Oligarchy is the rule of the few, and these few have been understood since Aristotle’s time to be men of wealth, property, nobility, what have you.

But somehow, as the definition of democracy has been handed down to us over the years, the word has come to mean the existence and exercise of a few basic rights and principles. The people — the “demos” — are imbued with no particular economic characteristic. This is wrong. Our definition of democracy needs to change.

Democracy can’t flourish in a context of grotesque concentration of wealth. This idea is neither new nor radical nor alien. It is old, mainstream and as American as Thomas Jefferson.

I invoke Jefferson for a reason. Everyone knows how he was occupying his time in the summer of 1776; he was writing the Declaration of Independence. But what was he up to that fall? He was a member of the Virginia House of Delegates, and he was taking the lead in writing and sponsoring legislation to abolish the commonwealth’s laws upholding “entail” (which kept large estates within families across generations) and primogeniture.

Mere coincidence that he moved so quickly from writing the founding document of democracy to writing a bill abolishing inheritance laws brought over from England? Hardly. He believed, as the founders did generally, that excess inherited wealth was fundamentally incompatible with democracy.

They were most concerned with inherited wealth, as was the Scottish economist Adam Smith, whom conservatives invoke constantly today but who would in fact be appalled by the propagandistic phrase “death tax” — in their time, inherited wealth was the oppressive economic problem.

But their economic concerns weren’t limited to that. They saw clearly the link between democratic health and general economic prosperity. Here is John Adams, not exactly Jefferson’s best friend: All elements of society, he once wrote, must “cooperate in this one democratical principle, that the end of all government is the happiness of the People: and in this other, that the greatest happiness of the greatest Number is the point to be obtained.” “Happiness” to the founders meant economic well-being, and note that Adams called it “democratical.”

So, yes, democracy and the kind of economic inequality we’ve seen in this country in recent decades don’t mix. Some will rejoin that many nations even more unequal than ours are still democracies — South Africa, Brazil, India. But are those the models to which the United States of America should aspire?

A number of scholars have made these arguments in recent years, notably Ganesh Sitaraman in his book “The Crisis of the Middle-Class Constitution.” All that work has been vitally important. But now that some politicians are saying it, we can finally have the broad national conversation we’ve desperately needed for years.

Bernie Sanders has proposed an inheritance tax that the founders would love, and Elizabeth Warren has proposed a wealth tax of which they’d surely approve. But you don’t have to be a supporter of either of those candidates or their plans to get behind the general idea that great concentration of wealth is undemocratic.

Policies built around this idea will not turn America into the Soviet Union or, in the au courant formulation, Venezuela. They will make it the nation the founders intended. And this, as Mr. Buttigieg’s words suggest, is how Democratic candidates should answer the socialism question (with the apparent exception of the socialist Mr. Sanders). No, I’m a capitalist. And that’s why I want capitalism to change.

Dear tech companies, I don’t want to see pregnancy ads after my child was stillborn

Dear Tech Companies:

I know you knew I was pregnant. It’s my fault, I just couldn’t resist those Instagram hashtags — #30weekspregnant, #babybump. And, silly me! I even clicked once or twice on the maternity-wear ads Facebook served up. What can I say, I am your ideal “engaged” user.

You surely saw my heartfelt thank-you post to all the girlfriends who came to my baby shower, and the sister-in-law who flew in from Arizona for said shower tagging me in her photos. You probably saw me googling “holiday dress maternity plaid” and “babysafe crib paint.” And I bet Amazon.com even told you my due date, Jan. 24, when I created that Prime registry.

But didn’t you also see me googling “braxton hicks vs. preterm labor” and “baby not moving”? Did you not see my three days of social media silence, uncommon for a high-frequency user like me? And then the announcement post with keywords like “heartbroken” and “problem” and “stillborn” and the 200 teardrop emoticons from my friends? Is that not something you could track?

You see, there are 24,000 stillbirths in the United States every year, and millions more among your worldwide users. And let me tell you what social media is like when you finally come home from the hospital with the emptiest arms in the world, after you and your husband have spent days sobbing in bed, and you pick up your phone for a few minutes of distraction before the next wail. It’s exactly, crushingly, the same as it was when your baby was still alive. A Pea in the Pod. Motherhood Maternity. Latched Mama. Every damn Etsy tchotchke I was considering for the nursery.

And when we millions of brokenhearted people helpfully click “I don’t want to see this ad,” and even answer your “Why?” with the cruel-but-true “It’s not relevant to me,” do you know what your algorithm decides, Tech Companies? It decides you’ve given birth, assumes a happy result and deluges you with ads for the best nursing bras (I have cabbage leaves on my breasts because that is the best medical science has to offer to turn off your milk), DVDs about getting your baby to sleep through the night (I would give anything to have heard him cry at all), and the best strollers to grow with your baby (mine will forever be 4 pounds 1 ounce).

And then, after all that, Experian swoops in with the lowest tracking blow of them all: a spam email encouraging me to “finish registering your baby” with them (I never “started,” but sure) to track his credit throughout the life he will never lead.

Please, Tech Companies, I implore you: If your algorithms are smart enough to realize that I was pregnant, or that I’ve given birth, then surely they can be smart enough to realize that my baby died, and advertise to me accordingly — or maybe, just maybe, not at all.

Regards,

Gillian

Addendum:

Rob Goldman, VP of advertising at Facebook, responded to an earlier version of my letter, saying:

“I am so sorry for your loss and your painful experience with our products. We have a setting available that can block ads about some topics people may find painful – including parenting. It still needs improvement, but please know that we’re working on it & welcome your feedback.”

In fact, I knew there was a way to change my Facebook ad settings and attempted to find it a few days ago, without success. Anyone who has experienced the blur, panic and confusion of grief can understand why. I’ve also been deluged with deeply personal messages from others who have experienced stillbirth, infant death and miscarriage who felt the same way I do. We never asked for the pregnancy or parenting ads to be turned on; these tech companies triggered that on their own, based on information we shared. So what I’m asking is that there be similar triggers to turn this stuff off on its own, based on information we’ve shared.

But for anyone who wants to turn off parenting ads on Facebook, it’s under: Settings>Ad Preferences>Hide ad topics>Parenting.

I have a better idea – just say no to facebook and related social media “look at me look at me” posts and get on with growing up and living your own life.

Google Fined $1.7 Billion by E.U. for Unfair Advertising Rules

The Monopolists and Oligopolists party that keeps rolling on. The U.S. needs to get on board NOW with Europe. In fact even Europe is a bit weak. It is time to break up the monopolies and oligopolies and spur real competition across many sectors.

This article underlies just one example. It is not just Google, but several other tech companies including those in Telecoms, shopping, and so on. The U.S. is now the land of Oligopolies and Monopolies. Vigorous anti-trust enforcement is needed now!
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LONDON — European authorities on Wednesday fined Google 1.5 billion euros for antitrust violations in the online advertising market, continuing its efforts to rein in the world’s biggest technology companies.

The fine, worth about $1.7 billion, is the third against Google by the European Union since 2017, reinforcing the region’s position as the world’s most aggressive watchdog of an industry with an increasingly powerful role in society and the global economy. The regulators said Google had violated antitrust rules by imposing unfair terms on companies that used its search bar on their websites in Europe.

Europe’s regulatory approach was once criticized as unfairly focusing on technology companies from the United States, but is now viewed as a potential global model as governments question the influence of Silicon Valley. Europe is at the forefront of a broad debate about the role of tech platforms like Apple, Amazon, Facebook and Google, and whether their size and power hurt competition.

With the announcement on Wednesday, the European fines against Google total roughly 8.2 billion euros, or $9.3 billion. But the bloc has not received any of the money yet; Google is appealing the earlier decisions, and is mulling whether to appeal the most recent ruling.

“Google has cemented its dominance in online search adverts and shielded itself from competitive pressure by imposing anticompetitive contractual restrictions on third-party websites,” Margrethe Vestager, Europe’s top antitrust watchdog, said in a statement. “This is illegal under E.U. antitrust rules.”

The fine centers on contracts that license the use of Google’s search bar on websites run by newspapers, blogs, travel services and other companies. European regulators said the operators of the third-party websites using Google’s search bar had been required to display a disproportionate number of text ads from Google’s own advertising services over competing digital advertising companies.

The practice, regulators said, undercut competitors, such as Microsoft and Yahoo, that were trying to challenge Google in search.

“There was no reason for Google to include these restrictive clauses in its contracts, except to keep its rivals out of the market,” Ms. Vestager said at a news conference in Brussels. She said the ruling covered 2006 to 2016, when Google stopped the practices.

Europe’s actions against Silicon Valley are influencing policy debates around the world, but some critics question the overall effectiveness of the penalties.

The European Union spent a decade investigating Google, a slow and deliberate process, during which the company’s business and power continued to grow. Annual revenue at Google’s parent company, Alphabet, reached $137 billion last year, compared with $22 billion a decade earlier. On Wednesday, Google shares rose 2 percent.

The Google cases highlight a larger question policymakers face in overseeing the digital economy.

“As it becomes increasingly clear that antitrust fines or after-the-fact remedies are not enough to bring vibrant competition to the market, governments will need to move to deeper tech sector regulation to remedy problems,” said Gene Kimmelman, a former antitrust official in the Justice Department who is now president of Public Knowledge, a consumer advocacy group. He suggested rules preventing tech platforms like Google from favoring their own services.

In the United States, where there has been limited regulation of tech companies, Senator Elizabeth Warren, Democrat of Massachusetts, has made breaking up Google and other tech giants a priority in her presidential campaign. This week, Representative David Cicilline, Democrat of Rhode Island and chairman of the House Subcommittee on Antitrust, Commercial and Administrative Law, called for a federal antitrust investigation of Facebook.

In response to the ruling on Wednesday, Google said, “Healthy, thriving markets are in everyone’s interest.”

“We’ve already made a wide range of changes to our products to address the commission’s concerns,” Kent Walker, Google’s senior vice president for global affairs, said in a statement. “Over the next few months, we’ll be making further updates to give more visibility to rivals in Europe.”

The case is the last of three investigations the European Commission has pursued against Google, which has headquarters in Mountain View, Calif.

Last year, Ms. Vestager fined Google a record €4.34 billion for using its ownership of the Android mobile operating system to unfairly undercut rivals in the mobile phone market, a decision that also forced the company to change how it bundled its apps on smartphones. In 2017, the company was fined 2.4 billion euros for unfairly favoring its own shopping services over those of rivals.

The two previous rulings have not had a big impact on Google’s financial health, but they have forced the tech giant to adjust some business practices.

After the Android ruling last year, Google for the first time began charging handset makers to pre-install Gmail, Google Maps and other popular applications for Android devices in the European Union.

Perhaps in an attempt to head off additional inquiries, Google announced a number of further changes to services across Europe on Wednesday, after rivals complained that it continued to benefit from anticompetitive business practices.

For the first time, the company said, it will ask Android phone users in Europe if they want to switch to a web browser and search engine not owned by Google. To allow more competition when customers shop with Google, it will give other shopping sites more prominence in its search results, the company also said. Google said it would do the same with local search queries in Europe, such as when a person searches for a restaurant, a move that could help companies like TripAdvisor and OpenTable.

Outside of its review of practices by Google and others, the European Union has adopted tough new privacy rules that many countries outside Europe now view as a template. Regulators here have also investigated tech companies’ tax practices and called for more scrutiny of artificial intelligence.

The decision on Wednesday against Google will be one of the final major antitrust rulings in the five-year term of Ms. Vestager, whose crackdown on Silicon Valley while competition commissioner has made her a minor celebrity in the often-staid world of European politics.

Ms. Vestager has expressed openness to serving another term as the bloc’s top antitrust watchdog, but she is also considered a contender to become president of the European Commission, the most powerful executive position in the European Union. Her future will depend in part on the outcome of European parliamentary elections in May.

Even with her possible departure, pressure on the technology industry is not easing.

The European Union is expected to adopt new copyright regulations as early as next week that would impose restrictions to stop unlicensed content, like music and videos, from being shared on tech platforms like Google and Facebook. Another proposal tries to block the sharing of hate speech and extremist content, a policy that some critics say could lead to censorship.

At the same time, regulators across Europe are pursuing several lines of inquiry.

Ms. Vestager’s office announced last year that Amazon was under investigation for its treatment of independent sellers who use its website to reach customers.

Apple, which in 2016 was ordered to pay Ireland $14.5 billion in back taxes, is now under scrutiny for its App Store policies. Facebook is facing separate inquiries related to its business practices and handling of user data. Google’s advertising practices are also being monitored by privacy advocates who are urging regulators to begin a new investigation for violating privacy rights.

“Businesses and consumers, they depend on platforms to get the best out of digitization,” Ms. Vestager said. “Illegal behavior in these cases is a very serious affair.”

High tech is watching you

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In new book [The Age of Surveillance Capitalism], Business School professor emerita says surveillance capitalism undermines autonomy — and democracy

The continuing advances of the digital revolution can be dazzling. But Shoshana Zuboff, professor emerita at Harvard Business School, warns that their lights, bells, and whistles have made us blind and deaf to the ways high-tech giants exploit our personal data for their own ends.

In her new book, “The Age of Surveillance Capitalism,” Zuboff offers a disturbing picture of how Silicon Valley and other corporations are mining users’ information to predict and shape their behavior.

The Gazette recently interviewed Zuboff about her belief that surveillance capitalism, a term she coined in 2014, is undermining personal autonomy and eroding democracy — and the ways she says society can fight back.
Q&A
Shoshana Zuboff

GAZETTE: The digital revolution began with great promise. When did you start worrying that the tech giants driving it were becoming more interested in exploiting us than serving us?

ZUBOFF: In my 2002 book, “The Support Economy,” I looked at the challenges to capitalism in shifting from a mass to an individual-oriented structure of consumption. I discussed how we finally had the technology to align the forces of supply and demand. However, the early indications were that the people framing that first generation of e-commerce were more preoccupied with tracking cookies and attracting eyeballs for advertising than they were in the historic opportunity they faced.

For a time I thought this was part of the trial and error of a profound structural transformation, but, certainly by 2007, I understood that this was actually a new variant of capitalism that was taking hold of the digital milieu. The opportunities to align supply and demand around the needs of individuals were overtaken by a new economic logic that offered a fast track to monetization.

GAZETTE: What are some of the ways we might not realize that we are losing our autonomy to Facebook, Google, and others?

ZUBOFF: I define surveillance capitalism as the unilateral claiming of private human experience as free raw material for translation into behavioral data. These data are then computed and packaged as prediction products and sold into behavioral futures markets — business customers with a commercial interest in knowing what we will do now, soon, and later. It was Google that first learned how to capture surplus behavioral data, more than what they needed for services, and used it to compute prediction products that they could sell to their business customers, in this case advertisers. But I argue that surveillance capitalism is no more restricted to that initial context than, for example, mass production was restricted to the fabrication of Model T’s.

Right from the start at Google it was understood that users were unlikely to agree to this unilateral claiming of their experience and its translation into behavioral data. It was understood that these methods had to be undetectable. So from the start the logic reflected the social relations of the one-way mirror. They were able to see and to take — and to do this in a way that we could not contest because we had no way to know what was happening.

We rushed to the internet expecting empowerment, the democratization of knowledge, and help with real problems, but surveillance capitalism really was just too lucrative to resist. This economic logic has now spread beyond the tech companies to new surveillance–based ecosystems in virtually every economic sector, from insurance to automobiles to health, education, finance, to every product described as “smart” and every service described as “personalized.” By now it’s very difficult to participate effectively in society without interfacing with these same channels that are supply chains for surveillance capitalism’s data flows. For example, ProPublica recently reported that breathing machines purchased by people with sleep apnea are secretly sending usage data to health insurers, where the information can be used to justify reduced insurance payments.

GAZETTE: Why have we failed even now to take notice of the effects of all this surveillance?

ZUBOFF: There are many reasons. I chronicle 16 explanations as to “how they got away with it.” One big reason is that the audacious, unprecedented quality of surveillance capitalism’s methods and operations has impeded our ability to perceive them and grasp their meaning and consequence.

Another reason is that surveillance capitalism, invented by Google in 2001, benefitted from a couple of important historical windfalls. One is that it arose in the era of a neoliberal consensus around the superiority of self-regulating companies and markets. State-imposed regulation was considered a drag on free enterprise. A second historical windfall is that surveillance capitalism was invented in 2001, the year of 9/11. In the days leading up to that tragedy, there were new legislative initiatives being discussed in Congress around privacy, some of which might well have outlawed practices that became routine operations of surveillance capitalism. Just hours after the World Trade Center towers were hit, the conversation in Washington changed from a concern about privacy to a preoccupation with “total information awareness.” In this new environment, the intelligence agencies and other powerful forces in Washington and other Western governments were more disposed to incubate and nurture the surveillance capabilities coming out of the commercial sector.

A third reason is that these methodologies are designed to keep us ignorant. The rhetoric of the pioneering surveillance capitalists, and just about everyone who has followed, has been a textbook of misdirection, euphemism, and obfuscation. One theme of misdirection has been to sell people on the idea that the new economic practices are an inevitable consequence of digital technology. In America and throughout the West we believe it’s wrong to impede technological progress. So the thought is that if these disturbing practices are the inevitable consequence of the new technologies, we probably just have to live with it. This is a dangerous category error. It’s impossible to imagine surveillance capitalism without the digital, but it’s easy to imagine the digital without surveillance capitalism.

A fourth explanation involves dependency and the foreclosure of alternatives. We now depend upon the internet just to participate effectively in our daily lives. Whether it’s interfacing with the IRS or your health care provider, nearly everything we do now just to fulfill the barest requirements of social participation marches us through the same channels that are surveillance capitalism’s supply chains.

GAZETTE: You warn that our very humanity and our ability to function as a democracy is in some ways at risk.

ZUBOFF: The competitive dynamics of surveillance capitalism have created some really powerful economic imperatives that are driving these firms to produce better and better behavioral-prediction products. Ultimately they’ve discovered that this requires not only amassing huge volumes of data, but actually intervening in our behavior. The shift is from monitoring to what the data scientists call “actuating.” Surveillance capitalists now develop “economies of action,” as they learn to tune, herd, and condition our behavior with subtle and subliminal cues, rewards, and punishments that shunt us toward their most profitable outcomes.

What is abrogated here is our right to the future tense, which is the essence of free will, the idea that I can project myself into the future and thus make it a meaningful aspect of my present. This is the essence of autonomy and human agency. Surveillance capitalism’s “means of behavioral modification” at scale erodes democracy from within because, without autonomy in action and in thought, we have little capacity for the moral judgment and critical thinking necessary for a democratic society. Democracy is also eroded from without, as surveillance capitalism represents an unprecedented concentration of knowledge and the power that accrues to such knowledge. They know everything about us, but we know little about them. They predict our futures, but for the sake of others’ gain. Their knowledge extends far beyond the compilation of the information we gave them. It’s the knowledge that they have produced from that information that constitutes their competitive advantage, and they will never give that up. These knowledge asymmetries introduce wholly new axes of social inequality and injustice.

GAZETTE: So how do we change this dynamic?

ZUBOFF: There are three arenas that must be addressed if we are to end this age of surveillance capitalism, just as we once ended the Gilded Age.

First, we need a sea change in public opinion. This begins with the power of naming. It means awakening to a sense of indignation and outrage. We say, “No.” We say, “This is not OK.”

Second, we need to muster the resources of our democratic institutions in the form of law and regulation. These include, but also move beyond, privacy and antitrust laws. We also need to develop new laws and regulatory institutions that specifically address the mechanisms and imperatives of surveillance capitalism.

A third arena relates to the opportunity for competitive solutions. Every survey of internet users has shown that once people become aware of surveillance capitalists’ backstage practices, they reject them. That points to a disconnect between supply and demand: a market failure. So once again we see a historic opportunity for an alliance of companies to found an alternative ecosystem — one that returns us to the earlier promise of the digital age as an era of empowerment and the democratization of knowledge.

Facebook’s Data Deals Are Under Criminal Investigation

Throw the book at em, and wind down this house of despicable spies and greedy exploiters of their (arguably gullible) flock

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Federal prosecutors are conducting a criminal investigation into data deals Facebook struck with some of the world’s largest technology companies, intensifying scrutiny of the social media giant’s business practices as it seeks to rebound from a year of scandal and setbacks.

A grand jury in New York has subpoenaed records from at least two prominent makers of smartphones and other devices, according to two people who were familiar with the requests and who insisted on anonymity to discuss confidential legal matters. Both companies had entered into partnerships with Facebook, gaining broad access to the personal information of hundreds of millions of its users.

The companies were among more than 150, including Amazon, Apple, Microsoft and Sony, that had cut sharing deals with the world’s dominant social media platform. The agreements, previously reported in The New York Times, let the companies see users’ friends, contact information and other data, sometimes without consent. Facebook has phased out most of the partnerships over the past two years.

A grand jury in New York has subpoenaed records from at least two prominent makers of smartphones and other devices, according to two people who were familiar with the requests and who insisted on anonymity to discuss confidential legal matters. Both companies had entered into partnerships with Facebook, gaining broad access to the personal information of hundreds of millions of its users.


Yep, no surprise here. The invasion of privacy extends much further including the oligopolist, and in many cases, outright monopolies in the mobile phone carriers, ISPs and beyond. When will the U.S. get serious about anti-trust enforcement in the tech industry?

“We are cooperating with investigators and take those probes seriously,” a Facebook spokesman said in a statement. “We’ve provided public testimony, answered questions and pledged that we will continue to do so.”

[Read Brian Chen’s story on what he found when he downloaded his Facebook data.]

It is not clear when the grand jury inquiry, overseen by prosecutors with the United States attorney’s office for the Eastern District of New York, began or exactly what it is focusing on. Facebook was already facing scrutiny by the Federal Trade Commission and the Securities and Exchange Commission. And the Justice Department’s securities fraud unit began investigating it after reports that Cambridge Analytica, a political consulting firm, had improperly obtained the Facebook data of 87 million people and used it to build tools that helped President Trump’s election campaign.

The Justice Department and the Eastern District declined to comment for this article.

The Cambridge investigation, still active, is being run by prosecutors from the Northern District of California. One former Cambridge employee said investigators questioned him as recently as late February. He and three other witnesses in the case, speaking on the condition of anonymity so they would not anger prosecutors, said a significant line of inquiry involved Facebook’s claims that it was misled by Cambridge.

In public statements, Facebook executives had said that Cambridge told the company it was gathering data only for academic purposes. But the fine print accompanying a quiz app that collected the information said it could also be used commercially. Selling user data would have violated Facebook’s rules at the time, yet the social network does not appear to have regularly checked that apps were complying. Facebook deleted the quiz app in December 2015.

The disclosures about Cambridge last year thrust Facebook into the worst crisis of its history. Then came news reports last June and December that Facebook had given business partners — including makers of smartphones, tablets and other devices — deep access to users’ personal information, letting some companies effectively override users’ privacy settings.

The sharing deals empowered Microsoft’s Bing search engine to map out the friends of virtually all Facebook users without their explicit consent, and allowed Amazon to obtain users’ names and contact information through their friends. Apple was able to hide from Facebook users all indicators that its devices were even asking for data.

Privacy advocates said the partnerships seemed to violate a 2011 consent agreement between Facebook and the F.T.C., stemming from allegations that the company had shared data in ways that deceived consumers. The deals also appeared to contradict statements by Mark Zuckerberg and other executives that Facebook had clamped down several years ago on sharing the data of users’ friends with outside developers.

F.T.C. officials, who spent the past year investigating whether Facebook violated the 2011 agreement, are now weighing the sharing deals as they negotiate a possible multibillion-dollar fine. That would be the largest such penalty ever imposed by the trade regulator.

Facebook has aggressively defended the partnerships, saying they were permitted under a provision in the F.T.C. agreement that covered service providers — companies that acted as extensions of the social network.

The company has taken steps in the past year to tackle data misuse and misinformation. Last week, Mr. Zuckerberg unveiled a plan that would begin to pivot Facebook away from being a platform for public sharing and put more emphasis on private communications.

Unearthed emails could be smoking gun in epic GDPR battle against Google, adtech giants

If online ads were simply outlawed, the problem would be fixed. That will not happen soon, so use the best ad-blocker you can, set your browser to dump cookies and other data upon exit (not available in Google Chrome –hhmmm now I wonder why..), and when done on one site, close browser and restart before going to new site.

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Privacy warriors have filed fresh evidence in their ongoing battle against real-time web ad exchange systems, which campaigners claim trample over Europe’s data protection laws.

The new filings – submitted today to regulators in the UK, Ireland, and Poland – allege that Google and industry body the Interactive Advertising Bureau (IAB) are well aware that their advertising networks’ business models flout the EU’s privacy-safeguarding GDPR, and yet are doing nothing about it. The IAB, Google – which is an IAB member – and others in the ad-slinging world insist they aren’t doing anything wrong.

The fresh submissions come soon after the UK Information Commissioner’s Office (ICO) revealed plans to probe programmatic ads. These are adverts that are selected and served on-the-fly as you visit a webpage, using whatever personal information has been scraped together about you to pick an ad most relevant to your interests.

Typically, advertisers bid for space on a webpage in real-time given the type of visitor: the page is fetched from a website, it brings in ad network code, which triggers an auction between advertisers that completes in a fraction of a second, and the winning ad is served and displayed (assuming the advert isn’t blocked.) This transaction, dubbed real-time bidding or RTB, happens automatically and immediately when an ad is required, and it can be fairly convoluted: ad slots may be passed through a tangle of publishers and exchanges before they arrive in a browser.

Netizens known to be wealthy and with a lot of disposable income, or IT buyers with big spending budgets, for example, will command higher ad rates than those unlikely to buy anything through an ad. This is why ad networks and exchanges, like Google, love to know everything about you, all that lovely private data, so they can tout you to advertising buyers and target ads at you for stuff you’re previously shown an interest in.

The ICO’s investigation will focus on how well informed people are about how their personal information is used for this kind of online advertising, which laws ad-technology firms rely on for processing said private data, and whether users’ data is secure as it is shared on these platforms.

Meanwhile, these latest filings follow on from gripes lodged by the same online rights campaigners late last month and in 2018.

The privacy warriors allege the aforementioned auction systems fall foul of Europe’s General Data Protection Regulation (GDPR) because netizens do not have much or any real control over the massive amounts of ad-related data lobbed between sites and services. Moreover, this information can be highly personal – sometimes including location coordinates along with pseudonymous identifiers, personal interests, and the site they are browsing.

The complaints, which point the finger of blame at the IAB’s openRTB and Google’s Authorized Buyers systems, were filed to watchdogs in the UK by Open Rights Group executive director Jim Killock and privacy research Michael Veale; in Ireland by Johnny Ryan of browser biz Brave; and in Poland by the Panoptykon Foundation.

The IAB has consistently stressed that the complaints should not be directed at RTB technology makers, such as itself – and that doing so is like holding road builders accountable for people who break the speed limit. In other words, the tech can be abused, but apparently not by its developers. And the industry body claimed the complainants have only proven it is possible to break the law, not that it has been broken.

As such, the privacy warriors hope to add more weight to their arguments, and today submitted a fresh set of documents to regulators in the aforementioned trio of nations. This cache includes examples of the data passed through RTB systems, and the number of daily bid requests ad exchanges make, which reach 131 billion for AppNexus and 90 billion for Oath/AOL.
Programmatic trading, or is that problematic trading?

The complainants have also filed documents they claim prove the IAB has long been aware that there is a potential problem with RTB systems and their compliance with GDPR.

Among the latest cache is an email from 2017 – obtained under a Freedom-of-Information request – sent from the CEO of IAB Europe, Townsend Feehan, to senior staff in the European Commission Directorate General for Communications Networks, Content, and Technology.

The email reveals Feehan lobbying commission staffers against proposals for a new ePrivacy Regulation – which was meant to come into force with GDPR but has been stuck in negotiations – saying it could “mean the end of the online advertising model.”

Programmatic trading would seem, at least prima facie, to be incompatible with consent under GDPR

The exec attached an 18-page document to the email detailing IAB Europe’s reasoning, which discussed the impact of proposals to tighten rules on the use of people’s private data to the same level as that of GDPR, particularly the requirement of someone’s consent to share their information. Crucially, consent under GDPR requires that people are told clearly what’s going on with their sensitive info, which means website visitors must be told the identity of the data controller(s) processing their data and the purposes of processing. Given the instantaneous and convoluted nature of ad bidding, it is seemingly impossible to alert netizens prior to the real-time auctions, it is claimed.

This, essentially, is the rub between GDPR and today’s on-the-fly web advertising, it would seem.

“As it is technically impossible for the user to have prior information about every data controller involved in a real-time bidding (RTB) scenario, programmatic trading, the area of fastest growth in digital advertising spend, would seem, at least prima facie, to be incompatible with consent under GDPR,” the IAB said.

Brave’s Johnny Ryan said this acknowledges the issue at the core of the campaigners’ complaint – and suggests the IAB doesn’t think adtech’s operating model can work with GDPR.

The IAB has since launched a “Consent and Transparency Framework” to help companies involved in RTB systems meet their legal requirements – but opponents argue that this doesn’t change the facts at the heart of the matter.

Similarly, a document from May 2018 produced by the IAB Tech Lab – a group that produces standards, software, and services for digital publishers, marketers, media, and adtech firms – acknowledged concerns about GDPR compliance. In it, the lab said publishers were concerned “there is no technical way to limit the way data is used after the data is received by a vendor for decisioning/bidding on/after delivery of an ad but need a way to clearly signal the restriction for permitted uses in an auditable way.”

It also said that “surfacing thousands of vendors with broad rights to use data w/out tailoring those rights may be too many vendors/permissions.” And elsewhere in the 2017 document, the IAB said that, since third parties in adtech have “no link to the end-user [they] will be unable to collect consent.”
All your basis are belong to…?

It is question-marks like these, from the industry itself, that the privacy campaigners hope will bolster their case. These concerns were also highlighted by the ICO’s tech policy lead Simon McDougall in a blog post earlier this month outlining the body’s plan to look into adtech.

“The lawful basis for processing personal data that different organisations operating in the adtech ecosystem currently rely upon are apparently inconsistent,” he said. “There seem to be several schools of thought around the suitability of various basis for processing personal data – we would like to understand why the differences exist.”

He added that the ICO was interested in how and what people are told about how their personal data is used for online advertising, and how accurate these disclosures are.

A third prong of the ICO probe will consider the security of the data that is widely and rapidly shared during the auctions. “We are interested in how organisations can have confidence and provide assurances that any onward transfers of data will be secure,” said McDougall.

The ICO stressed that it was in the fact-finding stages of its work, and that it wanted to listen to all the “diverging views” on adtech.

And, for their part, the complainants in the case against IAB Europe and Google have said that they aren’t, necessarily, seeking an end to online advertising. Rather, they want to see adtech firms operate without sharing the highly personal information they do at the moment. For instance, Ryan said that the IAB RTB system allows 595 different kinds of data to be included in a bid request. Scrapping the use of just four per cent would be an “easy, long overdue, fix

What would happen if Facebook was turned off?

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Imagine a world without the social network

THERE HAS never been such an agglomeration of humanity as Facebook. Some 2.3bn people, 30% of the world’s population, engage with the network each month. Economists reckon it may yield trillions of dollars’ worth of value for its users. But Facebook is also blamed for all sorts of social horrors: from addiction and bullying to the erosion of fact-based political discourse and the enabling of genocide. New research—and there is more all the time—suggests such accusations are not entirely without merit. It may be time to consider what life without Facebook would be like.

To begin to imagine such a world, suppose that researchers could kick a sample of people off Facebook and observe the results. In fact, several teams of scholars have done just that. In January Hunt Allcott, of New York University, and Luca Braghieri, Sarah Eichmeyer and Matthew Gentzkow, of Stanford University, published results of the largest such experiment yet. They recruited several thousand Facebookers and sorted them into control and treatment groups. Members of the treatment group were asked to deactivate their Facebook profiles for four weeks in late 2018. The researchers checked up on their volunteers to make sure they stayed off the social network, and then studied what happened to people cast into the digital wilderness.

Facebook is also blamed for all sorts of social horrors: from addiction and bullying to the erosion of fact-based political discourse and the enabling of genocide. New research—and there is more all the time—suggests such accusations are not entirely without merit. It may be time to consider what life without Facebook would be like.

 

THERE HAS never been such an agglomeration of humanity as Facebook. Some 2.3bn people, 30% of the world’s population, engage with the network each month. Economists reckon it may yield trillions of dollars’ worth of value for its users. But Facebook is also blamed for all sorts of social horrors: from addiction and bullying to the erosion of fact-based political discourse and the enabling of genocide. New research—and there is more all the time—suggests such accusations are not entirely without merit. It may be time to consider what life without Facebook would be like.

To begin to imagine such a world, suppose that researchers could kick a sample of people off Facebook and observe the results. In fact, several teams of scholars have done just that. In January Hunt Allcott, of New York University, and Luca Braghieri, Sarah Eichmeyer and Matthew Gentzkow, of Stanford University, published results of the largest such experiment yet. They recruited several thousand Facebookers and sorted them into control and treatment groups. Members of the treatment group were asked to deactivate their Facebook profiles for four weeks in late 2018. The researchers checked up on their volunteers to make sure they stayed off the social network, and then studied what happened to people cast into the digital wilderness.

Meanwhile back at the ranch – Alexa,Google Home, etc. are flying off the shelves.

Retail Arbitrage – Not everything on Amazon, eBay is a good deal

…And here is why

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The Herberts were on the hunt for all of the Contigo water bottles the store had in stock, and kept the camera rolling for their 6,400 YouTube subscribers. Within minutes, an employee pulled out 32 two-packs — sold on clearance for $5 each — from a back storage room. For two people who recently left their jobs in finance, the blue-and-black plastic bottles might as well have been made of gold. The Herberts would resell the two-packs on Amazon for $19.95. Subtracting some taxes and fees, they’d clear $6.16 in profit. All told, the Herbert’s 10-minute Target run earned them $198.

Juston, 30, and Kristen, 28, estimate they can reel in $150,000 this year from their newest gig: retail arbitrage. The basic idea is to buy up a bunch of the same item — from water bottles to vacuums to Monopoly boards — and then resell them online for a handsome profit.

Chris Green wrote one of the go-to how-to books on the topic, titled “Retail Arbitrage.” And he’s helped popularize the moniker.

…..

The term seems to be having a moment. In December, according to Google Trends, searches for “retail arbitrage” spiked on YouTube, where aficionados post videos of their shopping and reselling sprees. (One reseller, who has more than 52,000 YouTube subscribers, filmed his 22-hour buying binge through 17 Walmarts. He filled his trunk with 182 Monopoly games and flipped most of them in one night for $2,500.)

In the early 2000s, resellers started flipping products on eBay. But Green’s guide focused on the engine behind many of these small businesses: Fulfillment By Amazon, or FBA.

Chris Green wrote one of the go-to how-to books on the topic, titled “Retail Arbitrage.” And he’s helped popularize the moniker.

The term seems to be having a moment. In December, according to Google Trends, searches for “retail arbitrage” spiked on YouTube, where aficionados post videos of their shopping and reselling sprees. (One reseller, who has more than 52,000 YouTube subscribers, filmed his 22-hour buying binge through 17 Walmarts. He filled his trunk with 182 Monopoly games and flipped most of them in one night for $2,500.)

In the early 2000s, resellers started flipping products on eBay. But Green’s guide focused on the engine behind many of these small businesses: Fulfillment By Amazon, or FBA.


Amazon “needs people like me to fill all the holes in the marketplace,” he said.

“We’re literally flesh-and-blood robots for Amazon,” Rezendes said.

The retail giant hasn’t shied away from promoting its small businesses: In 2018, the number of small and medium-size businesses that passed $1 million in sales in Amazon stores worldwide grew by 20 percent. Third-party sales are growing at a faster rate than first-party sales online, the company said last month.

You’ll find Shane Myers on YouTube as the “Rise N Grind Picker” — with 15,000 YouTube subscribers.

Three years ago, with $20 in his savings account, Myers started reselling thrift store merchandise on eBay. He turned to Amazon in August. By September, Myers had churned out more than $2,000 selling used books alone. In his first three months back on retail arbitrage, he’d paid off all his credit card debt and car payments.

Myers, 31, pays $30 a month for an app called BrickSeek, which helps him find markdowns at big-box stores like Walmart and Target. A few weeks ago, Myers hit multiple Walmarts within a 150-mile radius and came home with 218 packages of lightbulbs. He found them on clearance for $2 each. He marked up the price and netted $4 to $5 on each package.

The grand total: more than $1,100 in profit.

Myers hopes that within the next year and a half he can move to retail arbitrage full time and will have paid off his house. And he hopes he’ll never miss his daughter’s birthday again for work, like when he was clocking in at his old day job in retail.

“I see money everywhere,” Myers said. “If I walk into a store, it’s just like a dollar sign sitting on the shelf.”

While one might conclude retail arbitrage hurts only the big box stores, it is untrue. It hurts the smaller retailers & shops much much more. The monopolist Amazon enables and encourages this as it helps them do further damage to the brick and mortar retailers.

Economics 101
A company wanting to monopolize a market may engage in various types of deliberate action to exclude competitors or eliminate competition. Such actions include collusion, lobbying governmental authorities, and force (see anti-competitive practices).” https://en.wikipedia.org/wiki/Monopoly

Sounds like modus operandi of big tech these days

Zucked: Waking Up to the Facebook Catastrophe -Book Review

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An important investor explains how his enthusiasm has turned to shame

As the so-called Techlash gains pace and polemics on the downsides of the internet flood the book market, one omission seems to recur time and again. Facebook, Google, Amazon and the rest are too often written about as if their arrival in our lives started a new phase of history, rather than as corporations that have prospered thanks to an economic and cultural environment established in the days when platforms were things used by trains. To truly understand the revolutions in politics, culture and human behaviour these giants have accelerated, you need to start not some time in the last 15 or so years, but in the 1980s.

Early in that decade, the first arrival of digital technology in everyday life was marked by the brief microcomputer boom, which was followed by the marketing of more powerful personal computers. Meanwhile, Margaret Thatcher and Ronald Reagan were embedding the idea that government should keep its interference in industry and the economy to a minimum. In the US, a new way of thinking replaced the bipartisan belief that monopolies should always be resisted: concentrations of economic power were not a problem as long as they led to lower prices for consumers. And at the same time as old-school class politics was overshadowed, the lingering influence of the 60s counterculture gave the wealthy a new means of smoothing over their power and privilege: talking in vague terms about healing the world, and enthusiastically participating in acts of spectacular philanthropy.

If there was one period when all this cohered, it was between 1984 to 1985: the time of Band Aid and Live Aid, the launch of both Bill Gates’s Microsoft Windows operating system and the Apple Macintosh, and the advent of Reagan’s second term as president. And in 1984 Mark Zuckerberg, who would grow up in a country and culture defined by these events and forces, was born; he invented Facebook while he was at Harvard, and made his fortune via an intrusive, seemingly uncontrollable kind of capitalism, sold with the promise of “bringing the world closer together”.

Roger McNamee is a little longer in the tooth. Aged 62, he is old enough to know that the US beat the depression and won the second world war when “we subordinated the individual to the collective good, and it worked really well”. He knows that the anti-state, libertarian mores that define what we now know as Big Tech were born in the 1980s, and that by the early 21st century, “hardly anyone in Silicon Valley knew there had once been a different way of doing things”. Laissez-faire ideas, he says, joined with a bombastic arrogance in the minds of the “bros” who flocked to northern California to make their fortune from the mid 1990s onwards. What they did was founded on cutting-edge technology – but in terms of its underlying economic ideas, their business represented recently established nostrums being taken to their logical conclusion.


Should political will and public alarm eventually combine to finally break Silicon Valley’s remarkable power, McNamee knows roughly what ought to happen. He points to giving people control and ownership of their data, and the need to push through years of free-market dogma and convince the US authorities to reinvent anti-monopoly rules, and to take some action. What exactly this might entail remains frustratingly unclear, but he wants his readers to know he has made the ideological leap required. “Normally, I would approach regulation with extreme reluctance, but the ongoing damage to democracy, public health, privacy and competition justifies extraordinary measures,” he says. Unwittingly, the way he frames his point speaks volumes about how much we lost in the laissez-faire revolutions of the 1980s: what, after all, is so extraordinary about democratically elected governments taking action against corporations that are out of control?


 
This may suggest the perspective of an outsider, but McNamee does not quite fit that description. As a high-profile investor in tech businesses, he was co-founder of Elevation Partners, a private equity firm established with U2 frontman Paul “Bono” Hewson, the very embodiment of the 80s’ uneasy mixture of profit and philanthropy. In 2010, the firm acquired 1% of Facebook for $90m, but McNamee had already put money into the company, become a source of occasional advice for its founder, and been key in the appointment as chief operating officer of Sheryl Sandberg, the former Bill Clinton administration insider who brought business acumen and political connections to Zuckerberg’s inner circle. But now McNamee has come to the conclusion that what he helped bring about is a blend of hubris and dysfunction: Zucked is partly the story of his early enthusiasm giving way to mounting alarm at Facebook’s failure to match its power with responsibility, and what he has tried to do about it.

It is an unevenly told tale. McNamee wants readers to think of him as a player in the events he describes, but the text regularly has a sense of things viewed from too great a distance. That said, he knows enough about Facebook and its contexts to get to the heart of what its presence in our lives means for the world, and is bracingly blunt about the company’s threat to the basic tenets of democracy, and his own awakening to its dangers. In early passages about the initial occasions when he met Zuckerberg, he writes of a man then aged 22 appearing “consistently mature and responsible”, and “remarkably grown-up for his age”. He goes on: “I liked Zuck. I liked his team. I liked Facebook.” But by the time of the 2016 presidential election, everything had changed. In a memo to Zuckerberg and Sandberg, McNamee was blunt: “I am disappointed. I am embarrassed. I am ashamed.” And he had a keen sense of what had gone wrong, summarised here in the kind of aphoristic phrase for which he clearly has a talent: “Facebook has managed to connect 2.2 billion people and drive them apart at the same time.”

The account of how this played out is now familiar, and ends with the election and subsequent revelation that 126 million Facebook users were exposed to messages authored in Russia. McNamee deals with the Cambridge Analytica scandal, and how it highlighted Facebook’s blithe attitude to its users’ personal data (though he really should have mentioned the Observer journalist Carole Cadwalladr, whose curiosity and resilience ensured that the story broke, and Facebook was called to account). But some of his best material is about the elements of Facebook’s organisation and culture that created the mess, and the work he has done trying to alert powerful people to the need for action.

Once Zuckerberg realised his creation was eating the world, he and his colleagues did what “bros” do, and embraced a mindset known as “growth hacking”, whereby what mattered was “increasing user count, time on site, and revenue”: unrestrained capitalism, in other words. And as all these things endlessly increased, the company simply sped on. “In the world of growth hacking, users are a metric, not people,” McNamee writes. As Facebook expanded, he says, “it is highly unlikely that civic responsibility ever came up.”
Roger McNamee, founder of Elevation Partners.

If Facebook looks like a borderline autocracy (Zuckerberg controls around 60% of the company’s voting shares, because his stock has a “class B” status that gives him unchallengeable power), that is partly because it is different from comparable companies in one crucial sense: the simplicity of its business model. “The core platform consists of a product and a monetisation scheme,” McNamee points out, which “enables Facebook to centralise its decision making. There is a core team of roughly ten people who manage the company, but two people – Zuck and Sheryl Sandberg – are the arbiters of everything.” In the final analysis, Zuckerberg “is the undisputed boss”, both “rock star and cult leader”. It was always going to be a dangerous combination: global reach, a vast influence on events across the world, and a command structure too often reducible to the strengths and weaknesses of one man.

McNamee has worked hard to hold Facebook to account. His key ally is Tristan Harris, a former Google insider who is now an expert critic of Big Tech and its apparent ethical vacuum. As the most compelling passages here recount, while anxiety about the company began to spread, the pair lobbied members of Congress, and were not surprised to find that Washington “remained comfortably in the embrace of the major tech platforms” – but did their best to educate them on a subject many US legislators still seem to barely understand. Their efforts led to two hearings in late 2017, attended only by the big tech companies’ lawyers. Six months later, Zuckerberg finally went to Capitol Hill to testify over two days, but was initially confronted with some of the moronic questions imaginable (“How do you sustain a business model in which users don’t pay for your service?” asked Utah’s 84 year-old Senator, Orrin Hatch). His second session, in front of the House Of Representatives’ Committee on Energy And Commerce, was much better, full of biting criticism. But, as McNamee sighingly acknowledges, his former friend “caught a break”: TV news was suddenly consumed by fallout from the FBI raiding the home and office of Donald Trump’s attorney Michael Cohen, and Zuckerberg went back to northern California looking remarkably untroubled.

Should political will and public alarm eventually combine to finally break Silicon Valley’s remarkable power, McNamee knows roughly what ought to happen. He points to giving people control and ownership of their data, and the need to push through years of free-market dogma and convince the US authorities to reinvent anti-monopoly rules, and to take some action. What exactly this might entail remains frustratingly unclear, but he wants his readers to know he has made the ideological leap required. “Normally, I would approach regulation with extreme reluctance, but the ongoing damage to democracy, public health, privacy and competition justifies extraordinary measures,” he says. Unwittingly, the way he frames his point speaks volumes about how much we lost in the laissez-faire revolutions of the 1980s: what, after all, is so extraordinary about democratically elected governments taking action against corporations that are out of control?

Zucked! Why We Keep Forgiving Facebook

Here is an excellent Pod cast from the NPR 1A show on Facebook. Joshua Johnsonm is interviewing Roger McNamee, the author of ‘Zucked: Waking up to the Facebook Catastrophe’

You may have lots of friends on Facebook. But are you friends with Facebook?

It’s been 15 years since a Harvard student named Mark Zuckerberg co-created the social network in his dorm room. But like many teenagers, it’s prone to misbehave and worry the grown-ups. Some expect Facebook to implode before it turns sweet sixteen.

No one intended Facebook to cause the problems that it has: not Zuckerberg, its engineers, its early investors or advisors.

We spoke with Roger McNamee, former advisor and early investor, about how the company changed the world in unexpected ways and — in his view — refused to do right by its users in times of trouble.