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Good morning! This Tuesday, Microsoft pushes for privacy laws, bookstores take on Amazon, and meet your new animated Zoom avatar.
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People Are Talking
The pandemic has made clear that big tech doesn't play by normal rules, Scott Galloway said:
- "There are really two Americas right now. There is Big Tech and there is everyone else. They can do what very few companies can do, which is play offense in the middle of a pandemic."
Gaming is having a coronavirus-related moment, Xbox chief Phil Spencer has found:
- "Gaming is a social and community connection for many people, and as physical distancing … is requiring that people are physically apart, the social connections and community connections that the games industry brings to people is just expanded."
Why do companies need retail stores? The answer is changing, Max Levchin believes:
- "In the world where showrooms are actually something people would like to avoid, at least the near future, I think it's going to flip where it's not the showroom, it's the warehouse."
The Big Story
Microsoft takes its privacy plans on the road
Microsoft spent years trying to get a privacy law passed in its home state. The law would give citizens the right to access a copy of the data that companies were collecting on them, the right to correct it and delete it, and the right to restrict the processing of that data.
The Washington Privacy Act never passed. But Microsoft's still pushing:
- Protocol's Issie Lapowsky identified at least four states — Arizona, Hawaii, Minnesota, and Illinois — where Microsoft has been on the ground advocating for versions of the law.
- "In almost every state where there's a version of the bill that looks like the Washington Privacy Act, that bill was introduced because someone from Microsoft introduced themselves to a lawmaker," said Joe Jerome, director of multistate policy at Common Sense Media.
- Privacy groups have pushed back. "We don't want to see a bill with loopholes, weak enforcement, and preemption becoming a so-called gold standard," Jennifer Lee, technology and liberty project manager at the ACLU of Washington, told Issie.
Microsoft was an early supporter of privacy legislation among the tech giants: Execs know regulation is coming, and they want to play a role in shaping it, even if it's one state at a time.
- "We believe people will only use technology if they can trust it, and strong privacy law is an important part of building trust," Microsoft's chief privacy officer, Julie Brill, said in a statement.
- In Minnesota, the efforts might pay off. State Rep. Steve Elkins introduced a new bill in March that he told Issie is "basically plagiarized" from the latest version of the Washington Privacy Act, but gets rid of some line items and loopholes that privacy groups opposed.
Privacy legislation has been slow going everywhere. It's even worse now: Whatever momentum Microsoft was building in state governments seems to have been at least temporarily stalled by the onset of coronavirus.
- "Ironically, there is more interest in the issue than ever because of the specter of widespread government tracking of our comings and goings for epidemiologic disease tracking purposes," Elkins said.
GDPR enforcement teams are woefully understaffed
The makers of the Brave browser filed a complaint with the EU yesterday that says 27 different EU states have failed to give their Data Protection Authorities enough resources to properly do their job.
- "Fault lies with national governments, rather than DPAs," Brave's Johnny Ryan wrote. "Article 52(4) of the GDPR requires that national governments give DPAs the human and financial resources necessary to perform their tasks. Almost no governments have done so."
- Brave found that only six national DPAs employ more than 10 tech specialists, and seven countries have two or fewer. Nearly a third of Europe's entire stock of DPA tech specialists are in Germany.
"The GDPR is at risk of failing" as a result, Ryan wrote. Governments don't have the people, the money or the resources to actually enforce the rules.
- Brave encouraged the EU to force member states to more adequately follow the law, staff their teams, and give them the financial help to fight and win in court.
- The company also wants the EU to build an overarching team to assist individual governments with tech investigations.
- Its other brilliant idea: Everyone should just totally use Brave.
Now's a good time to revisit Issie Lapowsky's story about Ryan, and his quest to crack down on big tech.
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Indie booksellers band together against Amazon
It may feel like the pandemic has only served to concentrate power in the hands of companies like Amazon, but some people see the current chaos as an opportunity. Andy Hunter, CEO of Bookshop.org, certainly does.
"To change [someone's] routine is the easiest way to change their habit," he told me. Coronavirus changed everyone's routine — so habits may start to shift, too.
- The habit that Hunter wants to change? People buying books from Amazon.
Bookshop launched in January as a way for indie bookstores to easily create their own digital storefronts, and put them all together to build the kind of efficient, convenient book-buying experience that could compete with Bezos.
- Bookshop is a B-corp, set up more to help the industry than generate a profit. It gives bookstores more than their normal share of proceeds, and also set up an affiliate program it hopes can lure even more people away from Amazon.
- Right now, Bookshop sells about $1 million worth of books every week from 600 stores on the platform. As of Monday its affiliate program had raised another $1 million-plus for independent bookstores. "If you look at our financial plan," Hunter said, "we're right now at where we said we'd be in 2023."
- The thing Hunter said indie bookstores like best about Bookshop? "We put in our documents of incorporation that we were never going to sell to Amazon, or Barnes & Noble, or any of the top retailers in the U.S. They didn't have to worry about putting a lot of energy into us just to have us flip the company."
Bookshop's early success has stoked its ambition. It's now selling audiobooks and ebooks, talking to partners about comics and magazines, and more. "I want to really change the equation for how viable bookselling is in this country, outside of Amazon," Hunter said.
Protocol's Biz Carson sends this in: Jon McNeill, former Tesla president and Lyft COO, is launching DeltaV, a different type of venture capital model that's designed to build new startups using an in-house team. (Think of it like a long-term holding company rather than a traditional venture fund.) A key criteria will be growing companies that have both product-market fit and go-to-market fit, something he said in a blog post that he found at Tesla, but not at Lyft. So far it's closed $20 million out of a $40 million goal. Joining McNeill at DeltaV are Henry Vogel, Karim Bousta, Sami Shalabi and Michael Rossiter.
Ben Horowitz is no longer on Lyft's board of directors. According to a note sent to investors yesterday, Lyft's not planning to replace him, and will have an eight-member board going forward.
Apparently today's all Lyft-related: The company hired Chris Martin, the former CTO of Pandora, as its new VP of data science and machine learning. Martin spent more than 12 years at Pandora before leaving in 2017.
In Other News
- Today in coronavirus: San Francisco extended its shelter-in-place order through the end of May. Airbnb is developing a new cleaning process for hosts, which will require up to a 72-hour gap between guests. The U.K. has rejected Google and Apple's contact-tracing technology in favor of developing its own. UPS and CVS are working together to deliver prescription medicine by drone. Google built an impressive-seeming AI screening tool for the health-care industry, but real-world tests haven't gone well. Tesla planned to bring factory workers back tomorrow, but eventually changed its mind. ISPs are extending their data-cap waivers and no-cancellation promises. Security cameras are getting an AI boost to help track the virus. And coronavirus has become a gold mine for pyramid schemes.
- Apple is reportedly delaying production on the next round of iPhones, due to both low demand and ongoing supply-chain issues.
- Instacart is trending up — way up. Even amid controversy over how the company treats its shoppers, the company is reportedly selling $700 million in groceries every week, up 450% since December. It's also going to be profitable. Imagine! A profitable delivery company!
- Twitter turned off its old SMS service in most places. Over the years, it has become more of a security risk than a useful feature. Finally time to delete 40404 from your address book, I guess.
- SaaS companies have weathered the economic downturn so far. But now, as subscription bills come due, many companies simply can't pay — and the whole subscription business starts to look suspect.
- The FCC ordered dozens of U.S. telecoms to remove all their Huawei-made equipment, which those telecoms say is both hugely expensive and totally unnecessary. And they want the government to reimburse them for their troubles.
- Silicon Valley's London push is on hold. Alphabet and Apple had both begun massive construction projects in the city, but after falling years behind schedule they're now being delayed even further.
One More Thing
Meet your new video-chat avatar
Remember Samsung's AR Emoji? The handset maker's take on Apple's Memoji that never really took off, because they just seemed a bit too … creepy? Well, Loom.ai, the company that built the animated emoji tech for Samsung, now wants to help us make our quarantine Zoom calls less stressful. The company's latest app, LoomieLive, makes it possible to replace your live video feed with an animated version of yourself, complete with lip syncing. Loom.ai co-founder Mahesh Ramasubramanian told Protocol's Janko Roettgers that his team has used it internally for almost all of its calls. "It substantially reduced the visual overload for us," he said. Now when you video chat, nobody has to see your bed hair.
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