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Source Code

Maps is where the money is

Your five-minute guide to what's happening in tech this Friday, from how AB 5 has been bad for Uber riders to the latest twists in the internet-provider space race.

Good morning! This Friday, Google Maps gets an update, how an old privacy law is increasingly important for technology companies, and a developer wants to charge you $1,000 a month for an underground bunk bed.

People Are Talking

AB 5 has been bad for Uber riders, says CEO Dara Khosrowshahi:

  • "Service levels to riders have gotten worse" and "prices in California have gone up more than anywhere else in the country."

Existing cybersecurity problems will only get worse with 5G, Akamai security chief Andy Ellis told Protocol's Adam Janofsky:

  • "We buy this world full of connected devices, and the mortgage is that at some point we have to secure them before they cause more problems for us."

Russian trolls didn't influence American voters, according to a Russian troll indicted for influencing American voters:

  • "I believe that what occurs in another country, it's pretty hard for me to influence it." And later: "Blaming me is the same as blaming Zuckerberg for creating Facebook."

Twitter is looking outside SF to grow its talent pool, says CEO Jack Dorsey:

  • "Concentration in San Francisco is not serving us any longer, and we will strive to be a far more distributed workforce, which we will use to improve our execution."
  • A Twitter spokesperson told Protocol's Levi Sumagaysay that "there's incredible talent around the world, and we have to be able to work in a way that supports them as employees regardless of where they live."

The Big Story

Google turns on the Maps money tap

Google Maps is 15 years old, and, like any 15-year-old, really ought to start earning its keep. So Google's making some big changes to one of its most quietly important products. Maps has a new icon (not a fan, personally), a new Contribute tab that's going to infuriate everyone at Yelp, and a new focus on helping people find places to go rather than just helping them get there.

  • In many ways it makes Maps a more useful real-world search engine, which means it has a straighter path toward making lots of ad money for Google. A Morgan Stanley analyst told Bloomberg last year that "the most under-monetized asset that I cover is Google Maps," and that eventually Google would flip on the money switch. This might be the moment.
  • Maps head Jen Fitzpatrick told Wired that "we do see that there is potential to, in a thoughtful utility-focused way, have ads continue to play in the broader maps experience." She emphasized that Google cares about user experience, but still: Get ready for more sponsored pizza places, and a little ad-flagged arrow in your AR view pointing to sweet savings down the block.

For years, Google has obsessed over how it might translate its excellence in searching on a screen to searching in the real world. Glass, Lens and countless other projects have aimed at that same goal. Maps seems to be the obvious place for Google to focus those efforts — and the company knows it.

Does your business advertise on Google Maps? How do you as a user feel about the way it's changed? Send me a note: david@protocol.com.

Regulation

An old privacy law with newfound significance

Last week, Facebook paid $550 million to settle an Illinois lawsuit from 2015 that actually pertains to a law the state passed in 2008. Protocol's Charles Levinson has the story of how the Biometric Information Privacy Act was passed and why 12 years later it matters in a big way.

  • BIPA required that companies receive permission from users before collecting biometric facial recognition data.
  • Facebook didn't get permission before it rolled out a feature that suggested who might be in that photo you just uploaded, and a suit filed in 2015 alleged that it was violating the law as a result.

Facebook agreed to the settlement after the Supreme Court declined to hear its appeal. Privacy advocates are now using the hefty settlement to make the case to legislators debating privacy laws in other states that they should emulate the tough provisions in the Illinois law, like an individual's private right to sue companies.

  • "It underscores why you have to have meaningful access to justice for an individual," Washington representative Norma Smith told Charles. "We should have a meaningful voice in how our personhood is sliced and diced and monetized." (Facebook's legal team at Mayer Brown LLP declined to comment for the article.)
  • Facebook, of course, is hardly new to receiving large fines for questionable practices. And even the big ones don't seem to ding the company's spirits — or its share price.

Read Charles' story for the full details on BIPA, the fight over privacy legislation, and what it might take for these questions to actually be answered in court.

A MESSAGE FROM NASDAQ

Reimagining Markets Everywhere

Nasdaq Technology is reshaping the future of global markets by redefining what a marketplace can be.

Learn more here.

Space

The internet-provider space race is taking off

It's still not clear if the future of internet connection involves balloons or drones hovering above us, but it definitely involves satellites. And there's a bit of an arms race going on:

Both companies are planning to offer a service in the next year or so, though with very different business models: Starlink plans to compete directly with Comcast and Verizon, while OneWeb plans to partner with them to extend their range to hard-to-reach places.

If you're counting, that's a lot of satellites heading into the skies. And the Times reports that some astronomers are worried about radio interference — and all that machinery getting in the way of their view of the stars.

Making Moves

  • Michael Murphy is the new CEO of vaping company Pax Labs. No word on Murphy's favorite oil flavor or how big a cloud he can blow.
  • WeWork shook up its board. Three members have been dropped from the group Adam Neumann bossed around, and will be replaced in part by SoftBank's Kirthiga Reddy — WeWork's first female board member.
  • Amazon is hiring. A lot. Again. The company says it plans to create 15,000 jobs in Bellevue, Washington, and build "its biggest tower ever" in the town. Unlike other Amazon real-estate plans, this was announced without months of public buildup and competition.
  • Okta named Craig Weissman as its new chief architect. Weissman was formerly CTO at Salesforce, and told Business Insider that part of his job is to help turn Okta into a "true platform."
  • Jan Chong, longtime senior director of engineering at Twitter, is now VP of engineering at the financial-automation firm Tally.

In Other News

  • Google turned its endless supply of free food into a five-year study on healthy eating. The company changed plate sizes, moved snacks and coffee farther apart, and found it could subtly lead employees to better habits. Please, someone, come to the Protocol office and do the same to me.
  • Uber and Lyft drivers continue to share articles, tips and warnings about coronavirus in Facebook groups, sometimes to problematic effect. "Please do NOT post bogus crap just to get people riled up," the moderator of one large San Francisco group wrote recently. "Do your research before posting, and if it's just a photo without a supporting article it will be deleted. No racist Asian comments will be tolerated."
  • Jeff Bezos posted a truly glorious sub-'gram on Thursday, asking what to do in a nightmarish business situation. Turns out he may have been referring to organizing a meeting with the White House adviser Peter Navarro. (To answer your question, Jeff, the answer is (E): Yell "Alexa, save me!" and have your private Prime Air plane swoop you away.)
  • The FCC announced its plans to reuse chunks of spectrum, currently claimed by satellite providers, for various 5G purposes. There's an auction for the spectrum planned for the end of this year, and the spectrum could be back in use by 2021.
  • A D.C. appeals court said it won't reconsider last year's net neutrality repeal. The appeal had been brought forward by 15 states and various trade groups, including one representing Amazon, Microsoft, Facebook, and Alphabet.
  • The U.S. offered its first safety exemption for self-driving cars — to Nuro, a startup that now plans to launch as many as 5,000 vehicles onto American streets. Their first job will be the most important thing any vehicle can ever do: delivering Domino's pizza.
  • Huawei, Xiaomi and BBK are building a platform to rival Google's Play Store, Reuters reports. The "Global Developer Service Alliance" would allow non-Chinese developers to upload to all three of the companies' app stores at the same time, chipping away at Google's services revenue.

One More Thing

I found you a new place to sleep in SF

You know those SF real estate stories that pop up every now and then, where you can buy a bunch of broken boards that someone calls a "house" for the low, low price of $9 million? I can beat that: A developer wants to build 88 underground "sleeping pods" underneath apartment buildings in the city — and charge $1,000 a month in rent. Key amenities: No doors and no windows, but you do get a "privacy curtain" and plenty of company from the five other people sleeping in fancy bunkbeds right next to yours. Want your own bathroom? Too bad, that's only for the upstairs people paying twice as much for hardly any more space. Don't get your hopes up, though, because the project hasn't cleared the city yet — and rent will probably double before it does.

A MESSAGE FROM NASDAQ

Reimagining Markets Everywhere

Nasdaq Technology is daring to think differently.

Learn more here.

Thoughts, questions, tips? Send them to me, david@protocol.com, or our tips line, tips@protocol.com. See you tomorrow.

Correction: An earlier version of this newsletter incorrectly characterized Facebook's recent settlement related to Illinois' Biometric Information Privacy Act. The settlement is being used to argue in favor of a right to sue in privacy laws being debated elsewhere; it did not end any private citizens' right to sue. An earlier version also misspelled the name of Protocol reporter Levi Sumagaysay. This story was updated Feb. 7, 2020.

Power

The video game industry is bracing for its Netflix and Spotify moment

Subscription gaming promises to upend gaming. The jury's out on whether that's a good thing.

It's not clear what might fall through the cracks if most of the biggest game studios transition away from selling individual games and instead embrace a mix of free-to-play and subscription bundling.

Image: Christopher T. Fong/Protocol

Subscription services are coming for the game industry, and the shift could shake up the largest and most lucrative entertainment sector in the world. These services started as small, closed offerings typically available on only a handful of hardware platforms. Now, they're expanding to mobile phones and smart TVs, and promising to radically change the economics of how games are funded, developed and distributed.

Of the biggest companies in gaming today, Amazon, Apple, Electronic Arts, Google, Microsoft, Nintendo, Nvidia, Sony and Ubisoft all operate some form of game subscription. Far and away the most ambitious of them is Microsoft's Xbox Game Pass, featuring more than 100 games for $9.99 a month and including even brand-new titles the day they release. As of January, Game Pass had more than 18 million subscribers, and Microsoft's aggressive investment in a subscription future has become a catalyst for an industrywide reckoning on the likelihood and viability of such a model becoming standard.

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Nick Statt
Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at nstatt@protocol.com.

Over the last year, financial institutions have experienced unprecedented demand from their customers for exposure to cryptocurrency, and we've seen an inflow of institutional dollars driving bitcoin and other cryptocurrencies to record prices. Some banks have already launched cryptocurrency programs, but many more are evaluating the market.

That's why we've created the Crypto Maturity Model: an iterative roadmap for cryptocurrency product rollout, enabling financial institutions to evaluate market opportunities while addressing compliance requirements.

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Caitlin Barnett, Chainanalysis
Caitlin’s legal and compliance experience encompasses both cryptocurrency and traditional finance. As Director of Regulation and Compliance at Chainalysis, she helps leading financial institutions strategize and build compliance programs in order to adopt cryptocurrencies and offer new products to their customers. In addition, Caitlin helps facilitate dialogue with regulators and the industry on key policy issues within the cryptocurrency industry.
Protocol | Policy

Lina Khan wants to hear from you

The new FTC chair is trying to get herself, and the sometimes timid tech-regulating agency she oversees, up to speed while she still can.

Lina Khan is trying to push the FTC to corral tech companies

Photo: Graeme Jennings/AFP via Getty Images

"When you're in D.C., it's very easy to lose connection with the very real issues that people are facing," said Lina Khan, the FTC's new chair.

Khan made her debut as chair before the press on Wednesday, showing up to a media event carrying an old maroon book from the agency's library and calling herself a "huge nerd" on FTC history. She launched into explaining how much she enjoys the open commission meetings she's pioneered since taking over in June. That's especially true of the marathon public comment sessions that have wrapped up each of the two meetings so far.

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Ben Brody

Ben Brody (@ BenBrodyDC) is a senior reporter at Protocol focusing on how Congress, courts and agencies affect the online world we live in. He formerly covered tech policy and lobbying (including antitrust, Section 230 and privacy) at Bloomberg News, where he previously reported on the influence industry, government ethics and the 2016 presidential election. Before that, Ben covered business news at CNNMoney and AdAge, and all manner of stories in and around New York. He still loves appearing on the New York news radio he grew up with.

Protocol | Fintech

Beyond Robinhood: Stock exchange rebates are under scrutiny too

Some critics have compared the way exchanges attract orders from customers to the payment for order flow system that has enriched retail brokers.

The New York Stock Exchange is now owned by the Intercontinental Exchange.

Photo: Aditya Vyas/Unsplash

As questions pile up about how powerful and little-known Wall Street entities rake in profits from stock trading, the exchanges that handle vast portions of everyday trading are being scrutinized for how they make money, too.

One mechanism in particular — exchange rebates, or payments from the exchanges for getting certain trades routed to them — has raised concerns with regulators and members of Congress.

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Tomio Geron

Tomio Geron ( @tomiogeron) is a San Francisco-based reporter covering fintech. He was previously a reporter and editor at The Wall Street Journal, covering venture capital and startups. Before that, he worked as a staff writer at Forbes, covering social media and venture capital, and also edited the Midas List of top tech investors. He has also worked at newspapers covering crime, courts, health and other topics. He can be reached at tgeron@protocol.com or tgeron@protonmail.com.

Protocol | Workplace

The Activision Blizzard lawsuit has opened the floodgates

An employee walkout, a tumbling stock price and damning new reports of misconduct.

Activision Blizzard is being sued for widespread sexism, harassment and discrimination.

Photo: Bloomberg/Getty Images

Activision Blizzard is in crisis mode. The World of Warcraft publisher was the subject of a shocking lawsuit filed by California's Department of Fair Employment and Housing last week over claims of widespread sexism, harassment and discrimination against female employees. The resulting fallout has only intensified by the day, culminating in a 500-person walkout at the headquarters of Blizzard Entertainment in Irvine on Wednesday.

The company's stock price has tumbled nearly 10% this week, and CEO Bobby Kotick acknowledged in a message to employees Tuesday that Activision Blizzard's initial response was "tone deaf." Meanwhile, there has been a continuous stream of new reports unearthing horrendous misconduct as more and more former and current employees speak out about the working conditions and alleged rampant misogyny at one of the video game industry's largest and most powerful employers.

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Nick Statt
Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at nstatt@protocol.com.
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