This week on the Source Code podcast: Hirsh Chitkara on Bumble's big IPO, Anna Kramer on Libby and the future of digital books, and Tomio Geron on PayPal's plan to win the future of finance.
For more on the topics in this episode:
David Pierce ( @pierce) is Protocol's former editorial director. Prior to joining Protocol, he was a columnist at The Wall Street Journal, a senior writer with Wired, and deputy editor at The Verge. He owns all the phones.
The tech giant is adept at winning friends even when it’s not trying to immediately influence people.
A map display of Washington lines the floor next to the elevators at the Google office in Washington, D.C.
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.
As Google has faced intensifying pressure from policymakers in recent years, it’s founded trade associations, hired a roster of former top government officials and sometimes spent more than $20 million annually on federal lobbying.
But the company has also become famous in Washington for nurturing less clearly mercenary ties. It has long funded the work of laissez-faire economists who now defend it against antitrust charges, for instance. It’s making inroads with traditional business associations that once pummeled it on policy, and also supports think tanks and advocacy groups.
And, through a previously little-publicized program, Google is carefully expanding its soft power by building relationships with progressives of color.
Documents seen by Protocol reveal that Google has spent years fostering its Next Gen Learning Community, a network of people of color who are interested in tech policy. Several of the participants have influential perches in politics or culture — even as Google flies them to its campuses, seeks to impress upon them its view of issues like Section 230 reform and watches them connect with some of the very same lawmakers who have turned up the heat on Google.
Next Gen participants who spoke with Protocol portrayed the program as a vital link between people of color, who are underrepresented in tech policy, and said it provides a forum to bring criticisms to the tech giant. But the program also echoes one of Google’s most potent and under-discussed Washington tactics: its long history of winning friends in the tech policy community even when it’s not trying to influence people. Part of that effort is burnishing its image in the eyes of sometime-opponents without demanding they become supporters — but also without always addressing their concerns quickly.
The Next Gen program appears to go back to 2016, when it was created by top Google staffer Chanelle Hardy. According to her LinkedIn profile, Hardy had previously held prominent positions at the Federal Trade Commission and Federal Communications Commission, in congressional offices and with major consumer and civil rights groups. That likely made her a natural fit to oversee policy partnerships for the company when she joined it that year.
In an invitation to an event hosted by the program in 2021, she wrote that the program was designed to “inform Next Gens about key topics in tech policy and racial justice.” Hardy also laid out Section 230, content moderation, intellectual property policy and the future of work as “key focus areas.” The invitation and a list of participants was shared exclusively with Protocol by the Tech Transparency Project, an ethics watchdog that has done extensive research into Big Tech’s influence networks, including Next Gen.
TTP’s research reveals that, despite the emphasis by participants on the program’s networking opportunities, Google kept close tabs on the growing voice of Next Gen participants in the policy conversation. For instance, one presentation, which was publicized by someone who did branding work for Google, noted extensive meetings with policymakers by Next Gen participants, appearances on panel discussions that focused on tech issues and more.
Members of Congress clearly addressed the group on certain occasions, but Google was adamant that the presentation, which cited more than 350 meetings with congressional offices and policymakers, included incorrect placeholder figures. The company also said the pamphlet detailed outreach that Next Gen participants did as part of their own work rather than at the urging of Google.
“We do not ask Next Gen participants to take policy positions, nor do we provide them with advocacy materials,” Google spokesperson José Castañeda said. “We welcome discussion, debate and disagreement and in no way influence their advocacy efforts.”
The company did not dispute the presentation’s assertion that Next Gen members met with Democratic Reps. Karen Bass, Pramila Jayapal, Ted Lieu and Sheila Jackson Lee with an emphasis on “the work of creatives of color, promoting diverse voices, and helping communities of color navigate the future of work.” According to the presentation, those meetings happened in 2020 ahead of Google CEO Sundar Pichai’s testimony to a House panel investigating Big Tech’s competitive practices. Tweets also show Reps. Jimmy Gomez and Tony Cárdenas addressed the group in 2019.
Castañeda said Google is proud of the program, which facilitates meetings “with experts from civil society and the tech industry to engage on a range of policy topics.”
Spokespeople for Bass, Lieu and Jackson Lee did not respond to questions about the meetings. A spokesperson for Jayapal, Siham Zniber, said her office was “not aware of these meetings/conversations.” Jayapal, the only lawmaker among the four who actually serves on the panel interviewing Pichai, asked pointed questions of him during the marathon session. Lieu and Bass serve on a committee focused on intellectual property.
Meetings of the group, which is free to join, occur about two or four times a year, according to participants. In addition to hot-button tech topics such as Section 230, intellectual property and antitrust, discussions have included mass incarceration, privacy, disinformation, immigration and more.
Before COVID-19, Google footed the bill for travel — often to Washington, D.C., but also to other Google campuses. The group has met with company officials, and Next Gen also appears to have made it possible for participants to attend other conferences, summits and receptions in the capital.
Multiple participants said networking was the greatest benefit of Next Gen, emphasizing that participants talk to each other even outside of Google’s purview. They also lamented how few other spaces they’d found to work with other people of color who are interested in advancing racial justice through tech.
According to materials obtained by TTP, the program has attracted some top-tier names, not just from government and politics but also from academia, civil rights, advocacy, media, philanthropy, think tanks and the arts. Alencia Johnson — a former senior adviser to Joe Biden’s presidential campaign who had previously served in top roles for Sen. Elizabeth Warren’s White House bid, Planned Parenthood and President Obama’s reelection — is a participant. So are Alisa Valentin, a special adviser to FCC Commissioner Geoffrey Starks, and April Reign, the creator of the #OscarsSoWhite campaign.
“It’s a great sharing that I think we need more of — and we need more of creating routes for people of color to have influence over this sort of policymaking,” said participant Chris Lewis, president of tech policy non-profit Public Knowledge, adding that through Next Gen he had been able to speak with entrepreneurs and artists who he “wasn’t naturally coming into contact with.”
Big companies have a long history of courting influential outside voices like Lewis, a former FCC staffer and aide to Sen. Ted Kennedy, sometimes through commitments to important causes like diversity, equity and inclusion.
Among many in Washington, Google is seen as having a sophisticated network of ties, in part because the company seems to believe it benefits from supporting academics and activists even when it’s not demanding any chorus of support in return.
“What they’re doing, frankly, is going out and making friends,” said Steve Billet, a former lobbyist at AT&T who is now a professor at Notre Dame. He added he had “no doubt” that the program could help improve Google’s standing among the participants and even potentially mute criticism.
Billet said a policy operation shouldn’t merely revolve around lobbying spending, campaign contributions and meetings with government officials: It should also account for how companies maintain ties with all sorts of groups.
“This is something that smart corporations have always done,” he said. “They at least put themselves in a place where they’re able to discuss and sit down at the table with organizations that are active in their area, [that] may be adversaries on some issues.”
Google, for instance, has been diligent about funding the work of economists and legal academics going back years, even before its latest antitrust woes, according to other reports from TTP. Many of those same scholars insisted that the money didn’t influence their subsequent defenses of the company or tech generally, but in the case of the economists, they were not always forthright about their ties, according to the Wall Street Journal. Google also seemed to focus money and attention on those who might be most ideologically disposed to support the company’s pushback to competition concerns.
In addition, in 2017, Eric Schmidt, who was then Alphabet’s executive chairman, pressured the head of a liberal think tank over one unit’s anti-Big Tech statements, according to a New York Times report. Schmidt had also previously funded and served as chairman of the group, and Google funded it. The offending scholar, competition expert Barry Lynn, blamed those financial relationships for his eventual dismissal.
Overall, the company publicly supports an extensive list of organizations in the policy conversation — from think tanks on the left and right to trade associations and local chambers of commerce — and has a pattern of doing so even when some of them are genuine thorns in the company’s side on certain issues.
Public Knowledge and Lewis in some ways epitomize the relationship between Google and those it keeps in the fold. The group has hammered Google extensively over its competitive practices and been a key force behind the push for antitrust legislation that could fundamentally remake the company’s business. Google and Public Knowledge are fighting each other tooth and nail on the issue. But because the group often aligns with the company on Section 230 and intellectual property issues, it also seems to demonstrate the company’s willingness to make alliances when it can.
“We’re clear, and I’m very clear with our donors, that they have no say in our positions,” Lewis said. He added he’s clear internally and to Google that he wouldn’t even participate in Next Gen if he felt he “did not have an independent voice.”
Google did seem to want to ensure Next Gen participants made use of their voices, especially in opinion pieces. A tweet from a participant, for instance, showed a Next Gen session that taught op-ed writing, and the Next Gen presentation that described lawmaker meetings also touted that participants were producing op-eds, academic papers, blog posts, media appearances and social media posts on tech policy.
Nor is the company shy about making its positions clear during sessions, participants said, including on issues like Section 230 or competition, which represent some of the company’s biggest policy vulnerabilities and in which Google has significant financial stake in the status quo.
Participants who spoke with Protocol insisted they hadn’t felt pressure to take up Google’s views and said they’d witnessed serious debates and sometimes-pointed criticism of the company itself. Some participants made clear that, far from being a form of corporate indoctrination, Next Gen allows Google to hear directly from outspoken critics, including on topics of participants’ choosing, whether the company’s handling of election integrity or antitrust.
“We’ve been invited to be open and honest and critical as appropriate,” said participant Yosef Getachew, who is the media and democracy program director at Common Cause. He pointed out he’s called out the company publicly on election disinformation. “I’ve directly reached out to Google employees in the past to speak to them directly on the issues that [Common Cause is] working on and push them to do more.”
There’s little doubt that the concerns from communities of color about Google have grown over the years. It’s faced criticism that it’s been slow to combat election-related misinformation, especially on YouTube, and such misinformation has sometimes been aimed at Black and Latinx voters in particular. The mining of personal data at the heart of Google’s digital ads may also allow ads for opportunities to be targeted in discriminatory ways (some of which Google now forbids). And the company’s commitment to diversity and unbiased algorithmic research took a hit in 2020 after it fired prominent AI researcher Timnit Gebru.
Though Next Gen participants are not part of any explicit lobbying operation, they admit Google hasn’t necessarily been swift to address their concerns, and readily concede that Google is a self-interested company whose Washington work can’t possibly be entirely altruistic.
Getachew in particular said the advantage of Next Gen for Google may lie more in getting a word in on policy than in stepping up on diversity and inclusion.
“I can imagine them saying, ‘Well, we’re hosting this convening, this program, that features people of color’ as their part of doing something,” he said. “In my opinion, is that enough? Obviously not. There’s a lot more that Google can do to be equitable both from a policy and practical standpoint.”
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.
Denelle Dixon is CEO and Executive Director of the Stellar Development Foundation, a non-profit using blockchain to unlock economic potential by making money more fluid, markets more open, and people more empowered. Previously, Dixon served as COO of Mozilla. Leading the business, revenue and policy teams, she fought for Net Neutrality and consumer privacy protections and was responsible for commercial partnerships. Denelle also served as general counsel and legal advisor in private equity and technology.
Sustainability. It can be a charged word in the context of blockchain and crypto – whether from outsiders with a limited view of the technology or from insiders using it for competitive advantage. But as a CEO in the industry, I don’t think either of those approaches helps us move forward. We should all be able to agree that using less energy to get a task done is a good thing and that there is room for improvement in the amount of energy that is consumed to power different blockchain technologies.
So, what if we put the enormous industry talent and minds that have created and developed blockchain to the task of building in a more energy-efficient manner? Can we not just solve the issues but also set the standard for other industries to develop technology in a future-proof way?
I think we can and it's what motivated our organization, the Stellar Development Foundation (SDF)[1], to work closely with an international consultancy to research and understand the energy efficiency of the Stellar network and its Proof-of-Agreement (PoA) consensus mechanism, the Stellar Consensus Protocol, so that we can take actionable steps to address the network’s carbon footprint – learn more about the findings here.
We hope this is a driver for others, within and beyond blockchain, to do the same. While this research was meant to make the Stellar network better, we believe that we came away with a framework that can kick start a dialogue around a path forward for the industry.
Here are some takeaways:
First, we wanted to understand how Stellar compares to other blockchains and the legacy financial system. But as we tried to gather information on what was publicly available, there was little to be found. Rigorously-tested data and research from the blockchain and traditional finance industries as a whole is lacking and not easy to come by.
We hope to use this research in a couple of important ways with our broader industry counterparts. True to our open source roots, we will share the methodology that other blockchain networks can use as a framework to figure out their carbon impact as well as encourage greater transparency from legacy players to share their data so we can all have visibility into the sustainability of financial services as a whole. The framework will serve as a guide for other public blockchain networks to assess sustainability through the lens of three key impact areas: energy use, GHG emissions from energy use, and e-waste/embodied carbon. It serves as a resource to assess the comparative impact of blockchain protocols—namely, the electricity used in running the blockchain software responsible for handling transactions, and electricity consumed by data transmission and storage. As more players from traditional financial services and blockchain share their own footprints, we’ll get a better look at what works and what needs to be improved so that next generation financial infrastructure is built with transparency across the board.
Second, the research reaffirms something we already knew but can now prove: the Stellar Consensus Protocol is incredibly efficient.
The research found that the Stellar network uses:
These figures help put Stellar’s environmental impact into context, and also help demonstrate that blockchain technology can be built in an efficient way.
While these numbers are low considering how many transactions Stellar processes every year, we believe that part of our role in the Stellar ecosystem is to bring network actors together to do what we can to offset the electricity use that cannot be avoided.
Guided by these findings, SDF has established an ongoing Carbon Dioxide Removal (CDR) commitment. Together with the Stellar ecosystem, we will pay for removal of carbon emitted by the network every year, and are retroactively paying for the removal of the historical carbon footprint of the network since launch.
We’ve chosen to work with a company that captures CO₂ directly from the air and stores it underground. By permanently removing CO₂ emissions from the air, they can no longer contribute to climate change. While there’s no perfect solution for addressing CO₂ emissions, we wanted to invest in something durable and vouched for by the scientific community — and carbon removal was recently deemed an essential strategy in meeting global emissions reduction targets by 2050.[2]
We are also looking at many other initiatives that we can explore on the climate front that directly leverage blockchain technology – namely, an ecosystem standard that could help wallets and other products build in functionality to pay to offset transactions at the time they are processed.
A sustainable future requires a collective effort. For the world to achieve its climate goals, we will each have to play our part, asking ourselves hard questions and using the answers to find ways we can make a difference. Because if we say we want a more inclusive system, we need to build that new system so that it's built to last for years to come. We need to live up to the spirit behind our mission – creating equitable access to the global financial system means creating a system that works for the many, not the few.
If you would like to learn more about our research efforts, visit our landing page for more details.
[1] Stellar.org is a non-profit that supports the growth and development of the Stellar network.
[2] https://www.ipcc.ch/report/ar6/wg3/
Denelle Dixon is CEO and Executive Director of the Stellar Development Foundation, a non-profit using blockchain to unlock economic potential by making money more fluid, markets more open, and people more empowered. Previously, Dixon served as COO of Mozilla. Leading the business, revenue and policy teams, she fought for Net Neutrality and consumer privacy protections and was responsible for commercial partnerships. Denelle also served as general counsel and legal advisor in private equity and technology.
Will tech companies and startups continue to have layoffs?
It’s not just early-stage startups that are feeling the burn.
Nat Rubio-Licht is a Los Angeles-based news writer at Protocol. They graduated from Syracuse University with a degree in newspaper and online journalism in May 2020. Prior to joining the team, they worked at the Los Angeles Business Journal as a technology and aerospace reporter.
Michelle Ma (@himichellema) is a reporter at Protocol, where she writes about management, leadership and workplace issues in tech. Previously, she was a news editor of live journalism and special coverage for The Wall Street Journal. Prior to that, she worked as a staff writer at Wirecutter. She can be reached at mma@protocol.com.
What goes up must come down.
High-flying startups with record valuations, huge hiring goals and ambitious expansion plans are now announcing hiring slowdowns, freezes and in some cases widespread layoffs. It’s the dot-com bust all over again — this time, without the cute sock puppet and in the midst of a global pandemic we just can’t seem to shake.
Founders and investors are preparing for what looks like an economic downturn — and perhaps even a recession. Last week, Y Combinator sent an email to its portfolio founders warning them to “plan for the worst.” The startup accelerator cautioned that the downturn would likely most affect “international companies, asset heavy companies, low margin companies, hardtech, and other companies with high burn and long time to revenue."
It’s not just early-stage startups that are feeling the burn. Big tech companies including Meta, Salesforce and Netflix have also recently announced hiring freezes or layoffs in the midst of cost-cutting pressure and rising inflation, coupled with a looming bear market and rising interest rates. Industry stalwarts (Microsoft), upstart social media companies (Snap) and crypto newbies (Coinbase) haven’t announced layoffs, but they’ve all slowed hiring after poor quarterly results. The S&P 500, dominated by tech stocks, has lost over 20% of its value so far this year.
On Blind, speculative posts about layoffs like one called “Layoff safe companies that are still hiring?” are drawing hundreds of comments. One user wrote, “No company is lay-off safe. You need to make yourself lay-off safe. Get some seniority and work hard to make yourself irreplaceable. Or at least a strong contributor.”
The bright spot? The tech industry may be under siege, but American job seekers overall still have substantial bargaining power. What we’re seeing in one sector — though a substantial one — stands in stark contrast to the rest of the economy, with U.S. employers adding 428,000 jobs in April, more than expected, according to Bureau of Labor Statistics data. Average hourly wages are also still continuing to grow (but still below the pace of inflation).
Layoffs range from the small-scale to, in the worst cases, mass layoffs conducted via impersonal video messages that have left employees gutted and the industry questioning, “Are Zoom layoffs ever OK?” Former Employment Development Department director Michael Bernick told KTVU that tech layoffs are now at their highest point since January 2021, and they’ve come for both the giants and startups. A crowdsourced tech startup layoffs tracker, Layoffs.fyi, recorded 60 tech companies with layoffs in the last month or so, with more than 16,000 employees laid off. Some of the companies that have cut staff in the last few weeks include nutrition startup Noom, on-demand grocery delivery service Getir and fintech company Bolt, according to Layoffs.fyi.
Lacework
Cybersecurity firm Lacework laid off 20% of its workforce. Though it didn’t disclose the number of people this would affect, the company had previously reported having more than 1,000 employees as of March 2022. Lacework said in a blog post that the decision was part of “restructuring and modification to the company plan." Cybersecurity professionals have been in high demand, with companies like Microsoft announcing plans to help with reskilling efforts to account for the widening gap in jobs and those with the knowledge to fill them.
Gorillas
On-demand grocery app Gorillas cut half its corporate staff, or about 300 employees around the world. In a message to staff, Gorillas co-founder and CEO Kagan Sumer said: "Two months ago in March, the markets turned upside down, and since then the situation has continued to worsen.”
PayPal
Just weeks after laying off more than 80 employees at its San Jose headquarters, PayPal let go of additional employees in risk management and operations in Chicago, Nebraska and Arizona.
Bolt
Maju Kuruvilla, the CEO of payments company Bolt, told employees that the company is undergoing “several structural changes,” and cut more than 100 staff members in order to “secure [Bolt’s] financial position” amid shaky market conditions.
Carvana
Online used car dealer Carvana laid off 2,500 employees, many of them over Zoom. The laid-off employees mostly served in operational roles and made up about 12% of the company’s workforce. Carvana said the decision was due to “macroeconomic factors” which “have pushed automotive retail into recession.”
Mural
Several employees at collaboration tool startup Mural were let go, according to LinkedIn posts from affected employees. The exact number of employees laid off was not reported. Leah Taylor, a spokesperson for Mural, told Protocol that staffing reductions were “focused on redundancies.”
ClickUp
Productivity app ClickUp laid off 7% of its staff in an unexpected move. CEO Zeb Evans told Protocol the goal was to ensure ClickUp’s profitability and efficiency in the future, saying it puts the company “in a position to accelerate our timeline to profitability and ultimately achieve our goal of going public.”
Klarna
"Buy now, pay later" company Klarna laid off 10% of its workforce as it has reportedly been looking for more funding, potentially at a lower valuation. Klarna has about 5,000 employees, according to its website. In a prerecorded message to the impacted staff members, Klarna CEO Sebastian Siemiatkowski said the company set its business plans last year in “a very different world than the one we are in today.”
Cameo
Celebrity video greetings startup Cameo laid off 87 staff members, affecting some of Cameo’s most senior executives, including CTO Rob Post, top marketing executive Emily Boschwitz, CPO Nundu Janakiram and Chief People Officer Melanie Steinbach. CEO Steven Galanis pointed to pandemic-fueled hiring as a reason for the cuts, as “market conditions have rapidly changed.”
Robinhood
Trading app Robinhood laid off roughly 9% of its full-time workforce. Following a period of "hypergrowth," the company cut down on duplicate roles and job functions as a way to mitigate "more layers and complexity than are optimal," CEO Vlad Tenev said in a blog post. The decision affected roughly 340 Robinhood employees.
Netflix
Netflix first laid off a number of journalists working for the company’s entertainment site Tudum in late April. Weeks later, the company laid off an additional 150 employees. Following the company’s less-than-stellar Q1 earnings report, Netflix CFO Spencer Neumann said that the company would be pulling back on some of its spending to get costs under control.
Though major companies haven’t had to make drastic cuts, several are slowing down or freezing hiring, citing disappointing earnings and a battered tech sector, but continue to reassure staff that job cuts aren’t imminent. A lot of these hiring slowdowns, like at Microsoft, are contained to specific departments rather than companywide.
Microsoft
Microsoft slowed hiring for its Windows, Office and Teams software groups. The slowdown is specific to those teams, as they've expanded recently. A spokesperson for the company told Bloomberg that Microsoft is “making sure the right resources are aligned to the right opportunity” as the new fiscal year approaches.
Nvidia
Nvidia will slow hiring later this year, the company said in its latest earnings call. Nvidia told Protocol that the move is "to focus our budget on taking care of existing employees as inflation persists.”
Lyft
Lyft is slowing hiring to focus on critical open roles. President John Zimmer told staff in a memo that the company would be cutting costs in response to "an economic slowdown and the dramatic change in investor sentiment."
Snap
After struggling to meet earnings estimates, Snap announced that it would hit the brakes on hiring through the end of the year. Snap CEO Evan Spiegel denied both layoffs and a hiring freeze. The company pointed to a few reasons for the slowdown: rising inflation, rising interest rates, supply chain, the war in Ukraine and Apple’s new ad-tracking policies.
Uber
Uber is cutting back on hiring and other costs to address a "seismic shift" in the market, according to an email that CEO Dara Khosrowshahi sent to staff. Khosrowshahi said hiring should be treated as a "privilege,” and that the company would scale back on the "least efficient" marketing and incentive costs.
Coinbase
Coinbase COO Emilie Choi announced that the company is slowing hiring in a note to employees. Choi said the move is meant to "reprioritize our hiring needs against our highest-priority business goals." Coinbase also pointed to the market's downturn as a reason to slow hiring.
Salesforce
Per an internal memo, Salesforce slowed hiring and cut back on other expenses, including corporate travel and some upcoming off-sites. The company didn’t provide a reason for the cutbacks. Salesforce’s stock price has plunged almost 50% in the last six months.
Meta
Meta is perhaps the biggest company to have announced a hiring freeze for certain roles as it works to control its spending amid an “industry-wide downturn.” Mark Zuckerberg assured employees at an internal all-hands that job cuts aren’t planned. The hiring cutbacks will hit “almost every team across the company" and will last for the rest of the year.
CEO Parag Agrawal announced in a memo that it would freeze hiring and pull back spending. Two key leaders, Kayvon Beykpour and Bruce Falck left the company. Agrawal said the company made these decisions after struggling to meet audience and revenue growth goals, though the company has faced some internal turmoil amidst Elon Musk’s takeover deal. It’s also been reported that Twitter has even started rescinding job offers.
Nat Rubio-Licht is a Los Angeles-based news writer at Protocol. They graduated from Syracuse University with a degree in newspaper and online journalism in May 2020. Prior to joining the team, they worked at the Los Angeles Business Journal as a technology and aerospace reporter.
Don’t know what to do this weekend? We’ve got you covered.
Our favorite picks for your weekend pleasure.
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.
We could all use a bit of a break. This weekend we’re diving into Netflix’s beautifully animated sci-fi “Love, Death & Robots,” losing ourselves in surreal “Men” and loving Zelda-like Moonlighter.
The third season of Netflix’s sci-fi anthology series “Love, Death & Robots” debuted last week with a new collection of “Black Mirror”-esque thought experiments and beautifully animated narrative shorts. Like “The Animatrix” and more recent anthology series like Disney’s “Star Wars: Visions,” almost every episode brings a fresh cast of talent, from the animation studio and source material to the director and voice actors. This season even features longtime executive producer David Fincher taking the director helm for the first time, as well as some heavyweight voice-acting talent from the likes of Mackenzie Davis, Rosario Dawson and Dan Stevens.
The newest film from “Ex Machina” and “Annihilation” director Alex Garland is as provocative as its title suggests. I saw “Men” knowing little to nothing about the experience other than that it draws influence from the surreal horror movement popularized by the work of Jordan Peele and Ari Aster and also reunited Garland with boundary-pushing arthouse production company A24. It did not disappoint. There’s nothing I could tell you now about what to expect from “Men,” especially its jaw-dropping final act. Just go see it. And then, like me, devour every piece of writing about it on the internet you can find.
Netflix is getting more serious about gaming, and one of its more high-profile titles is Digital Sun’s Moonlighter, a unique, Zelda-inspired action RPG that has players playing shopkeeper during the day and looting intricate dungeons at night. The game was first released for Mac, PC and consoles in 2018, but as part of the exclusive partnership with Netflix, Moonlighter is now available for the first time on mobile and free for all subscribers of the streaming service. If you’ve toyed with Apple Arcade or enjoy more premium mobile gaming, Moonlighter is worth a shot. It’s available on iOS and Android.
Much has been written about the rise of retail bots and the role they’ve played in online commerce, from the PS5 shortage to the sneakerhead boom. But journalist Luke Winkie’s new report for The Verge takes a fresh angle by diving into the developer-side market for the alarmingly sleek software that facilitates widespread automated ecommerce, with a focus on the polished buying bot Dakoza. “This software lets [users] change their lives,” the bot’s creator said of enabling scalpers.
A version of this story also appeared in today’s Entertainment newsletter; subscribe here.
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.
Companies are embracing automated video interviews to filter through floods of job applicants. But interviews with a computer screen raise big ethical questions and might scare off candidates.
Although automated interview companies claim to reduce bias in hiring, the researchers and advocates who study AI bias are these companies’ most frequent critics.
Anna Kramer is a reporter at Protocol (Twitter: @ anna_c_kramer, email: akramer@protocol.com), where she writes about labor and workplace issues. Prior to joining the team, she covered tech and small business for the San Francisco Chronicle and privacy for Bloomberg Law. She is a recent graduate of Brown University, where she studied International Relations and Arabic and wrote her senior thesis about surveillance tools and technological development in the Middle East.
Applying for a job these days is starting to feel a lot like online dating. Job-seekers send their resume into portal after portal and a silent abyss waits on the other side.
That abyss is silent for a reason and it has little to do with the still-tight job market or the quality of your particular resume. On the other side of the portal, hiring managers watch the hundreds and even thousands of resumes pile up. It’s an infinite mountain of digital profiles, most of them from people completely unqualified. Going through them all would be a virtually fruitless task.
Enter the Tinders of corporate America. These services are the ones that made it so easy for anyone to apply for a job on the internet. But just like online dating, once the entire world is available for a match, you need to introduce some kind of filter to figure out who you should review first.
Most large companies use software to sort through resumes and cover letters, identifying likely candidates based on keywords, professed qualifications or even just where they went to college. But these services have taken their product a step further. Now, when some companies (ranging from major financial institutions like J.P. Morgan to food prep and retail) invite someone for an interview, they have no intention of showing up for the interview themselves.
Instead, these corporate Tinders give people an automated video interview, guiding the candidate through a conversation with their computer screen. The applicant stares at the webcam distortion of their face (instructed to emote normally like they would if speaking with an actual person), tries to explain why they want the job and then once more sends the information back into the abyss, often without being able to review their video first. The software will then produce a report and likely a ranking that will be used to determine if they get an interview with an actual person.
Automated resume and cover letter screening is just not advanced enough in a world where remote work is increasingly common and remote job applications are easier than ever. For hiring departments, automated video interview software makes whittling down the initial hiring pool infinitely easier. As an added bonus, the companies that make this software sell themselves as scientific and less biased than the flawed humans who run actual HR departments. The market is so fruitful that there are nearly endless options with similar services — among them HireVue, Modern Hire, Spark Hire, myInterview, Humanly.io, Willo and Curious Thing. Entry-level college graduates in tech, banking and even consulting almost always get funneled through these systems. In March 2021, HireVue announced that its platform had hosted more than 20 million video interviews since its inception.
But easy, frictionless processes like these always have a catch. Most companies like to talk about hiring like they’re finding the right fit specifically for their workplace. By relying on automated video interviews, they willingly introduce a third party — another company with its own goals, preferences and biases — between themselves and their new hires. Someone or something else is making the initial decision that could make all the difference.
All of these companies use AI buzzwords to sell their services and advertise their tools. Modern Hire calls its service an “AI-Powered Automated Interview Creator;” at HireVue, the words “science-backed” appear frequently on marketing materials, and a HireVue spokesperson told Protocol that its “assessments are designed by psychologists with evidence-based approaches.” Companies deploy machine learning in different ways; HireVue and Modern Hire use AI tools primarily to transcribe the interviews and then to evaluate and rank the interview text.
Although the companies claim to reduce bias in hiring, the researchers and advocates who study AI bias are these companies’ most frequent critics. They argue that most machine-learning tools aren’t properly audited or regulated and commonly recreate or enhance already existing biases, so opting to incorporate AI into the hiring system is knowingly making a choice to take that risk.
The FTC has warned companies against using algorithms that could be unfair or create adverse outcomes, according to Sara Geoghegan, a law fellow at the Electronic Privacy Information Center. In 2019, EPIC filed a complaint with the FTC alleging that HireVue was engaging in unfair and deceptive practices that violated AI standards by using facial recognition AI tools in its video-interview analysis.
Then, in 2021, HireVue removed the facial recognition tools from its system. “HireVue research, conducted early this year, concluded that for the significant majority of jobs and industries, visual analysis has far less correlation to job performance than other elements of our algorithmic assessment,” the company wrote about its decision. “We made the decision to not use any visual analysis in our pre-hire algorithms going forward. We recommend and hope that this decision becomes an industry standard.”
Federal and state regulators have also started to propose legislation that would restrict how these algorithms are used and require independent audits. New York City passed a bill recently that would require “bias audits” for algorithms used in hiring, and Washington, D.C.’s proposed Stop Discrimination by Algorithms Act of 2021 would set a strict list of requirements for companies wanting to use algorithms in employment settings like the automated video interviews.
“We only score by the way the words people say that are transcribed, not the way they sound or the way they look. That is a hard line that we draw and have always drawn; my mentality and our mentality as a company is that we should only be scoring information that candidates consciously provide to us,” said Eric Sydell, the executive vice president of Innovation at Modern Hire. “There are organizations that use that information. I think it’s wrong. I only give you express permission to use my responses; that’s the right way that we need to proceed.”
For the systems’ critics, it’s difficult to actually prove why someone has been filtered out of the system. “What’s particularly tricky about this — it’s really hard to find people who have experienced an adverse outcome because of these systems, because you don’t know. If I do a little 90-second or 60-second video of myself, and I say, ‘Hi, I’m a lawyer and I do tech stuff,’ I won’t know if I don’t get a job if it’s because I wasn’t qualified or if it’s because a system made a call in a matter of seconds, and now I’m subject to that system,” Geoghegan said.
The companies that actually make the systems argue that hiring is already such a flawed and biased process that taking the actual interviewer out of the screening process actually makes it more fair. When people conduct unstructured interviews, they almost always hire the people they like, not necessarily the ones best qualified for the job. One striking example: a University of Texas study found that after its medical school had to accept students it had initially rejected based on interviews, the rejected students and the originally accepted ones had the same performance in school.
“The hiring industry and the hiring process itself has long been broken,” Sydell said. “This is a challenge that algorithms and modern science are suited to help solve, and help make scientific sense of it — which pieces about a candidate are predictive about your success on the job.”
“We are humans; the way our brains process information is very biased. We are always looking for people who are similar to ourselves; we weed out other people who might be different,” he said.
Companies implement these systems because they have commercial and practical hiring needs they must meet. “It’s very difficult for them to go through this mass of applicants. They are indispensable, they couldn’t cope without them,” said Zahira Jaser, a professor at the University of Sussex Business School. “Though I am quite critical, I also don’t see a way out of it. I think this is going to become a bigger and bigger phenomenon.”
Jaser studies how people experience automated video interviews and how they affect hiring, not the AI itself. Her research has found that most people who undergo these video interviews don’t understand how the system works or what they’re getting themselves into, and she urges employers to adopt a “glass-box” approach where they provide as much transparency as possible about how their interviews will be processed and screened. At the very least, candidates need to understand that software, not a person, will be analyzing the text of what they say to a webcam. She also recommends employers create their own simple systems for candidates where they can see what successful interviews look like and why, and that they provide feedback to people who are rejected about why and what they can do to improve.
Without some of these changes, companies could run afoul of laws like the Americans with Disabilities Act. Federal regulators just released guidance in May that explains how the use of algorithms could violate the ADA. One of the key recommendations? Applicants need to understand the system and have straightforward ways to ask for alternative interview methods if they have a disability that could interfere with how the algorithm assesses their interview.
Smaller firms also need to consider whether the video interview might turn away potential candidates who see the system as offensive and develop easy alternative interview methods. One job applicant for a major media firm told Protocol that he immediately rescinded his application when the firm asked him to complete a Modern Hire interview. “It’s just the lack of transparency, and the data, and the laziness as well. It wouldn’t be that hard to just ask for a 20-minute chat. The person I actually want to talk to is the hiring manager,” he said.
“Why do they feel their time is more valuable? And this was for a mid-relatively high-up position; I can maybe understand it for graduates where you are receiving thousands of applications, maybe it’s a good tool to filter out from literally thousands. But even that is questionable in my opinion.”
Jaser sees that same sentiment from the people she has interviewed in her research.
“The technology doesn’t care about the human. So effectively it’s very exploitative of the human,” she said. “They are extracting what’s of interest to the employer in a very narrow way, forgetting almost all of humanity. It’s a very narrow way of judging. There is no relationship built.”
Anna Kramer is a reporter at Protocol (Twitter: @ anna_c_kramer, email: akramer@protocol.com), where she writes about labor and workplace issues. Prior to joining the team, she covered tech and small business for the San Francisco Chronicle and privacy for Bloomberg Law. She is a recent graduate of Brown University, where she studied International Relations and Arabic and wrote her senior thesis about surveillance tools and technological development in the Middle East.
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