In a statement, France's Cour de Cassation said: "The driver does not provide services as a self-employed person, but as an employee."
The decision came as part of a driver's request to reclassify his contract.
Bulletins
Shakeel Hashim
Shakeel Hashim ( @shakeelhashim) is a growth manager at Protocol, based in London. He was previously an analyst at Finimize covering business and economics, and a digital journalist at News UK. His writing has appeared in The Economist and its book, Uncommon Knowledge.
Latest Bulletins
The question of "is sending a Calendly link rude?" comes up often enough that the scheduling app has a whole blog post and ebook addressing it. The latest Twitter debate stems from a post by former Facebook VP Sam Lessin calling Calendly "The Most Raw / Naked Display of Social Capital Dynamics in Business."
\u2018Calendly\u2019 Etiquette is The Most Raw / Naked Display of Social Capital Dynamics in Business.pic.twitter.com/GEdYj6J6Rt— sam lessin (@sam lessin) 1643238794
Lessin, now a partner at VC firm Slow Ventures, argues that if you send someone a Calendly link, you're telling that person you're more important than them. When the sender is clearly a higher-up, like the "president of the US," then Calendly works. Otherwise, Lessin says he won't use it. "But just be clear about the social message I receive from you of your asserted self worth when you send me that link :)," he writes.
Others promptly weighed in, with one user calling it a "weirdly aggressive reaction to Calendly links." Overwhelmingly, people jumped in to defend Calendly. Users said the tool helps eliminate back-and-forth emails, and inspires focus. "The weirdest part of this Calendly discourse is it could have been solved with therapy," one user tweeted. Lessin's former Facebook colleague Dustin Moskovitz asked "who hurt you Sam". Marc Andreessen declared that anyone who disregards his Calendly links will be "permabanned from raising venture capital in Silicon Valley."
Imagine being triggered by calendly— Kim Taylor (@Kim Taylor) 1643247772
This has come up on Twitter before. Even in 2019, people were making fun of others taking offense at Calendly links. In September 2020, some people brought the debate into perspective by sharing Calendly's high revenue stats. Calendly's CEO Tope Awotona responded playfully to Lessin's post on Thursday, thanking him for an apparent spike in sign-ups.
I'd like to personally thank the @Calendly customer community for the re: the value we provide you, and @lessin for a huge spike in signups and for all his portfolio cos that rely on Calendly to win and delight customers. We appreciate the support— Tope Awotona (@Tope Awotona) 1643313630
Twitter drama aside, the company acknowledged that some people do feel sending a Calendly link implies a certain power dynamic. In an email to Protocol, Calendly communications manager Samantha Bosio noted that striking an approachable tone may help when emailing someone your scheduling link. “Feel free to share some times you’re available, or you can also pick from my Calendly if it’s easier," is one example. Overall, you want to emphasize that you're trying to respect the recipient's time.
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Robinhood shares plunged late Thursday, falling below $10 after the company reported disappointing results and a revenue outlook that well below what Wall Street was expecting.
Robinhood’s stock, which shed more than 6% in regular trading, fell another 14% in late trades to around $9.95.
The trading app reported a fourth-quarter loss of 49 cents a share, bigger than Wall Street’s estimate for 45 cents a share. The company posted revenue of $363 million, which topped expectations. But it also revealed that its monthly active users had fallen to 17.3 million in the fourth quarter from 18.9 million in the third quarter.
Robinhood’s revenue outlook for the current quarter was "less than $340 million," more than $100 million short of Wall Street’s target of $448.2 million. The projection was roughly 35% lower than revenue for the year-ago quarter when Robinhood got a lift from the GameStop trading frenzy which the company said featured “heightened trading activity, particularly relating to certain meme stocks.”
The company has also experienced volatility in its crypto trading business, which has grown quickly but made revenue harder to forecast. Falling crypto prices like the market has seen recently tend to depress trading, which could weigh on Robinhood's business.
Robinhood got some good news on Thursday when a U.S. federal court in Florida dismissed a lawsuit accusing the company of violating state laws when it restricted trades on meme stocks in January 2021. Chief Judge Cecilia Altonaga said the negligence and breach of fiduciary duty claims of the plaintiff were not valid due to a customer agreement which allowed Robinhood to restrict trading.
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A New York law taking effect May 7 requires employers to disclose electronic monitoring of their workers. This is similar to workplace monitoring laws already in effect in Connecticut since 1998 and Delaware since 2017. Federally, employers may spy on their employees as they perform work duties.
The New York law, which is an amendment to the state’s civil rights protections, only applies to employees hired on or after that date. However, it’s meant as a response to increased surveillance tech many employees have already confronted since they started working remotely during the pandemic. According to research by Top10VPN, surveillance software jumped 54% in the first half of 2020.
Now, employees must be notified that “any and all telephone conversations or transmissions, electronic mail or transmissions, or internet access or usage by an employee by any electronic device or system,” can be monitored “at any and all times by any lawful means,” according to the bill’s text.
But penalties are low, and legal experts told Bloomberg Law that it may be difficult for plaintiffs to use. The New York attorney general can seek $500, $1,000 and $3,000 for first, second and third offenses, but individual employees cannot enforce their rights in a court of law because the law doesn’t contain a private right of action.
Experts are watching to see if the law inspires similar legislation in other states, like California and Illinois.
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Proponents of the America Competes Act of 2022, introduced this week in the U.S. House of Representatives, said the legislation would make the U.S. supply chain stronger and help the country's technology industry compete with China. The crypto industry is worried the sector will be collateral damage.
Crypto lobbying groups are worried about a specific provision proposed by Rep. Jim Himes, buried around page 1,482 of the almost-3,000-page bill, that would allow the Treasury Department to bypass certain checks to take “special measures” to surveil, condition or prohibit any transactions deemed of concern to U.S. interests. The provision, titled “Prohibitions or Conditions on Certain Transmittal of Funds,” also expands the department’s authority to include crypto exchanges and transactions.
First introduced in the Patriot Act in 2001, “special measures” can only be imposed through regulation, would require public notice and can only be imposed for up to 120 days. The provision in the Competes Act would strike those limitations. The use of such measures, however, has been historically infrequent.
Jerry Brito, executive director of Coin Center, outlined his issues with the bill in a lengthy thread on Twitter on Wednesday. The exec of the D.C. crypto think tank warned that the provision would “essentially give the Treasury Secretary unchecked and unilateral power to ban exchanges and other financial institutions from engaging in cryptocurrency transactions.”
The Blockchain Association has also voiced its concerns with the provision and told Protocol that it is working with relevant lawmakers and will continue to advocate for a final bill that will preserve existing limitations on the Treasury's authority.
“Without this due process, many in the crypto industry fear that it could provide a pathway for a misguided crackdown on the use of cryptocurrencies,” the association said in a statement to Protocol.
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Tesla has sued a Chinese car influencer with 14 million followers for defamation, the company’s Chinese office confirmed to several media outlets on Wednesday. It’s the latest example of Tesla striking back at popular allegations in China about its safety issues, particularly around brake malfunctions.
The influencer Xiaogang Xuezhang (小刚学长) creates videos about testing and customizing cars on Douyin, TikTok’s Chinese version. In April 2021, he posted two videos comparing the automatic emergency braking systems of Tesla’s Model 3 and the XPeng P7 — a domestic EV model — in which he shows the Model 3’s emergency braking system failing to activate two times, resulting in hitting both a cardboard car and an inflatable mannequin.
The videos received half a million likes combined before one of the two was deleted. But their authenticity was also questioned by other influencers and Tesla owners, who pointed out signs that suggest he might have hit the gas while testing, which would obstruct Tesla’s braking system. Others speculate that the videos were sponsored by Tesla competitors.
While controversies about Tesla’s safety issues exist both in the United States and China, the company’s Chinese subsidiary has been much more litigious against customers and influencers who have spoken out. In 2021, Tesla China sued at least two owners who publicly demanded compensation for alleged safety issues. In May, it also registered a social media account for Tesla’s legal department in China, which proceeded to send cease-and-desist letters to influencers, Chinese media reported.
On Thursday, the sued influencer Xiaogang Xuezhang responded in a Douyin video, claiming that he only learned about the lawsuit through media and hadn’t received any attorney's letter from Tesla. He also accused Tesla of releasing his personal information and paying for social media campaigns that magnify the lawsuit. “On the surface, it looks like Tesla is suing me; deep down, it’s making an example of me,” he said in the video, doubling down on the authenticity of his videos. “No one would dare stand up against Tesla and point out its problems in the future.”
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Google is increasing its leave benefits for parents, parents who give birth and those caring for seriously ill loved ones, the company announced Thursday.
Starting on Jan. 1, parental leave for all parents increased by six weeks, from 12 to 18 weeks off. Parental leave for parents who give birth was also lengthened by six weeks, from 18 to 24 weeks off.
The company is making two additional changes to its time-off policies beginning April 2: Google will double what it calls "carer’s leave" for seriously ill loved ones from four to eight weeks. Employees will also receive five more vacation days, increasing from 15 to 20 minimum paid vacation days.
Chief People Officer Fiona Cicconi said the company wants to support the over 40% of Google employees who are part of the “sandwich generation,” meaning they’re likely caring for both children and aging parents at once. Older workers in this generation have told Protocol that they often feel ostracized, especially in an industry dominated by young people.
“We want to support our employees at every stage of their lives and that means providing extraordinary benefits, so they can spend more time with their new baby, look after a sick loved one or take care of their own wellbeing,” Cicconi said in a statement provided to Protocol.
Pinterest has also expanded its parental leave recently for both birthing and non-birthing parents. Just a month before the company announced those changes, the House of Representatives passed a bill that would mandate four weeks of paid family and medical leave for all workers.
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SoftBank COO Marcelo Claure may step down as soon as today, CNBC reported.
Claure has been discussing resignation for several months, people familiar with the situation told CNBC, and is considering running his own investment firm. Bloomberg reported that the executive is resigning due to fights over compensation with Masayoshi Son, SoftBank's founder. Claure is currently the company's second-highest paid executive.
In December, Claure asked the company for $2 billion in compensation over a period of several years for his role as the SoftBank's fixer, such as negotiating Adam Neumann's $180 million severance package from WeWork and assisting in the merger of T-Mobile and Sprint. Son and other senior executives from SoftBank disagreed that Claure deserved the steep compensation package.
Claure joined SoftBank in 2013 after selling a majority stake of Brightstar, a wireless service provider, to the company for $1.26 billion, and became the CEO of SoftBank-owned Sprint from 2014 to 2018. After stepping down from Sprint, he became COO at SoftBank Group and CEO at SoftBank Group International.
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In Tesla's fourth-quarter earnings call Thursday, Elon Musk said the company won’t produce any new models this year.
Tesla reported overall strong earnings with revenue growing 65% year-over-year in the quarter, and automotive revenue rising to $15.97 billion. Musk addressed a range of issues during the call, including the persistent chip shortage, supply chain concerns and Tesla’s autonomous vehicle push.
Big bots
Musk said building a humanoid robot is the company’s primary focus in terms of products. The company said in August that it’s working on a “Tesla Bot” and expects to have a prototype within the year.
No new models in 2022
A Tesla shareholder deck revealed supply chain woes continue to be its “main limiting factor” to production, and those issues will probably continue into this year.
Musk said the ongoing chip crisis continues to impact Tesla. As a result, the company won’t produce any new vehicles this year and will instead prioritize delivering its existing vehicles. “If we were to introduce new vehicles, our total vehicle output will decrease,” he said.
That means Tesla won’t come out with a $25,000 car, an idea which had been floated as a relatively cheaper option. “At some point we will. We have enough on our plate right now,” Musk said. The company has also yet to release its Cybertruck and Roadster, but Musk said he hopes they'll be ready by 2023.
'Safer than a human'
The company wrote that building autonomous vehicles “remains one of our primary areas of focus.”
“Over time, our software-related profit should accelerate our overall profitability,” the company said.
The NHTSA launched an investigation into Tesla's driver assistance features following accidents with the vehicles. Later in 2021, U.S. vehicle safety regulators began to examine the safety of Tesla's new gaming features. Tesla said it would update its Passenger Play software just after the latter probe began.
Despite regulators' concerns, Musk appeared confident in achieving full self-driving. The company said 60,000 vehicles in the U.S. now have the Full Self-Driving Beta. “I would be shocked if we do not achieve Full Self-Driving safer than a human this year," Musk said. "I would be shocked.”
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Regulators in China said today they will allow AMD to acquire Xilinx, the Wall Street Journal reports. It’s the last regulatory hurdle the company needed to cross to complete the largest deal in its history.
The potential $35 billion acquisition was plagued by politics and opaque regulatory reviews in China. AMD initially announced the deal in October of 2020, saying it planned to close by the end of 2021. But in the last month of the year, the company said it would delay closing until late March of 2022.
AMD has long trailed its competitor Intel in terms of enterprise tech market share; at the third quarter of 2021, AMD only controlled 10% of the market for x86 processors, while Intel controlled 90%. By acquiring programmable chipmaker Xilinx — one half of a FPGA duopoly between the company and Altera, owned by Intel — AMD thinks it will be able to make inroads with data-center chip buyers.
One expert told Protocol last week that the odds of the deal could as unpredictable as a “coin toss.” Others compared the deal to Qualcomm’s bid for NXP, a Dutch chipmaker, that became entangled with the 2017 trade war (which China denies). But others had been less critical, saying the deal had been proceeding more smoothly than others assumed
AMD was required to re-file its paperwork with U.S. regulators after the deal was delayed into 2022, which will hold up the closing a little longer but isn't expected to derail the process. In a statement, AMD said it still expects the deal to close in the first quarter of 2022.
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About 100 company leaders are pressing their colleagues to improve the workplace for people with disabilities and evaluate their inclusion of people with disabilities, Disability:IN announced Thursday.
The letter’s newest signatories of the “CEOs Are IN” campaign include the heads of Micron Technology, Tripadvisor and other tech and health care professionals. Accenture, Intel and Microsoft are among the first companies to back the letter when it was first released in 2019. These companies pledged to make disability inclusion a business priority by participating in an assessment of their disability inclusion and equality practices.
Disability:IN CEO Jill Houghton said focusing on diversity, equity and inclusion efforts will help create sustainable companies, especially in light of the Great Resignation. “By encouraging CEOs to make disability inclusion a business priority, these 101 signatories are joining IN to positively transform lives and create financial and social impact,” Houghton said in a release.
The signatories pledged to take part in the Disability Equality Index, which is administered by Disability:IN and the American Association of People with Disabilities. Participants of the assessment receive a score between 0 and 100, with scores over 80 indicating that they are the “Best Places to Work for Disability Inclusion,” according to the release. The DEI looks at criteria within six categories including culture and leadership, community engagement and supplier diversity. The organization added questions related to board diversity this year, and the findings from those questions will be released in July, according to Disability:IN's Houghton.
Of the 319 companies that took the examination last year, 272 scored 80 or above, Houghton said. Adobe, Dell and Cisco were among dozens of companies to receive a score of 100 in 2021; Amazon and VMware were given scores of 90%; and Snap, Micron and Workday received scores of 80%. Registration for the Disability Equality Index is currently open, and results are released in July.
The Diem Association, a Meta-backed crypto project, is winding down and selling its technology to Silvergate Capital for $200 million, the Wall Street Journal reported on Wednesday.
Bloomberg first reported on Tuesday that Diem was interested in cashing out on its remaining assets as a way to return capital to investors, but that sale discussions were still in early stages. The appearance of a buyer could signal a clear end to Meta's ambitious crypto project.
Diem, originally known as Libra, was founded by Facebook in 2019 and wanted to create a stablecoin linked in value to fiat currencies. The project drew worldwide scrutiny from regulators, leading backers to drop from the project as Mark Zuckerberg was called before Congress to defend it in 2019.
The association had announced in May that Silvergate Bank, a subsidiary of Silvergate Capital, would be the issuer of its currency, but Diem's coin never launched, and Meta introduced a crypto wallet last year without Diem's involvement. Now it appears that Diem partner Silvergate, which serves several customers in the crypto space and has signaled its ambitions to issue a stablecoin, will carry on what remains of the project.
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The Amazon Labor Union has reportedly gotten a "sufficient showing of interest" in holding a union election among JFK8 warehouse employees in Staten Island, New York.
A hearing will be held on Feb. 16 to work out details of the election, the National Labor Relations Board confirmed to Vice reporter Lauren Kaori Gurley on Wednesday. The warehouse's first petition to hold a union vote was rejected by the NLRB in November for not having enough employees who had signed authorization cards. Workers refiled its petition in December.
BREAKING: @amazonlabor has attained "a sufficient showing of interest" to hold a union election at NYC's JFK8 warehouse, NLRB confirmed to me
A hearing will be held on Feb 16 to determine the specifics of election. This is the 2nd time that Amazon workers have gotten this far
— Lauren Kaori Gurley (@LaurenKGurley) January 26, 2022
The election is another signal of the rising demand for unionization among Amazon warehouse workers as the company faces continued scrutiny for its treatment of employees. A second vote to unionize an Amazon facility in Bessemer, Alabama will be held on Feb. 4, after results of the first election last March were thrown out due to illegal interference by the company. Amazon also finalized a settlement with the NLRB in December to allow its warehouse employees to organize more easily.
Amazon spokesperson Kelly Nantel, said in a statement, "We’re skeptical that there are a sufficient number of legitimate signatures and we’re seeking to understand how these signatures were verified. Our employees have always had a choice of whether or not to join a union, and as we saw just a few months ago, the vast majority of our team in Staten Island did not support the ALU."
Update: This post was updated with a statement from Amazon.
Correction: This post was updated to correct the day the hearing was announced.
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Shares of LendingClub fell in after-hours trading Wednesday after posting weaker-than-expected revenue outlook, despite reporting strong results. The fall below $20 wiped out almost all the gains the company saw in a rally that ran from July to November as its neobank strategy showed strength, taking shares from around $16 to as high as $49. With inflation on the rise and other threats looming, that strategy's freshly in question.
LendingClub’s stock tumbled about 14% in trades after the market closed, following a trading session that saw its shares rise 4.5% in anticipation of its earnings. The company reported a profit of 27 cents a share on revenue of $262.2 million in the fourth quarter. Analysts expected LendingClub to post earnings of 22 cents a share on revenue of $245.7 million.
The company said it expects first-quarter revenue of $255 million to $265 million. Analysts were expecting revenue of $257 million.
Analyst Michele Alt, a partner at Klaros Group, attributed the stock fall to “market jitters.”
LendingClub CEO Scott Sanborn agreed, telling Protocol, “There's just a lot of volatility out there and a lot of anxiety and a lot of sharp movements happening.”
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A Walmart-backed fintech startup is buying two companies in an effort to become the latest super app to handle all of a consumer's financial needs.
The new company, which is majority-owned by Walmart and also backed by Robinhood investor Ribbit Capital, is buying Even, an early wage access startup that already has Walmart as a customer. It is also buying One Finance, a neobank. The new combination of the three companies will take the One name. Even and One had a combined valuation of $400 million, according to the Wall Street Journal.
The new company is headed by two former Goldman Sachs executives, including Omer Ismail, its CEO, who was previously head of Goldman's Marcus unit.
PayPal, Block, Affirm and others are also building out their own version of a super app, with services including shopping, payments, savings, banking and crypto.
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UBS is buying robo-adviser Wealthfront for $1.4 billion, the financial services giant said Wednesday.
The acquisition would expand the Zurich-based bank's reach among millennial and Gen Z investors, who have favored automated investing services. It would also boost UBS's automated wealth-management capabilities.
Launched in 2008, Wealthfront is considered a pioneer in robo-investing software. The fintech manages over $27 billion in assets and has over 470,000 clients in the U.S.
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Amazon has stopped paying warehouse workers to sing the company's praises on social media, according to the Financial Times.
The ecommerce giant shuttered its fulfillment center "ambassadors" program at the end of 2021, claiming executions didn't think the program's reach was good enough, anonymous sources told FT. The program launched in 2018, paying workers in its fulfillment centers to tweet about positive work experiences as a way to fight negative press and repair its reputation. It seemingly started in response to stories tweeted by employees about horrific working conditions and low pay.
According to Insider, ambassadors were tweeting in Amazon's support as recently as March 2021, popping up prior to the union vote in its Bessemer, Alabama, center.
Since the program's launch, the ambassadors had been mocked and parodied, accused of being "propaganda" for the company.
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The Business Roundtable, whose members include more than 230 CEOs of some of the world’s largest companies, want “rational” and “flexible” government regulations for AI. The group, which includes CEOs of tech, financial services and defense industry giants such as 3M, Amazon, Bank of America, Google, Mastercard, Northrop Grumman, Oracle and Verizon, published a set of guidelines Wednesday for businesses implementing AI and recommendations for policymakers.
As technologies employing artificial intelligence and machine learning stream into every nook and cranny of business operations — from algorithmic recruitment platforms to no-code AI tools used by marketing or supply chain teams — the need to address the implications of technologies that make automated decisions and replace humans is no longer merely the purview of the data science or legal team, but the C-suite.
The organization’s 10 core principles for responsible AI call on Business Roundtable members to operationalize AI governance throughout their businesses, design and deploy secure AI, collect and manage data responsibly, mitigate for AI bias that produces unfair decisions and evaluate and monitor AI models according to such goals.
Some companies in the group have adopted their own AI principles in recent years. However, in general, there are few assurances that companies have put pledges to use AI fairly and safely into practice in standardized, measurable or accountable ways. In fact, some have been criticized for their internal approaches to addressing AI ethics. Google famously shuttered its AI ethics committee following criticism over its choices for committee members. The company also angered the AI ethics community after firing one of the industry's most respected AI ethics researchers.
The Business Roundtable called on the U.S. government to establish practices and rules for AI, including by updating existing rules or laws. The recommendations state that the administration, Congress and regulators should craft “targeted and flexible governance and oversight” that account for the evolving nature of AI by employing “an agile and collaborative approach to AI governance” and an “adaptive approach to enforcement" that focuses on “efforts on bad actors.”
The group also wants to limit new regulations. The policy recommendations state that government should “assess regulatory gaps before considering new regulations,” and when new rules are deemed necessary, “narrowly scope the new rules or guidance to address the gaps.”
Some businesses are already starting to incorporate some of the approaches the organization suggests policymakers implement. For example, the group called for incentivizing industry to conduct its own self-assessments of AI. The group suggests its members evaluate and monitor AI models for accuracy, unfair bias, data protection and unintended uses.
Introduction of the principles could bode well for a new crop of AI auditing providers.
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Google broke the internet last year with its plan to break the internet last year.
Of course, I’m talking about FLoC, Google’s poorly named plan to kill off the third-party cookie and allow advertisers to target “cohorts” of anonymous users instead. It managed to piss off everyone, with privacy groups calling it invasive and the ad industry calling it anticompetitive.
Yesterday, Google killed off FLoC, announcing it’s replacing it with a shiny new ad-targeting tool called Topics. The idea behind Topics is pretty simple. It’s an API that uses people’s browsing history to infer their interests in broad topics like, say, fitness. The API will share a rotating subset of those interests with publishers, who can then use them to serve targeted ads on their sites. Users can also delete topics they don’t want shared in what Google argues is a much better deal for privacy.
But if Google was expecting a standing ovation from FLoC’s critics, it might have been disappointed. The company’s plan for Topics has, so far, gotten something between a lukewarm and icy response from the very people who called for FLoC’s demise.
“It just seems like rearranging deck chairs on the sinking ship of targeted ads,” said Justin Brookman, director of Consumer Privacy at Consumer Reports.
“There’s no way to spin this as anything other than a new privacy violation being built into your browser,” said Bennett Cyphers, staff technologist at the Electronic Frontier Foundation.
There’s no doubt Topics is a slight improvement over FLoC, Cyphers and Brookman acknowledged, but it hardly satisfies the growing movement calling for the eradication of behavioral ad targeting altogether. That includes not just advocates, but lots of Democrats in Congress and lawmakers in Europe who have recently pushed for legislation that would ban targeted ads.
In its announcement, Google emphasized the importance of giving people control over the topics that advertisers use to target them. "Because Topics is powered by the browser, it provides you with a more recognizable way to see and control how your data is shared, compared to tracking mechanisms like third-party cookies," the post read.
But privacy hawks argue that user controls can be the enemy of offering people true privacy in the first place. “It's just not feasible for someone to track and control their Topics on a week-by-week basis: Who would do that?!” Brookman said.
As it happens, Facebook pitched a similar proposal last year but changed course due to privacy concerns. “If automatic inferences are returned based on behavioral data, there is a risk of sensitive information disclosure. I think this is a fair point,” Facebook engineer Ben Savage wrote in an online discussion group regarding the proposal.
But just because the privacy world hates Topics doesn’t mean the ad world loves it. It may not kill ad targeting, but it will cut ad-tech firms and publishers off from a whole lot of web browsing data they currently have access to — data Google, which owns the biggest browser in the world, will continue to have access to.
That raises tricky questions about what Topics means for competition. “Google isn’t going to use it,” said James Rosewell, director of Movement for an Open Web, a group that’s pushing back against Google’s privacy efforts. “Topics are for rivals. [Google] is still discriminating against rivals.”
Google’s decision to kill FLoC didn’t happen in a vacuum. It comes at a time when Google is facing mounting scrutiny of both its privacy practices and its approach to competition. And at least some of that scrutiny has focused directly on FLoC.
In addition to all of the public backlash, the U.K.’s competition regulator has also been investigating Google’s privacy plans since last year, after Rosewell filed a complaint accusing the tech giant of trying to stifle competition through FLoC and other privacy changes. That prompted Google to delay its plans to kill the third-party cookie this year, postponing the change to 2023. And just this week, hundreds of publishers in Germany, including Protocol parent company Axel Springer, filed a similar complaint to Europe’s top competition watchdog, alleging that Google’s privacy moves violate EU competition law.
In its blog post announcing Topics, Google said it’s been working with the U.K. competition authority to “ensure our proposals are developed in a way that works for the entire ecosystem.” Time will tell if regulators think Topics meets the mark.
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The Diem Association, a controversial Meta-backed cryptocurrency project, is reportedly looking to sell its assets to return capital to investors, Bloomberg reported.
The association is reportedly in discussion with investment bankers on how to cash out on the project, including selling its intellecutal property and finding other work for its developers and engineers. Sale discussions are still early and there is no guarantee that Diem's assets will be bought, people familiar with the conversations told Bloomberg. Meta owns around a third of Diem, with the rest owned by members of the association, which includes VC firms and other tech companies.
The news comes a few months after David Marcus, founder of Diem, announced his departure from Meta's financial technology unit, which was recently renamed from Facebook Financial to Novi. Novi introduced a long-expected digital wallet last year to a limited set of users, and relied on a stablecoin from Paxos, not the still-unavailable Diem coin.
Diem, which was originally known as Libra, drew strong regulatory scrutiny. First unveiled by Facebook in 2019, Diem aimed to create a stablecoin linked in value to a basket of fiat currencies. Diem announced in May that Silvergate Bank would be the issuer of its currency.
Silvergate CEO Alan Lane said during the bank's fourth-quarter earnings call last week that it was "ready to launch something in 2022" and it's applied with the New York State Department of Financial Services to form a trust company for holding stablecoin reserves. He didn't specifically address the status of Diem in the call.
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Boris Johnson said on Tuesday that he is talking to the U.S. about a possible Russian ban from the SWIFT system, which undergirds global payments. Amid increasing threats of a Ukraine invasion, Western governments are looking for deterrence measures.
The British leader's threat could carry significant economic consequences: The SWIFT global payments system carries more than five billion financial messages each year covering payments, trade finance, foreign exchange and treasury, and securities. If Russia is banned from the system, that could mean cutting off access to banking and credit card systems from across the world.
This specific economic sanction has only been used on two countries so far, North Korea and Iran. Iran launched an alternative called SEPAM in 2013 as a result. VTB Bank head Andrey Kostin said last month that the sanction “would be a very serious measure, 'unfriendly' doesn't do it justice." However, the Biden administration has made it abundantly clear that if Russia proceeds with military force in Ukraine, the U.S. is prepared to enact economic sanctions.
In an effort to try to get ahead of sanctions, Russia experimented with blockchain-based solutions as an alternative in April last year. It has also developed its own banking messaging system known as SPFS. But the Russian government's apparent disagreement on how crypto should be regulated could hobble its attempt to use digital currencies as a workaround.
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Russia’s Ministry of Finance is opposed to the Central Bank of Russia’s proposed crypto ban, calling for regulation instead of a complete ban.
“Regulation is sufficient to protect our citizens,” Ivan Chebeskov, the head of the financial policy department at the ministry, said in a conference on cryptocurrencies on Tuesday. He added that the ministry has prepared a set of proposed crypto regulations awaiting government evaluation and approval.
The Central Bank of Russia proposed a full ban on cryptocurrencies in a report released earlier this month, adding to an existing ban on using crypto in payments and prohibiting mutual funds from investing in crypto. The report cited crypto's effect on Russia’s financial stability, as well as concerns about crypto mining’s impact on the energy supply. Russia is the third-largest crypto-mining country in the world, with over $5 billion worth of crypto transactions conducted every year, according to a Central Bank report.
The Ministry of Finance isn’t alone in its criticisms. Many within the tech and political spheres have voiced their concerns.
“No developed country bans cryptocurrencies,” Telegram founder Pavel Durov wrote in a tweet. “These technologies improve the efficiency and security of many human activities, from finance to the arts.”
The U.S. has found itself struggling to regulate crypto as well, with federal agencies like the SEC, CFTC and OCC competing to take the lead. The White House is reportedly poised to issue an executive order next month outlining a clearer approach to regulating crypto with a directive asking for agency reports later this year.
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Twitter was abuzz Tuesday over a long thread written on Monday by Bolt CEO Ryan Breslow, who claimed that Stripe and Y Combinator are “mob bosses,” using “every power move imaginable” to block competitors from becoming successful.
In other words: Silicon Valley is cutthroat. Who knew?
Or at least, that summarizes most of the replies on Twitter. Few deny that there’s a powerful hierarchy in Silicon Valley. Most agreed with Breslow’s assertions about Y Combinator’s influential stature and Stripe’s impressive cap table. But given that Bolt was initially rejected from Y Combinator, and competes directly with Stripe in payments, most onlookers are taking the tweetstorm as a pretty low blow.
“I hold no interest in Stripe, Initialized is not an investor … but this take by a Stripe competitor is just dishonest,” tweeted Initialized Capital co-founder Garry Tan, a former Y Combinator partner. Joe Benjamin, the founder of Profs, called it a “marketing stunt.”
I hold no interest in Stripe, Initialized is not an investor, I was not around for that company going through YC (I had credit card debt and was struggling through as an engineer myself at the time)
But this take by a Stripe competitor is just dishonest.
— garrytan.eth 陈嘉兴 🥑🌐🦇🔊🍌🔺(∞, ∞) (@garrytan) January 25, 2022
I’m pretty sure the Bolt thread about YC, Stripe and HN is a marketing stunt.
1. Create narrative of an enemy/us vs them
2. The relatable underdog
3. Perfect bait for the tech community to jump in and dunk or provide their thoughts
Marketing 101 on social media
— Joe Benjamin (@JoeBenjamin_) January 25, 2022
The tweets gave Breslow’s account of Bolt’s rise to its current $11 billion valuation (it raised $355 million this month). The storyline was familiar to most starry-eyed entrepreneurs: a great product that VCs and peers didn’t initially see value in, but that rises to be a top competitor in the field. But in Breslow’s telling, VCs and customers ignored Bolt in the early days because it wasn’t part of Y Combinator, and Y Combinator formally and informally backed Stripe.
As evidence, Breslow pointed to the fact that few well-known VC firms that invested in Stripe showed interest in Bolt. He didn’t help himself by falsely claiming that Lyft selected Stripe as its payments processor because both were Y Combinator companies — Lyft is not, which Breslow later acknowledged — or ignoring that Y Combinator backed payments startup WePay in the same batch as Stripe.
Breslow continued to double down on his argument Tuesday as the discussion continued, with some observers claiming the pushback actually supported his point, as evidence of how Silicon Valley circles the wagons.
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Ripple has bought back shares it issued after securing $200 million in funding in 2019, an unusual move which CEO Brad Garlinghouse said underlined the crypto company’s momentum despite its ongoing legal battle with the SEC.
Ripple secured series C funding led by Tetragon, with investments from SBI Holdings and Route 66 Ventures, at a $10 billion valuation in late 2019. Ripple is reacquiring the equity shares at a $15 billion valuation, which suggests the investors made a 50% profit in just over two years. The company did not confirm the details of the transaction beyond the company valuation.
Tetragon and Route 66 Ventures could not immediately be reached for comment, and SBI Holdings declined to comment. Share buybacks are uncommon but not unheard of among venture-backed companies. "Typically, they are a very inefficient use of capital" for startups, Redpoint partner Tomasz Tunguz wrote in 2019.
“Despite these crazy headwinds with the SEC and frankly losing some customers because of the SEC lawsuit, we grew very quickly,” Garlinghouse told Protocol. “Ripple’s business has materially grown. We have a strong balance sheet. Even after doing this repurchase, we have over a billion dollars in cash. We're starting 2022 in a great position of strength.”
Ripple is engaged in a legal brawl with the SEC, which sued the company in December 2020. The regulatory agency accused Ripple of raising $1.3 billion in unregistered digital-asset securities by issuing XRP tokens. The SEC's key claim is that XRP is not a currency, but a security, and therefore subject to strict securities laws.
The lawsuit caused the value of XRP to drop dramatically, although it is still the 8th largest cryptocurrency based on value with a market cap of $29 billion. XRP has fallen sharply along with other cryptocurrencies in the recent market rout which has wiped out more than $1 trillion in value.
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Nvidia's bold $40 billion bid for chip designer Arm has been in trouble for months, after regulatory impediments in Europe, the U.K. and the U.S. have threatened to disintegrate the deal. It might be time for Plan B.
Bloomberg News said Tuesday that both Nvidia and current Arm owner SoftBank have begun to quietly make preparations to put an end to the proposed transaction. Nvidia has told partners it doesn’t expect the deal to go through, and SoftBank is prepping to take Arm public via an initial public offering, the report said.
Should the deal fall through, SoftBank would get to keep a nearly $1.3 billion breakup fee from Nvidia.
Ever since Nvidia announced the deal in 2020, industry veterans and financial analysts alike have said that there was no path to successfully bringing the deal home. In addition to regulators around the world, the acquisition has faced opposition from some of the most important chipmakers in the world, such as Qualcomm and Intel, but also big tech companies: Amazon and Microsoft have both actively sought to torpedo the bet.
Industry and tech opposition is no shock: Arm develops the designs other companies like Apple can license to make chips themselves, and is considered something of a neutral distributor as a result. Arm designs power thousands of products ranging from auto chips to smartphone processors. Putting Arm under Nvidia’s control would theoretically give it access to what its rivals are working on.
If the deal does close, it would be the largest in Nvidia’s history. Having Arm’s designs under Nvidia’s roof would also give the company access to server processor designs that would further open the data center market. Combined with the manufacturing prowess of TSMC, it would also vault Nvidia into a more competitive position against Intel.
A spokesperson for Nvidia said in a statement: “We continue to hold the views expressed in detail in our latest regulatory filings — that this transaction provides an opportunity to accelerate Arm and boost competition and innovation.”
"We remain hopeful that the transaction will be approved," a Softbank spokesperson said in a statement.
This story was updated with a comment from Softbank.
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In the last few years, Google tried out a new project for ad targeting, FLoC, in an effort to get rid of cookies. The system was supposed to group people by interests for advertising purposes, but received significant pushback from experts who believed it would exacerbate discriminatory and predatory ad targeting.
Today, the plan is dead. In its place: Topics.
The new API will track users’ interests as they surf the web, collecting data in three-week chunks. It will then categorize surfing history into 300 pre-designated “topics,” or interest areas, which do not include sensitive characteristics like race and gender. Then, when a user visits a site, three of their top five most-visited “topics” will be reflected in the ads. Users will be able to turn off specific topics in their settings.
In theory, this should provide users with a more private ad experience than cookies do. Google says it will begin beta tests of the API at the end of the quarter. In the meantime, it’s published a technical explainer of the API, part of the company’s “Privacy Sandbox” of open-source tools for developers, on GitHub.
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