Start Up No.958: Amazon hacked?, how bots spread lies, another bitcoin casualty, hello Mars!, and more

Mobile payments are growing fast in rapid-service locations – but what does that mean for tipping? CC-licensed photo by Jason Tester Guerrilla Futures on Flickr

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A selection of 12 links for you. Use them wisely. I’m @charlesarthur on Twitter. Observations and links welcome.

Study: it only takes a few seconds for bots to spread misinformation • Ars Technica

Jennifer Ouellette:


Shortly after the 2016 election, newly elected President Donald Trump—peeved at losing the popular vote to Democratic opponent Hillary Clinton—falsely claimed he would have won the popular vote if not for the supposed votes of three million illegal immigrants. The lie spread rapidly across social media—far faster than factual attempts to debunk it. And Twitter bots played a disproportionate role in spreading that false information.

That’s according to a new study by researchers at Indiana University, published in Nature Communications. They examined 14 million messages shared on Twitter between May 2016 and May 2017, spanning the presidential primaries and Trump’s inauguration. And they found it took just 6% of Twitter accounts identified as bots to spread 31% of what they term “low-credibility” information on the social network. The bots managed this feat in just two to 10 seconds, thanks in large part to automated amplification.

Why are bots so effective at spreading false information? Study co-author Filippo Menczer attributes their success to so-called “social bias:” the human tendency to pay more attention to things that seem to be popular. Bots can create the appearance of popularity or that a certain opinion is more widely held than it actually is. “People tend to put greater trust in messages that appear to originate from many people,” said Menczer’s co-author, Giovanni Luca Ciampaglia. “Bots prey upon this trust by making messages seem so popular that real people are tricked into spreading their messages for them.”

Their findings are consistent with those of an earlier study, published by MIT researchers this past March in Science. Those researchers concluded that false stories travel “farther, faster, deeper, and more broadly than the truth in all categories of information.” The MIT study was based on analysis of 126,000 stories tweeted by around 3 million people more than 4.5 million times, from 2007-2017. The result: a false story only needs roughly 10 hours to reach 1,500 users on Twitter, compared to 60 hours for a true story.

“No matter how you slice it, falsity wins out,” said co-author Deb Roy, who runs MIT’s Laboratory for Social Machines.

Roy and his colleagues also found that bots sped up the spread of both true and false news at equal rates. So he concluded that it’s the human factor, more than bots, that is responsible for the spread of false news.


Happy.. whatever day the bots have decided it is!
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Amazon admits it exposed customer email addresses, but refuses to give details • Techcrunch

Zack Whittaker and
Josh Constine:


Users don’t know which of Amazon’s sites was impacted, who their email address could have been exposed to, or any ballpark figure of the number of victims. It’s also unclear whether it has or plans to contact any government regulatory bodies.

“We’re contacting you to let you know that our website inadvertently disclosed your email address due to a technical error,” said Amazon in the email with the subject line: “Important Information about your Account.” The only details Amazon provided were that: “The issue has been fixed. This is not a result of anything you have done, and there is no need for you to change your password or take any other action.”

The security lapse comes days ahead of one of the busiest retail days of the year, the post-Thanksgiving holiday sales day, Black Friday. The issue could scare users away from Amazon, which could be problematic for revenue if the issue impacted a wide number of users just before the heavy shopping day.

Amazon’s vague and non-specific email also sparked criticism from users — including security experts — who accused the company of withholding information. Some said that the correspondence looked like a phishing email, used to trick customers into turning over account information.

Customers in the US, the UK and Europe have reported receiving an email from Amazon.


Wait long enough, and everyone gets hacked. I think at this point only Apple and Google haven’t had a serious breach of their systems. (Users of both have been phished many, many times but the core systems haven’t.)

By the way, if you haven’t already turned on two-factor authentication for your Amazon account, this is a good time to do it. (Look under Account – Security.)
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Harvesting in a trade war – US crops rot as storage costs soar • Reuters

Mark Weinraub:


U.S. farmers planted 89.1m acres of soybeans this year, the second most ever, expecting China’s rising demand to give them better returns than other bulk crops.

But Beijing slapped a 25% tariff on US soybeans in retaliation for duties imposed by Washington on Chinese exports. That effectively shut down U.S. soybean exports to China, worth around $12bn last year. China typically takes around 60% of US supplies.

The US government rolled out an aid programme of around the same size – $12bn – to help farmers absorb the cost of the trade war. As of mid-November, $837.8m had been paid out.

Some of that money will pass from farmers to grain merchants such as Archer Daniels Midland Co and Bunge Ltd, who are charging farmers more to store crops at elevators where there is limited space. Bunge and ADM did not respond to requests for comment on storage fees.

The storage crunch and higher fees have boosted revenues at grain elevator Andersons, Chief Executive Officer Pat Bowe said in an interview.

“It’s paying a grain handler to store – it’s the old-fashioned way to make money,” Bowe said.

These are also boom times for John Wierenga, president of grain storage bag retailer Neeralta. Sales of their bags – white tubes up to 300 feet now littering Midwest fields – are up 30% from a year ago.

“The demand has been huge,” Wierenga said. “We are sold out.”

Farmers are feeling the pinch. Those in central Illinois could pay up to 40% more than in previous years to store crops over the coming weeks, agricultural consultant Matt Bennett estimated.


Also: next year, China will go back to this year’s sources of soybeans – not the US.
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You snooze, you lose: insurers make the old adage literally true • ProPublica

Marshall Allen:


[Tony] Schmidt, 59, has sleep apnea, a disorder that causes worrisome breaks in his breathing at night. Like millions of people, he relies on a continuous positive airway pressure, or CPAP, machine that streams warm air into his nose while he sleeps, keeping his airway open. Without it, Schmidt would wake up hundreds of times a night; then, during the day, he’d nod off at work, sometimes while driving and even as he sat on the toilet.

“I couldn’t keep a job,” he said. “I couldn’t stay awake.” The CPAP, he said, saved his career, maybe even his life.

As many CPAP users discover, the life-altering device comes with caveats: health insurance companies are often tracking whether patients use them. If they aren’t, the insurers might not cover the machines or the supplies that go with them.

In fact, faced with the popularity of CPAPs, which can cost $400 to $800, and their need for replacement filters, face masks and hoses, health insurers have deployed a host of tactics that can make the therapy more expensive or even price it out of reach.

Patients have been required to rent CPAPs at rates that total much more than the retail price of the devices, or they’ve discovered that the supplies would be substantially cheaper if they didn’t have insurance at all.

Experts who study health care costs say insurers’ CPAP strategies are part of the industry’s playbook of shifting the costs of widely used therapies, devices and tests to unsuspecting patients.


It would be OK to check whether people are using them – but pricing them out of reach? Truly, US health insurers are the problem, not the solution.
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UK sugar tax raises well under half forecast amount • FT

Madison Marriage:


Britain’s sugar tax has raised well under half the originally forecast amount in its first seven months, reflecting a huge shift by drinks manufacturers to cut the amount of sugar in their products.

The levy has raised £154m since it came into force in April. It will be used to tackle childhood obesity and to fund physical education activities and breakfast clubs in schools.

When former chancellor George Osborne announced the tax in 2016, he forecast it would raise around £520m a year. But manufacturers reduced the amount of sugar they use to avoid the levy — one of the government’s intended goals.

HM Revenue & Customs said on Tuesday that 457 traders had registered to pay the levy, which imposed an additional tax of 18p a litre on drinks that contain 5g of sugar per 100ml; and 24p a litre on drinks with more than 8g of sugar per 100ml.

It added that between the announcement and implementation more than 50% of drinks by volume had had enough sugar removed to no longer be affected by the levy. It now expects the levy to generate £240m annually.


The intro (lede; first paragraph) makes it sound as though it’s a failure. But it has had exactly the desired effect: there’s less sugar in drinks. Next step: ratchet down the amount of sugar allowed before the tax applies.
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Bitcoin mining firm Giga Watt declares bankruptcy owing millions • Coindesk

Yogita Khatri:


US-based bitcoin mining firm Giga Watt has declared bankruptcy with millions still owed to creditors.

The firm filed for Chapter 11 bankruptcy at a court in the Eastern District of Washington on Monday, revealing that it still owes its biggest 20 unsecured creditors nearly $7m in court documents seen by CoinDesk.

Creditors include the utilities provider in its Douglas County base, having a claim of over $310,000, and electricity provider Neppel Electric, which is owed almost half a million dollars.

Giga Watt has estimated assets worth less than $50,000, whereas estimated liabilities are in the range of $10–50m, according to the court documents.

“The corporation is insolvent and unable to pay its debts when due,” read the minutes of a special meeting of the shareholders of Giga Watt, which was held on Nov. 18. “The corporation and its creditors would best be served by reorganization of the corporation under Chapter 11 of the Bankruptcy Code.”

The meeting was called by Andrey Kuzenny, a director owning more than 10% of the mining firm.

Giga Watt was founded by bitcoin miner Dave Carlson with the plan being to open up the industry to smaller scale miners by creating customized mining “pods” along with a cheap and stable electricity supply and round-the-clock maintenance at a facility in central Washington.

As part of a plan to allow investors to buy a stake in the company’s services, it held an initial coin offering (ICO) in May 2017 that raised about $22m-worth of cryptocurrency at the time.

However, this January, a group of plaintiffs sued Giga Watt for allegedly conducting an unregistered securities offering.


Oof. The fallout continues.
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Google’s cloud business under Greene was plagued by internal clashes, missed acquisitions, insiders say • CNBC

Jillian D’Onfro:


[Google chief Sundar] Pichai wrote in his introductory blog post in November 2015 that “Diane [Greene, ex-VMWare, now appointed Google’s cloud chief – and already on Alphabet’s board.. before Pichai] needs no introduction.” She would get her own dedicated sales team, pulling cloud software sales out from under the control of the core advertising business.

On Friday, that plan came to an abrupt halt when Greene announced that she will leave her post in January. Greene will be replaced by Thomas Kurian, who recently left a top executive role at Oracle, where he spent 22 years.

During Greene’s tenure, Google increased its annual capital expenditures from $10bn to over $13bn, and went on a hiring spree — the cloud group has added more people than any other at Alphabet over the last two years. It got some key customer wins and built out several important functions for selling to enterprises, including professional services, training and marketing.

Despite all that, Google continues to struggle. People who follow the industry say it’s a two-horse race between Google and Microsoft, with Google failing to keep pace in a cloud infrastructure market that Gartner expects to grow to $39.5 billion next year from $31bn in 2018. In terms of market share, Google has yet to crack double digits.

“They figured out and monetized search like nobody probably ever will, but I don’t think they care about the enterprise,” said Tom Siebel, the co-founder of software company Siebel Systems, which Oracle acquired for almost $6bn in 2006. Siebel, who has known Greene for about 15 years and is now CEO of cloud software company C3, said that when it comes to helping big businesses solve their infrastructure problems, “Google is just not a factor.”


This is a mixed story: it sounds more like Greene was struggling with the whole Google culture, which isn’t tuned towards selling into enterprise, than failing on her own terms.
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Mobile payments now account for 6% of all UK card transactions • NFC World

Sarah Clark:


The percentage of payments made with a mobile phone in UK stores has jumped from 1.3% in Q3 2016 to 5.6% in Q3 2018, an analysis of 190m card transactions has shown. Compared to this time last year, the volume of contactless mobile payments has increased by 60%.

For payments under the £30 contactless payments limit, the number of transactions accounted for by mobile payments increased from 1.8% in Q3 2016, to 4.6% in Q3 2017 and then 7% in Q3 2018, the analysis by Cardlytics found.

“The biggest beneficiaries of growing mobile payments are quick-service merchants who have introduced contactless payment methods,” the company says. “This includes quick-service-restaurants (11.3%), coffee shops (11%), public transport (11%) and bars and pubs (9.25%).

“This reflects that mobile payments are used more readily at merchants that people visit on a daily basis and wish to pay more expediently, while less popular amongst bigger-ticket, one off purchases.”


That’s roughly a doubling every year. One observation: for places where some staff might rely on or hope for tips, mobile payments preclude them. If this is repeated in the US, where tipping is pretty much essential as a salary topup for many service jobs, it’s going to create a big disjoint.
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On November 26th, a mole will land on Mars • The Oatmeal

Matthew Inman:



Really can’t summarise Inman’s wonderful examination of this mission (which you’d probably all forgotten about). Enjoy it.
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The land that failed to fail • NY Times


China’s Communist leaders have defied expectations again and again. They embraced capitalism even as they continued to call themselves Marxists. They used repression to maintain power but without stifling entrepreneurship or innovation. Surrounded by foes and rivals, they avoided war, with one brief exception, even as they fanned nationalist sentiment at home. And they presided over 40 years of uninterrupted growth, often with unorthodox policies the textbooks said would fail.

In late September, the People’s Republic of China marked a milestone, surpassing the Soviet Union in longevity. Days later, it celebrated a record 69 years of Communist rule. And China may be just hitting its stride — a new superpower with an economy on track to become not just the world’s largest but, quite soon, the largest by a wide margin.

The world thought it could change China, and in many ways it has. But China’s success has been so spectacular that it has just as often changed the world — and the American understanding of how the world works.

There is no simple explanation for how China’s leaders pulled this off. There was foresight and luck, skill and violent resolve, but perhaps most important was the fear — a sense of crisis among Mao’s successors that they never shook, and that intensified after the Tiananmen Square massacre and the collapse of the Soviet Union.

Even as they put the disasters of Mao’s rule behind them, China’s Communists studied and obsessed over the fate of their old ideological allies in Moscow, determined to learn from their mistakes. They drew two lessons: The party needed to embrace “reform” to survive — but “reform” must never include democratization.

China has veered between these competing impulses ever since, between opening up and clamping down, between experimenting with change and resisting it, always pulling back before going too far in either direction for fear of running aground.

Many people said that the party would fail, that this tension between openness and repression would be too much for a nation as big as China to sustain. But it may be precisely why China soared.

Whether it can continue to do so with the US trying to stop it is another question entirely.


A quietly important article: that China’s authoritarian rule has lasted longer than the USSR is a surprising but telling fact.
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RBS customer lost thousands of pounds in scam • BBC News

David Quinn:


A Royal Bank of Scotland customer had more than £4,300 stolen from her account by a fraudulent caller who got one of her security questions wrong, BBC Watchdog Live has found.

The bank insisted for more than a year that Charlotte Higman was aware of the transaction and refused to refund her.

The Financial Ombudsman Service (FOS) agreed with the bank when a complaint was raised in October 2017.

But earlier this month, RBS apologised and issued Charlotte a full refund.

Charlotte, from Totnes in Devon, believes that RBS repeatedly failed to pick up on evidence, including warnings raised in its own security processes.

In a recording of the fraudulent phone call obtained by Watchdog Live, a woman can be heard incorrectly answering a security question relating to Charlotte’s occupation.

Despite this, a transaction of £4,318 is approved by the bank and it is only after the caller requests a second transaction, and is unable to answer additional security questions, that a warning is raised on Charlotte’s account.

The bank’s own records show that the phone call, in January 2017, was marked as a “potential account takeover” and the caller failed the bank’s voice recognition checks. Despite this, the initial transaction was not reversed.


Reading between the lines, the only reason the customer (Charlotte) was able to prove this was because she got hold of the recordings – presumably through data protection law (because it relates to “her”). The fraudster had already conned her landline provider to divert her number to a mobile phone – which the bank rang to confirm the transaction.

Clearly, humans aren’t good at spotting chained fraud.
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Tech shoppers ditch desktop PCs and DVD players • Ofcom


Ownership of digital devices such as smart TVs, smart watches and smartphones has grown significantly in recent years, as more people need a constant connection to the internet – internet users say they spend an average of 24 hours a week online.

By contrast, MP3 players, DVD players and desktop computers seem to be falling out of favour as smartphone use continues to grow, particularly for browsing and streaming.

Meanwhile, the popularity of tablets and e-readers seems to have peaked. Ownership of both is significantly higher than it was seven years ago, but has levelled out in the last few years.

Ofcom now measures ownership of smart speakers (owned by 13% of households) and virtual reality (VR) headsets (5%). The first VR headset went on sale in the UK in 2015 – a year earlier than smart speakers, which have been quicker to capture the imagination of tech shoppers.

Other emerging trends include wearable tech, such as smart watches and fitness trackers. One in five households now owns these devices, and ownership has been doubling every year since 2016.

Ian Macrae, Ofcom’s Director of Market Intelligence, said: “As technology evolves and transforms how we live our lives, the devices we rely on are constantly changing.

“The growth in popularity of streaming services has created tremendous demand for connected TVs, which for many people are replacing DVD players, and the smartphone is replacing several other devices at once.

“The range of connected devices is expanding rapidly. Smart speakers really took off last year and along with other smart home devices will again be ones to watch this year.”


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Errata, corrigenda and ai no corrida: none notified.

2 thoughts on “Start Up No.958: Amazon hacked?, how bots spread lies, another bitcoin casualty, hello Mars!, and more

  1. Re the Ofcom study, it’s surprising to the point of being iffy:
    – 25% Mp3 ownership ? That’s at best utterly disconnected from actual use, at worst people answering “yes” because their phone plays mp3.
    – looking at desktops but not laptops is weird. Legacy computer ownership isn’t down 50+% ; it’s mostly transfered to laptops. Use is down more than ownership, but ownership ain’t that much down.

    • They studied laptops separately: see their small infographic. Or explore their interactive.
      As to your view of their numbers – they’re an organisation which pays for statistically robust surveys of usage. Please let us know the organisation you use for your surveys.
      On MP3 players, for example, perhaps they’re people who still do somewhere own an iPod or similar; or who let their kids have that but not a phone. You’d need to look at the questions, but I think it would be “do you own any of the following..?”

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