Start Up No.978: Facebook in hot water again, China arrests another Canadian, Amazon’s Marketplace scams, Apple’s India problem, and more


Vaping is significantly safer than tobacco smoking, a new British government-funded study says. CC-licensed photo by Vaping360 on Flickr.


It’s charity time: ahead of Christmas, I’m encouraging readers to make a donation to charity; a different one each day.
Today’s (given events at Wednesday’s PMQs) is
Action On Hearing Aid, which aims to provide vital support to thousands of people affected by deafness, tinnitus and hearing loss.

Readers in the US can donate to the National Association of the Deaf. Please give as generously as you feel you can.


A selection of 10 links for you. But have you got all the presents? I’m @charlesarthur on Twitter. Observations and links welcome.

As Facebook raised a privacy wall, it carved an opening for tech giants • The New York Times

Gabriel J.X. Dance, Michael LaForgia and Nicholas Confessore:

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Pushing for explosive growth, Facebook got more users, lifting its advertising revenue. Partner companies acquired features to make their products more attractive. Facebook users connected with friends across different devices and websites. But Facebook also assumed extraordinary power over the personal information of its 2.2 billion users — control it has wielded with little transparency or outside oversight.

Facebook allowed Microsoft’s Bing search engine to see the names of virtually all Facebook users’ friends without consent, the records show, and gave Netflix and Spotify the ability to read Facebook users’ private messages.

The social network permitted Amazon to obtain users’ names and contact information through their friends, and it let Yahoo view streams of friends’ posts as recently as this summer, despite public statements that it had stopped that type of sharing years earlier.

Facebook has been reeling from a series of privacy scandals, set off by revelations in March that a political consulting firm, Cambridge Analytica, improperly used Facebook data to build tools that aided President Trump’s 2016 campaign. Acknowledging that it had breached users’ trust, Facebook insisted that it had instituted stricter privacy protections long ago. Mark Zuckerberg, the chief executive, assured lawmakers in April that people “have complete control” over everything they share on Facebook.

But the documents, as well as interviews with about 50 former employees of Facebook and its corporate partners, reveal that Facebook allowed certain companies access to data despite those protections. They also raise questions about whether Facebook ran afoul of a 2011 consent agreement with the Federal Trade Commission that barred the social network from sharing user data without explicit permission.

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Facebook has responded on its PR page, and insists the access that was given was with consent, and didn’t break the FTC decree. Also: “most of these features are now gone.” (Me: “Most”?)

Related: [Washington] DC attorney general sues Facebook over alleged privacy violations from Cambridge Analytica scandal.
link to this extract


E-cigarettes around 95% less harmful than tobacco estimates landmark review • GOV.UK

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An expert independent evidence review published today by Public Health England (PHE) concludes that e-cigarettes are significantly less harmful to health than tobacco and have the potential to help smokers quit smoking.

Key findings of the review include:

• the current best estimate is that e-cigarettes are around 95% less harmful than smoking
• nearly half the population (44.8%) don’t realise e-cigarettes are much less harmful than smoking
• there is no evidence so far that e-cigarettes are acting as a route into smoking for children or non-smokers

The review, commissioned by PHE and led by Professor Ann McNeill (King’s College London) and Professor Peter Hajek (Queen Mary University of London), suggests that e-cigarettes may be contributing to falling smoking rates among adults and young people. Following the review PHE has published a paper on the implications of the evidence for policy and practice.

The comprehensive review of the evidence finds that almost all of the 2.6 million adults using e-cigarettes in Great Britain are current or ex-smokers, most of whom are using the devices to help them quit smoking or to prevent them going back to cigarettes. It also provides reassurance that very few adults and young people who have never smoked are becoming regular e-cigarette users (less than 1% in each group).

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Not surprising. The only risk is continuing nicotine addiction, and the cancers associated – oral, throat. But so much less dangerous than the smoke of tobacco.
link to this extract


Third Canadian detained in China amid Huawei dispute • Reuters

David Ljunggren:

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A third Canadian has been detained in China following the arrest of a Chinese technology executive in Vancouver, a Canadian government official said on Wednesday amid a diplomatic dispute also involving the United States.

The detentions of the Canadians followed the Dec. 1 arrest in Vancouver of Meng Wanzhou, chief financial officer of the Chinese telecommunications giant Huawei Technologies Co Ltd, at the request of the United States, which is engaged in a trade war with China.

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Another victim of Trump’s transactional diplomacy: the Chinese expect he’ll ignore US law and trade them for Meng once she’s extradited.
link to this extract


Dirty dealing in the $175bn Amazon Marketplace • The Verge

Josh Dzieza:

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Last August, Zac Plansky woke to find that the rifle scopes he was selling on Amazon had received 16 five-star reviews overnight. Usually, that would be a good thing, but the reviews were strange. The scope would normally get a single review a day, and many of these referred to a different scope, as if they’d been cut and pasted from elsewhere. “I didn’t know what was going on, whether it was a glitch or whether somebody was trying to mess with us,” Plansky says.

As a precaution, he reported the reviews to Amazon. Most of them vanished days later — problem solved — and Plansky reimmersed himself in the work of running a six-employee, multimillion-dollar weapons accessory business on Amazon. Then, two weeks later, the trap sprang. “You have manipulated product reviews on our site,” an email from Amazon read. “This is against our policies. As a result, you may no longer sell on Amazon.com, and your listings have been removed from our site.”

A rival had framed Plansky for buying five-star reviews, a high crime in the world of Amazon. The funds in his account were immediately frozen, and his listings were shut down. Getting his store back would take him on a surreal weeks-long journey through Amazon’s bureaucracy, one that began with the click of a button at the bottom of his suspension message that read “appeal decision.”

…Sellers are more worried about a case being opened on Amazon than in actual court, says Dave Bryant, an Amazon seller and blogger. Amazon’s judgment is swifter and less predictable, and now that the company controls nearly half of the online retail market in the US, its rulings can instantly determine the success or failure of your business, he says. “Amazon is the judge, the jury, and the executioner.”

Amazon is far from the only tech company that, having annexed a vast sphere of human activity, finds itself in the position of having to govern it. But Amazon is the only platform that has a $175bn prize pool tempting people to game it, and the company must constantly implement new rules and penalties, which in turn, become tools for new abuses, which require yet more rules to police.

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link to this extract


Pinterest readies itself for early 2019 IPO • WSJ

Maureen Farrell:

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Pinterest Inc. is actively preparing for an IPO that could come as soon as April, according to people familiar with the company’s plans, the latest in a line of tech companies ramping up plans to go public.

Pinterest has told bankers it could choose its slate of underwriters to run the initial-public-offering process as soon as January, these people said. It could achieve a valuation in the public market at or in excess of $12 billion—the level at which it most recently raised funding, some of the people said. Valuations can change until a company prices its initial public offering.

In September, Pinterest surpassed more than 250 million monthly active users, who visit the site to browse through billions of images on topics ranging from living-room furniture to dinner recipes and tattoos. The company generates revenue from ads scattered across its site and is poised to generate revenue in excess of $700m this year, up 50% from the prior year, according to a person familiar with the matter.

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With revenues like that, it might even be making a profit. How soon before we hear it has been taken over by Nazis and pornographers?
link to this extract


How Amazon Alexa uses machine learning to get smarter • WIRED

Brian Barrett:

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Because many voice assistant improvements aim to reduce friction, they’re almost invisible by design. Over the past year, Alexa has learned how to carry over context from one query to the next, and to register follow-up questions without having to repeat the wake word. You can ask Alexa to do more than one thing in the same request, and summon a skill—Alexa’s version of apps—without having to know its exact name.

Those may sound like small tweaks, but cumulatively they represent major progress toward a more conversational voice assistant, one that solves problems rather than introducing new frustrations. You can talk to Alexa in a far more natural way than you could a year ago, with a reasonable expectation that it will understand what you’re saying.

Those gains have come, unsurprisingly, through the continued introduction and refinement of machine learning techniques. So-called active learning, in which the system identifies areas in which it needs help from a human expert, has helped substantially cut down on Alexa’s error rates. “That’s fed into every part of our pipeline, including speech recognition and natural language understanding,” says Rohit Prasad, vice president and chief scientist of Amazon Alexa. “That makes all of our machine learning models look better.”

…The benefits of the machine learning improvements manifest themselves across all aspects of Alexa, but the simplest argument for its impact is that the system has seen a 25% reduction in its error rate over the last year. That’s a significant number of headaches Echo owners no longer have to deal with.

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link to this extract


Kids apps on Google Play have “disturbing” content and may violate privacy laws, says letter to FTC • Buzzfeed

Virginia Hughes:

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Google is marketing apps to kids that share personal data with third parties, show manipulative ads, and are rife with creepy images — from graphic plucking of eyelashes to rubbing oil on scantily clad pregnant women — according to a new review.

In a 99-page letter sent to the Federal Trade Commission on Wednesday, the Campaign for a Commercial-Free Childhood and 21 other child advocacy groups argue that the government should investigate Google for misrepresenting these apps as safe for families. Two Democratic lawmakers, Sen. Tom Udall and Rep. David Cicilline, also support the letter.

“Google doesn’t really have any incentive to clean up its own app store,” said Josh Golin, executive director of the CCFC, because app makers give Google 30% of the revenue for every app purchase and in-app purchase. “The things that are concerning and problematic, they actually profit off of.”

Apple’s App Store lists some of the same apps, though it has stricter rules for those allowed in its “Kids” category. And Google has done little to address the problem, Golin said, despite getting public heat since April.

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The illustrations show that they really are creepy images.
link to this extract


BT suspends free calls from new wi-fi hubs after drug dealers dominate use • Eastlondonlines

Thames Menteth-Wheelwright:

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British Telecom has suspended calls from all of its futuristic InLink phone kiosks in Tower Hamlets after it emerged that the service was being used to facilitate drug dealing.

The 16 5G-enabled phone kiosks, which have replaced traditional red phone boxes, give users 30-second free phone calls to mobile devices and supply public streets with free, high-speed Wi-Fi and touchscreen web services.

Since December 6, these free calls have been temporarily suspended by BT. This follows six months of pressure from local councillors and the Metropolitan Police to suspend the service after investigations showed that drug users and dealers were using free calls to coordinate deals and drug drops.

The council said that the borough’s CCTV unit had watched an InLink for a day and found that out of 80 calls made on its free telephone, 72 of them were to buy drugs.

According to E+T magazine, the decision comes after senior police officers and InLink managers were brought face to face at a meeting in October organised by Tower Hamlets Council…

…Police and councils have halted InLink’s installation of a further 1000 kiosks in other towns and cities across the UK following Tower Hamlets’ example.

According to E+T, Bristol City Council barred 20 out of 25 InLink applications after local police objected, citing concerns raised in the east London borough.

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Goose: cooked.
link to this extract


TikTok has a Nazi problem • Motherboard

Joseph Cox:

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Users on mega popular children’s lip-synching app TikTok are sharing calls for violence against people of colour and Jews, as well as creating and sharing neo-Nazi propaganda, Motherboard has found.

Some accounts verbatim read “kill all n*****,” “all jews must die,” and “killn******.” (The words are uncensored on the app, which is a sort of melding of Vine and Instagram that allows users to create short videos synced to music.)

Motherboard found the content on the Chinese-made app, which is used by hundreds of millions people, many including teenagers and children in the United States, within minutes of starting a basic search.

“We’ve never talked to Tik Tok, but clearly we need to,” Heidi Beirich, director of the intelligence project at the Southern Poverty Law Center (SPLC), told Motherboard in an email. “They need the site to be cleaned up—and now.”

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I’d love to know how well this problem (and the previous problem, in the linked article in the body, of nudes) correlates with growth in numbers of American users.
link to this extract


‘It’s been a rout’: Apple’s iPhones fall flat in world’s largest untapped market • WSJ

Newley Purnell and Tripp Mickle:

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Amit Rajput, who runs a counter selling iPhones in a busy electronics shop here, cuts a lonely figure. He is lucky to sell one device a day, compared with the 10 or more smartphones his colleagues at desks for Samsung Electronics Co. , Nokia Corp. and China’s Oppo sell daily in the same store.

As customers walk past his display, he recalls a different time in 2013 when he sold as many as 80 iPhones a day. Now most people want to pay less than $300 for their devices—a fraction of what Apple’s newer models cost.

Smartphone makers, facing sputtering growth in the rest of the world, have looked to India to make up the difference. With 1.3 billion consumers, the country is the world’s biggest untapped tech market. Just 24% of Indians own smartphones, and the number of users is growing faster than in any other country, according to research firm eMarketer.

How has that worked out for one of America’s most valuable companies?

The number of iPhones shipped in India has fallen 40% so far this year compared with 2017, and Apple’s market share there has dropped to about 1% from about 2%, research firm Canalys estimates…

…India’s market presents unique challenges. While competitors tweaked their phones to address local consumer concerns—increasing battery life, for example, and offering less expensive models—Apple took an inflexible stand on its pricing and products. Friction with the government hasn’t helped.

Whether the company can get its phones into the pockets of the world’s next billion smartphone buyers—in India as well as in other emerging markets, such as Indonesia and parts of Latin America—will help determine how much the company will grow in the coming decade.

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link to this extract


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Errata, corrigenda and ai no corrida: while high-fructose corn syrup (HFCS) is used for almost half of sweetening in the US (while sucrose, from sugar, is used for 90% in the rest of the world), it isn’t reckoned to be a principal cause of obesity on its own. Thanks to Pete Kleinschmidt for the pointer.

One thought on “Start Up No.978: Facebook in hot water again, China arrests another Canadian, Amazon’s Marketplace scams, Apple’s India problem, and more

  1. re iPhones in India. Samsung ain’t faring very well over there either, at 22% share, they’re at 32% in Europe.

    What’s striking is the randomness of analysts: “tweaking for India” is “lowering prices and putting a bigger battery” ? Yep, that’s very India-specific, I’m sure other countries just hate or ignore that. I can understand some segmentation, dual-SIM isn’t important everywhere, selfie cams are mostly for the young and their proportion varies a lot by country, the importance of local storage varies with data costs, coverage, piracy… But singling out battery life, which is a leading complaint about pretty much all phones in all countries, is nonsensical.

    Ditto price elasticity. People’s demands/expectations of their smartphones has plateaued a few years ago, around iPhone 5 or 6, and they don’t want/need more. People around me are replacing their phones because the battery is dead or the screen broken, not because they want/need a better phone. Which killer apps runs on an XS, but not a 5 ? Which meaningful-not-even-killer app ? AR ? Ah !

    I really think Apple got lost in their own hype, and got to thinking their users were high-end users. They mostly aren’t, on the contrary they’re staid if not lame users who were in search of reliability and simplicity even more than of glamour let alone performance. And nowadays Apple has no USP re. these first two pillars, making the double whammy of huge price hikes while the competition (“nice” phones, which used to be $500+ flagships but now are $200 Redmis) is ever cheaper. Even the performance part doesn’t matter anymore, nobody’s using AR/VR and I’ve yet to hear a complaint about an iPhone 6’s or a Redmi Note 5’s (similar) performance.

    Fresh markets like India just show what happens when lock-in hasn’t had time to set in. I think the rest of the world will trend to the same, except for the fashionista niche, and unfree markets (the US mostly). Legit requests for flagships incl. iPhones are less than 10% around me.

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