Start Up No.1943: metaverse still a money drain, renewables boost in EU, how Amazon’s ASINs work, Britain’s semi pause, and more

Putting screws into iPhones on the assembly line – two per minute, hour after hour – is a tedious, demanding, but solid job. How would you cope at it? CC-licensed photo by Daiji Hirata on Flickr.

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On Friday, there’s another post due at the Social Warming Substack at about 0845 UK time.

A selection of 10 links for you. What number are you? I’m @charlesarthur on Twitter. Observations and links welcome.

Meta lost $13.7bn on Reality Labs in 2022 after metaverse pivot • CNBC

Jonathan Vanian and Ari Levy:


Mark Zuckerberg’s dream of a future in the metaverse is costing investors a boatload of money.

In its earnings report after the bell on Wednesday, Meta said its Reality Labs division, home to the company’s virtual reality technologies and projects, posted a $4.28bn operating loss in the fourth quarter, bringing its total for 2022 to $13.72bn.

It was a tough first full year for the new Meta, the company formerly known as Facebook. In late 2021, Zuckerberg changed the company’s name and said its future would be in the metaverse, a digital universe where people will work, shop, play and learn.

But for now, it’s just a cost center, and Meta is still an online ad company.

Reality Labs generated $727m in the fourth quarter, and $2.16bn in revenue for all of 2022 — a decline from $2.27bn in 2021 — including sales of Quest headsets. In other words, the division lost more than six times the amount of money it generated in revenue last year, while accounting for less than 2% of total sales at Meta.

Analysts were expecting Reality Labs to record an quarterly operating loss of $4.36bn on revenue of $715.1m, according to StreetAccount.

Sales of VR headsets in the US declined 2% in 2022 from the prior year as of early December, according to data shared with CNBC by research firm NPD Group.

In July, Meta announced it was raising the price of its Quest 2 VR headset by $100. The company said at the time that the price hike was necessary to account for inflationary pressures. Meta then debuted its more expensive Quest Pro VR headset in October, pitching it to companies as an enterprise-workplace device for $1,500. This week, Meta is running a sale on its high-end VR headset, shaving off $400 for a limited time.


There’s a strong Tinkerbell energy around Reality Labs: just keep wishing! But the fact that revenue dropped is significant. What if the metaverse thing was just a pandemic flop dream, like Peloton?
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Europe: Renewables in 2022 in five charts – and 2023 • Energy Monitor

Isabeau van Halm:


Climate think tank Ember released a new report today analysing the European electricity transition. What happened to renewables in Europe in 2022? Energy Monitor takes you through some of the main findings from the European Electricity Review 2023 and looks ahead to what to expect this year.

In the last quarter of 2022, electricity demand dropped almost 8% compared with the year before. This drop is similar to the one seen during Europe’s Covid-19 lockdowns: electricity demand fell by 9.6% during the second quarter of 2020, for example. According to the report’s lead author, Ember’s head of data insights Dave Jones, this fall in electricity demand was the most surprising finding in the analysis.

“The fall in electricity demand at the end of the year was very sudden and it happened in every country,” says Jones. “I have read lots on falling gas demand, but I never expected to see such big falls in electricity demand as well.”

The main driver of the drop was the mild temperatures this winter, but the energy crisis likely played a big part as well. “Mild temperatures across October and November were the main driver, but the falls were far bigger than weather alone,” according to Jones. “We suspect it is mostly driven by people and businesses looking to save money amidst the cost-of-living crisis and – in some countries – soaring electricity bills but also using less energy in solidarity to Europe’s Russia-induced energy crisis.”

It seems unlikely that electricity demand will see similar declines in the long term as it is not based on “traditional” energy efficiency but rather on short-term electricity savings to get through the crisis. “The challenge for policymakers is to make sure they don’t see this demand drop as true ‘energy efficiency’, and rather to use it as an opportunity to step up [action] on energy efficiency,” says Jones. “Ultimately, it is down to individuals, and I think 2022 was a tipping point for customers to understand how much energy they use, how much it costs, and with it, a desire to reduce the amount that they use.”


Also: wind and solar generated more power than gas in the EU; hydro and nuclear dropped.
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Foxconn protests and Covid cases: the chaos inside the China factory • Rest of World

Viola Zhou:


Chinese factory laborers call jobs like Hunter’s “working the screws.” Until recently, the 34-year-old worked on the iPhone 14 Pro assembly line at a Foxconn factory in the central Chinese city of Zhengzhou. His task was to pick up an iPhone’s rear cover and a tiny cable that charges the battery, scan their QR codes, peel off adhesive tape backing, and join the two parts by tightening two screws. He’d then put the unfinished phone onto a conveyor belt that carried it to the next station.

Hunter had to complete this task once every minute. During a normal 10-hour shift, his target was to attach 600 cables to 600 cases, using 1,200 screws. Every day, 600 more unassembled iPhones awaited him.

Apart from a strictly timed hour-long lunch break, he spent his days inside a windowless workshop that smelled of chlorine, wearing an antistatic gown and a face mask. If he needed to take a toilet break, he had to make up for lost time. Behind the assembly line, supervisors — known as xianzhang, or “line leaders” — monitored workers’ progress on a computer and frequently admonished those who fell behind.

“I feel we have no rights and dignity inside the workshops,” Hunter, who asked to be identified by his nickname, told Rest of World in a call after work one day. “Some line leaders just can’t live a day without scolding people.” He hated the humiliation and tediousness of the production line job, but he gritted his teeth. The pay would be worth it.


A good piece on what it’s like to work there: calm, straightforward, factual.
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The story behind ASINs (Amazon Standard Identification Numbers) • Invent Like An Owner

Rebecca Allen:


I (Rebecca Allen) proposed that we replace the 10-digit ISBN as the key for our catalog with a minimum-impact-on-the-code “ASIN”. The ASIN would be the ISBN (if the item were a book and had an ISBN), or a 10 character serial number that represented a base 62 number. I got a ton of objections to base 62 (the 26 letters of the alphabet, case sensitive, plus the 10 digits), because that would have involved a case sensitive string — b000000000 would be a very different number from B000000000. Very. Different.

I somewhat agreed, and decided that a base 36 number (the letters of the alphabet plus the 10 digits) would work just fine. There was some debate about whether the key should have any structure. For example, credit card numbers have quite a bit of structure to them, as do well-constructed ISBNs for that matter. I objected to subdividing and having different parts of the string mean different things because it would substantially reduce the addressable space, and limit the number of items that could be moved through Amazon before having to go back and do this re-keying exercise again, with an even bigger code base. 

The people who wanted “special” ASINs were pretty persistent, though, so I threw them a bone: they could have all the ASINs that started with the letter A, and I would start the counter for ASINs at B000000000. Finally, this proposal had to get past Shel, and Shel was not super keen on the idea of someone going through the code and changing every last place that ISBNs were referenced to something that was an ASIN. Even though this proposal actually minimized the hazards in several ways (same length string, same set of allowable characters, ISBNs are still legal ASINs, etc.), it was really going to involve a lot of code being changed at the same time. And an error would be very bad.

…between sometime in 1997 or 1998 (I forget exactly when I created ASINs, but I left in 1998, so it had to be before that, and it wasn’t one of the first things I did, so it was not in 1996) and 2016, Amazon used 100 Billion (with a B, for Bezos) ASINs. Between 2016 and now, they’ve gone through at least 6 times that.

Whee! Are they going to run out?


That’s the big, big question.
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FTC loses antitrust challenge to Facebook parent Meta • WSJ

Dave Michaels and Jan Wolfe:


A federal judge declined to halt Meta Platforms’ acquisition of the virtual-reality startup Within Unlimited, delivering a setback to antitrust enforcers at the Federal Trade Commission seeking to block the deal, a person familiar with the ruling said.

In a sealed court decision issued overnight, US District Judge Edward Davila in San Jose, Calif., denied the FTC’s request for an injunction blocking the proposed merger, the person said.

The judge’s opinion, which isn’t yet public, is a boost to Meta’s virtual-reality ambitions and appears to vindicate for now the Facebook parent’s claims that the FTC overreached by bringing a flawed antitrust case.

The FTC could continue to try to block the deal through a separate lawsuit filed in its in-house administrative court, where a trial is scheduled to begin on Feb. 13. But antitrust enforcers have in the past often abandoned such administrative litigation once a federal judge denies the request for an injunction.

The lawsuit has been closely watched because it is based on an unusual theory of competitive harm focusing on potential future competition in a nascent industry. The case is also widely seen as emblematic of FTC Chair Lina Khan’s opposition to the expansion of big technology companies.


The “unusual theory” is roughly the same as the one that Europe uses: harm to competition rather than harm to the “consumer” is taken as the crux of antitrust harm.
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Ben Adida on Mastodon


So OpenAI just released a detector of AI-generated text – I assume because of concerns in education / homework.

Maybe this is good?

No, it’s very bad.

They claim 26% true positives, 9% false positives. Assume 10% of submitted homework is ChatGPT generated, you get the classic counterintuitive outcome of poor predictive power: if a homework is flagged, there’s a 3:1 chance it’s *human* generated.

This is going to cause a lot of harm. It should be immediately recalled.


We’re all familiar with false positives, false negatives and the population incidence problem after Covid, right? So this sort of calculation should be familiar. (Also: first time linking to a post on Mastodon. It’s happening, people!)
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Why content moderation on Mastodon isn’t the train wreck some on Twitter Say It Is • FOSS Force

Christine Hall wrote something on Mastodon, got a response from someone particularly unpleasant, and reported them to their instance admin (at


I should probably explain that while Mastodon has a look and feel, as well as a functionality, that’s very similar to Twitter, or just about any other social network, it’s different under the hood. Instead of being one giant megalithic architecture housing all users under a single roof, Mastodon takes what’s called a “federated” approach. It’s a collection of independently operated servers (or “instances”) of various sizes, each running its own copy of the software that makes the platform tick and networked into the greater federation, which has little say over how individual instances manage their communities.

This includes moderation. When I reported spiritsplice, that report went straight to the administrator(s) of the server(s), who then decide according to the standards of their instance whether to take action on the complaint. This meant that if pieville is a server hosting a lot of homophobic, sexist, and/or white supremacist loudmouths, which I suspected, the administrator was likely to take no action at all, other than giving me the middle finger and a silent “FU.”

That’s why I took the screenshots of the conversation with spiritsplice and tooted them with the warning, “This thread just happened to me.” Even if the administrator of spiritsplice’s instance chose to ignore my complaint, admins at other instances aren’t bound by that decision. If they think that this user is a problem, they can block him from their server to protect their users, and I wanted to get the word out to admins at other instances that they might want to take a look at this guy.

My suspicion that pieville, the server used by spiritsplice, might not only be full of bad actors, but actually created especially for bad actors (you don’t have to get permission to connect yourself to the federation), began to be verified right away. Shortly after I posted the photos of the thread, Ariadne Conill, a streetwise maintainer at Alpine Linux who never fails to say what she thinks), posted: “Pieville should just be suspended everywhere. It’s a bunch of alt-right fuckwits.”


This reminds me of how Usenet worked: admins of servers would identify malicious or spamming sources and prevent them feeding into the federated “news” (actually, forums) servers. Seems to be as effective, too.
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Britain’s semiconductor plan goes AWOL as US and EU splash billions – POLITICO

Graham Lanktree and Annabelle Dickson:


In a letter to Prime Minister Rishi Sunak first reported by the Times and also obtained by POLITICO, Britain’s semiconductor sector said its “confidence in the government’s ability to address the vital importance of the industry is steadily declining with each month of inaction.”

That followed the leak of an early copy of the UK’s semiconductor strategy, reported on by Bloomberg, warning that Britain’s over-dependence on Taiwan for its semiconductor foundries makes it vulnerable to any invasion of the island nation by China.  

Taiwan, which Beijing considers part of its territory, makes more than 90% of the world’s advanced chips, with its Taiwan Semiconductor Manufacturing Company (TSMC) vital to the manufacture of British-designed semiconductors.

US and EU action has already tempted TSMC to begin building new plants and foundries in Arizona and Germany. “We critically depend on companies like TSMC,” said the industry executive quoted above. “It would be catastrophic for Western economies if they couldn’t get access to the leading-edge semiconductors any more.”

Yet there are concerns both inside and outside the British government that key Whitehall departments whose input on the strategy could be crucial are being left out in the cold. The Department for Digital, Culture, Media and Sport (DCMS) is preparing the UK’s plan and, according to observers, has fiercely maintained ownership of the project. DCMS is one of the smallest departments in Whitehall, and is nicknamed the ‘Ministry of Fun’ due to its oversight of sports and leisure, as well as issues related to tech.

“In other countries, semiconductor policies are the product of multiple players,” said Paul Triolo, a senior vice president at US-based strategy firm ASG. This includes “legislative support for funding major subsidies packages, commercial and trade departments, R&D agencies, and high-level strategic policy bodies tasked with things like improving supply chain resilience,” he said.

“You need all elements of the UK’s capabilities. You need the diplomatic services, the security services. You need everyone working together on this,” said the former Downing Street official quoted above. “There are huge national security aspects to this.”

The same person said that relying on “a few [lower] grade officials in DCMS — officials that don’t see the wider picture, or who don’t have either capability or knowledge,” is a mistake. 


The “strategy” is coming Real Soon Now! Honest!
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AI-generated voice firm clamps down after 4chan makes celebrity voices for abuse • Motherboard

Joseph Cox:


It was only a matter of time before the wave of artificial intelligence-generated voice startups became a plaything of internet trolls. On Monday, ElevenLabs, founded by ex-Google and Palantir staffers, said it had found an “increasing number of voice cloning misuse cases” during its recently launched beta. ElevenLabs didn’t point to any particular instances of abuse, but Motherboard found 4chan members appear to have used the product to generate voices that sound like Joe Rogan, Ben Shapiro, and Emma Watson to spew racist and other sorts of material. ElevenLabs said it is exploring more safeguards around its technology.

The clips uploaded to 4chan on Sunday are focused on celebrities. But given the high quality of the generated voices, and the apparent ease at which people created them, they highlight the looming risk of deepfake audio clips. In much the same way deepfake video started as a method for people to create non-consensual pornography of specific people before branching onto other use cases, the trajectory of deepfake audio is only just beginning.

In one example, a generated voice that sounds like actor Emma Watson reads a section of Mein Kampf. In another, a voice very similar to Ben Shapiro makes racist remarks about Alexandria Ocasio-Cortez. In a third, someone saying “trans rights are human rights” is strangled.

…The clips run the gamut from harmless, to violent, to transphobic, to homophobic, to racist. One 4chan post that included a wide spread of the clips also contained a link to the beta from ElevenLabs, suggesting ElevenLabs’ software may have been used to create the voices.


Inevitable. The question is quite what the useful use case is, and how ElevenLabs plans to monetise (and police) that.
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Shoshana Zuboff: ‘Privacy has been extinguished. It is now a zombie’ • Financial Times

Henry Mance:


The problem for privacy advocates is that their cause seems to offer too few advantages and too many drawbacks. For most European citizens, the biggest impact of privacy legislation is annoying cookies pop-ups. Regulation seems impractical: the UK and France have both wanted to place age limits on porn sites, but have so far failed to find effective ways of doing so.

Similarly, [Shoshana] Zuboff criticises Apple and Google for taking control of Covid tracing, but what if their system simply worked better than the centralised ones favoured by European health officials? She laughs at the suggestion. But she admits regulation is hindered “because we can’t get inside [tech companies] to know what’s really going on. We’re regulating with blinders on . . . We don’t understand our adversary well enough.”

Zuboff insists that her attack is not against technology itself, but the economic logic that underpins it — “theft”. She holds out the possibility that we could use data and prediction for the common good. The counterargument is that there are basic trade-offs. Tech services, whether for predicting text answers or the fastest driving routes, can only work by accumulating data and reducing our privacy.

I ask what she makes of Musk’s ownership of Twitter. “We’ve got politicians, lawmakers, elected officials, as well as the entire citizenry, focused on one man and asking the question, ‘what will he do?’ Our political stability, our ability to know what’s true and what false, our health and to some degree our sanity, is challenged on a daily basis depending on which decisions Mr Musk decides to take. I regard this as fundamentally intolerable . . . These spaces cannot exist solely under corporate control . . . We’re two decades into the digital era but we have never, as democracies, taken stock of the meaning of these technologies.”

…She compares the west’s tech giants to China’s surveillance state. “This is a world in which privacy has been extinguished. Privacy is now a zombie category. None of us have privacy, even as we thought about it in the year 2000.”


It’s slightly odd how the US protects individual privacy from the government, but not from companies.
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• Why do social networks drive us a little mad?
• Why does angry content seem to dominate what we see?
• How much of a role do algorithms play in affecting what we see and do online?
• What can we do about it?
• Did Facebook have any inkling of what was coming in Myanmar in 2016?

Read Social Warming, my latest book, and find answers – and more.

Errata, corrigenda and ai no corrida: none notified

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