| Facebook and Google Reshape the Narrative on Privacy |
![Google's Sundar Pichai at the company's annual conference for developers this week.]() | | Google's Sundar Pichai at the company's annual conference for developers this week. "We think privacy is for everyone," he said. Jim Wilson/The New York Times | |
| Each week, we review the week's news, offering analysis about the most important developments in the tech industry. |
| Hi, I'm Jamie Condliffe. Greetings from London. Here's a look at the week's tech news: |
| Stop me if you've heard this before: The chief executive of a huge tech company with vast stores of user data, and a business built on using it to target ads, now says his priority is privacy. |
| This time it was Google's Sundar Pichai, at the company's annual conference for developers. "We think privacy is for everyone," he explained on Tuesday. "We want to do more to stay ahead of constantly evolving user expectations." He reiterated the point in a New York Times Op-Ed, and highlighted the need for federal privacy rules. |
| The previous week, Mark Zuckerberg delivered similar messages at Facebook's developer conference. "The future is private," he said, and Facebook will focus on more intimate communications. He shared the idea in a Washington Post op-ed just weeks before, also highlighting the need for federal privacy rules. |
| Google went further than Facebook's rough sketch of what this future looks, and unveiled tangible features: It will let users browse YouTube and Google Maps in "incognito mode," will allow auto-deletion of Google history after a specified time and will make it easier to find out what the company knows about you, among other new privacy features. |
| Fatemeh Khatibloo, a vice president and principal analyst at Forrester, told The Times: "These are meaningful changes when it comes to the user's expectations of privacy, but I don't think this affects their business at all." Google has to show that privacy is important, but it will still collect data. |
| What Google and Facebook are trying to do, though, is reshape the privacy narrative. You may think privacy means keeping hold of your data; they want privacy to mean they don't hand data to others. ("Google will never sell any personal information to third parties," Mr. Pichai wrote in his Op-Ed.) |
| Werner Goertz, a research director at Gartner, said Google had to respond with its own narrative. "It is trying to turn the conversation around and drive public discourse in a way that not only pacifies but also tries to get buy-in from consumers, to align them with its privacy strategy," he said. |
| Politics of privacy law |
| Facebook and Google may share a voice on privacy. Lawmakers don't. |
| Members of the Federal Trade Commission renewed calls at a congressional hearing on Wednesday to regulate big tech companies' stewardship of user data, my colleague Cecilia Kang reported. That was before a House Energy and Commerce subcommittee, on which "lawmakers of both parties agreed" that such a law was required, The Wall Street Journal reported. |
| Sounds promising. |
| But while the F.T.C. was united in asking for more power to police violations and greater authority to impose penalties, there were large internal tensions about how far it should be able to go in punishing companies. And the lawmakers in Congress "appeared divided over key points that legislation might address," according to The Journal. Democrats favor harsh penalties and want to give the F.T.C. greater power; Republicans worry that strict regulation could stifle innovation and hurt smaller companies. |
| Finding compromise will be difficult, and conflicting views risk becoming noise through which a clear voice from Facebook and Google can cut. The longer disagreement rages, the more likely it is that Silicon Valley defines a mainstream view that could shape rules. |
| It's Uber I.P.O. day! |
| The most hotly anticipated initial public offering of 2019 will see Uber trade on the New York Stock Exchange on Friday. |
| The company hits the markets valued at about $82.4 billion, after pricing its shares at $45 a share. That's below the $100 billion that Uber had forecast to some investors, and far below the $120 billion that some bankers suggested. (It is, however, above the $76 billion that an August fund-raising round pegged it at.) |
| Uber's is one of the largest I.P.O.s ever, but its sliding valuation suggests that this darling disrupter has lost some of its charm. That could spell trouble for other unicorns, like Slack and WeWork, that are expected to make I.P.O.s this year. |
| Uber's concern now: avoiding the fate of its rival, Lyft, which fared poorly after its I.P.O. in March. Its shares quickly fell below its offering price, and were 26 percent below its offering price on Wednesday. |
| [Bonus: How today's tech I.P.O.s differ from the dot-com boom's.] |
| Antitrust in the App Store |
| Here's a story: Company makes smartphone. Company encourages third parties to build services for smartphone, to encourage adoption. Smartphone sells. Third parties prosper. Smartphone sales plateau. Company decides to build services. |
| We're living the next chapter, and it's messy. |
| In March, Spotify filed a complaint with European regulators, accusing Apple of using its App Store to squash rivals of its own services, like Apple Music. A focus: the 30 percent fee that Spotify and others pay for using the Apple's payment system for subscriptions sold via the App Store. (Other app makers have made antitrust complaints about the App Store, too.) |
| Unidentified sources told The Financial Times that the European Union's competition commission would open an investigation into Spotify's complaint. That would result in a lengthy process that could result in Apple's being fined as much as 10 percent of its global turnover, or forced to change its behavior. |
| If Apple is found at fault, the correct response is unclear. Pablo Ibáñez Colomo, a professor at the London School of Economics who specializes in competition law, said regulators would struggle to know how far to go. Acting strictly may require the App Store to be micromanaged — but who polices that? If a response doesn't go that far, what happens about the inevitable flood of complainants wanting their own justice? |
| A can of worms is set to explode, though it comes with a long fuse. |
| And some stories you shouldn't miss |
| ■ A Facebook founder wants it broken up. Chris Hughes, who left the company a decade ago, says it is now "a threat to our economy and democracy." |
| ■ Investors don't dig climate start-ups. Venture capitalists want returns within years, and many clean-tech start-ups work to longer timelines, which means they struggle to secure funding. |
| ■ Chinese spies captured the National Security Agency's weapons. They intercepted the tools from an N.S.A. attack on their own computers, "like a gunslinger who grabs an enemy's rifle and starts blasting away," and then used them against ally nations. |
| ■ How will Elizabeth Holmes defend herself? The lawyers for Ms. Holmes, the former Theranos chief executive, look set to take the high-risk strategy of going after the government. |
| ■ Amazon had a rough week. It admitted to having been hit by an "extensive" fraud, got federal discrimination complaints from three Muslim workers and has been accused of violating a child privacy law. |
| ■ Europe's clampdown on Big Tech is proving controversial. Critics are sounding alarms because, as I've argued, it risks limiting free expression and undercutting the ideals of an open web. |
| ■ What do you do when you get rich in San Francisco? For the millennials whom companies like Uber and Lyft have turned into millionaires, the answer is: Move somewhere with lower taxes. |
| ■ Unimpressed by service at the Apple Store? So is its staff. Some of its members told Bloomberg that brand building had become more important than serving shoppers. |
| ■ Don't buy a 5G phone yet. The phones are currently bigger and heavier than their 4G counterparts, and the networks won't really be worth using until 2020 or 2021. |
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