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Neuron Bursts Can Mimic a Famous AI Learning Strategy

By Allison Whitten
A new model of learning centers on blasts of neural activity that act as teaching signals—approximating an algorithm called backpropagation.

Voice chat is coming to Roblox

By Taylor Hatmaker

As one of the frontrunners in the race to build the metaverse, Roblox is thinking ahead to what virtual worlds really need. And while the platform has had no shortage of growth on its current path — as of July, it boasted 47 million daily active users — it’s looking to chart a course toward deeper, richer virtual experiences that will keep people coming back for years to come.

To that end, Roblox is taking careful but decisive steps toward weaving voice chat into the platform’s core experience. The first move: inviting a group of trusted developers to explore how they can integrate proximity-based audio into the wildly popular experiences that beat at the heart of the platform — from chill, vaporwavey vibe games to pulling off kickflips in a Vans-sponsored skate park.

With spatial audio, users will be able to speak with other people nearby through live voice chat. Roblox sees its new voice product as a natural extension of the way that text chat works now, but instead of text bubbles that pop up over an avatar’s head, visible to anybody around them, players will be able to talk naturally to the other people they bump into.

Say you’re hanging out in a virtual skatepark in Roblox with spatial audio enabled: skaters in the half pipe with you would sound loud and clear, just like they would in real life. But you wouldn’t be able to hear someone walking around on the sidewalk across the street, since they’re too far away. To have a private conversation with a nearby friend, you might peel off and walk toward a store down the block.

“As we think about the future of communication in the metaverse, we think that it needs to be very natural and feel very similar to the way we communicate in the real world,” Roblox Chief Product Officer Manuel Bronstein told TechCrunch in an interview. “But it also can transcend, some of the limitations that physics and space create in the real world.”

Bronstein joined the company in March, leaving Google to help realize Roblox’s particular vision for the metaverse. Prior to hopping over to Roblox, Bronstein worked on product teams at Zynga, Xbox and YouTube — three very different companies that are probably equal parts relevant to his current work.

“If you think about the metaverse as the next incarnation of where you know I could go shopping or I could go to a concert, I could go to school, I think that you need to be relevant to everybody in society and you need to both build the content, the rules, the features that support all of those behaviors,” Bronstein said. “And part of bringing voice to the platform is to ensure that our older audiences have a natural way to communicate.”

Voice chat is very much on the way to Roblox, but that doesn’t mean it will appear overnight — and that’s by design. The company is inviting an initial group of 5,000 developers, all 13 and older, to try out the new spatial voice chat capabilities in a custom-built Roblox community space.

“We’ve put a bunch of neat features in there and places for them to chat and hang out and they’re going to be able to learn from the code that we wrote for that community space… So a few weeks later or a month later they can put that into their experiences and turn it on,” Bronstein said.

Bronstein emphasizes that Roblox will take this process slowly, building new moderation and safety tools in parallel as it goes. The voice rollout will go slowly, starting with the chosen circle of developers and gradually expanding out from there as the company feels confident that it can create a safe enough environment with its moderation tools.

“I think we want to take it slowly and we want to learn as we go through it,” Bronstein said. “We may start, as I mentioned, with the developers. It is likely that right after that, we may go to an audience that is 13+ and park there for a while until we understand exactly if all the pieces are falling into place before deciding if we ever open it to a younger audience.”

To moderate its sprawl of virtual worlds, Roblox uses a blend of automated scanning and a 3,000-person safety team of human reviewers. Like in any social network, players can report, block and mute other players to make their own experiences feel more comfortable. And because half of its player base is under 13, Roblox gives parents options on what kinds of age-appropriate experiences to allow and toggles for things like text chat. If voice chat ever makes its way to younger age groups, parents would be able to disable it altogether.

Roblox’s under-13 crowd comprises a massive chunk of its user base, but a surprising number of older kids and young adults hang out there too. According to the company, 50% of its users are over the age of 13 and it’s seeing the most explosive user growth among 17- to 24-year-olds. Roblox is attracting new users, but its core users are also growing up and the company knows it needs to grow alongside them.

Whether voice chat ever rolls out for younger users or not, Roblox seems well aware that keeping a virtual environment with voice chat feeling safe and friendly is a steep challenge. The company plans to rely on user-initiated reporting as voice rolls out and it’s exploring other tools that could bolster those efforts. The company is looking at a few different tools, including automatically recording a snippet of conversation just prior to a user being reported as a way to capture bad behavior for reviewers. It’s also interested in expanding reputation systems that automatically restrict users who have a certain number of strikes against them.

Much like any social platform, Roblox will likely lean heavily on user reporting, which disproportionately shifts the burden to users on the receiving end of hate and harassment — an unfortunate outcome that no social company has properly dedicated the human resources to solving.

Next on the voice roadmap

Bronstein describes spatial audio as “one component” of Roblox’s vision for natural communication. The next step is integrating a voice chat experience that’s persistent across experiences, letting users who know each other hang out even when they aren’t doing the same thing. For anyone who paid attention to the company’s quiet acquisition of a company called Guilded last month, that won’t come as a surprise. Though Roblox’s work on voice pre-dates the acquisition, Guilded will lay the groundwork for Roblox’s future voice plans.

A Discord competitor, Guilded similarly built out a chat platform for gamers, doubling down on the competitive gaming scene where Discord expanded its horizons beyond gaming. Beyond group voice chat, Guilded gives gamers built-in scheduling and community management tools that ease the hassle of organizing complex online social events, like wrangling 20-some-odd gamers to run raids in World of Warcraft.

“In the near term, Guilded has an amazing road map, we want to just continue with that road map and grow it without any hardcore integration at this point,” Bronstein said.

Into the metaverse

Moderation challenges aside, there’s basically nothing in Roblox’s way. The company went public in March and today it’s worth $49 billion, making it easily one of the most valuable companies in gaming. Investors, content creators and tech giants alike are going all-in on the metaverse, and really, it looks like a pretty safe bet.

Metaverse is a buzzy term right now, but it’s more shorthand than empty hype. When people talk about the metaverse, they generally want to evoke a futuristic vision of interconnected virtual worlds — online spaces that we can move through, socialize and shop within (for better or worse, that last part is key). Whether this will all be in virtual reality or not and when is a point of some debate, but really the interconnected part is the bigger challenge. In the app age, software was siloed by design. But to realize the promise of the metaverse, our virtual selves and our virtual stuff will need to be able to move through online worlds fluidly.

A few companies are ahead of the curve on this, and it’s no coincidence that two of the big ones, Roblox and Fortnite-maker Epic — best known for their virtual worlds stocked with custom avatars, in-game economies and a seamless social layer — are elevating user-created content. Those experiences, and the ability to easily hang out with friends while doing stuff in them and elsewhere in virtual space, may wind up being what the metaverse is all about.

Most adults can hardly grasp the appeal of the blocky, suburban worlds that their kids love hanging out in, but Roblox understands something fundamental about where online life is going. Or rather where we’ll all going — into online worlds like Roblox.

 

WhatsApp faces $267M fine for breaching Europe’s GDPR

By Natasha Lomas

It’s been a long time coming but Facebook is finally feeling some heat from Europe’s much trumpeted data protection regime: Ireland’s Data Protection Commission (DPC) has just announced a €225 million (~$267M) for WhatsApp.

The Facebook-owned messaging app has been under investigation by the Irish DPC, its lead data supervisor in the European Union, since December 2018 — several months after the first complaints were fired at WhatsApp over how it processes user data under Europe’s General Data Protection Regulation (GDPR), once it begun being applied in May 2018.

Despite receiving a number of specific complaints about WhatsApp, the investigation undertaken by the DPC that’s been decided today was what’s known as an “own volition” enquiry — meaning the regulator selected the parameters of the investigation itself, choosing to fix on an audit of WhatsApp’s ‘transparency’ obligations.

A key principle of the GDPR is that entities which are processing people’s data must be clear, open and honest with those people about how their information will be used.

The DPC’s decision today (which runs to a full 266 pages) concludes that WhatsApp failed to live up to the standard required by the GDPR.

Its enquiry considered whether or not WhatsApp fulfils transparency obligations to both users and non-users of its service (WhatsApp may, for example, upload the phone numbers of non-users if a user agrees to it ingesting their phone book which contains other people’s personal data); as well as looking at the transparency the platform offers over its sharing of data with its parent entity Facebook (a highly controversial issue at the time the privacy U-turn was announced back in 2016, although it predated GDPR being applied).

In sum, the DPC found a range of transparency infringements by WhatsApp — spanning articles 5(1)(a); 12, 13 and 14 of the GDPR.

In addition to issuing a sizeable financial penalty, it has ordered WhatsApp to take a number of actions to improve the level of transparency it offer users and non-users — giving the tech giant a three-month deadline for making all the ordered changes.

In a statement responding to the DPC’s decision, WhatsApp disputed the findings and dubbed the penalty “entirely disproportionate” — as well as confirming it will appeal, writing:

“WhatsApp is committed to providing a secure and private service. We have worked to ensure the information we provide is transparent and comprehensive and will continue to do so. We disagree with the decision today regarding the transparency we provided to people in 2018 and the penalties are entirely disproportionate. We will appeal this decision.” 

It’s worth emphasizing that the scope of the DPC enquiry which has finally been decided today was limited to only looking at WhatsApp’s transparency obligations.

The regulator was explicitly not looking into wider complaints — which have also been raised against Facebook’s data-mining empire for well over three years — about the legal basis WhatsApp claims for processing people’s information in the first place.

So the DPC will continue to face criticism over both the pace and approach of its GDPR enforcement.

…system to add years until this fine will actually be paid – but at least it's a start… 10k cases per year to go! 😜

— Max Schrems 🇪🇺 (@maxschrems) September 2, 2021

 

Indeed, prior to today, Ireland’s regulator had only issued one decision in a major cross-border cases addressing ‘Big Tech’ — against Twitter when, back in December, it knuckle-tapped the social network over a historical security breach with a fine of $550k.

WhatsApp’s first GDPR penalty is, by contrast, considerably larger — reflecting what EU regulators (plural) evidently consider to be a far more serious infringement of the GDPR.

Transparency is a key principle of the regulation. And while a security breach may indicate sloppy practice, systematic opacity towards people whose data your adtech empire relies upon to turn a fat profit looks rather more intentional; indeed, it’s arguably the whole business model.

And — at least in Europe — such companies are going to find themselves being forced to be up front about what they’re doing with people’s data.

Is GDPR working?  

The WhatsApp decision will rekindle the debate about whether the GDPR is working effectively where it counts most: Against the most powerful companies in the world, who are also of course Internet companies.

Under the EU’s flagship data protection regulation, decisions on cross border cases require agreement from all affected regulators — across the 27 Member States — so while the GDPR’s “one-stop-shop” mechanism seeks to streamline the regulatory burden for cross-border businesses by funnelling complaints and investigations via a lead regulator (typically where a company has its main legal establishment in the EU), objections can be raised to that lead supervisory authority’s conclusions (and any proposed sanctions), as has happened here, in this WhatsApp case.

Ireland originally proposed a far more low-ball penalty of up to €50M for WhatsApp. However other EU regulators objected to the draft decision on a number of fronts — and the European Data Protection Board (EDPB) ultimately had to step in and take a binding decision (issued this summer) to settle the various disputes.

Through that (admittedly rather painful) joint-working, the DPC was required to increase the size of the fine issued to WhatsApp. In a mirror of what happened with its draft Twitter decision — where the DPC has also suggested an even tinier penalty in the first instance.

While there is a clear time cost in settling disputes between the EU’s smorgasbord of data protection agencies — the DPC submitted its draft WhatsApp decision to the other DPAs for review back in December, so it’s taken well over half a year to hash out all the disputes about WhatsApp’s lossy hashing and so forth — the fact that ‘corrections’ are being made to its decisions and conclusions can land — if not jointly agreed but at least arriving via a consensus being pushed through by the EDPB — is a sign that the process, while slow and creaky, is working.

Even so, Ireland’s data watchdog will continue to face criticism for its outsized role in handling GDPR complaints and investigations — with some accusing the DPC of essentially cherry-picking which issues to examine in detail (by its choice and framing of cases) and which to elide entirely (by those issues it doesn’t open an enquiry into or complaints it simply drops or ignores), with its loudest critics arguing it’s therefore still a major bottleneck on effective enforcement of data protection rights across the EU. And the associated conclusion for that critique is that tech giants like Facebook are still getting a pretty free pass to violate Europe’s privacy rules.

But while it’s true that a $267M penalty is still the equivalent of a parking ticket for Facebook, orders to change how such adtech giants are able to process people’s information have the potential to be a far more significant correction on problematic business models. Again, though, time will be needed to tell.

In a statement on the WhatsApp decision today, noyb — the privacy advocay group founded by long-time European privacy campaigner Max Schrems, said: We welcome the first decision by the Irish regulator. However, the DPC gets about ten thousand complaints per year since 2018 and this is the first major fine. The DPC also proposed an initial €50MK fine and was forced by the other European data protection authorities to move towards €225M, which is still only 0.08% of the turnover of the Facebook Group. The GDPR foresees fines of up to 4% of the turnover. This shows how the DPC is still extremely dysfunctional.”

Schrems also noted that he and noyb still have a number of pending cases before the DPC — including on WhatsApp.

In further remarks, Schrems and noyb said: “WhatsApp will surely appeal the decision. In the Irish court system this means that years will pass before any fine is actually paid. In our cases we often had the feeling that the DPC is more concerned with headlines than with actually doing the hard groundwork. It will be very interesting to see if the DPC will actually defend this decision fully, as it was basically forced to make this decision by its European counterparts. I can imagine that the DPC will simply not put many resources on the case or ‘settle’ with WhatsApp in Ireland. We will monitor this case closely to ensure that the DPC is actually following through with this decision.”

Corelight secures $75M Series D to bolster its network defense offering

By Carly Page

Corelight, a San Francisco-based startup that claims to offer the industry’s first open network detection and response (NDR) platform, has raised $75 million in Series D investment led by Energy Impact Partners. 

The round — which also includes a strategic investment from Capital One Ventures, Crowdstrike Falcon Fund and Gaingels — brings Corelight’s total raised to $160 million, following a $50 million Series C in October 2019, a $25 million Series B in September 2018 and a $9.2 million Series A in July 2017.

While it’s raised plenty of capital in the past few years, the startup isn’t planning its exit just yet. Brian Dye, CEO of Corelight, tells TechCrunch that given Corelight’s market opportunity and performance — the startup claims to be the fastest-growing NDR player at scale — it plans to invest in growth and expects to raise additional capital in the future. 

“Public listing time frames are always hard to forecast, and we view the private markets as attractive in the short term, so we expect to remain private for the next couple years and will look at market conditions then to decide our next step,” Dye said, adding that Corelight plans to use its latest investment to fuel the acceleration of its global market presence and to develop new data and cloud-based offerings.

“Aside from go-to-market expansion, we are investing to ensure that the insight we provide both continues to lead the industry and can be readily used by customers of all types,” he added. 

Corelight, which competes with the likes of FireEye and STG-owned McAfee, was founded in 2013 when Dr. Vern Paxson, a professor of computer science at the University of California, Berkeley, joined forces with Robin Sommer and Seth Hall to build a network visibility solution on top of an open source framework called Zeek (formerly Bro). 

Paxson began developing Zeek in 1995 when he was working at Lawrence Berkeley National Laboratory (LBNL). The software is now widely regarded as the gold standard for both network security monitoring and network traffic analysis and has been deployed by thousands of organizations around the world, including the U.S. Department of Energy, various agencies in the U.S. government and research universities like Indiana University, Ohio State and Stanford.

TikTok adds educational resources for parents as part of its Family Pairing feature

By Sarah Perez

TikTok is expanding its in-app parental controls feature, Family Pairing, with educational resources designed to help parents better support their teenage users, the company announced morning. The pairing feature, which launched to global users last year, allows parents of teens aged 13 and older to connect their accounts with the child’s so the parent can set controls related to screen time use, who the teen can direct message, and more. But the company heard from teens that they also want their voices to be heard when it comes to parents’ involvement in their digital life.

To create the new educational content, TikTok partnered with the online safety nonprofit, Internet Matters. The organization developed a set of resources in collaboration with teens that aim to offer parents tips about navigating the TikTok landscape and teenage social media usage in general.

Teens said they want parents to understand the rules they’re setting when they use features like Family Pairing and they want them to be open to having discussions about the time teens spend online. And while teens don’t mind when parents set boundaries, they also want to feel they’ve earned some level of trust from the adults in their life.

The older teens get, the more autonomy they want to have on their own device and social networks, as well. They may even tell mom or dad that they don’t want them to follow them on a given platform.

This doesn’t necessarily mean the teen is up to no good, the new resources explain to parents. The teens just want to feel like they can hang out with their friends online without being so closely monitored. This has become an important part of the online experience today, in the pandemic era, where many younger people are spending more time at home instead of socializing with friends in real-life or participating in other in-person group activities.

Image Credits: TikTok

Teens said they also want to be able to come to parents when something goes wrong, without fearing that they’ll be harshly punished or that the parent will panic about the situation. The teens know they’ll be consequences if they break the rules, but they want parents to work through other tough situations with them and devise solutions together, not just react in anger.

All this sounds like straightforward, common sense advice, but parents on TikTok often have varying degrees of comfort with their teens’ digital life and use of social networks. Some basic guidelines that explain what teens want and feel makes sense to include. That said, the parents who are technically savvy enough to enable a parental control feature like Family Pairing may already be clued into best practices.

Image Credits: TikTok

In addition, this sort of teen-focused privacy and safety content is also designed to help TikTok better establish itself as a platform working to protect its younger users — an increasingly necessary stance in light of the potential regulation which big tech has been trying to ahead of, as of late. TikTok, for instance, announced in August it would roll out more privacy protections for younger teens aimed to make the app safer. Facebook, Google and YouTube also did the same.

TikTok says parents or guardians who have currently linked their account to a teen’s account via the Family Pairing feature will receive a notification that prompts them to find out more about the teens’ suggestions and how to approach those conversations about digital literacy and online safety. Parents who sign up and enable Family Pairing for the first time, will also be guided to the resources.

Cybersecurity VC funding surges to a record $11.5B in 2021

By Carly Page

The pandemic completely upended the threat landscape as we know it. Ransomware accounted for an estimated 2.9 million attacks so far in 2021, and supply-chain attacks that targeted Kaseya and SolarWinds have increased fourfold over 2020, according to the European Union’s cybersecurity agency, ENISA, which recently warned that the more traditional cybersecurity protections are no longer effective in defending against these types of attacks.

This has created an unprecedented need for emerging technologies, attracting both organizations and investors to look closer at newer cybersecurity technologies.

“We are seeing a perfect storm of factors coming together to create the most aggressive threat landscape in history for commercial and government organizations around the world,” said Dave DeWalt, founder and managing director of NightDragon, which recently invested in multi-cloud security startup vArmour. “As an investor and advisor, I feel we have a responsibility to help these organizations better prepare themselves to mitigate this growing risk.”

According to Momentum Cyber’s latest cybersecurity market review out Wednesday, investors poured $11.5 billion in total venture capital financing into cybersecurity startups in the first half of 2021, up from $4.7 billion during the same period a year earlier.

More than 36 of the 430 total transactions surpassed the $100 million mark, according to Momentum, which includes the $543 million Series A raised by passwordless authentication company Transmit Security and the $525 million round closed by cloud-based security company Lacework.

“As an investor in the cyber market for over fifteen years, I can say that this market climate is unlike anything we’ve seen to date,” said Bob Ackerman, founder and managing director of AllegisCyber Capital, which recently led a $26.5 million investment in cybersecurity startup Panaseer. “It is encouraging to finally see CEOs, boards of directors, investors and more paying serious attention to this space and putting the resources and capital in place to fund the innovations that address the cybersecurity challenges of today and tomorrow.”

Unsurprisingly, M&A volume also saw a massive increase during the first six months of the year, with significant deals for companies in cloud security, security consulting, and risk and compliance. Total M&A volume reached a record-breaking $39.5 billion across 163 transactions, according to Momentum, more than four-times the $9.8 billion spent in the first half of 2020 across 93 transactions.

Nine M&A deals in 2021 so far have been valued at greater than $1 billion, including Proofpoint’s $12.3 billion acquisition by Thoma Bravo, Auth0’s $6.4 billion acquisition by Okta, and McAfee’s $4 billion acquisition by TG.

“Through the first half of 2021, we have witnessed unprecedented strategic activity with both M&A and financing volumes at all-time highs,” said Eric McAlpine and Michael Tedesco, managing partners at Momentum Cyber. “We fully expect this trend to continue through the rest of the year and into 2022.”

Read more on Extra Crunch:

This Week in Apps: OnlyFans bans sexual content, SharePlay delayed, TikTok questioned over biometric data collection

By Sarah Perez

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.

This Week in Apps offers a way to keep up with this fast-moving industry in one place with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters

Top Stories

OnlyFans to ban sexually explicit content

OnlyFans logo displayed on a phone screen and a website

(Photo Illustration by Jakub Porzycki/NurPhoto via Getty Images)

Creator platform OnlyFans is getting out of the porn business. The company announced this week it will begin to prohibit any “sexually explicit” content starting on October 1, 2021 — a decision it claimed would ensure the long-term sustainability of the platform. The news angered a number of impacted creators who weren’t notified ahead of time and who’ve come to rely on OnlyFans as their main source of income.

However, word is that OnlyFans was struggling to find outside investors, despite its sizable user base, due to the adult content it hosts. Some VC firms are prohibited from investing in adult content businesses, while others may be concerned over other matters — like how NSFW content could have limited interest from advertisers and brand partners. They may have also worried about OnlyFans’ ability to successfully restrict minors from using the app, in light of what appears to be soon-to-come increased regulations for online businesses. Plus, porn companies face a number of other issues, too. They have to continually ensure they’re not hosting illegal content like child sex abuse material, revenge porn or content from sex trafficking victims — the latter which has led to lawsuits at other large porn companies.

The news followed a big marketing push for OnlyFans’ porn-free (SFW) app, OFTV, which circulated alongside reports that the company was looking to raise funds at a $1 billion+ valuation. OnlyFans may not have technically needed the funding to operate its current business — it handled more than $2 billion in sales in 2020 and keeps 20%. Rather, the company may have seen there’s more opportunity to cater to the “SFW” creator community, now that it has big names like Bella Thorne, Cardi B, Tyga, Tyler Posey, Blac Chyna, Bhad Bhabie and others on board.

U.S. lawmakers demand info on TikTok’s plans for biometric data collection

The TikTok logo is seen on an iPhone 11 Pro max

The TikTok logo is seen on an iPhone 11 Pro max. Image Credits: Nur Photo/Getty Images

U.S. lawmakers are challenging TikTok on its plans to collect biometric data from its users. TechCrunch first reported on TikTok’s updated privacy policy in June, where the company gave itself permission to collect biometric data in the U.S., including users’ “faceprints and voiceprints.” When reached for comment, TikTok could not confirm what product developments necessitated the addition of biometric data to its list of disclosures about the information it automatically collects from users, but said it would ask for consent in the case such data collection practices began.

Earlier this month, Senators Amy Klobuchar (D-MN) and John Thune (R-SD) sent a letter to TikTok CEO Shou Zi Chew, which said they were “alarmed” by the change, and demanded to know what information TikTok will be collecting and what it plans to do with the data. This wouldn’t be the first time TikTok got in trouble for excessive data collection. Earlier this year, the company paid out $92 million to settle a class-action lawsuit that claimed TikTok had unlawfully collected users’ biometric data and shared it with third parties.

Weekly News

Platforms: Apple

Image Credits: Apple

  • ⭐ Apple told developers that some of the features it announced as coming in iOS 15 won’t be available at launch. This includes one of the highlights of the new OS, SharePlay, a feature that lets people share music, videos and their screen over FaceTime calls. Other features that will come in later releases include Wallet’s support for ID cards, the App Privacy report and others that have yet to make it to beta releases.
  • Apple walked back its controversial Safari changes with the iOS 15 beta 6 update. Apple’s original redesign had shown the address bar at the bottom of the screen, floating atop the page’s content. Now the tab bar will appear below the page’s content, offering access to its usual set of buttons as when it was at the top. Users can also turn off the bottom tab bar now and revert to the old, Single Tab option that puts the address bar back at the top as before.
  • In response to criticism over its new CSAM detection technology, Apple said the version of NeuralHash that was reverse-engineered by a developer, Asuhariet Ygvar, was a generic version, and not the complete version that will roll out later this year.
  • The Verge dug through over 800 documents from the Apple-Epic trial to find the best emails, which included dirt on a number of other companies like Netflix, Hulu, Sony, Google, Nintendo, Valve, Microsoft, Amazon and more. These offered details on things like Netflix’s secret arrangement to pay only 15% of revenue, how Microsoft also quietly offers a way for some companies to bypass its full cut, how Apple initially saw the Amazon Appstore as a threat and more.

Platforms: Google

  • A beta version of the Android Accessibility Suite app (12.0.0) which rolled out with the fourth Android beta release added something called “Camera Switches” to Switch Access, a toolset that lets you interact with your device without using the touchscreen. Camera Switches allows users to navigate their phone and use its features by making face gestures, like a smile, open mouth, raised eyebrows and more.
  • Google announced its Pixel 5a with 5G, the latest A-series Pixel phone, will arrive on August 27, offering IP67 water resistance, long-lasting Adaptive Battery, Pixel’s dual-camera system and more, for $449. The phone makes Google’s default Android experience available at a lower price point than the soon to arrive Pixel 6.
  • An unredacted complaint from the Apple-Epic trial revealed that Google had quietly paid developers hundreds of millions of dollars via a program known as “Project Hug,” (later “Apps and Games Velocity Program”) to keep their games on the Play Store. Epic alleges Google launched the program to keep developers from following its lead by moving their games outside the store.

Augmented Reality

  • Snap on Thursday announced it hired its first VP of Platform Partnerships to lead AR, Konstantinos Papamiltiadis (“KP”). The new exec will lead Snap’s efforts to onboard partners, including individual AR creators building via Lens Studio as well as large companies that incorporate Snapchat’s camera and AR technology (Camera Kit) into their apps. KP will join in September, and report to Ben Schwerin, SVP of Content and Partnerships.

Fintech

  • Crypto exchange Coinbase will enter the Japanese market through a new partnership with Japanese financial giant Mitsubishi UFJ Financial Group (MUFG). The company said it plans to launch other localized versions of its existing global services in the future.

Social

Image Credits: Facebook

  • Facebook launched a “test” of Facebook Reels in the U.S. on iOS and Android. The new feature brings the Reels experience to Facebook, allowing users to create and share short-form video content directly within the News Feed or within Facebook Groups. Instagram Reels creators can also now opt in to have their Reels featured on users’ News Feed. The company is heavily investing its its battle with TikTok, even pledging that some portion of its $1 billion creator fund will go toward Facebook Reels.
  • Twitter’s redesign of its website and app was met with a lot of backlash from users and accessibility experts alike. The company choices add more visual contrast between various elements and may have helped those with low vision. But for others, the contrast is causing strain and headaches. Experts believe accessibility isn’t a one-size fits all situation, and Twitter should have introduced tools that allowed people to adjust their settings to their own needs.
  • The pro-Trump Twitter alternative Gettr’s lack of moderation has allowed users to share child exploitation images, according to research from the Stanford Internet Observatory’s Cyber Policy Center.
  • Pinterest rolled out a new set of more inclusive search filters that allow people to find styles for different types of hair textures — like coily, curly, wavy, straight, as well as shaved or bald and protective styles. 

Photos

  • Photoshop for iPad gained new image correction tools, including the Healing Brush and Magic Wand, and added support for connecting an iPad to external monitors via HDMI or USB-C. The company also launched a Photoshop Beta program on the desktop.

Messaging

  • WhatsApp is being adopted by the Taliban to spread its message across Afghanistan, despite being on Facebook’s list of banned organizations. The company says it’s proactively removing Taliban content — but that may be difficult to do since WhatsApp’s E2E encryption means it can’t read people’s texts. This week, Facebook shut down a Taliban helpline in Kabul, which allowed civilians to report violence and looting, but some critics said this wasn’t actually helping local Afghans, as the group was now in effect governing the region.
  • WhatsApp is also testing a new feature that will show a large preview when sharing links, which some suspect may launch around the time when the app adds the ability to have the same account running on multiple devices.

Streaming & Entertainment

  • Netflix announced it’s adding spatial audio support on iPhone and iPad on iOS 14, joining other streamers like HBO Max, Disney+ and Peacock that have already pledged to support the new technology. The feature will be available to toggle on and off in the Control Center, when it arrives.
  • Blockchain-powered streaming music service Audius partnered with TikTok to allow artists to upload their songs using TikTok’s new SoundKit in just one click.
  • YouTube’s mobile app added new functionality that allows users to browse a video’s chapters, and jump into the chapter they want directly from the search page.
  • Spotify’s Anchor app now allows users in global markets to record “Music + Talk” podcasts, where users can combine spoken word recordings with any track from Spotify’s library of 70 million songs for a radio DJ-like experience.
  • Podcasters are complaining that Apple’s revamped Podcasts platform is not working well, reports The Verge. Podcasts Connect has been buggy, and sports a confusing interface that has led to serious user errors (like entire shows being archived). And listeners have complained about syncing problems and podcasts they already heard flooding their libraries.

Dating

  • Tinder announced a new feature that will allow users to voluntarily verify their identity on the platform, which will allow the company to cross-reference sex offender registry data. Previously, Tinder would only check this database when a user signed up for a paid subscription with a credit card.

Gaming

Image Source: The Pokémon Company

  • Pokémon Unite will come to iOS and Android on September 22, The Pokémon Company announced during a livestream this week. The strategic battle game first launched on Nintendo Switch in late July.
  • Developer Konami announced a new game, Castlevania: Grimoire of Souls, which will come exclusively to Apple Arcade. The game is described as a “full-fledged side-scrolling action game,” featuring a roster of iconic characters from the classic game series. The company last year released another version of Castelvania on the App Store and Google Play.
  • Dragon Ball Z: Dokkan Battle has now surpassed $3 billion in player spending since its 2015 debut, reported Sensor Tower. The game from Bandai Namco took 20 months to reach the figure after hitting the $2 billion milestone in 2019. The new landmark sees the game joining other top-grossers, including Clash Royale, Lineage M and others.
  • Sensor Tower’s mobile gaming advertising report revealed data on top ad networks in the mobile gaming market, and their market share. It also found puzzle games were among the top advertisers on gaming-focused networks like Chartboost, Unity, IronSource and Vungle. On less game-focused networks, mid-core games were top titles, like Call of Duty: Mobile and Top War. 

Image Credits: Sensor Tower

Health & Fitness

  • Apple is reportedly scaling back HealthHabit, an internal app for Apple employees that allowed them to track fitness goals, talk to clinicians and coaches at AC Wellness (a doctors’ group Apple works with) and manage hypertension. According to Insider, 50 employees had been tasked to work on the project.
  • Samsung launched a new product for Galaxy smartphones in partnership with healthcare nonprofit The Commons Project, that allows U.S. users to save a verifiable copy of their vaccination card in the Samsung Pay digital wallet.

Image Credits: Samsung

Adtech

Government & Policy

  • China cited 43 apps, including Tencent’s WeChat and an e-reader from Alibaba, for illegally transferring user data. The regulator said the apps had transferred users location data and contact list and harassed them with pop-up windows. The apps have until August 25 to make changes before being punished.

Security & Privacy

  • A VICE report reveals a fascinating story about a jailbreaking community member who had served as a double agent by spying for Apple’s security team. Andrey Shumeyko, whose online handles included JVHResearch and YRH04E, would advertise leaked apps, manuals and stolen devices on Twitter and Discord. He would then tell Apple things like which Apple employees were leaking confidential info, which reporters would talk to leakers, who sold stolen iPhone prototypes and more. Shumeyko decided to share his story because he felt Apple took advantage of him and didn’t compensate him for the work.

Funding and M&A

💰 South Korea’s GS Retail Co. Ltd will buy Delivery Hero’s food delivery app Yogiyo in a deal valued at 800 billion won ($685 million USD). Yogiyo is the second-largest food delivery app in South Korea, with a 25% market share.

💰 Gaming platform Roblox acquired a Discord rival, Guilded, which allows users to have text and voice conversations, organize communities around events and calendars and more. Deal terms were not disclosed. Guilded raised $10.2 million in venture funding. Roblox’s stock fell by 7% after the company reported earnings this week, after failing to meet Wall Street expectations.

💰 Travel app Hopper raised $175 million in a Series G round of funding led by GPI Capital, valuing the business at over $3.5 billion. The company raised a similar amount just last year, but is now benefiting from renewed growth in travel following COVID-19 vaccinations and lifting restrictions.

💰 Indian quiz app maker Zupee raised $30 million in a Series B round of funding led by Silicon Valley-based WestCap Group and Tomales Bay Capital. The round values the company at $500 million, up 5x from last year.

💰 Danggeun Market, the publisher of South Korea’s hyperlocal community app Karrot, raised $162 million in a Series D round of funding led by DST Global. The round values the business at $2.7 billion and will be used to help the company launch its own payments platform, Karrot Pay.

💰 Bangalore-based fintech app Smallcase raised $40 million in Series C funding round led by Faering Capital and Premji Invest, with participation from existing investors, as well as Amazon. The Robinhood-like app has over 3 million users who are transacting about $2.5 billion per year.

💰 Social listening app Earbuds raised $3 million in Series A funding led by Ecliptic Capital. Founded by NFL star Jason Fox, the app lets anyone share their favorite playlists, livestream music like a DJ or comment on others’ music picks.

💰 U.S. neobank app One raised $40 million in Series B funding led by Progressive Investment Company (the insurance giant’s investment arm), bringing its total raise to date to $66 million. The app offers all-in-one banking services and budgeting tools aimed at middle-income households who manage their finances on a weekly basis.

Public Markets

📈Indian travel booking app ixigo is looking to raise Rs 1,600 crore in its initial public offering, The Economic Times reported this week.

📉Trading app Robinhood disappointed in its first quarterly earnings as a publicly traded company, when it posted a net loss of $502 million, or $2.16 per share, larger than Wall Street forecasts. This overshadowed its beat on revenue ($565 million versus $521.8 million expected) and its more than doubling of MAUs to 21.3 million in Q2.  Also of note, the company said dogecoin made up 62% of its crypto revenue in Q2.

Downloads

Polycam (update)

Image Credits: Polycam

3D scanning software maker Polycam launched a new 3D capture tool, Photo Mode, that allows iPhone and iPad users to capture professional-quality 3D models with just an iPhone. While the app’s scanner before had required the use of the lidar sensor built into newer devices like the iPhone 12 Pro and iPad Pro models, the new Photo Mode feature uses just an iPhone’s camera. The resulting 3D assets are ready to use in a variety of applications, including 3D art, gaming, AR/VR and e-commerce. Data export is available in over a dozen file formats, including .obj, .gtlf, .usdz and others. The app is a free download on the App Store, with in-app purchases available.

Jiobit (update)

Jiobit, the tracking dongle acquired by family safety and communication app Life360, this week partnered with emergency response service Noonlight to offer Jiobit Protect, a premium add-on that offers Jiobit users access to an SOS Mode and Alert Button that work with the Jiobit mobile app. SOS Mode can be triggered by a child’s caregiver when they detect — through notifications from the Jiobit app — that a loved one may be in danger. They can then reach Noonlight’s dispatcher who can facilitate a call to 911 and provide the exact location of the person wearing the Jiobit device, as well as share other details, like allergies or special needs, for example.

Tweets

When your app redesign goes wrong…

Image Credits: Twitter.com

Prominent App Store critic Kosta Eleftheriou shut down his FlickType iOS app this week after too many frustrations with App Review. He cited rejections that incorrectly argued that his app required more access than it did — something he had successfully appealed and overturned years ago. Attempted follow-ups with Apple were ignored, he said. 

Image Credits: Twitter.com

Anyone have app ideas?

Today’s real story: The Facebook monopoly

By Walter Thompson
Daniel Liss Contributor
Daniel Liss is the founder and CEO of Dispo, the digital disposable camera social network.

Facebook is a monopoly. Right?

Mark Zuckerberg appeared on national TV today to make a “special announcement.” The timing could not be more curious: Today is the day Lina Khan’s FTC refiled its case to dismantle Facebook’s monopoly.

To the average person, Facebook’s monopoly seems obvious. “After all,” as James E. Boasberg of the U.S. District Court for the District of Columbia put it in his recent decision, “No one who hears the title of the 2010 film ‘The Social Network’ wonders which company it is about.” But obviousness is not an antitrust standard. Monopoly has a clear legal meaning, and thus far Lina Khan’s FTC has failed to meet it. Today’s refiling is much more substantive than the FTC’s first foray. But it’s still lacking some critical arguments. Here are some ideas from the front lines.

To the average person, Facebook’s monopoly seems obvious. But obviousness is not an antitrust standard.

First, the FTC must define the market correctly: personal social networking, which includes messaging. Second, the FTC must establish that Facebook controls over 60% of the market — the correct metric to establish this is revenue.

Though consumer harm is a well-known test of monopoly determination, our courts do not require the FTC to prove that Facebook harms consumers to win the case. As an alternative pleading, though, the government can present a compelling case that Facebook harms consumers by suppressing wages in the creator economy. If the creator economy is real, then the value of ads on Facebook’s services is generated through the fruits of creators’ labor; no one would watch the ads before videos or in between posts if the user-generated content was not there. Facebook has harmed consumers by suppressing creator wages.

A note: This is the first of a series on the Facebook monopoly. I am inspired by Cloudflare’s recent post explaining the impact of Amazon’s monopoly in their industry. Perhaps it was a competitive tactic, but I genuinely believe it more a patriotic duty: guideposts for legislators and regulators on a complex issue. My generation has watched with a combination of sadness and trepidation as legislators who barely use email question the leading technologists of our time about products that have long pervaded our lives in ways we don’t yet understand. I, personally, and my company both stand to gain little from this — but as a participant in the latest generation of social media upstarts, and as an American concerned for the future of our democracy, I feel a duty to try.

The problem

According to the court, the FTC must meet a two-part test: First, the FTC must define the market in which Facebook has monopoly power, established by the D.C. Circuit in Neumann v. Reinforced Earth Co. (1986). This is the market for personal social networking services, which includes messaging.

Second, the FTC must establish that Facebook controls a dominant share of that market, which courts have defined as 60% or above, established by the 3rd U.S. Circuit Court of Appeals in FTC v. AbbVie (2020). The right metric for this market share analysis is unequivocally revenue — daily active users (DAU) x average revenue per user (ARPU). And Facebook controls over 90%.

The answer to the FTC’s problem is hiding in plain sight: Snapchat’s investor presentations:

Snapchat July 2021 investor presentation: Significant DAU and ARPU Opportunity

Snapchat July 2021 investor presentation: Significant DAU and ARPU Opportunity. Image CreditsSnapchat

This is a chart of Facebook’s monopoly — 91% of the personal social networking market. The gray blob looks awfully like a vast oil deposit, successfully drilled by Facebook’s Standard Oil operations. Snapchat and Twitter are the small wildcatters, nearly irrelevant compared to Facebook’s scale. It should not be lost on any market observers that Facebook once tried to acquire both companies.

The market Includes messaging

The FTC initially claimed that Facebook has a monopoly of the “personal social networking services” market. The complaint excluded “mobile messaging” from Facebook’s market “because [messaging apps] (i) lack a ‘shared social space’ for interaction and (ii) do not employ a social graph to facilitate users’ finding and ‘friending’ other users they may know.”

This is incorrect because messaging is inextricable from Facebook’s power. Facebook demonstrated this with its WhatsApp acquisition, promotion of Messenger and prior attempts to buy Snapchat and Twitter. Any personal social networking service can expand its features — and Facebook’s moat is contingent on its control of messaging.

The more time in an ecosystem the more valuable it becomes. Value in social networks is calculated, depending on whom you ask, algorithmically (Metcalfe’s law) or logarithmically (Zipf’s law). Either way, in social networks, 1+1 is much more than 2.

Social networks become valuable based on the ever-increasing number of nodes, upon which companies can build more features. Zuckerberg coined the “social graph” to describe this relationship. The monopolies of Line, Kakao and WeChat in Japan, Korea and China prove this clearly. They began with messaging and expanded outward to become dominant personal social networking behemoths.

In today’s refiling, the FTC explains that Facebook, Instagram and Snapchat are all personal social networking services built on three key features:

  1. “First, personal social networking services are built on a social graph that maps the connections between users and their friends, family, and other personal connections.”
  2. “Second, personal social networking services include features that many users regularly employ to interact with personal connections and share their personal experiences in a shared social space, including in a one-to-many ‘broadcast’ format.”
  3. “Third, personal social networking services include features that allow users to find and connect with other users, to make it easier for each user to build and expand their set of personal connections.”

Unfortunately, this is only partially right. In social media’s treacherous waters, as the FTC has struggled to articulate, feature sets are routinely copied and cross-promoted. How can we forget Instagram’s copying of Snapchat’s stories? Facebook has ruthlessly copied features from the most successful apps on the market from inception. Its launch of a Clubhouse competitor called Live Audio Rooms is only the most recent example. Twitter and Snapchat are absolutely competitors to Facebook.

Messaging must be included to demonstrate Facebook’s breadth and voracious appetite to copy and destroy. WhatsApp and Messenger have over 2 billion and 1.3 billion users respectively. Given the ease of feature copying, a messaging service of WhatsApp’s scale could become a full-scale social network in a matter of months. This is precisely why Facebook acquired the company. Facebook’s breadth in social media services is remarkable. But the FTC needs to understand that messaging is a part of the market. And this acknowledgement would not hurt their case.

The metric: Revenue shows Facebook’s monopoly

Boasberg believes revenue is not an apt metric to calculate personal networking: “The overall revenues earned by PSN services cannot be the right metric for measuring market share here, as those revenues are all earned in a separate market — viz., the market for advertising.” He is confusing business model with market. Not all advertising is cut from the same cloth. In today’s refiling, the FTC correctly identifies “social advertising” as distinct from the “display advertising.”

But it goes off the deep end trying to avoid naming revenue as the distinguishing market share metric. Instead the FTC cites “time spent, daily active users (DAU), and monthly active users (MAU).” In a world where Facebook Blue and Instagram compete only with Snapchat, these metrics might bring Facebook Blue and Instagram combined over the 60% monopoly hurdle. But the FTC does not make a sufficiently convincing market definition argument to justify the choice of these metrics. Facebook should be compared to other personal social networking services such as Discord and Twitter — and their correct inclusion in the market would undermine the FTC’s choice of time spent or DAU/MAU.

Ultimately, cash is king. Revenue is what counts and what the FTC should emphasize. As Snapchat shows above, revenue in the personal social media industry is calculated by ARPU x DAU. The personal social media market is a different market from the entertainment social media market (where Facebook competes with YouTube, TikTok and Pinterest, among others). And this too is a separate market from the display search advertising market (Google). Not all advertising-based consumer technology is built the same. Again, advertising is a business model, not a market.

In the media world, for example, Netflix’s subscription revenue clearly competes in the same market as CBS’ advertising model. News Corp.’s acquisition of Facebook’s early competitor MySpace spoke volumes on the internet’s potential to disrupt and destroy traditional media advertising markets. Snapchat has chosen to pursue advertising, but incipient competitors like Discord are successfully growing using subscriptions. But their market share remains a pittance compared to Facebook.

An alternative pleading: Facebook’s market power suppresses wages in the creator economy

The FTC has correctly argued for the smallest possible market for their monopoly definition. Personal social networking, of which Facebook controls at least 80%, should not (in their strongest argument) include entertainment. This is the narrowest argument to make with the highest chance of success.

But they could choose to make a broader argument in the alternative, one that takes a bigger swing. As Lina Khan famously noted about Amazon in her 2017 note that began the New Brandeis movement, the traditional economic consumer harm test does not adequately address the harms posed by Big Tech. The harms are too abstract. As White House advisor Tim Wu argues in “The Curse of Bigness,” and Judge Boasberg acknowledges in his opinion, antitrust law does not hinge solely upon price effects. Facebook can be broken up without proving the negative impact of price effects.

However, Facebook has hurt consumers. Consumers are the workers whose labor constitutes Facebook’s value, and they’ve been underpaid. If you define personal networking to include entertainment, then YouTube is an instructive example. On both YouTube and Facebook properties, influencers can capture value by charging brands directly. That’s not what we’re talking about here; what matters is the percent of advertising revenue that is paid out to creators.

YouTube’s traditional percentage is 55%. YouTube announced it has paid $30 billion to creators and rights holders over the last three years. Let’s conservatively say that half of the money goes to rights holders; that means creators on average have earned $15 billion, which would mean $5 billion annually, a meaningful slice of YouTube’s $46 billion in revenue over that time. So in other words, YouTube paid creators a third of its revenue (this admittedly ignores YouTube’s non-advertising revenue).

Facebook, by comparison, announced just weeks ago a paltry $1 billion program over a year and change. Sure, creators may make some money from interstitial ads, but Facebook does not announce the percentage of revenue they hand to creators because it would be insulting. Over the equivalent three-year period of YouTube’s declaration, Facebook has generated $210 billion in revenue. one-third of this revenue paid to creators would represent $70 billion, or $23 billion a year.

Why hasn’t Facebook paid creators before? Because it hasn’t needed to do so. Facebook’s social graph is so large that creators must post there anyway — the scale afforded by success on Facebook Blue and Instagram allows creators to monetize through directly selling to brands. Facebooks ads have value because of creators’ labor; if the users did not generate content, the social graph would not exist. Creators deserve more than the scraps they generate on their own. Facebook suppresses creators’ wages because it can. This is what monopolies do.

Facebook’s Standard Oil ethos

Facebook has long been the Standard Oil of social media, using its core monopoly to begin its march upstream and down. Zuckerberg announced in July and renewed his focus today on the metaverse, a market Roblox has pioneered. After achieving a monopoly in personal social media and competing ably in entertainment social media and virtual reality, Facebook’s drilling continues. Yes, Facebook may be free, but its monopoly harms Americans by stifling creator wages. The antitrust laws dictate that consumer harm is not a necessary condition for proving a monopoly under the Sherman Act; monopolies in and of themselves are illegal. By refiling the correct market definition and marketshare, the FTC stands more than a chance. It should win.

A prior version of this article originally appeared on Substack.

Medal.tv, a video clipping service for gamers, enters the livestreaming market with Rawa.tv acquisition

By Sarah Perez

Medal.tv, a short-form video clipping service and social network for gamers, is entering the livestreaming market with the acquisition of Rawa.tv, a Twitch rival based in Dubai, which had raised around $1 million to date. The seven-figure, all-cash deal will see two of Rawa’s founders, Raya Dadah and Phil Jammal, now joining Medal, and further integrations between the two platforms going forward.

The Middle East and North African region (MENA) is one of the fastest-growing markets in gaming and still one that’s mostly un-catered to, explained Medal.tv CEO Pim de Witte, as to his company’s interest in Rawa.

“Most companies that target that market don’t really understand the nuances and try to replicate existing Western or Far-Eastern models that are doomed to fail,” he said. “Absorbing a local team will increase Medal’s chances of success here. Overall, we believe that MENA is an underserved market without a clear leader in the livestreaming space, and Rawa brings to Medal the local market expertise that we need to capitalize on this opportunity,” de Witte added.

Medal.tv’s community had been asking for the ability to do livestreaming for some time, the exec also noted, but the technology would have been too expensive for the startup to build using off-the-shelf services at its scale, de Witte said.

“People increasingly connect around live and real-time experiences, and this is something our platform has lacked to date,” he noted.

But Rawa, as the first livestreaming platform dedicated to Arab gaming, had built out its own proprietary live and network streaming technology that’s now used in all its products. That technology is now coming to Medal.tv.

Image Credits: Medal.tv

The two companies were already connected before today, as Rawa users have been able to upload their gaming clips to Medal.tv, and some Rawa partners had joined Medal’s skilled player program. Going forward, Rawa will continue to operate as a separate platform, but it will become more tightly integrated with Medal, the company says. Currently, Rawa sees around 100,000 active users on its service.

The remaining Rawa team will continue to operate the livestreaming platform under co-founder Jammal’s leadership following the deal’s close, and the Rawa HQ will remain based in Dubai. However, Rawa’s employees have been working remotely since the start of the pandemic, and it’s unclear if that will change in the future, given the uncertainty of COVID-19’s spread.

Medal.tv detailed its further plans for Rawa on its site, where the company explained it doesn’t aim to build a “general-purpose” livestreaming platform where the majority of viewers don’t pay — a call-out that clearly seems aimed at Twitch. Instead, it says it will focus on matching content with viewers who would be interested in subscribing to the creators. This addresses one of the challenges that has faced larger platforms like Twitch in the past, where it’s been difficult for smaller streamers to get off the ground.

The company also said it will remain narrowly focused on serving the gaming community as opposed to venturing into non-gaming content, as others have done. Again, this differentiates itself from Twitch which, over the years, expanded into vlogs and even streaming old TV shows. And it’s much different from YouTube or Facebook Watch, where gaming is only a subcategory of a broader video network.

The acquisition follows Medal.tv’s $9 million Series A led by Horizons Ventures in 2019, after the startup had grown to 5 million registered users and “hundreds of thousands” of daily active users. Today, the company says over 200,000 people create content every day on Medal, and 3 million users are actively viewing that content every month.

Former Snap employees raise $9M for Trust, emerging from beta to level marketing playing field

By Christine Hall

Trust wants to give smaller businesses the same advantages that large enterprises have when marketing on digital and social media platforms. It came out of beta with $9 million in seed funding from Lerer Hippeau, Lightspeed Venture Partners, Upfront Ventures and Upper90.

The Los Angeles-based company was started in 2019 by a group of five Snap alums working in various roles within Snap’s revenue product strategy business. They were building tools for businesses to fund success with digital marketing, but kept hearing from customers about the advantage big advertisers had over smaller ones — the ability to receive good payment terms, credit lines, as well as data and advice.

Aiming to flip the script on that, the group created Trust, which is a card and business community to help digital businesses navigate the ever-changing pricing models to market online, receive the same incentives larger advertisers get and make the best decision of where their marketing dollars will reach the furthest.

Trust dashboard

Trust does this in a few ways: Its card, built in partnership with Stripe, enables businesses to increase their buying power by up to 20 times and have 45 days to make payments on their marketing investments, CEO James Borow told TechCrunch. Then as part of its community, companies share knowledge of marketing buys and data insights typically reserved for larger advertisers. Users even receive news via their dashboard around their specific marketing strategy, he added.

“The ad platforms are a wall of gardens, and most people don’t know what is going on inside, so our customers work together to see what is going on,” Borow said.

The growth of e-commerce is pushing more digital marketing investments, providing opportunity for Trust to be a huge business, Borow said. E-commerce sales in the U.S. grew by 39% in the first quarter, while digital advertising spend is forecasted to increase 25% this year to $191 billion. Meanwhile, Google, Facebook, Snapchat and Twitter all recently reported rapid growth in their year-over-year advertising revenues, Borow said.

The new funding will go toward increasing the company’s headcount.

“We have active customers on the platform, so we wanted to ramp up hiring as soon as we went into general release,” he added. “We are leaving beta with 25 businesses and a few hundred on our waitlist.”

That list will soon grow. In addition to the funding round, Trust announced a strategic partnership with social shopping e-commerce platform Verishop. The company’s 3,500 merchants will receive priority access to the Trust card and community, Borow said.

Andrea Hippeau, partner at Lerer Hippeau, said she knew Borow from being an investor in his previous advertising company Shift, which was acquired by Brand Networks in 2015.

When Borow contacted Lerer about Trust, Hippeau said this was the kind of offering that would be applicable to the firm’s portfolio, which has many direct-to-consumer brands, and knew marketing was a huge pain point for them.

“Digital marketing is important to all brands, but it is also a black box that you put marketing dollars into, but don’t know what you get,” she said. “We hear this across our portfolio — they spend a lot of money on ad platforms, yet are treated like mom-and-pop companies in terms of credit. When in reality Casper is outspending other companies by five times. Trust understands how important marketing dollars are and gives them terms that are financially better.”

 

ChargePoint acquires Amsterdam-based electric fleet manager ViriCiti

By Aria Alamalhodaei

ChargePoint has made its second acquisition since going public in March, purchasing European electric fleet management company ViriCiti for €75 million ($88 million) in cash. The news comes just a few weeks after the EV charging network operator announced the purchase of European charging software company has·to·be.

Like the has·to·be buy, this newer deal will beef up ChargePoint’s portfolio of hardware and vehicle management software for electric fleet customers, as well as add another 2,500 networked ports and 3,500 connected vehicles to its growing portfolio. ViriCiti customers include Chicago Transit Authority, San Francisco Municipal Transportation Authority, British public transportation company Arriva and Berlin’s main public transport service Berliner Verkehrsbetriebe.

Beyond this customer base, ChargePoint CEO Pasquale Romano told TechCrunch the acquisition of ViriCiti will give the company access to a much larger software feature set for customers beyond ChargePoint’s core offerings of charger management and vehicle charger scheduling, like battery health monitoring, vehicle operations data and greater vehicle telematics capabilities.

“It’s really important for us here to make it easy for fleets to electrify and this [acquisition] is all about making us continually having the most complete offering for fleets,” Romano said.

ChargePoint operates the largest vehicle charging network in North America, with more than 115,000 charging points globally. The company also offers customers access to another 113,000 public charging spots through network roaming agreements. While the company might be best known for this extensive branded network, it also has a cloud subscription platform, as well as a considerable commercial and fleet division. The company went public in March after merging with blank-check company Switchback Energy Acquisition Corporation.

Some of ViriCiti’s services, like battery health monitoring, could be applicable for residential customers, or even simply for fleet customers that let employees take home or use a company vehicle full-time. “If you have vehicles that go home with the driver […] it would stand to reason that what you need to do in the take-home scenario is, your infrastructure needs to look like a logical extension of the infrastructure that you would have in your depots. So we’re pleasantly surprised at how much commercial and residential relevance there is.”

Crucially, ChargePoint will also be absorbing ViriCiti’s more than 50-person workforce, a whole team of mostly software engineers that will transfer their expertise to the new company. “If you just want to see evidence of where our mindset is, look at how many software engineers [are] in the sum total of those two acquisitions,” Romano said. “It’s the majority of both of those companies’ staffs are engineers, and they’re all software in general […] You can see where our focus is in terms of in terms of investment.”

Element Ventures pulls in $130M to double-down on the fintech enterprise trend

By Mike Butcher

With the rise of Open Banking, PSD2 Regulation, insurtech and the whole, general fintech boom, tech investors have realized there is an increasing place for dedicated funds which double down on this ongoing movement. When you look at the rise of banking-as-a-service offerings, payments platforms, insurtech, asset management and infrastructure providers, you realize there is a pretty huge revolution going on.

European fintech companies have raised $12.3 billion in 2021 according to Dealroom, but the market is still wide open for a great deal more funding for B2B fintech startups.

So it’s no surprise that B2B fintech-focused Element Ventures has announced a $130 million fund to double down on this new fintech enterprise trend.

Founded by financial services veterans Stephen Gibson and Michael McFadgen, and joined by Spencer Lake (HSBC’s former vice chairman of Global Banking and Markets), Element is backed by finance-oriented LPs and some 30 founders and executives from the sector.

Element says it will focus on what it calls a “high conviction investment strategy,” which will mean investing in only around a handful of companies a year (15 for the fund in total) but, it says, providing a “high level of support” to its portfolio.

So far it has backed B2B fintech firms across the U.K. and Europe, including Hepster (total raised $10 million), the embedded insurance platform out of Germany which I recently reported on; Billhop (total raised $6.7 million), the B2B payment network out of Sweden; Coincover (total raised $11.6 million), a cryptocurrency recovery service out of the U.K.; and Minna (total raised $25 million), the subscription management platform out of Sweden.

Speaking to me over a call, McFadgen, partner at Element Ventures, said: “Stephen and I have been investing in B2B fintech together for quite a long time. In 2018 we had the opportunity to start element and Spencer came on board in 2019. So Element as an independent venture firm is really a continuation of a strategy we’ve been involved in for a long time.”

Gibson added: “We are quite convinced by the European movement and the breakthrough these fintech and insurtech firms in Europe are having. Insurance has been a desert for innovation and that is changing. And you can see that we’re sort of trying to build a network around companies that have those breakthrough moments and provide not just capital but all the other things we think are part of the story. Building the company from A to C and D is the area that we try and roll our sleeves up and help these firms.”

Element says it also will be investing in the U.S. and Asia.

Industrial cybersecurity startup Nozomi Networks secures $100M in pre-IPO funding

By Carly Page

Nozomi Networks, an industry cybersecurity startup that aims to shield critical infrastructure from cyberattacks, has raised $100 million in pre-IPO funding. 

The Series D funding round was led by Triangle Peak Partners, and also includes investment from a number of equipment, security, service provider and go-to-market companies including Honeywell Ventures, Keysight Technologies and Porsche Digital. 

This funding comes at a critical time for the company. Cyberattacks on industrial control systems (ICS) — the devices necessary for the continued running of power plants, water supplies, and other critical infrastructure — increased both in frequency and severity during the pandemic. Look no further than May and June, which saw ransomware attacks target the IT networks of Colonial Pipeline and meat manufacturing giant JBS, forcing the companies to shut down their industrial operations.

Nozomi Networks, which competes with Dragos and Claroty, claims its industrial cybersecurity solution, which works to secure ICS devices by detecting threats before they hit, aims to prevent such attacks from happening. It provides real-time visibility to help organizations manage cyber risk and improve resilience for industrial operations.

The technology currently supports more than a quarter of a million devices in sectors such as critical infrastructure, energy, manufacturing, mining, transportation, and utilities, with Nozomi Networks doubling its customer base in 2020 and seeing a 5,000% increase in the number of devices its solutions monitor. 

The company will use its latest investment, which comes less than two years after it secured $30 million in Series C funding, to scale product development efforts as well as its go-to-market approach globally. 

Specifically, Nozomi Networks said it plans to grow its sales, marketing, and partner enablement efforts, and upgrade its products to address new challenges in both the OT and IoT visibility and security markets. 

Yat thinks emoji ‘identities’ can be a thing, and it has $20M in sales to back it up

By Amanda Silberling

I learned about Yat in April, when a friend sent our group chat a link to a story about how the key emoji sold as an “internet identity” for $425,000. “I hate the universe,” she texted.

Sure, the universe would be better if people with a spare $425,000 spent it on mutual aid or something, but minutes later, we were trying to figure out what this whole Yat thing was all about. And few more minutes later, I spent $5 (in USD, not crypto) to buy ☕👉💩❗, an emoji string that I think tells a moving story about my caffeine dependency and sensitive stomach. I didn’t think I would be writing about this when I made that choice.

Kesha’s Yat URL on Twitter

On the surface, Yat is a platform that lets you buy a URL with emojis in it — even Kesha (y.at/🌈🚀👽), Lil Wayne (y.at/👽🎵), and Disclosure (y.at/😎🎵😎) are using them in their Twitter bios. Like any URL on the internet, Yats can redirect to another website, or they can function like a more eye-catching Linktree. While users could purchase their own domain name that supports emojis and use it instead of a Yat, many people don’t have the technical expertise or time to do so. Instead, they can make one-time purchase from Yat, which owns the Y.at domain, and the company will provide your with your own y.at subdomain for you.

This convenience, however, comes at a premium. Yat uses an algorithm to determine your Yat’s “rhythm score,” its metric for determining how to price your emoji combo based on its rarity. Yats with one or two emojis are so expensive that you have to contact the company directly to buy them, but you can easily find a four- or five-emoji identity that’ll only put you out $4.

Beyond that, CEO Naveen Jain — a Y Combinator alumnus, founder of digital marketing company Sparkart, and angel investor — thinks that Yat is ultimately an internet privacy product. Jain wants people to be able to use their Yats in any way they’re able to use an online identity now, whether that’s to make payments, send messages, host a website, or login to a platform.

“Objectively, it’s a strange norm. You go on the internet, you register accounts with ad-supported platforms, and your username isn’t universal. You have many accounts, many usernames,” Jain said. “And you don’t control them. If an account wants to shut you down, they shut you down. How many stories are there of people trying to email some social network, and they don’t respond because they don’t have to?”

Yat doesn’t plan to fuel itself with ad money, since users pay for the product when they purchase their Yat, whether they get it for $4 or $400,000.

In the long run, Yat’s CEO says the company plans to use blockchain technology as a way to become self-sovereign. Yats would become assets issued on decentralized, distributed databases. Today, there are several projects working to create a decentralized alternative to the current domain name system (DNS), which is managed by internet regulatory authority ICANN.  DNS is how you find things on the internet, but uses a centralized, hierarchical system. A blockchain domain name system would have no central authority, and some believe this could be the foundation of a next-gen web, or “Web 3.0.”

Today, words like “blockchain” and “cryptocurrency” don’t appear on the Yat website. Jain doesn’t think that’s compelling to average consumers — he believes in progressive decentralization, which explains why Yats are currently purchased with dollars, not ethereum.

“Something we think is really funny about the cryptocurrency world is that anyone who’s a part of it spends a lot of time talking about databases,” Jain said. “People don’t care about databases. When’s the last time you went to a website and it said ‘powered by MySQL’?”

Y.at, however, was registered at a traditional internet registrar, not on the blockchain.

“We agree that this is early stage, there’s no debate about that,” said Jain. “This is laying the foundation — there are certain elements of the vision that are certainly more of a social contract than actual implementation at this point in time. But this is the vision that we’ve set forth, and we’re working continuously towards that goal.”

Still, until Yat becomes more decentralized, it can’t yet give users the complete control it aspires to. At present, the Terms & Conditions give Yat the authority to terminate or suspend users at its discretion, but the company claims it hasn’t yet booted anyone from the system.

As Yat becomes more decentralized, our terms and conditions won’t be important,” Jain said. “This is the nature of pursuing a progressive decentralization strategy.”

In its “generation zero” phase (an open beta), Yat has sold almost $20 million worth of emoji identities. Now, as the waitlist to get a Yat ends, Yat is posting some rare emoji identities on OpenSea, the NFT marketplace that recently reached a valuation of $1.5 billion.

A still image of a Yat visualizer creation

“For the first time ever, we’re going to be auctioning some Yats on OpenSea, and we’re going to be launching minting of Yats on Ethereum,” Jain said. Before minting Yats as NFTs, users can create a digital art landscape for their Yats through a Visualizer. These features, as well as new emojis in the Yat emoji set, will launch this evening at a virtual event called Yat Horizon.

Yat Creators will now have more rights,” Jain said about the new ability to mint Yats as NFTs. “We are going to continue to pursue progressive decentralization until we achieve our ultimate goal: making Yat the best self-directed, self-sovereign identity system for all.”

Consumers have a demonstrated interest in retaining greater privacy on the internet — data shows that in iOS 14.5, 96% of users opted out of ad tracking. But the decentralization movement hasn’t yet been able to market its privacy advantages to the mainstream. Yat helps solve this problem because even if you don’t understand what blockchain means, you understand that having a personal string of emojis is pretty fun. But, before you spend $425,000 on a single-emoji username, keep in mind that Yat’s vision will only completely materialize with the advent of Web 3.0, and we don’t yet know when or if that will happen.

Spotify’s Clubhouse rival, Greenroom, tops 140K installs on iOS, 100K on Android

By Sarah Perez

Spotify’s recently launched live audio app and Clubhouse rival, Spotify Greenroom, has a long road ahead of it if it wants to take on top social audio platforms like Clubhouse, Airtime, Spoon and others, not to mention those from top social networks, like Twitter and Facebook. To date, the new Greenroom app has only been downloaded a total of 141,000 times on iOS, according to data from app intelligence firm Sensor Tower. This includes downloads from its earlier iteration, Locker Room — an app Spotify acquired to make its move into live audio.

On Android, Google Play data indicates the app has been installed over 100,000 times, but Sensor Tower cannot yet confirm this figure.

For comparison, Clubhouse today has 30.2 million total installs, 18.7 million of which are on iOS, Sensor Tower says.

Other top audio apps include Airtime, with 11.4 million iOS installs, out of a total of 14.3 million (including Android); and Spoon, with 7.6 million iOS installs, out of a total of  27.3 million.

International apps like UAE’s Yalla and China’s Lizhi are massive, as well, with the former sporting 48.1 total installs, 3.8 million of which are on iOS. The latter has 29.5+ million total installs, but only a handful on iOS.

There are other newcomers that have managed to stake smaller claims in the social audio space, too, including Fishbowl (759,000 total installs), Cappuccino (497,000 installs), Riff (339,000 installs) and Sonar (154,000 installs.)

Image Credits: Sensor Tower. The firm analyzed 34 social audio apps. The chart shows those with the most installs.  

Spotify Greenroom’s launch last month, meanwhile, seems to have attracted only a small fraction of Spotify’s larger user base, which has now grown to 365 million monthly active users.

The majority of Greenroom’s installs — around 106,000 — took place after Greenroom’s official launch on July 16, 2021 through July 25, 2021, Sensor Tower says. Counting only its Greenroom installs, the app is ranked at No. 12 among social audio apps. It follows Tin Can, which gained 127,000 installs since launching in early March.

Because Greenroom took over Locker Room’s install base, some portion of Greenroom’s total iOS installs (141K) included downloads that occurred when the app was still Locker Room. But that number is fairly small. Sensor Tower estimates Locker Room saw only around 35,000 total iOS installs to date. That includes the time frame of October 26, 2020 — the month when the sports chat app launched to the public — up until the day before Greenroom’s debut (July 15, 2021).

We should also point out that downloads are not the same thing as registered users, and are far short of active users. Many people download a new app to try it, but then abandon it shortly after downloading it, or never remember to open it at all.

That means the number of people actively using Greenroom at this time, is likely much smaller that these figures indicate.

Spotify declined to comment on third-party estimates.

While Sensor Tower looked at competition across social audio apps on the app stores, Spotify’s competition in the live audio market won’t be limited to standalone apps, of course.

Other large tech platforms have more recently integrated social audio into their apps, too, including Facebook (Live Audio Rooms), Twitter (Spaces), Discord (Stage Channels) and trading app Public. A comparison with Greenroom here is not possible, as these companies would have to disclose how many of their active users are engaging with live audio, and they have not yet done so.

Despite what may be a slower uptake, Greenroom shouldn’t be counted out yet. The app is brand-new, and has time to catch up if all goes well. (And if the market for live audio, in general, continues to grow — even though the height of Covid lockdowns, which prompted all this live audio socializing in the first place, seems to have passed.)

Spotify’s success or failure with live audio will be particularly interesting to watch given the potential for the company to cross-promote live audio shows, events, and artist-produced content through its flagship streaming music application. What sort of programming Greenroom may later include is still unknown, however.

Following Spotify’s acquisition of Locker Room maker Betty Labs, the company said it would roll out programmed content related to music, culture, and entertainment, in addition to sports. It also launched a Creator Fund to help fuel the app with new content. 

But so far, Spotify hasn’t given its users a huge incentive to visit Greenroom.

The company, during its Q2 2021 earnings, explained why. It said it first needed to get Greenroom stabilized for a “Spotify-sized audience,” which it why it only soft-launched the app in June. Going forward, Spotify says there will be “more tie-ins” with the main Spotify app, but didn’t offer any specifics.

“Obviously we’ll leverage our existing distribution on Spotify,” noted Spotify CEO Daniel Ek. “But this feels like a great way to learn, experiment and iterate, much faster than if we had to wait for a full on integration into the main app,” he added.

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