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11 July Subscribe
Tech news, HAT-slanted 
Issue 125

Et tu?

Chris Hughes stabbed Mark Zuckerberg in the NY Times last week.

The ex-cofounder of Facebook wrote an editorial entitled "It's time to break up Facebook" that called Mark the most powerful man in democracy and decried his leverage of his three platforms' (WhatsApp, Facebook, Insta) algorithms as dominion over "a powerful monopoly, eclipsing all of its rivals and erasing competition from the social networking category."

It's too interesting and important a written piece to not spend an editorial on, whether you agree with it or not, and so please enjoy this amuse-bouche of the highlights.

"[Facebook] is a powerful monopoly, eclipsing all of its rivals and erasing competition from the social networking category. This explains why, even during the annus horribilis of 2018, Facebook’s earnings per share increased by an astounding 40 percent compared with the year before."

"In one of the government’s few attempts to rein in the company, the F.T.C. in 2011 issued a consent decree that Facebook not share any private information beyond what users already agreed to. Facebook largely ignored the decree. Last month, the day after the company predicted in an earnings call that it 
would need to pay up to $5 billion as a penalty for its negligence — a slap on the wrist — Facebook’s shares surged 7 percent, adding $30 billion to its value, six times the size of the fine."

"When it hasn’t acquired its way to dominance, Facebook has used its monopoly position to shut out competing companies or has copied their technology. The News Feed algorithm reportedly prioritized videos created through Facebook over videos from competitors, like YouTube and Vimeo. In 2012, Twitter introduced a video network called Vine that featured six-second videos. That same day, Facebook blocked Vine from hosting a tool that let its users search for their Facebook friends while on the new network. The decision hobbled Vine, which shut down four years later."

"Facebook makes its money from targeted advertising, meaning users do not pay to use the service. But it is not actually free, and it certainly isn’t harmless. Facebook’s business model is built on capturing as much of our attention as possible to encourage people to create and share more information about who they are and who they want to be. We pay for Facebook with our data and our attention, and by either measure it doesn’t come cheap."

There's been a decent amount of commentary on Chris' piece, ranging from shrugs, to "whatcha gonna dos", to "breakups ain't going to help the problem," but there's a single piece of takeaway that I want to make sure we all have coming from this.

Digital power is unequivocally power these days.

We said it last week about Amazon and we're saying it this week about Facebook and we'll be saying it next week about Alibaba or something: if we don't want that power to be abused we need some of it for ourselves.

Yours in HAT,

Leila Trilby, Editor-in-chief

The present


"...for enterprise startups — which is where we focus — we now wonder if there’s practical evidence of data network effects at all. Moreover, we suspect that even the more straightforward data scale effect has limited value as a defensive strategy for many companies." Iiiiiiinterestink.

(Some) "workers" (here) "are calling for an end to the era of moving fast and breaking things" according to a nice report put out by thinktank DotEveryone.

"Users want control" == "Users can't trust you to give them what they actually want" - a blog post.

War crime evidence or hate content?

Vice was worth nothing.

The future

The doghouse


Big ol' WhatsApp breach.

The Google is merging Nest into the Mothership (and thus removing the barriers that protected Nest data as an entity all its own).

What's the opposite of a doghouse


A bunch of Google apps are gaining a "privacy mode" where the data doesn't go to home base. ("...most companies don't want to be creepy, they want to sell shoes...")

HAT News

CDL. Creative Destruction Lab is coming to the UK - lmk if you know someone who knows someone who should know.

Traction reports. If you're a past investor interested in this round we're sending around weekly traction reports to those who raise their hands. If you'd like one send me an email.

Wah-ick. It's Coventry day tomorrow, who's in?

Jonathan Holtby, HAT Community Manager

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