The UpStream (Page 15)

Netflix and Hulu sued for using the internet without permission

posted Saturday Aug 15, 2020 by Scott Ertz

Netflix and Hulu sued for using the internet without permission

Some of the regional laws governing media transmission are bizarre and made even more so in the ever-changing landscape of modern media. As appointment television slowly fades into a second-tier position and internet content takes over, cities with some of these strange laws are looking to implement those laws against the internet. And that is exactly what is happening in a town in Texas.

The town of New Boston, Texas has filed a class-action suit against Netflix and Hulu for violating one of these television transmission rules. The rule takes offense to the fundamental way that the internet works.

When a Netflix subscriber wants to view Netflix programming, the subscriber's Internet service provider will connect the subscriber to the closest Netflix Open Connect server offering the fastest speeds and best video quality. According to Netflix, that means that most of its subscribers receive Netflix's video programming from servers either inside of, or directly connected to, the subscriber's Internet service provider's network within their local region.
As video service providers, Defendants were required to file an application with the Public Utility Commission of Texas for a state-issued certificate of franchise authority prior to providing video service. Defendants failed to apply for and obtain a SICFA, and are, therefore, providing video service throughout Texas without authorization, and in contravention of the Texas Utility Code.

This could be an interesting case for a variety of reasons. Disney and Comcast, which own Hulu, both hold a SICFA license for the state of Texas, which seems to negate the basic premise of the lawsuit, at least as far as Hulu is concerned. In addition, Disney+ and Peacock, also owned by Disney and Comcast, respectively, are not named as defendants in the lawsuit, despite functioning the same way.

The other interesting aspect is that Texas is essentially attempting to bring an individual service which operates online under the umbrella of a regional utility. They are hoping to regulate Netflix in the same category as Charter and Comcast's cable operations, rather than the same category as Facebook and Twitter.

In the end, it seems unlikely that Netflix and Hulu will be classified by any court as a utility, as they own and operate none of the lines required for the transmission of their video content. This is yet another instance of a city not understanding the changing world of media content.

Mozilla announces layoffs and restructuring amid revenue drop

posted Saturday Aug 15, 2020 by Scott Ertz

Mozilla announces layoffs and restructuring amid revenue drop

In decades past, the browser wars were a major part of the technology world. Everyone and their mother was making a web browser, and everyone wanted to be in charge. What a lot of the developers learned was that offering a software product that was a lot of work to make for free was not a great way to generate revenue. Today, the browser wars are mostly settled, with Google, Microsoft, and Mozilla being the last major players. While Google and Microsoft use the revenue from other divisions to keep their browsers aloft, Mozilla has little else going on. This week, that business model bit them and their employees.

Mozilla Corporation, the for-profit division of the Mozilla Foundation, which makes Firefox, announced that it will be laying off 250 employees. This represents a quarter of the global workforce of the company. The employees being let go are said to be receiving a severance package that equates to full pay through the end of the year.

The layoffs come as revenue has begun to slip for the company. The majority of Mozilla's revenue comes from contracts with search engines to integrate into the browser in different regions. Some of those contracts are expiring before the end of 2020, which could explain why the move is happening now, in preparation. The browser's shrinking market share is also leading to lower revenue against the performance bonuses.

This is the second round of layoffs in 2020. The first, which only represented 70 employees in January, gave some additional insight into what is happening within the company. Mozilla has been working on other products in an attempt to generate more regular revenue, such as the VPN service subscription. Unfortunately, the company underestimated the amount of time it would take to develop, test, and deploy these new products.

Because of the increased development costs and declining revenue, layoffs were inevitable. But a restructure was also inevitable. The company has said that it will halt development in its Developer Tools, internal tools, and more, in order to put focus back on developing new products and Firefox, which has suffered in recent months.

An Epic legal battle is coming to a mobile App Store near you

posted Saturday Aug 15, 2020 by Scott Ertz

An Epic legal battle is coming to a mobile App Store near you

Over the past few weeks, a storm has been brewing over the way the two mobile app stores treat their developers and their platforms. The biggest offender has been Apple, whose App Store is a closed ecosystem with a set of very strict rules that are expensive for app publishers. They have even barred Google Stadia and Xbox Game Streaming from their platform entirely. Among those rules is that if you offer anything for purchase in the app that is usable in that app, you must process your payment through Apple's system, which includes a 30% fee to use the system. Google has a similar rule, but it only applies if you distribute Google Play and use any Google Play Services.

One of the companies that has been loudest about its dislike of the rules has been Epic Games. When they launched Fortnite on Android, they bypassed Google Play and Google Play Services. This allowed them to do as they wished with the game, including avoiding the heavy fee for V-Bucks, the in-game currency. Eventually, the company gave in and published through the store for the convenience of gamers, which meant implementing Google Play Services. They also brought the game to iOS, all with the same result.

This week, Epic Games introduced the ability to purchase V-Bucks directly from Epic in both the App Store and Google Play variants of Fortnite, including offering a discount for using that option instead of the store payment. Within a few hours, Apple pulled the game from the App Store over policy violations. Apple replied to the move saying,

As a result their Fortnite app has been removed from the store. Epic enabled a feature in its app which was not reviewed or approved by Apple, and they did so with the express intent of violating the App Store guidelines regarding in-app payments that apply to every developer who sells digital goods or services.

This is exactly what Epic was hoping for, however, as they had a lawsuit locked and loaded, which was filed nearly immediately. The suit alleges that Apple has used its position in the market to extort developers out of money. Shortly after the Apple lawsuit was filed, Google pulled the game from Google Play. Google said,

While Fortnite remains available on Android, we can no longer make it available on Play because it violates our policies. However, we welcome the opportunity to continue our discussions with Epic and bring Fortnite back to Google Play.

A nearly identical suit was then filed against Google, with similar claims about the overreach of the company and its policies. Epic said of Gooogle,

In 1998, Google was founded as an exciting young company with a unique motto: "Don't Be Evil." Twenty-two years later, Google has relegated its motto to nearly an afterthought, and is using its size to do evil upon competitors, innovators, customers, and users in a slew of markets it has grown to monopolize.

This suit is inline with other antitrust suits against Apple and Google. The EU has been investigating both companies, and both CEOs have recently had to answer to the US Congress over their business practices. It could be a landmark case, truly bringing the behavior of these large companies intothe light of the law.

Uber and Lyft might shut down in California after court loss

posted Friday Aug 14, 2020 by Scott Ertz

Uber and Lyft might shut down in California after court loss

In September of 2019, California passed a law requiring changes to the operations of gig economy companies, specifically Uber and Lyft. The ultimate goal of the law was to force these companies to treat their contractors as employees. The end result would be a change in the entire way these companies work and the way that their contractors work. Despite the major change in the companies' business models, Uber and Lyft made changes in an attempt to come into compliance with Assembly Bill 5.

On Monday, San Francisco Superior Court Judge Ethan Schulman ruled that the companies had violated Assembly Bill 5, even with the changes that were made. He also placed a deadline of August 20, 2020, for the companies to appeal the ruling, which is also the deadline for the companies to come into compliance. He later rules that there was no reason to extend his initial August 20, 2020 deadline.

In addition to working on an appeal, the companies have also stated that, if the rules are enforced, they will likely need to suspend operations in the state. That suspension would be in place until the residents of California get a chance to vote on Proposition 22 in November, which would override the Assembly Bill 5. This proposition would allow gig companies, such as Uber and Lyft, to maintain the contractor designation while adding some benefits. If Prop 22 is voted down, it could be the end of the gig economy in California.

This case could potentially decide the future of the gig economy. If California charges ahead with the demands, these companies will have to decide whether to change the fundamental structure of their businesses, or shut down operations in areas with these rules. We could see a similar exit to Google News leaving Spain over laws specifically targeting them. For Lyft, this would represent about 16% of the total rides.

Quibi is experimenting with a new, free ad-supported subscription

posted Sunday Aug 9, 2020 by Scott Ertz

Quibi is experimenting with a new, free ad-supported subscription

Quibi is far from the darling of the streaming video industry. In fact, the company was confusing even before its launch. The professionally-produced short-form content concept didn't make a lot of sense to most of the industry, but T-Mobile saw the potential. While there were a lot of initial signups, the company struggled to convert trials to paid memberships. It could be that people weren't interested in paying $5 per month to watch maybe one or two interesting shows (Reno 911!, anyone?).

Taking a page out of Peacock's equally confusing launch, adding a new ad-supported free tier in some markets. Quibi's "standout" feature is its short-form content. Essentially, the content is designed to be consumed easily and conveniently between other activities, or while waiting on something else to begin. But, unlike watching someone do something stupid on TikTok, this content is professionally produced, scripted content.

Other content services that offer short-form video tend to be ad-supported. Think of things like Facebook Watch, YouTube, TikTok, etc. None of them charge a monthly fee, so people are used to their "wasting time" content being free and ad-supported. By bringing that feature to Quibi, it is likely that their active user count and viewer time will increase.

The big disappointment is that they do not seem to have implemented this new pricing tier in all markets. So far, it looks like it might just be an experiment in Australia and New Zealand. Hopefully, though, we will see this tier expand to more markets in the future. Until then, if you are outside of those two countries, you're going to have to either get your viewing done in the 14-day trial or cough up the $5 per month for the full experience.

Would an ad-supported tier convince you to spend time on Quibi? Let us know in the comments.

Google+ lawsuit settled and you might be owed a little money

posted Sunday Aug 9, 2020 by Scott Ertz

Google+ lawsuit settled and you might be owed a little money

In the crowded field of social media, one brand we did not expect to be talking about in 2020 is Google+. The service ran from 2012 until 2019 when Google shut it down following poor consumer reception and, acting as the final nail in the coffin, was a revealed data breach. Because of that breach, a small number of affected users came together to file a class-action suit against Google, a move that was almost inevitable. While the case has gone on for the past year, a settlement has finally been reached.

If you had a Google+ account between January 2, 2015, and April 2, 2019, and entered any private information into your profile, you are entitled to a portion of the class settlement. For your troubles, your piece of the pie will be a whopping $12. To add insult to injury, the $12 is only available once per person, regardless of how many Google+ account you might have had during that period. To file your claim, you can head to the class action claim page.

The suit and subsequent settlement were focused on the issues with Google's API. Profiles had the ability to list public and private information, however the API's security was not setup to support that security profile. The API exposed the private information through a public endpoint, which allowed anyone to retrieve that information, no matter the user's settings. The issues existed for several years, but was not revealed to users until just before the announcement of the service's termination.

What added difficulties to Google's reputation, and likely their court case, was the forced integration of Google+ into other services. Google tried to force people to use Google+ by using it as the commenting system for YouTube, terminating Google Photos and moving it into Google+, and more. This meant that the number of people with a Google+ profile was even higher than it would have been, entirely because of Google's heavy hand.

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