The UpStream (Page 40)

Apple and Ireland to fight European Union control over taxes

posted Saturday Aug 17, 2019 by Scott Ertz

Apple and Ireland to fight European Union control over taxes

In 2016, the European Union decided that Ireland had not charged Apple enough in taxes, and demanded that Ireland collect an additional 13 billion euro (or roughly $14.4 billion) in "back taxes." This would be far from the first time a company, especially a tech company, was accused of avoiding taxes. For example, Bernie Sanders believes that Amazon has skirted tax law in the United States. However, this might be the first time that the country in question believes that the company paid what they were supposed to.

In this case, Ireland is on Apple's side, not the side of the EU. In fact, the Irish government will be heading to court with Apple to argue against the EU's imposed penalties over Apple paying exactly what the country asked them to pay. The EU has essentially argued that Apple has an unfair advantage in Ireland, where the company houses its European headquarters.

Publicly, the issue revolves around how Apple reports profits. Since the company's European headquarters are in Ireland, they report the profit from their various divisions within Europe through their corporate office. This allows them to pay 3.8 percent on their European profits. However, the EU believes that the amount collected should be reflective of the countries in which the company operates, including design and manufacturing.

In 2016, the Obama administration claimed that the EU was trying to help itself to cash that rightly belongs within the United States' economy. Many in Silicon Valley have argued that it is just one example of many of the jealousy of the EU over constantly losing out on the highly profitable tech market, and trying to rig EU regulations against US companies. This argument has been made many times, often referencing the "Google Tax", which has already claimed services in Europe, like Google News.

YouTube has different rules for the platform's biggest stars

posted Friday Aug 9, 2019 by Scott Ertz

YouTube has different rules for the platform's biggest stars

Over the last year, there has been a lot of discussion about YouTube and, in particular, the way their Community Guidelines are implemented and enforced. The company has changed its public rules to define what is true, as well as demonetizing videos that don't fit into a particular political or social view. The problem is that, while the rules are usually written clearly, the enforcement is not.

It often seems that the majority of content creators are bound to the published Community Guidelines, the bigger creators are not. The biggest example of inconsistent policy enforcement for big-name content creators has been Logan Paul. Early last year, Paul posed with and seemed to mock a dead body that he found in a forest in Japan, known for suicides, in a video posted to YouTube. The company took two full weeks to respond to the incident, removing him from the Preferred partner program. Afterward, YouTube released new policies and procedures, theoretically preventing the problem in the future. When Paul tazed a rat in another video a few weeks later, the company ignored the policies and removing monetization for 2 weeks, essentially a slap on the wrist.

It has long been believed that YouTube turns a blind eye to what the big creators do until criticism no longer allows them to pretend they didn't know. According to The Washington Post, who interviewed current and former content moderators for YouTube, this is exactly what happens. One former moderator told the Post,

Our responsibility was never to the creators or to the users. It was to the advertisers.

That should be a surprise to no one. YouTube is owned by Google, which is an advertising company through and through. Everything they do is intended to increase eyeballs and advertising returns. If a content creator creates popular videos, they will attract more advertising dollars, even if they push the boundaries.

Instagram facing some of the same privacy issues as parent Facebook

posted Friday Aug 9, 2019 by Scott Ertz

Instagram facing some of the same privacy issues as parent Facebook

Facebook has definitely become the face of the online privacy debates in the past few years. The biggest issue for the company came about with Cambridge Analytica, a company that accessed the Facebook API and gathered and stored information on users who had used the company's apps. Essentially, this was done by promoting the "which character from *random 90s show* are you" type "games" which ask for permission to access certain profile data. From there, the company stored that information and used it for advertising purposes. While this is a massive breach of both user privacy and Facebook data policies, Facebook didn't act on knowledge of the behavior until it became public. Cambridge Analytica is far from the only data breach at Facebook, however.

Now, Facebook-owned Instagram is beginning to see similar issues with companies accessing the brand's API, as well as scraping data from the app and website. Hyp3r, which markets itself as "the award winning location-based marketing platform" was banned from Instagram this week for violating Instagram's data collection and storage policies. In particular, the company scraped data from profiles and posts to identify user locations, which fed its marketing platform. Hyp3r CEO Carlos Garcia told Business Insider,

Hyp3r is, and has always been, a company that enables authentic, delightful marketing that is compliant with consumer privacy regulations and social network Terms of Services. We do not view any content or information that cannot be accessed publicly by everyone online.

The problem with that argument is that, even though data is being made publicly viewable, does not mean that the data is legally permitted to be scraped or stored by third-parties. Instagram does not generally allow any external storage of user data, no matter how it is obtained. According to an Instagram spokesperson,

Hyp3r's actions were not sanctioned and violate our policies. As a result, we've removed them from our platform. We've also made a product change that should help prevent other companies from scraping public location pages in this way.

The change mentioned is small but significant. Hyp3r had gotten a lot of their data from Instagram's Locations page, which shows photos from public user profiles that are tagged to a location. Previously, this page was available to everyone, but now it will require a user to be logged into their Instagram account to access the data. This should allow the company to monitor who is pulling large amounts of location data and take action.

Loot box odds to be made public by 2020 thanks to self-regulation

posted Friday Aug 9, 2019 by Scott Ertz

Loot box odds to be made public by 2020 thanks to self-regulation

Loot boxes have long been an annoyance of videogames, especially when you pay for the box. When you spend your $5, will you get three $1 skins, or will you get a $25 weapon? There is never any telling, and it has caused a lot of trouble. There is no better example than Star Wars: Battlefront II, the game synonymous with the problem. Gamers were not happy with the almost requirement of purchasing boxes with no idea of what they would be buying. EA eventually killed the feature, but not before taking a huge hit in sales.

Since then, governments the world over, including the US Federal Trade Commission have investigated the legality of the practice. With unknown chances, the governments maintain that the practice amounts to gambling, which is illegal outside of designated areas in most countries. As with most government activities, these inquiries have been slow going, and will likely not amount to much. However, the gaming industry has always been great at regulating itself, thanks to the ESA, most famous for the game rating program.

This week, at an event, called "Inside the Game," Michael Warnecke, the chief counsel of tech policy for the ESA announced that Microsoft, Nintendo, and Sony had worked together to require loot box odds disclosure on future games.

I'm pleased to announce this morning that Microsoft, Nintendo, and Sony have indicated to ESA a commitment to new platform policies concerning the use of paid loot boxes in games that are developed for their platform. Specifically, this would apply to new games and game updates that add loot box features. And it would require the disclosure of the relative rarity or probabilities of obtaining randomized virtual items in games that are available on their platforms.

This will not apply to games that are out in the wild already, as some of those games would be outside of their update period. However, it will apply to all new games released on the big three platforms, as well as any existing games that add loot boxes after the rules go into effect. The exact timeline for implementation is unknown, but it will be completed by the end of 2020.

This comes as other members of the industry have been abandoning paid loot boxes entirely. Fortnite is phasing out the concept now, as will Rocket League, which was recently acquired by Fortnite developer Epic. This is definitely the direction that most gamers would prefer, and these changes from such a large publisher are a move in the right direction.

Samsung and Microsoft make Android and Windows better friends

posted Friday Aug 9, 2019 by Scott Ertz

Samsung and Microsoft make Android and Windows better friends

This week, Samsung finally announced the highly leaked Note 10 smartphones, the newest member of the popular phablet line. While the Note 10 brings many new enhancements, the biggest news (for us) was the enhanced relationship between Samsung and Microsoft. For years the two have worked together, with Microsoft edition Galaxy phones being made available with Microsoft apps pre-installed. Now, the two have come together even closer to bring some expanded capabilities between the phones and Windows 10.

The Your Phone app on Windows 10 is nice, it can bring notifications, text messages, and even photos from your Android device to your desktop or laptop with ease. Now, starting with the Note 10, you'll be able to do a host of exciting new capabilities. For example, Your Phone will interact with Samsung's DeX, bringing screen mirroring directly to the app. This means no more third party software or questionable downloads, it will be built right into your devices. This also means that DeX will be front and center, allowing you to use the desktop features of the phone on an existing PC. It also means that Android apps will be easily accessible on your Windows 10 PC, allowing for Snapchat on the PC for the first time (officially).

This is just the beginning, though. In a future update later in the year (likely in conjunction with the semi-annual Windows 10 update), Microsoft plans to bring phone calling to the application. This would allow you to use Your Phone to make and receive calls from your phone on your computer, eliminating the need to have the phone easily accessible.

This is all part of Microsoft's cross-platform access campaign, which seems intended to counter Apple's closed-loop ecosystem. iPhone owners can do many of these things now, but only if they have a Mac. With Mac being a statistically insignificant portion of the computer world, this means that the majority of iPhone users are left in the dark. Apple has always followed the old Sony methodology, hoping that restricting capabilities will drive sales, despite that philosophy almost bankrupting Sony, and hasn't worked for Apple, either. The open nature of Android and the modern Microsoft seems to be driving growth (just look at iPhone sales numbers).

Broadcast networks sue Locast for illegally streaming local channels

posted Friday Aug 2, 2019 by Scott Ertz

Broadcast networks sue Locast for illegally streaming local channels

A few years ago, a unique company popped up, offering the ability to stream live TV over the internet. While that concept is far from novel, Aereo was streaming directly from local TV antennas, giving people access to local programming from markets they were not in. This was really popular for sports fans who lived in different markets, such as our former host who used it to watch Giants games when they were blacked out in Tampa. The company was sued, eventually losing a Supreme Court case, inevitably ending their operations in 2015.

It is unusual for someone to attempt to revive a business model that has been deemed illegal by the highest court in the land, but that is exactly what non-profile Locast has done. The difference is that Locast offers the service for free, assumedly hoping that the lack of charge would prevent the legal challenge that ended Aereo's dreams. That has absolutely not been the case, as the organization has been sued by, well, everyone. A lawsuit filed by ABC, CBS, Fox, and NBC asks that Locast be shutdown and financial damages be awarded. With a Supreme Court case in their favor, it seems likely to go that way. According to the lawsuit,

Locast captures over-the-air broadcast signals, strips critical data from those signals, and then retransmits those signals, and the copyrighted content that they carry, to registered users over the Internet. The catch is, unlike licensed cable, satellite, and streaming services, Locast neither obtains Plaintiffs' permission nor pays for its exploitation of Plaintiffs' exclusive rights to publicly perform their copyrighted content. Instead, Locast simply takes Plaintiffs' copyrighted content and retransmits it to its registered users at will over the Internet.

Local networks receive a lot of money from cable, satellite, and streaming licensing deals. In fact, the amount could have been as high as $10 billion in 2018 alone. A service like Locast undermines that aspect of their business, which is how the brands can afford to continue operations. It is no surprise, however, that the organization in question is financially backed by AT&T, who owns DirecTV. The organization is also founded by Dish Network lobbyist. The non-profit status of the organization gives them some new ground on which to fight, but the resources of the 4 big media companies will make it a challenge. The fact that the organization has such ties to Dish and DirecTV won't help either,

These two for-profit businesses (AT&T and Dish) provide Locast with valuable nationwide distribution of the Locast app on the Internet-connected set-top boxes of their subscribers. At the same time, Locast provides these two major distributors with commercial benefits that include the ability (a) to avoid obtaining retransmission consent from local stations to include local stations in their pay-TV offerings by integrating the Locast app into their customers' set-top boxes; (b) to gain leverage in negotiations with broadcast stations over retransmission consent rights to offer their subscribers access to broadcast channels; and (c) for Dish, to promote a version of its Sling TV Internet television service that does not carry local broadcast channels by telling potential customers that they can "supplement" Sling TV by getting the broadcast channels via Locast. Locast is not the noncommercial, community public service it purports to be. It is a strategic play funded by and functioning for the benefit of decidedly commercial interests.

Those ties will certainly be called into question and the bypass of an official Act of Congress almost certainly will prevent Locast from winning this fight.

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