The UpStream

Changes on the Horizon at HBO, While the DoJ Begins to Challenge the Purchase

posted Saturday Jul 14, 2018 by Scott Ertz

Changes on the Horizon at HBO, While the DoJ Begins to Challenge the Purchase

It was only a month ago that a federal judge rejected a governmental argument that AT&T's purchase of Time Warner would harm the industry. That rejection signaled the end of the fight for AT&T, who wrote their check and began the process of integrating the company into the AT&T business. The biggest immediate change was the name of the company; to prevent confusion with the former cable company, the company was renamed to WarnerMedia.

In addition to the name change, some staffing changes were made. For example, a new head was appointed, who oversees all of WarnerMedia. John Stankey, who has been an executive with AT&T for several years, was moved to the newest member of the company. According to audio obtained by NYT, some big changes are coming to WarnerMedia property HBO.

The biggest problem, according to Stankey, is that viewers are not spending enough hours per day with the network. In the recording, he says,

I want more hours of engagement. Why are more hours of engagement important? Because you get more data and information about a customer that then allows you to do things like monetize through alternate models of advertising as well as subscriptions, which I think is very important to play in tomorrow's world.

Longer engagement likely means more Netflix-style content. Netflix received more Emmy award nominations this year than HBO for the first time in 17 years because of its increased quality and quantity. This is the direction that Stankey would like HBO to follow. This will require one important thing to become a reality: government approval. Yes, the case was dismissed a month ago, which is how we got to this point, but it might not last.

The Department of Justice has filed an appeal, stating that they had met the burden of proof. AT&T's general counsel, David McAtee, is definitely confident in the company's ability to win the appeal, saying,

The court's decision could hardly have been more thorough, fact-based, and well-reasoned. While the losing party in litigation always has the right to appeal if it wishes, we are surprised that the D.O.J. has chosen to do so under these circumstances.

While the government likely doesn't have a chance of winning this case, the point is likely more to show that the Department of Justice is going to be strong against big mergers. This is in stark contrast to quick approval of the Disney-Fox merger, which was completed before the deal was even finalized. In fact, the quick approval was partially responsible for the deal closing in the first place, since Fox didn't feel that the Comcast offer would be approved.

Internet Services Trying to Decide How and When to Censor User Content

posted Saturday Jul 14, 2018 by Scott Ertz

Internet Services Trying to Decide How and When to Censor User Content

Over the past year, one of the big topics on the internet has been about internet censorship. Some people believe that the internet should be a place for the free and open exchange of ideas. Others believe that it is the responsibility of platforms to censor the content that users publish, based on their own version of reality. A surprising percentage of people believe both of these things at once.


Take, for example, Facebook: the platform was intimately involved in trying to prevent the FCC from removing the guidelines known colloquially as "net neutrality." These guidelines restricted companies like Comcast from blocking content on the internet based on the company's interests. For example, if Comcast felt a threat to their corporate culture or corporate interests from HuffPo, which is owned by Verizon, they could block that content.

On the other hand, the company has been very interested in doing the same thing on their own platform. The company has openly suspended pages from conservatives, even closing personal accounts of people who share content that Facebook themselves deems to be "fake news." Overall, however, the company has tried to remain a little farther from the front lines on the topic, often times removing individual posts, but not closing accounts entirely. Their users would prefer that they do more.

This week, the company was thrust into the spotlight over a popular Facebook page, which represents the online publication InfoWars. For those who are unfamiliar, InfoWars is an enigma: their frontman, Alex Jones, is often times a nutjob, while the rest of the site is filled with legitimate journalism. Most people don't remember anything about InfoWars other than gay frogs, however. Facebook has been reluctant to take action against the site, which is annoying users who disagree with the content on the site. Facebook responded, saying,

We see Pages on both the left and the right pumping out what they consider opinion or analysis - but others call fake news. We believe banning these Pages would be contrary to the basic principles of free speech.

It's good that Facebook has not gone completely 1984 on us, though it does seem to be headed in that direction.


Reddit has taken an equally contradictory stance on censoring content on their site. CEO Steve Huffman created a scenario this week in which the only question we can ask is, "What does he actually believe?" Responding to the question, "Why do you admins not just ban hate speech?" Huffman, better known on the platform as spez, said,

spez: Our violent speech policy is effectively that.

whatll: I'd argue that hate speech should be banned with its own rule, separate from the violence policy. But thank you for replying.

spez: Hate speech is difficult to define. There's a reason why it's not really done. Additionally, we are not the thought police. It's not the role of a private company to decide what people can and cannot say.

whatll: But it *is* the role of a private company to decide what people can and cannot say *on {its} own platform*.

spez: I know what you're asking, but it's a nearly impossible precedent to uphold. It's impossible to enforce consistently.

The position that he has taken is that it is a slippery slope. Once you start the process of censoring content, the site becomes more and more responsible for censoring content on the site. That is a reasonable position - he doesn't want to police the ideas of people on the site. That brings us back to the open and free exchange of ideas concept, something that many people believe. However, his actions following the conversation were not quite consistent.

Following the conversation, whatll's account was suspended. So, I guess they don't want to be the thought police, assuming your thoughts agree with the policies of Reddit? While the company has confirmed that the conversation did take place, they only report that the suspension was "for harassment" and nothing more. It's possible that the user was harassing someone somewhere else, though it seems like if someone was going to get upset, it would be over the topic with spez.

It is unlikely that the topic of online censorship will be going anywhere, anytime soon. In fact, it is likely that more companies will be bullied into censoring content the way that YouTube has been. On YouTube, there are tags you cannot use if you want to be monetized. There are certain legal topics you cannot discuss if you want to be monetized. This is not nearly the end, more like the beginning.

Nintendo has Patched New Switch Consoles Against Exploit [Report]

posted Saturday Jul 14, 2018 by Scott Ertz

Nintendo has Patched New Switch Consoles Against Exploit [Report]

Earlier in the year, it was reported that there was a flaw in the Nintendo Switch hardware which made bypassing the system protections fairly easy. These types of issues exist fairly often in modern hardware, as firmware developers reply on the ability to patch too heavily. The issue here is that the flaw was in the Tegra X1 chip provided by NVIDIA, meaning that software alone could not guarentee success in preventing owners from hacking the system.

According to Twitter user @SciresM, however, new batches of Switch units have been pre-patched for one of the known exploits. They are, however, also shipping with version 4.1.0 of the system firmware, which means that the systems are not entirely devoid of known vulnerabilities. In this case, Deja Vu, which is an exploit that was patched in firmware version 5.0. The discrepancy suggests that the chips were patched in the factory before the Fusée Gelée exploit was made public, but before Deja Vu was known.

This is bad news for people who are interested in making the Switch do things that it was never intended to do. Some of these things are innocuous, such as making it run Windows 10. Others, however, are not nearly as above board, such as running system emulators. While emulators are not themselves illegal, they do promote the use of unlicensed software which is illegal. While Nintendo does not particularly care about the first scenario, the second can cause problems.

In addition to running unlicensed software, a hacked Switch could potentially also make it possible for players to cheat in a game. For example, with a game like Splatoon 2, a popular multiplayer game on the platform, a hacked console could automate certain tasks making it easier to win a game. If you are the owner of that particular Switch, that might provide a little fun, it certainly ruins the experience for the other people in the match.

If you want to use the Switch for something that it is not intended for, you might want to get one now.

PC Shipments Increase for the First Time in More Than 5 Years

posted Saturday Jul 14, 2018 by Scott Ertz

PC Shipments Increase for the First Time in More Than 5 Years

It is no secret that PC sales have been on the decline for a while. In fact, it has been nearly 6 years since the industry saw its last increase in sales. That changed this quarter, according to a Gartner report, which shows that the industry saw an uptake in sales. This upward trend was spurred by enterprise spending worldwide, replacing older computers with newer Windows 10 machines. According to Mikako Kitagawa of Gartner,

PC shipment growth in the second quarter of 2018 was driven by demand in the business market, which was offset by declining shipments in the consumer segment. Consumers are using their smartphones for even more daily tasks, such as checking social media, calendaring, banking and shopping, which is reducing the need for a consumer PC.

Overall, the global trend for replacing computers is because of the end of the support cycle for older versions of Windows. This is usually the cause for enterprises, who notoriously avoid modernization because of the overall cost. In a business with thousands of employees, that could mean millions of dollars worth of expense to modernize computers, so the expense is often avoided until the computers are no longer supported by the vendor (traditionally Windows, as Mac has no discernable presence in business due to its low price-to-value proposition).

With support for older versions of Windows coming to an end, this mass purchase was inevitable. After these enterprises finish updating their computer fleets, it is likely that sales will continue to trend down. The overall sales decrease is because of the change in how consumers use electronics. A decade ago, the only way to consume digital content was via a PC. Today, most people do their data consumption via less capable, but more convenient devices. For example, news and social media are mostly consumed via phones and tablets. Netflix and Hulu can be used mobile, but are also incredibly popular on Xbox, PlayStation, Roku and the like.

The drop in PC sales is not an indication of an industry in decline, however. This is because companies like Lenovo, who are best known for their laptops, also produce phones, tablets, and other more specialty devices. Samsung, which is best known for their phones, also produce incredibly specialized devices, including the Harmon Kardon Invoke smart speaker, which is an increasingly popular way to consume streaming music.Kitagawa

Disney Gets Government Approval to Purchase Fox Assets, Comcast Still Fighting

posted Sunday Jul 1, 2018 by Scott Ertz

Disney Gets Government Approval to Purchase Fox Assets, Comcast Still Fighting

What happens when two different companies, both bent on owning everything, bid on the same company? You end up with the epic three-way that is Fox-Disney-Comcast. It all started when Disney bid to purchase Twentieth-Century Fox. Their bid, which was the only one, was $52.4 billion, which seemed like a clear decision for Fox.

Once Disney got involved in this process, Comcast decided that they couldn't let that happen. Owning NBCUniversal wasn't enough for them, so they added a bid for $65 billion; more than 20% more than Disney had bid. Not to be outdone, Disney came back with a new bid for $71.3 billion, raising the bid by 10% over Comcast's and over 30% more than their original bid.

This week, some interesting new moves happened. First, the biggest hurdle in the acquisition attempt was cleared: the Department of Justice approved the merger, though it's not going to sound like it. The DOJ filed a lawsuit to block the purchase unless certain conditions are met. The only real requirement the government has for Disney is that they divest their newfound interest in the former Fox regional sports networks. According to DOJ antitrust chief Makan Delrahim,

American consumers have benefitted from head-to-head competition between Disney and Fox's cable sports programming that ultimately has prevented cable television subscription prices from rising even higher. Today's settlement will ensure that sports programming competition is preserved in the local markets where Disney and Fox compete for cable and satellite distribution.

With this approval, Fox has reason to reject any future bids from Comcast, which is something the company wants to do. They believe that there is little to no chance that the government will approve the purchase if they go with Comcast because Comcast already owns a lot of content production. Owning the pipes and the content is something that scares a lot of people, and getting that approval would be a lot harder than the already acquired Disney approval. So, it appears likely that Disney will be the new owner of the Twentieth-Century Fox assets very quickly.

Conflicting Internet Regulations Could Kill Technological Innovation

posted Sunday Jul 1, 2018 by Scott Ertz

Conflicting Internet Regulations Could Kill Technological Innovation

2018 might just be the year of bad internet regulations being passed globally. A little over a month ago we had the implementation of GDPR, which requires that a citizen of the European Union can request that a company delete all personal data they have collected about that person. Conceptually, the law makes sense: you may not want a company like Facebook to know everything that you have ever done. And when you delete your account, you would like to know that it is actually gone.

Now we have new laws coming around that are going to implement different sets of regulations on internet traffic and usage. For example, California has passed what is being called CCPA, which is essentially California's version of GDPR. The law was rushed and never fully considered because it was a knee-jerk reaction to the Cambridge Analytica issue from earlier in the year. The law will certainly not be the last of its kind in the US and is a sign of a problem.

California is proof that not thinking about a law can cause drama, but the EU continues to prove that even long consideration can produce garbage. Between GDPR and their newest legal disaster, they show a complete misunderstanding about how the internet works. Even worse, they, along with California, are producing an environment in which technological innovation is going to come to a screeching halt.

GDPR had the unfortunate side effect of essentially making blockchain, which is designed to prevent centralization, a liability. Once you store profile information in a block, it is there. You can make adjustments, but you can never remove content from the ledger, or it will never validate. That means that whole parts of blockchain usage is officially illegal in the EU. However, the new law is about to make memes illegal. If you use any piece of content that is copyrighted, a platform will be required to autonomously remove it. So, no more Rick & Morty memes about a long day at work.

In addition, the wording of the law could also try to implement a link tax. This concept has been tried and failed spectacularly in the past because implementing it is impossible. Imaging the government trying to charge Facebook because you shared this article on the platform. Neither Facebook nor PLuGHiTz Live had anything to do with your actions, but both of us have to be involved now. Pure insanity.

If these types of laws continue to pop up around the world, we will see one of two results. Either we will see companies implementing different rules for each global area, which means only big companies with large legal departments, will be able to compete, or we will see companies block these regions entirely. We've seen the latter happen before when Google News pulled out of Spain for a similar type of link tax. I fear that we will see a result somewhere down the middle, where fewer startups will be able to succeed and the big companies will punish the EU in particular for their laws.

We're live now - Join us!



Forgot password? Recover here.
Not a member? Register now.
Blog Meets Brand Stats