Tag: mobile technology

Why Montana’s TikTok ban may not work | CNN Business

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CNN
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Montana has become the first US state to ban TikTok on all devices, even personal ones, triggering renewed doubts about the short-form video app’s future in the country.

On Wednesday, the state’s governor, Greg Gianforte, signed a bill into law that would fine TikTok and online app stores for making the service available to state residents. It takes effect next year.

The move goes a step beyond other states that have restricted TikTok from government devices. It also comes at a time when some federal lawmakers are pushing for a nationwide ban.

But legal and technology experts say there are huge hurdles for Montana, or any state, to enforce such a law. The TikTok ban immediately prompted one lawsuit from TikTok users who allege it violates their First Amendment rights, with more legal challenges expected. Even if the law is allowed to stand, the practicalities of the internet may make it impossible to keep TikTok out of the hands of users.

Montana’s new law, SB419, makes it illegal for TikTok and app marketplaces to offer the TikTok service within state lines.

Passed in April, the bill establishes fines of $10,000 per violation per day, where a single violation is defined as “each time that a user accesses TikTok, is offered the ability to access TikTok, or is offered the ability to download TikTok.”

Individual users themselves would not be on the hook just for accessing TikTok, according to the law.

If the law survives in the courts, TikTok, and companies such as Apple and Google, could be forced to find ways to restrict TikTok from Montana smartphone users — or face huge penalties.

But that’s a big if.

TikTok and other civil society groups warn that the law as written is unconstitutional. There are two main arguments TikTok’s defenders have cited.

One is that the law violates the First Amendment rights of Montanans, by restricting their ability to access legal speech and by infringing on their own rights to free expression through the app.

On Thursday, the American Civil Liberties Union accused Gianforte and the state legislature of having “trampled on the free speech of hundreds of thousands of Montanans who use the app to express themselves, gather information, and run their small business in the name of anti-Chinese sentiment.”

A group of TikTok users echoed that complaint in a lawsuit filed Wednesday evening in the US District Court for the District of Montana, hours after the governor’s signature. “Montana can no more ban its residents from viewing or posting to TikTok than it could ban the Wall Street Journal because of who owns it or the ideas it publishes,” according to the complaint.

Another allegation is that the law represents an unconstitutional “bill of attainder,” or a law that penalizes somebody absent due process.

NetChoice, an industry trade group that counts TikTok as a member, said the bill “ignores the U.S. Constitution.”

“The government may not block our ability to access constitutionally protected speech – whether it is in a newspaper, on a website or via an app,” said Carl Szabo, NetChoice’s general counsel.

A spokesperson for Gianforte didn’t immediately respond to a request for comment.

Even if the law survives a legal challenge, experts say its breadth could make it difficult to effectively implement and enforce.

For one thing, app stores such as Apple’s operate on a country-by-country basis and aren’t able to filter apps at the state level, multiple experts have said.

As a result, there would be no way for companies such as Apple and Google to practically comply with the law, TechNet, a trade organization that counts those companies as members, told Montana lawmakers at a hearing in March.

“App stores,” a TechNet witness said at the hearing, “do not have the ability to geofence on a state-by-state basis. It would thus be impossible for our members to prevent the app from being downloaded specifically in the state of Montana.”

The open-ended nature of the law means enormous unbounded liabilities for TikTok and app store operators.

“What this really does is create a huge potential liability for both TikTok and the mobile app stores,” said Nicholas Garcia, policy counsel at the consumer advocacy group Public Knowledge. “And what it requires them to do is to figure it out, under threat of Montana coming in and saying, ‘You have not been complying with the law.’”

It’s unclear how, exactly, Montana officials might determine noncompliance.

One sure-fire way would be for Montana officials to attempt to download or access TikTok themselves on devices they control, and if they are successful, to sue TikTok or app store companies for those violations, said Alan Rozenshtein, an associate law professor at the University of Minnesota. But that would not identify violations occurring on devices used by the wider public, which is the entire point of the ban, he added.

“That would require Montana to do surveillance of its own citizens of who’s downloading, and how,” Rozenshtein said. Alternatively, he added, Montana could try to obtain court orders compelling the companies to hand over business information — such as billing data or other non-content information related to users — that could identify them as Montana residents.

Authorities could also try to subpoena TikTok or the app stores for information on users who have accessed or downloaded TikTok from within the state, but those requests wouldn’t capture the many people who would likely circumvent the ban using more sophisticated methods.

Virtual private networking (VPN) services would make it trivial for users to get around the restrictions, according to Evan Greer, director of Fight for the Future, a consumer advocacy group. A VPN could make a user in Montana appear as if they are connected to the internet from outside state lines.

“Any teenage anime fan or British TV aficionado can tell you how to circumvent such a silly ban using a VPN,” said Greer.

Officials could potentially try to expand their dragnet by asking companies to use additional data they possess on their users to make inferences about who may be accessing TikTok. But depending on the scope of such a request, it could trigger legal objections and privacy concerns — if the additional data is even available.

Asking internet providers to implement statewide network filters might be another way to enforce the law, said Garcia. But internet providers are not named as a type of entity subject to the TikTok ban.

“So the only reason they would get involved would be if TikTok or Apple and Google wanted them to,” Garcia said, “and made some business case for why they should go through that effort on a contractual basis or something.”

Still, said Rozenshtein, just because the Montana law is silent on internet providers does not preclude Montana from potentially seeking a court order forcing broadband companies to filter TikTok traffic at the network level.

As with the dozens of other states that have imposed some level of TikTok restrictions, Montana’s government has cited the app as a potential privacy and security risk.

US officials worry that TikTok’s links to China through its parent company, ByteDance, might result in American’s personal information leaking to the Chinese government. That could help China with spying or disinformation campaigns against the United States, according to authorities.

So far, though, the risk appears to be hypothetical: There is no public evidence to suggest that the Chinese government has actually accessed TikTok’s US user data. And TikTok isn’t the only company that collects large amounts of data, or that might be an attractive target for Chinese espionage.

TikTok has said it is executing on a plan to store US user data on cloud servers owned by the US tech giant Oracle, and that when the initiative is complete, access to the data will be overseen by US employees.

More than half of US states have announced some restrictions on TikTok affecting the app on government devices. Montana’s ban marks the beginning of a new phase, however — and the widely expected legal challenges may determine whether other states soon follow suit.

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April 12, 2021
Meta could become even more dominant in social media with Threads | CNN Business

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Washington
CNN
—

In less than 48 hours, Meta’s Twitter rival Threads has surpassed 70 million sign-ups, upended the social media landscape and appears to have rattled Twitter enough that it is now threatening legal action against Meta.

But even as users signed up for Threads in droves, with some clearly eager to flee the chaos of Elon Musk’s Twitter, the sudden success of Meta’s app could raise a new set of concerns.

Meta has long been criticized for its market dominance, and for allegedly trying to choke off competition by copying and killing rival applications. Now, some competition experts and even some Threads users worry that if the new app’s traction continues, it may simply lead to the accumulation of even more power and dominance for Meta and its CEO Mark Zuckerberg.

“The prospect of total monopoly by Meta, yikes,” wrote one user. “It’s a real problem for society when a few dozen people and companies own every single thing so that no alternative paradigms can exist that they don’t co-opt from the cradle,” replied another.

Twitter had always been much smaller than Meta’s platforms, but it had an outsized influence in tech, media and politics. As Twitter faltered under Musk, though, a cottage industry emerged of smaller apps trying to capture some of its magic. Now more than any of them, Meta seems best positioned to claim the crown.

Threads’ blockbuster launch this week highlights the uncomfortable reality of the modern digital economy: To potentially beat some of the biggest players in the industry, you might have to be a giant yourself.

The overnight success of Threads is a testament both to the dissatisfaction with Musk’s ownership of Twitter and to the unique power and reach of one of Meta’s most important properties: Instagram.

Instagram has more than two billion users, far more than the 238 million users Twitter reported having in the months before Musk took over. When new users sign up for Threads, which they do using an Instagram account, the app prompts them to follow all of their existing Instagram contacts with a single tap. It’s optional, but is easy to accept, and it takes a conscious decision to decline.

By promoting Threads through Instagram, and by sharing Instagram user data with Threads to let people instantly recreate their social networks, Meta has significantly greased the onboarding process. That frictionless experience has allowed Threads to leapfrog what’s known in the industry as the “cold start” problem, in which a new platform struggles to gain new users because there are no other users there to attract them.

Thanks to the Instagram integration, “that biggest problem, the chicken-egg problem, has been solved from the jump,” Reddit co-founder and venture investor Alexis Ohanian said in a video Thursday (posted, naturally, on Threads).

That Threads appeared to clear that hurdle easily, Ohanian said, makes him “bullish” on the new app.

But that same innovation that made signing up so many users so quickly may raise competition concerns, particularly in Europe where new antitrust rules for digital platforms are set to go into effect in a matter of months.

“From a competition perspective this can be problematic because Meta can use it to leverage its market power and raise barriers to entry, as other rivals would not have the customer base Meta has via Instagram,” said Agustin Reyna, director of legal and economic affairs at the Brussels-based consumer advocacy organization BEUC.

Under the EU’s Digital Markets Act (DMA), “digital gatekeepers” — a term that’s expected to cover Meta and/or its subsidiaries — will be prohibited from combining a user’s data from multiple platforms without consent, Reyna said. Another restriction forbids requiring users to sign up for one platform as a condition of using another.

Instagram CEO Adam Mosseri appeared to acknowledge those issues this week in an interview with The Verge. Threads won’t be launching in the EU for now, he said, because of “complexities with complying with some of the laws coming into effect next year” — a statement The Verge suggested was a reference to the DMA.

The DMA was passed specifically to deal with the antitrust concerns raised by large tech platforms. That Threads apparently cannot (yet) comply with rules designed to protect competition underscores uncertainty about the app’s potential competitive impact.

Meta’s approach to Threads could also revive longstanding criticisms about the company’s alleged practice of copying and killing rivals, particularly as Twitter has warned Meta it may sue over claims of trade secret theft (an allegation Meta denies).

The issue isn’t limited to the realm of social media. As the world races to develop artificial intelligence, Threads represents a huge new opportunity for Meta to gather training data for its own AI technology, in a way that could help it catch up to industry leaders such as OpenAI and Google. That could complicate any attempt at a comprehensive analysis of what Threads means for competition in tech.

Part of what makes the debate so complicated is Threads’ seemingly very real threat to Twitter.

If Threads puts pressure on Twitter to improve its service, that is a form of competition between apps, said Geoffrey Manne, founder of the Portland, Oregon-based International Center for Law and Economics.

But, he added, if it leads to a concentration of power in the social media industry more broadly, it could mean a reduction in competition overall. It all depends on how you define the market.

“I’m inclined to say it does both simultaneously, and the ultimate consequences aren’t so clear,” Manne said.

Rather than viewing it through the lens of a social media market, one helpful way to look at the issue is from the perspective of the advertising market, he said. It’s possible that once Threads introduces advertising — which Zuckerberg has said won’t happen until the app has increased to significant scale — Threads simply reinforces Meta’s advertising market power, Manne said. That could lead to further antitrust scrutiny for Meta even if the question about competition in social media is ambiguous.

Jeff Blattner, a former DOJ antitrust official, said it can only benefit consumers to have Threads as a rival to Twitter.

“Two platforms run by maniac billionaires are better than one,” he wrote on Threads — though if Threads is so successful as to effectively knock out Twitter altogether, then in some ways the original question about Meta’s dominance will still stand.

Threads has one thing going for it that may nip any competition concerns in the bud: A commitment to integrate with the same open protocols used by other distributed social media alternatives, such as Mastodon.

That would give users the option to migrate their accounts, along with all their follower data intact, to a rival like Mastodon that isn’t controlled by Meta.

While that interoperability isn’t available yet, Mosseri has repeatedly highlighted it as a priority on his to-do list.

When and if it happens, that could be a significant step. What may appear now as an audience grab by Meta could someday wind up being how millions of people were onboarded to a massive, decentralized social networking infrastructure that is not controlled by any single company, individual or organization.

“This is why we think interoperability requirements are so important,” said Charlotte Slaiman, a competition expert at the Washington-based consumer group Public Knowledge. If users could port their entire social graph from one rival to another whenever they wanted, she said, “we could have more fair competition based on the quality of the product, not just incumbency advantage.”

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April 12, 2021
TikTok is owned by a Chinese company. So why doesn’t it exist there? | CNN Business

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Beijing
CNN
—

TikTok is fighting to stay alive in the United States as pressure builds in Washington to ban the app if its Chinese owners don’t sell the company.

But the wildly popular platform, developed with homegrown Chinese technology, isn’t accessible in China. In fact, it’s never existed there. Instead, there’s a different version of TikTok — a sister app called Douyin.

Both are owned by Beijing-based parent company ByteDance, but Douyin launched before TikTok and became a viral sensation in China. Its powerful algorithm became the foundation for TikTok and is key to its global success.

But the two platforms, similar on the surface, play by starkly different rules.

Here’s what you need to know about Douyin and ByteDance:

Douyin has a whopping 600 million users a day. Like TikTok, it’s a short-form video app.

Launched in 2016, Douyin was the major money spinner for ByteDance years before TikTok, raking in revenue through in-app tipping and livestreaming.

ByteDance was founded by Zhang Yiming, a former Microsoft employee, and first became known for its news app Jinri Toutiao or “Today’s Headlines,” which debuted in 2012 soon after the company was founded.

Toutiao created customized news feeds for each user. People quickly got hooked, with users averaging more than 70 minutes a day on the platform.

ByteDance applied a similar formula to Douyin.

Then in 2017, the privately-owned tech company bought a US-based video startup and released TikTok as the overseas version of Douyin. It also bought popular lip syncing app musical.ly, and moved those users onto TikTok in 2018.

The app’s popularity has since gone global. In 2021, TikTok reached more than 1 billion monthly active users around the world.

The TikTok and Douyin interfaces look similar, but when users turn on their cameras, one difference becomes clear: Douyin has an automatic beauty filter, which smooths out skin and often changes the shape of a person’s face.

Women in China have long faced huge pressure to conform to beauty standards that emphasize a slim figure, large eyes, dewy skin and high cheekbones.

There is surging demand for plastic surgery. Between 2014 and 2017, the number of people getting plastic surgery in China more than doubled. Meanwhile, beauty apps compete to create filters that show users more beautiful versions of themselves.

While TikTok also has beauty filters, users can select them when filming. They do not launch automatically.

Another major difference between TikTok and Douyin is China’s massive online shopping market.

Livestreaming sales of products is a multibillion-dollar industry in mainland China, and was given a major boost during the pandemic.

As of June last year, there were more than 460 million livestreaming e-commerce users in mainland China, according to the Academy of China Council for the Promotion of International Trade, a body affiliated with Beijing’s commerce ministry.

Douyin is a major platform for livestreamers, along with Taobao, Alibaba’s

(BABA) eBay-like online marketplace.

I
n-app shopping is made easy: Products and discounts are displayed on-screen during livestreams, with purchases just a swipe or a click away.

China has one of the world’s strictest censorship regimes, and Douyin must follow the rules.

Internet watchdogs crack down regularly on online dissent and block politically sensitive information.

When CNN searched “Tiananmen 1989” in Douyin, nothing came up.

The Tiananmen massacre, in which Chinese troops cracked down brutally on pro-democracy protesters in Beijing, has been wiped from China’s history books. Any discussion of the event is strictly censored and controlled.

When CNN searched the same phrase in TikTok, it yielded many results including videos of users talking about what happened and a brief Wikipedia blurb summarizing the event.

“It’s so interesting to see this contradiction in this one company [ByteDance] with these two faces,” said Duncan Clark, chairman and founder of investment advisory BDA China.

Another key difference: Douyin takes a much stricter line on younger users.

Users under 14 can access only child-safe content and use the app for just 40 minutes a day and. They can’t use the app from 10 p.m. to 6 a.m.

For years, China has tried to curb video game addiction and other unhealthy online habits. It announced a curfew for online gaming for minors in 2019, before outright banning online gaming during weekdays for minors.

Even on most weekends, users under 18 are only allowed to play for three hours.

“There’s been very much a laissez-faire attitude in the US towards content, even content targeting teenagers and vulnerable people,” said Clark. “The Chinese government has been much more leaning into regulation at early stages in the growth of Douyin, particularly protecting younger people.”

TikTok took some similar steps earlier this month, announcing that every user under 18 will soon have their accounts default to a one-hour daily screen time limit, though teenage users will be able to turn off this new default setting.

TikTok is not the only Chinese-owned platform finding viral success in the United States.

Of the top 10 most popular free apps on Apple’s

(AAPL)US app store, four were developed with Chinese technology.

Besides TikTok, there’s also shopping app Temu, fast fashion retailer Shein and video editing app CapCut, which is also owned by ByteDance.

TikTok remains hugely popular in the United States, with more than 150 million monthly users — almost half of the country’s population.

It remains to be seen whether TikTok can convince US lawmakers that it poses no threat — but the showdown in Washington has highlighted larger questions about security and data privacy that could see other apps come under fire.

These apps could be next, said Clark. He said the US needs a “more sophisticated framework for regulating the big tech companies,” given the number of US investors and users on foreign platforms.

“They need to also think about how high they’re gonna raise the bar for Chinese investment in the US, and the consequences of completely excluding four of the top ten apps,” said Clark.

“What’s gonna replace them? And how is that going to play out? And how is that equitable to the investors in those apps versus US players?” he added. “It’s a mess.”

— CNN’s Riley Zhang contributed reporting.

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April 12, 2021
Apple got rich in China. Other Asian markets offer the next ‘golden opportunity’ | CNN Business

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Hong Kong
CNN
—

Apple launched an online store in Vietnam this week, in another nod to the growing importance of emerging markets for the iPhone maker.

The opening on Thursday, which followed the high-profile launch of its first physical shops in India, means consumers in the fast-growing Southeast Asian economy will be able to buy any Apple product directly for the first time.

Markets like Vietnam, India and Indonesia are becoming more important for Apple as its growth in developed markets, including China, slows down, prompting the company to focus on places where it’s traditionally been less active.

For decades, China was central to Apple’s extraordinary ascent to become the most valuable company on Earth, serving as a backbone for both its production and consumption. While the country remains key to Apple’s operations, the tech giant is now hedging its bets.

Apple

(AAPL) CEO Tim Cook has pointed to the company’s prospects in emerging economies, calling them bright spots in the company’s financial results. On an earnings call this month, Cook said he was “particularly pleased” with the performance in these markets during the first three months of the year.

Apple “achieved all-time records in Mexico, Indonesia, the Philippines, Saudi Arabia, Turkey and the UAE, as well as a number of March quarter records, including in Brazil, Malaysia and India,” he told analysts.

That came as the California-based giant also reported its second straight drop in overall quarterly revenue, prompting concerns about a broader slowdown in demand amid economic uncertainty.

“Clearly, growth has slowed globally and thus put more pressure [on Apple] to aggressively go after emerging markets,” said Daniel Ives, managing director of Wedbush Securities.

Ives predicts that “over the coming years, Indonesia, Malaysia and India will comprise a bigger piece of the pie for Apple, given its efforts in these countries.”

The start of online sales in a country usually precedes the launch of brick-and-mortar stores for Apple, he told CNN. This was true of India, for instance, which got its first physical outlets last month and a pledge from Cook to further invest in the country.

Thursday’s launch showed how Apple was “further cementing” its presence in emerging markets, according to Chiew Le Xuan, a research analyst who covers smartphones in Southeast Asia for Canalys.

He said the tech giant had been “actively increasing” its presence in the region in recent months, ramping up its distribution and network of authorized resellers, especially in Malaysia.

Apple has ample room to run in these markets.

Currently, the company only operates its own stores in more developed regional economies, such as Thailand and Singapore, according to Canalys.

Even Indonesia, a vast archipelago that is the world’s sixth-biggest smartphone market, doesn’t have a physical Apple store yet, said Chiew. Apple’s market share there is tiny, at just 1% in 2022, according to Canalys data.

“We’re putting efforts in a number of these markets and really see, particularly given our low share and the dynamics of the demographics … a great opportunity for us,” Cook said during Apple’s results call.

Apple joins a growing list of global businesses that have become bullish on Southeast Asia, where more investment is being poured into manufacturing.

The region’s consumer base also holds promise, with the number of middle-income and affluent households in economies such as Vietnam, Indonesia, and the Philippines projected to grow by around 5% annually through 2030, according to the Boston Consulting Group.

The consultancy has called this group of consumers “the next mega-market.”

The allure of Southeast Asia’s rising middle class “has changed the dynamic in these countries, which previously Apple stayed away from,” according to Ives.

“This is a golden opportunity for Apple,” he said.

For years, premium brands like Apple have have struggled to compete in emerging markets because of the price of their products, choosing instead to rely on local resellers.

iPhones, which cost between $470 and $1,100, are expensive for consumers in less developed Southeast Asian economies, where the bulk of smartphone shipments are priced under $200, according to Chiew.

He said Apple’s absence from places like Cambodia or Vietnam was typically more apparent around the launch of a new iPhone, as buyers from those countries often flew to Singapore or Malaysia to purchase devices and take them back for resale.

This could change in the coming years, particularly as Apple continues to increase its firepower in the region.

Ives predicted that Apple could “further expand its ecosystem and tentacles to emerging markets using its China playbook,” meaning it could try to hook customers through “various pricing strategies and building out from there.”

Once those users have converted to Apple’s operating system, iOS, they tend to stick around and become loyal customers, he added.

This has “been the core part of its success in China that now can be replicated in India, Indonesia, and Vietnam, among others,” said Ives.

But Apple may face hurdles in Southeast Asia, where several countries have placed stringent requirements on foreign businesses, according to Chiew.

For example, at least 35% of the components of electronic goods sold in Indonesia must made locally, a threshold Apple has had to meet by working with partners, he added. Similar rules prevented Apple from setting up shop in India for years until the relaxation of regulations in 2019.

And while consumers are becoming more affluent, the company’s price points are still considered high in many emerging markets, noted Ives. “Growth will be choppy we believe.”

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April 12, 2021
Elon Musk is the gift that keeps on giving to Mark Zuckerberg | CNN Business

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New York
CNN
—

At the start of last year, Meta CEO Mark Zuckerberg was in the hot seat.

Revelations from hundreds of internal company documents, known as the Facebook Papers, had drawn sharp criticism from lawmakers, users and civil society groups in late 2021 and forced company executives to appear before Congress. Zuckerberg’s plan to rebrand Facebook as Meta and pivot to the so-called metaverse was met with broad skepticism. And the company’s core ad business was under significant pressure from privacy changes made by Apple.

But then, the attention of lawmakers, media and the tech world writ large abruptly shifted to another tech billionaire: Elon Musk.

Musk early last year criticized Twitter, then nearly joined its board, then agreed to buy the company before launching a monthslong and ultimately unsuccessful fight to get out of the deal. The saga, which only continued after Musk completed the deal and pushed through numerous controversial changes, often dominated news cycles. In the process, it seemed to make Twitter’s rivals look better managed and draw away critical attention that might otherwise have been focused on other tech giants, including Meta, as they went through painful layoffs and suffered declines on Wall Street.

This week, however, Zuckerberg notched his biggest win from Musk yet. After years of trying and failing to capture Twitter’s audience with copycat features, Zuckerberg is now capitalizing on Twitter’s struggles with a new app called Threads. Meta’s Twitter clone launched this week to unprecedented success, despite Meta’s history of privacy violations and enabling election meddling, not to mention longstanding concerns that the company and Zuckerberg wield too much power over the social media market.

The app’s overnight success was a direct result of the chaos under Musk’s leadership of Twitter since last October. During that time, he has managed to anger many of the platform’s users and advertisers with his erratic statements, mass layoffs and significant changes to Twitter’s policies. While Twitter users have lamented what Musk’s ownership has meant for the platform, it may be the best thing that could have happened for Zuckerberg.

“Musk has done one thing after another to piss off his own user base,” said Herbert Hovenkamp, a professor at the University of Pennsylvania’s Carey Law School.

Some early Threads users even commented on the strange nature of the situation — that they would be eager to join a social network run by one billionaire whose company has faced intense public criticism simply because they were so eager to get away from another.

“It boggles the mind,” one user posted to Threads. “I boycotted Facebook years ago and when I heard about this I joined immediately.”

“Never used [Facebook] nor [Instagram],” another user said, adding that they had to join Instagram for the first time to gain access to Threads. “Last thing I would have EVER expected was to use any platform of Zuckerberg’s.”

And yet, by Friday, Zuckerberg said Threads had reached 70 million user signups — amassing a user base nearly a third of the size of Twitter’s in fewer than two days for a platform that could eventually help knock out one of Facebook’s chief rivals and give a boost to Meta’s struggling ad business.

If Musk is a boon to Zuckerberg’s fortunes, he’s an unlikely one. Zuckerberg and Musk have often been at odds over the years.

In 2018, in the wake of Facebook’s Cambridge Analytica scandal, Musk said he had deleted the Facebook pages for his companies Tesla and SpaceX because the platform “gives me the willies.” And later that year, he also deleted his Instagram account.

More recently, Musk has claimed that Instagram “makes people depressed” and appeared to imply that Meta was complicit in the January 6, 2021, attack on the US Capitol.

Zuckerberg has also thrown jabs at Musk, including after a SpaceX explosion accidentally blew up a satellite that was being used by Facebook, and in a critique of his stance on artificial intelligence during a 2017 Facebook Live broadcast.

But earlier this year, Zuckerberg also complimented Musk’s leadership of Twitter. In a podcast interview last month, Zuckerberg said that “Elon led a push early on to make Twitter a lot leaner … I think that those were generally good changes.”

In some ways, Musk’s moves at Twitter may have given Zuckerberg and Meta — as well as other tech companies — cover to take similar actions without as much criticism. Meta announced it would eliminate more than 20,000 employees over two rounds of layoffs, marking the largest cuts in its history. But Meta came off looking responsible compared to Twitter’s mass layoffs by handling the cuts professionally and providing more robust severance.

After Musk restored the account of former President Donald Trump following a two-year suspension that began after the January 6 attack, Twitter faced criticism from civil society civic? groups who called on advertisers to boycott the platform. But Meta, along with YouTube, followed suit several months later (although those platforms cited their own risk analyses, rather than Musk’s leadership, in explaining their decisions).

The distraction and chaos of Musk’s Twitter takeover could hardly have come at a better time for Zuckerberg and Meta.

The social media giant’s business had a brutal year — posting its first-ever quarterly revenue decline as a public company during the June quarter, and then again in each of the two remaining quarters of the year, as it struggled with a weak online advertising market while pouring billions into its plan for the metaverse. The company lost more than $600 billion in market value during 2022.

Now, the launch of Threads marks a huge new opportunity for Meta and Zuckerberg. Threads could be a way of getting social media users to spend even more time on Meta’s apps, especially as Facebook increasingly struggles with the perception of being a has-been platform that’s less attractive to younger users.

Zuckerberg said on Wednesday that he hopes to eventually have more than one billion users on Threads, far more than the 238 million active users on Twitter prior to Musk’s takeover.

Although there are no ads on the platform yet, Threads could also ultimately supplement Meta’s core advertising business. Instagram head Adam Mosseri, who oversaw the Threads launch, told The Verge in an interview about the new platform this week that, “if we make something that lots of people love and keep using, we will, I’m sure, monetize it” through advertising.

For Musk, losing Twitter users, or having its future growth hamstrung, thanks to Threads, could mean further harm to the $44 billion investment he made to buy the social media platform — and, perhaps more importantly, to his reputation as a genius with a knack for turning around troubled companies.

Musk appears to be trying to push back against Zuckerberg’s turn of fortune. On Wednesday, a lawyer for Musk sent a letter to Meta threatening to sue the company over the rival app, accusing it of trade secret theft through the hiring of former Twitter employees. (Meta denied the charge.)

The Twitter-Threads battle has raised the stakes for another fight: a cage fight that Musk and Zuckerberg have spent the past several weeks planning. Zuckerberg, a regular practitioner of Brazilian jiu jitsu, appears to have the upper hand.

But whether or not the fight ends up going forward, Zuckerberg seems to have already won.

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April 12, 2021
Republican lawmaker calls TikTok ‘an immediate threat’ and calls for app to be banned | CNN Politics

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Washington
CNN
—

Republican Rep. Cathy McMorris Rodgers of Washington said Sunday that TikTok represents “an immediate threat” from China and called for the short-form video app to be banned in the US.

The chairwoman of the House Energy and Commerce Committee said on CNN’s “State of the Union” that Congress should pass a data privacy law and ban TikTok in the US after the company’s CEO Shou Chew testified in front of her committee on Thursday.

McMorris Rodgers said Chew’s testimony “made clear” that TikTok is a threat to the US.

“What the hearing made clear to me was that TikTok should be banned in the United States of America to address the immediate threat and we also need a national data privacy law,” McMorris Rodgers told CNN’s Jake Tapper.

The Republican lawmaker cited TikTok and its parent company, ByteDance, being connected to China as evidence of the national security risk.

While many nations have imposed bans on official government devices out of national security concerns, there is currently no public evidence the Chinese government has spied on people through TikTok.

The company told CNN in a statement, “The best way to address concerns about national security is with the transparent US-based protection of US user data and systems with robust third-party monitoring, vetting and verification, which we are already implementing.”

On Sunday, McMorris Rodgers responded to criticism from TikTok users, many of whom mocked lawmakers for their lack of familiarity with the app and questioned why Congress would spend time regulating social media. She noted the rare bipartisan agreement on the national security risks the app presents.

“I would say there is an immediate threat via TikTok from the Chinese Communist Party. That is the reason that I believe we need to ban TikTok immediately. It is a national security threat,” McMorris Rodgers said. “It united Republicans and Democrats on the committee as to the urgent need for us to take action.”

Democratic Sen. Mark Warner, who chairs the Senate Intelligence Committee, also shared concerns over the app’s connection to China on Sunday.

“At the end of the day, TikTok is owned by a Chinese company, ByteDance, and by Chinese law, that company has to be willing to turn over data to the Communist Party or, one of my bigger fears, we have 150 million Americans on TikTok, average of about 90 minutes a day, and how that channel could be used for propaganda purposes or disinformation by the Communist Party,” Warner said in an interview with CBS News.

McMorris Rodgers also emphasized the need to pass a national data privacy law to restrict all social media platforms from collecting user data, including those based in the US.

“We need to take action whether it’s TikTok, big tech or other data brokers to restrict the amount of data that they’re collecting to begin with,” she said.

This story has been updated with additional information.

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April 12, 2021
‘Too good to be true?’ As Shein and Temu take off, so does the scrutiny | CNN Business

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CNN
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Temu and Shein are taking off in the United States, topping app stores and creating a frenzy with consumers.

But as the two online shopping platforms become hugely popular, they’re also facing questions over a litany of issues, including how they’re able to sell goods at such strikingly low prices, how transparent they are with the public and how much environmental waste their businesses generate.

Some of those questions aren’t unique to the two companies: Longtime fast-fashion producers like Zara or H&M

(HNNMY) have faced similar concerns.

But in recent weeks, Temu and Shein have also faced greater scrutiny over their ties to China, the country where their businesses originated and where they continue to rely on manufacturers.

Shein was started in China, while Temu was launched by a Chinese company that now bills itself as a multinational firm. They are based in Singapore and Boston, respectively.

That may matter little to policymakers. As US-China tensions remain high, American legislators have increased attempts to restrict technology linked in any way to foreign entities.

Earlier this month, a US congressional commission called out Shein and Temu in a report that suggested the companies and others in China were potentially linked to the use of forced labor, exploitation of trade loopholes, product safety hazards or intellectual property theft.

Both firms have enjoyed major success in the United States, noted Nicholas Kaufman, a policy analyst for the US-China Economic and Security Review Commission. This “has encouraged both established Chinese e-commerce platforms and startups to copy their model, posing risks and challenges to US regulations, laws, and principles of market access,” he wrote.

Temu and Shein have racked up tens of millions of US users

Shein: 24.5 millionTemu: 22.8 million
Note: US monthly active users, as of April 19
Source: Sensor Tower, a market intelligence firm

“Like Shein, Temu’s success raises flags about its business practices,” Kaufman added.

Asked about the report, Shein said in a statement that it “takes visibility across our supply chain seriously.”

“For over a decade, we have been providing customers with on-demand and affordable fashion, beauty, and lifestyle products, lawfully and with full respect for the communities we serve,” a spokesperson said.

Temu did not respond to a request for comment.

Temu and Shein have taken the world’s largest retail market — the United States — by storm.

Temu, which runs a marketplace for virtually everything from home goods to apparel to electronics, was launched by PDD Holdings

(PDD) last year. It has quickly become the most downloaded app in the United States, and continues to expand its user base.

PDD was founded in China but recently began billing itself as a Cayman Islands company, citing a new corporate registration there. As of a February regulatory filing, PDD’s head office was in Shanghai. Temu says it doesn’t operate in China.

PDD also owns Pinduoduo, a hugely popular Chinese e-commerce giant that was found in a recent CNN investigation to have the ability to spy on its users.

According to cybersecurity researchers, Pinduoduo can circumvent users’ mobile security to see what they’re doing on other apps, read their messages and even change settings.

While Temu has not been implicated, the allegations about its sister company have invited further scrutiny and were cited in the Congress report on Temu this month. PDD did not respond to CNN’s multiple requests for comment on the investigation.

Shein, which was founded by Chinese entrepreneur Chris Xu, has enjoyed similar success with its app over the last few years. The company initially created a cult following for its fast-fashion apparel and has since branched out into other offerings, such as home goods.

Both companies have gained traction stateside by offering extreme bargains to shoppers, many of whom continue to feel the squeeze from historically high inflation.

A shopper at a Shein pop-up store in New York last October. The company initially created a cult following for its fast-fashion apparel, and has since branched out into other offerings.

“The timing is very advantageous,” said Michael Felice, an associate partner in Kearney’s communications, media and technology practice. “You have extreme pressure on the consumer wallet right now.”

While Temu and Shein may appear similar, they have different business models.

Temu operates as an online store, carrying merchandise from independent sellers. Shein, on the other hand, commissions its own goods through manufacturers it teams up with in what is effectively seen as a supersonic version of fast fashion.

For some consumers, the companies’ low prices have raised eyebrows.

“I think transparency and traceability of product is becoming more important,” said Felice. “When you’re starting to see price points that almost could be too good to be true, you start to ask yourself, ‘Is that too good to be true?’”

Felice also said there was a risk of Temu facing resistance from US consumers as a cross-border business.

“There’s a rising sense of nationalism in markets,” he said. “It will be interesting to see which one wins as the dual pressures of inflation and nationalism take hold on American consumers.”

Lawmakers are also getting more hawkish. While both Temu and Shein have taken steps to separate their businesses from links to China, geopolitical tensions are proving hard to shake off.

Last month, a bipartisan group of US senators introduced legislation that would give the government new powers, including a ban on foreign-linked producers of software.

In a fact sheet distributed by lawmakers, Temu’s surge on US app stores was described as an example of how Chinese consumer technology was becoming more popular.

A screenshot from Temu's commercial unveiled during the Super Bowl in February, encouraging consumers to

“From the history of the companies to where their products come from, it’s very hard to say you’re not related to China,” said Sheng Lu, an associate professor of fashion and apparel studies at the University of Delaware.

Similar to TikTok, which faces the prospect of a US ban, Lu believes that Temu and Shein could face data privacy concerns from regulators.

“They’re large, influential and collect data,” he said. “This can make the companies a potential sensitive topic.”

The fashion industry is responsible for 10% of annual global carbon emissions, more than all international flights and maritime shipping combined, according to the United Nations Environment Programme. Around 85% of clothing ends up in landfills or is burned.

Experts say the problem is even worse with fast fashion, defined as the rapid design and production of cheap and low-quality goods that respond to fleeting trends.

These are “disposable fashion companies,” said Maxine Bédat, founder of the New Standard Institute.

“That’s the crux of what they are. This stuff is not meant to last in your wardrobe,” she added. “Their business wouldn’t function if it did.”

Shein argues that its business model enables it to reduce waste and overproduction by producing small batches and only responding with larger production if demand is shown. The company has set a goal of reducing emissions by 25% by 2030, based on 2021 figures.

A model trying on outfits in Temu's Super Bowl ad. The company runs a marketplace for virtually everything, from apparel to home goods to electronics.

Temu, which markets itself more as a general store than a fashion outlet, also said its model limits unsold inventory and waste by better matching demand with supply.

The company told CNN it offsets emissions for every order with “carbon credits which support wildlife conservation efforts” in the United States, though it did not provide details.

Researchers who study textile waste and sustainability in global supply chains say the companies need to go further.

Shein, for example, often uses low-cost fabrics that are hard to recycle. Compared with other fashion retailers, the company has a much lower percentage of products that mention using sustainable or recycled textile materials, said Lu.

There are also concerns about the conditions of workers who make some of the companies’ products.

In February, a bipartisan group of US senators wrote to Shein, pressing the company on its supply chain practices and calling for greater transparency in its supply chain.

“We are concerned that American consumers may be inadvertently purchasing apparel made in part with cotton grown, picked, and processed using forced labor,” the senators said.

The inquiry was made following a Bloomberg report showing lab testing on two occasions last year found that garments shipped to the United States by Shein were made with cotton from Xinjiang. Washington has banned all imports from the Chinese region over concerns of forced labor.

In a statement to CNN, Shein said it was committed to respecting human rights and adhering to laws and regulations in the countries where it operates. A spokesperson said the company had zero tolerance for forced labor, and worked with third parties to audit supplier factories.

To ensure compliance with US laws, Shein requires that suppliers purchase cotton from approved countries, and has built tracing systems to get visibility into the origins of cotton it uses, the spokesperson added.

Temu has not faced such questions, though its sister company received backlash in 2021 over allegations that it overworks its staff. Pinduoduo said at the time that it would provide counseling following the suicide of a worker.

Worker rights at Shein also made headlines in December, when a documentary by UK broadcaster Channel 4 alleged exploitation at two Chinese factories belonging to its suppliers.

The program claimed staff were working 18 hours a day, making the equivalent of pennies on each item. CNN has not independently verified the allegations.

Shein responded to the claims, saying independent audits had refuted most of the allegations. But it conceded that the investigation had showed workers at two of its suppliers were working longer hours than allowed.

The company has since reduced the size of its orders from those producers on an interim basis, and committed $15 million to upgrade hundreds of its partner factories.

Still, the “working conditions of workers making Shein’s products remain a black box,” said Lu, the University of Delaware professor.

“Shein should be more transparent about their factory conditions and workers’ well-being.”

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Editor’s Note: Kara Alaimo, an associate professor of communication at Fairleigh Dickinson University, writes about issues affecting women and social media. Her book, “Over the Influence: Why Social Media Is Toxic for Women and Girls — And How We Can Reclaim It,” will be published by Alcove Press in 2024. The opinions expressed in this commentary are her own. Read more opinion on CNN.

CNN
—

Utah’s Republican governor, Spencer Cox, recently signed two bills into law that sharply restrict children’s use of social media platforms. Under the legislation, which takes effect next year, social media companies have to verify the ages of all users in the state, and children under age 18 have to get permission from their parents to have accounts.

Parents will also be able to access their kids’ accounts, apps won’t be allowed to show children ads, and accounts for kids won’t be able to be used between 10:30 p.m. and 6:30 a.m. without parental permission.

It’s about time. Social networks in the United States have become potentially incredibly dangerous for children, and parents can no longer protect our kids without the tools and safeguards this law provides. While Cox is correct that these measures won’t be “foolproof,” and what implementing them actually looks like remains an open question, one thing is clear: Congress should follow Utah’s lead and enact a similar law to protect every child in this country.

One of the most important parts of Utah’s law is the requirement for social networks to verify the ages of users. Right now, most apps ask users their ages without requiring proof. Children can lie and say they’re older to avoid some of the features social media companies have created to protect kids — like TikTok’s new setting that asks 13- to 17-year-olds to enter their passwords after they’ve been online for an hour, as a prompt for them to consider whether they want to spend so much time on the app.

While critics argue that age verification allows tech companies to collect even more data about users, let’s be real: These companies already have a terrifying amount of intimate information about us. To solve this problem, we need a separate (and comprehensive) data privacy law. But until that happens, this concern shouldn’t stop us from protecting kids.

One of the key components of this legislation is allowing parents access to their kids’ accounts. By doing this, the law begins to help address one of the biggest dangers kids face online: toxic content. I’m talking about things like the 2,100 pieces of content about suicide, self-harm and depression that 14-year-old Molly Russell in the UK saved, shared or liked in the six months before she killed herself last year.

I’m also talking about things like the blackout challenge — also called the pass-out or choking challenge — that has gone around social networks. In 2021, four children 12 or younger in four different states all died after trying it.

“Check out their phones,” urged the father of one of these young victims. “It’s not about privacy — this is their lives.”

Of course, there are legitimate privacy concerns to worry about here, and just as kids’ use of social media can be deadly, social apps can also be used in healthy ways. LGBTQ children who aren’t accepted in their families or communities, for example, can turn online for support that is good for their mental health. Now, their parents will potentially be able to see this content on their accounts.

I hope groups that serve children who are questioning their gender and sexual identities and those that work with other vulnerable youth will adapt their online presences to try to serve as resources for educating parents about inclusivity and tolerance, too. This is also a reminder that vulnerable children need better access to mental health services like therapy — they’re way too young to be left to their own devices to seek out the support they need online.

But, despite these very real privacy concerns, it’s simply too dangerous for parents not to know what our kids are seeing on social media. Just as parents and caregivers supervise our children offline and don’t allow them to go to bars or strip clubs, we have to ensure they don’t end up in unsafe spaces on social media.

The other huge challenge the Utah law helps parents overcome is the amount of time kids are spending on social media. A 2022 survey by Common Sense Media found that the average 8- to 12-year-old is on social media for 5 hours and 33 minutes per day, while the average 13- to 18 year-old spends 8 hours and 39 minutes every day. That’s more time than a full time-job.

The American Academy of Pediatrics warns that lack of sleep is associated with serious harms in children — everything from injuries to depression, obesity and diabetes. So parents in the US need to have a way to make sure their kids aren’t up on TikTok all night (parents in China don’t have to worry about this because the Chinese version of TikTok doesn’t allow kids to stay on for more than 40 minutes and isn’t useable overnight).

Of course, Utah isn’t an authoritarian state like China, so it can’t just turn off kids’ phones. That’s where this new law comes in requiring social networks to implement these settings. The tougher part of Utah’s law for tech companies to implement will be a provision requiring social apps to ensure they’re not designed to addict kids.

Social networks are arguably addictive by nature, since they feed on our desires for connection and validation. But hopefully the threat of being sued by children who say they’ve been addicted or otherwise harmed by social networks — an outcome for which this law provides an avenue — will force tech companies to think carefully about how they build their algorithms and features like bottomless feeds that seem practically designed to keep users glued to their screens.

TikTok and Snap didn’t respond to requests for comment from CNN about Utah’s law, while a representative for Meta, Facebook’s parent company, said the company shares the goal to keep Facebook safe for kids but also wants it to be accessible.

Of course, if social networks had been more responsible, it probably wouldn’t have come to this. But in the US, tech companies have taken advantage of a lack of rules to build platforms that can be dangerous for our kids.

States are finally saying no more. In addition to Utah’s measures, California passed a sweeping online safety law last year. Connecticut, Ohio and Arkansas are also considering laws to protect kids by regulating social media. A bill introduced in Texas wouldn’t allow kids to use social media at all.

There’s nothing innocent about the experiences many kids are having on social media. This law will help Utah’s parents protect their kids. Parents in other states need the same support. Now, it’s time for the federal government to step up and ensure children throughout the country have the same protections as Utah kids.

Suicide & Crisis Lifeline: Call or text 988. The Lifeline provides 24/7, free and confidential support for people in distress, prevention and crisis resources for you and your loved ones, and best practices for professionals in the United States. En Español: Linea de Prevencion del Suidio y Crisis: 1-888-628-9454.

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Tag: mobile technology

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