Revised Tech Encryption Bill Sent to U.S. Senate for Vote

A bill seeking to prohibit the exploitation of minors on the Internet July 2 was sent to the floor of the U.S. Senate for a full vote. While there is no argument against removing images of child abuse from the Web, technology and trade organizations contend the “Eliminating Abuse and Rampant Neglect of Interactive Technology” (Earn It) Act — introduced in March by Lindsey Graham (R-SC), Richard Blumenthal (D-Conn.), Josh Hawley (R-Mo), and Dianne Feinstein (D-CA) — could undermine user encryption safeguards and hold platforms such as Facebook and Google-owned YouTube liable for video images distributed by third parties.

Indeed, the bill would enable U.S. Attorney General Bill Barr to force tech companies to bypass encryption found on cell phones, computers and portable media devices for law enforcement purposes.

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“The Earn It Act could end user privacy as we know it,” the Electronic Frontier Foundation said in a statement. “Tech companies that provide private, encrypted messaging could have to rewrite their software to allow police special access to their users’ messages.”

Graham later issued a statement stressing the bill would not undermine existing encryption safeguards.

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‘The goal here is not to outlaw encryption … that will be a debate for another day,” Graham said.

Gary Shapiro, CEO of the Consumer Technology Association, said the bill would stifle legal online speech and harm American competitiveness.

“Rather than targeting the actual problem and giving prosecutors the resources to lock up [sex] offenders, the EARN IT Act would promote lawsuits against legitimate Internet companies,” Shapiro said.

He said the bill would allow states to create a “patchwork quilt” of civil and criminal liability without specifying a “knowledge” standard.

“We appreciate the Senate Judiciary Committee’s interest in fighting child exploitation and believe the committee should pursue more effective measures,” Shapiro said. “There is nothing in existing law … that prevents the Department of Justice from bringing charges against abusers right now.”

Reuters: COVID-19 Ups Consumer Consumption, Trust of News Reporting

The ongoing coronavirus pandemic has increased consumer confidence in and consumption of news reporting on television and the Internet, including social media platforms, according to new data from Reuters Institute for the Study of Journalism.

Before the COVID-19 crisis hit, more than half of survey respondents in six countries (U.K., U.S., Germany, Spain, South Korea, and Argentina) said they were concerned about what was true or false on the Internet when it came to news.

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Domestic politicians were singled out as the single most frequently named source of misinformation, though in some countries — including the U.S. – people who self-identify as right-wing are more likely to blame the media, with Facebook seen as the main channel for spreading “fake news.”

Over the past nine years, Reuters has found online news overtaking television and print as the most frequently used source of news. The virus crisis has significantly changed that picture. Data from surveys conducted in early April found respondents gravitated toward traditional TV for coverage of COVID-19 more so than other topics, including politics and global warming.

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TV news saw an uplift in all six countries polled separately in January and April. Germany saw a 12-point decline in reach for TV news reversed as people turned to the medium for virus-related news, including public service announcements.

“Journalism matters and is in demand again,” Nic Newman senior research associate, wrote in the report.

The use of online and social media for news has significantly increased in most countries, according to Reuters. WhatsApp saw the biggest growth in general with increases of around 10% in some countries, while more than 51% of respondents used some kind of open or closed online group to connect, share information, or take part in a local support network.

Reuters also found that trust in media doubled for social networks, video platforms and messaging services when it came to the virus and economic shutdowns. Across all countries surveyed, 28% turned to a website or app for their news. Respondents 18 to 24 years old preferred accessing social media. Indeed, use of Instagram for news has doubled since 2018 and looks likely to overtake Twitter through 2021, according to the report.

“Facebook [which owns Instagram] and other social media groups are now used on average by 31% of respondents for local news and information,” Newman wrote.

NASCAR Partners With Facebook for New Interactive Fan App

NASCAR June 2 announced a partnership with Facebook for a new iOS and Android app that enables spectators to interact with commentators at live events.

Created by Facebook’s “New Product Experimentation” team, which researches, tests and refines new product experiences, the app dubbed “Venue” aims to offer fans an improved second-screen experience while watching sporting event.

Users will be able to interact with the expert commentators, journalists, current or former athletes or aspiring “fan-analysts,” who will host a venue for each race. During the race, those commentators will provide commentary, pose interactive questions and polls and open up short chats around specific moments of the event. Users will also be able to communicate with each other and enjoy multiple venues during a given race, offering different takes depending on their favorite expert commentary.

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“As NASCAR makes its return to action over the coming weeks, Venue will provide users with a unique and exciting way to connect with fellow race fans from around the globe — all from the safety and comfort of their own homes,” Tim Clark, SVP and chief digital officer at NASCAR, said in a statement. “NASCAR was built on innovation, and we couldn’t be more excited to help a great partner like Facebook’s New Product Experimentation team innovate around new platforms.”

Ime Archibong, head of Facebook’s New Product Experimentation, said the app is a good way to jumpstart live sporting events during a pandemic.

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“Digital spaces can connect us when we can’t be together in person, and Venue is one way to feel the energy of watching live events with other fans,” Archibong said.

Facebook said commentators will be able to create “moments” during the race — short-lived, digital opportunities for fans to connect based on something interesting that happened on the track. Users will be notified when a new “moment” is created so they don’t miss commentary while watching the race and interacting within the app.

Social media personality @nascarcasm will serve as the expert commentator for Sunday’s (June 7) Food City 500, with NASCAR Xfinity Series driver Landon Cassill and Fox Sports NASCAR reporter Alan Cavanna slated to appear in the app in future weeks.

FANG Plays Compassion Card in a Time of Crisis

As media companies large and small attempt to find their economic footing in the face of the coronavirus, Facebook, Amazon, Netflix and Google — companies CNBC’s “Mad Money” host Jim Cramer coined with the FANG acronym in 2013 in reference to their high-growth Internet stocks — are downplaying their relative fiscal fortunes in the midst of the pandemic.

Combined revenue for FANG skyrocketed to $441 billion at the end of 2019, from $51 billion a decade ago. None of the corporations have applied for government assistance.

Amazon saw sales increase 26% to a staggering $75.5 billion in the recent first quarter, from $59.7 billion in the previous-year period. The coronavirus has apparently affected company founder/CEO Jeff Bezos personally.

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Bezos and senior management spent the majority of the company fiscal release and webcast devoted to COVID-19, detailing what Amazon was doing for its 800,000 workers worldwide during the crisis.

The move was partially proactive after workers in select warehouses threatened to go on strike if safeguards protecting them from the virus weren’t put in place. Amazon needs healthy workers at a time when order fulfillment is stretched to capacity.

Amazon last month confirmed that a worker in Tracy, Calif., had died from the virus. An employee in the company’s Seattle headquarters tested positive, as reportedly did 48 workers in a New Jersey warehouse.

Eyeing a possible pandemic within its own company, Bezos re-assumed day-to-day operations of Amazon, ordering $600 million spending on virus-related expenses in the quarter. That amount is ballooning to $4 billion in the current quarter, which includes testing every Amazon employee.

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“The current crisis is demonstrating the adaptability and durability of Amazon’s business as never before, but it’s also the hardest time we’ve ever faced,” Bezos said in a statement.

“We’ve put some of our best people on [testing],” added CFO Brian Olsavsky. “[Tests] are not readily available on the scale that we need for our employees.”

Michael Pachter with Wedbush Securities in Los Angeles, said the increased expenses include a $2 raise for hourly workers and the hiring of 175,000 workers — many displaced from other companies — costing about $1 billion. The company is also paying double-time for overtime, or about $1.5 billion (assuming around 12% of hours are overtime). Amazon is spending $700 million on virus testing, with another $800 million spent keeping facilities clean and virus free.

Pachter believes Bezos’ concern involves around the stress having to potentially expose hundreds of thousands employees to a health risk.

“[The pandemic is] obviously great for revenue, but Bezos is trying to be compassionate about the human toll,” Pachter said in an email.

With a quarantined audience throughout much of the world, Netflix added a record 16 million subscribers worldwide in the first three months of the year — about 7 million more than revised Wall Street estimates and 9 million more than what Netflix had expected.

At a time when media companies are scrambling to find liquidity, furloughing/laying off employees, Netflix has seen its stock reach record highs — briefly surpassing the slumping Walt Disney Co.

“It’s an incredible tragedy for the world,” Hastings said about COVID-19. “Everyone is wrestling with the implications, both on health, on hunger, poverty. And we, too, are really unsure of what the future brings.”

Netflix was one of the first media companies to establish a $150 million fund to support idled workers and production crew associated with its original programming.

Facebook, which saw Q1 profit and revenue increase 18% and 102%, respectively, from the previous-year period, said it committed $300 million to help its “broader community,” which includes $100 million grant program to help small businesses and another $100 million to support the news industry.

“Helping people stay connected while we’re all apart; assisting the public health response and working on the economic recovery, especially for small businesses,” CEO Mark Zuckerberg said in a statement.

Google-parent Alphabet Inc., saw quarterly income increase about $300 million, while revenue soared 13% to $41.1 billion from 2019. The company has expanded free video streaming and educational content through YouTube. Google and Apple also announced a joint effort to enable the use of Bluetooth technology to help governments and health agencies reduce the spread of the virus, with user privacy and security central to the design.

“Given the depth of the challenges so many are facing, it’s a huge privilege to be able to help at this time,” CEO Sundar Pichai said in a statement. “People are relying on Google’s services more than ever and we’ve marshalled our resources and product development in this urgent moment.”

Analyst Adds Amazon, Facebook to ‘Best Ideas’ Company List During Coronavirus Pandemic

Wedbush Securities media analyst Michael Pachter has compiled a list of publicly traded companies he says are good bets (for investing in) during the ongoing coronavirus pandemic. With people encouraged to stay indoors in their homes and avoid large gatherings, companies catering towards consumers confined indoors are gaining traction with investors.

“We view Amazon as uniquely-positioned to gain meaningful market share across a number of verticals in a multitude of countries driven by coronavirus-related changes in consumer behavior,” Pachter wrote in a March 17 note.

Beyond its market-leader status in ecommerce, Amazon’s Prime Video streaming video service, Prime Channels (third-party SVOD platforms), Instant Video (transactional VOD) and packaged media offer a cross-platform variety of home entertainment options.

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With consumers in the near term appearing to spend more time and money shopping online to avoid crowds, limit time wasted searching for products sold-out at brick-and-mortar outlets, and, in some situations, to adhere to the rules implemented by different governmental bodies, Pachter contends companies like Amazon and Facebook are well-positioned to deal with the situation.

Indeed, despite Amazon disclosing delivery delays last weekend due to the consumer crush for select items (i.e. toilet paper), Pachter says this amounts to a “high-class” problem only.

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“We expect Amazon to absorb the learnings from this difficult period and adapt its supply chain and delivery network best practices accordingly,” Pachter wrote. “In addition, we expect consumers’ increasing reliance on the company at present to result in the acceleration of market share capture that should benefit Amazon and its investors for the next several years.”

The analyst believes Facebook has likely seen significant upticks in user engagement and hence ad impression growth across multiple properties driven by coronavirus fears. Given the seemingly unprecedented and unrelenting volume of news related to the global pandemic, the reliance that a large percentage of the world’s population has on Facebook as its primary source of information, and an increasingly-pervasive stay-at-home attitude accentuated in some instances by the government, “we believe that many Facebook users have been accessing its properties at meaningfully elevated levels over the last several weeks.”

Pachter expects the “positive” momentum for Facebook to continue through the remainder of the first quarter in many of Facebook’s most important geographies.

“When factoring in these recent trends, the company’s high-level Q1 top-line growth guidance and consensus expectations for the fiscal year appear overly conservative,” he wrote.

 

Why Have Netflix, Apple, Google, Facebook and Others Nixed Events? Local Government Asked Them To

With a growing list of media tech companies canceling appearances at the upcoming South by Southwest (SXSW) Music Festival in Austin, Texas, and other public events due to concerns about the spread of the coronavirus (COVID-19), the decision by Netflix, Apple, Google, Intel and Facebook, among others, was apparently inspired by local government.

The County of Santa Clara’s Public Health Department this week updated its recommendations to “protect residents of the county” from the virus, saying local employers should refrain from exposing staff to “close contact with large numbers of people.”

Santa Clara County includes the cities of Cupertino, Mountain View, Palo Alto, and San Jose — corporate homes to many of the aforementioned companies. Amazon, Facebook and Microsoft have offices in the county.

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With six new coronavirus cases confirmed in Santa Clara County, bringing to 20 the number of people who have tested positive for the virus in the area, the Public Health Department said it was taking proactive steps to slow the spread of the virus and reduce the number of people infected.

“We understand these recommendations will have a tremendous impact on the lives of people in our community,” the county said in a March 5 statement. “Public Health is making these recommendations in consultation with Centers for Disease Control and Prevention (CDC), based on the best information we have at this time, to protect the public’s health. This is a critical moment in the growing outbreak of COVID-19 … when such measures can potentially slow the spread of the disease.”

Specifically, the county said companies should suspend nonessential employee travel; minimize the number of employees working within arm’s length of one another, including minimizing or canceling large in-person meetings and conferences.

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It urged employees to stay home when they are sick and maximize flexibility in sick leave benefits, and not require a doctor’s note for employees that are sick as healthcare offices may be busy and unable to provide that documentation right away.

Companies should also consider the use of telecommuting options for appropriate employees, and stagger the start and end times for workers to reduce large numbers of people coming together at the same time.

Earlier this week, Adobe canceled the live portion of the Adobe Summit 2020 confab — originally slated for March 29 to April 2 in Las Vegas — due to the virus. The 2019 event attracted 16,000 attendees and featured presentations by Reese Witherspoon and New Orleans Saints quarterback Drew Brees, among others. The summit will continue this year as an online only event.

“Over the past few weeks, we have been closely monitoring and evaluating the situation around COVID-19 to ensure we are taking the necessary measures to protect the health and wellbeing of Adobe Summit attendees,” Adobe said in a statement. “As a result, we have made the difficult but important decision to make Adobe Summit 2020 an online event this year and to cancel the live event in Las Vegas.”

Google canceled its Cloud Next event in San Francisco, while Facebook nixed its F8 developers confab in San Jose.

Meanwhile, tickets for the Netflix Is a Joke Festival live stand-up comedy event across 20 venues, April 27 – May 3 in Los Angeles, went on sale March 4.

 

Amazon Studios Pulls Out of SXSW as Calls Grow to Cancel Annual Media Festival

Amazon Studios has become the latest media company to pull out of the annual South by Southwest (SXSW) Music Festival, March 13-22, in Austin, Texas.

Amazon joins Facebook, Twitter, Mashable, TikTok, Dell, Intel, China Gathering and other companies that are dropping out of SXSW over concerns of the coronavirus’ possible impact on company employees.

To date, more than 91,000 people globally have been infected with 3,100 deaths attributed to the disease. There are more than 100 confirmed cases in the United States, including nine deaths.

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Amazon, which just disclosed that an employee in its Seattle headquarters had contracted the COVID-19 virus, had planned to unveil several projects through its Prime Video unit, including a co-promotion with Entertainment Weekly.

“Due to health concerns Amazon Prime Video has decided to pull back from the festival and will be cancelling all activities, including the Blue Room Photo/Video Studio over the weekend and the Entertainment Weekly party on Sat evening,” the publication said in a statement. “We regret any inconvenience this may cause. The health of our team members and guests is our priority. Thank you for your understanding.”

Despite an online petition and calls from some, including Twitter CEO Jack Dorsey, to cancel this year’s festival, organizers say the show will go on. Indeed, the show actually pushed-back with the March 2 announcement of new big-name speakers, including former U.S. Secretary of State Hillary Clinton and former Democratic Presidential candidate Beto O’Rourke.

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In a statement on its website, organizers said they are working “closely on a daily basis” with local, state, and federal agencies to plan for a safe event.

“As a result of this dialogue and the recommendations of Austin Public Health, the 2020 event is proceeding with safety as a top priority,” SXSW said in a statement. “We hope that people follow the science, implement the recommendations of public health agencies, and continue to participate in the activities that make our world connected.”

In addition to festivals, Sony Pictures shuttered three offices in Europe (Paris, London and Gdynia, Poland) due to coronavirus concerns.

Microsoft canceled its “Most Valuable Professional (MVP) Summit,” slated for March 16 in Seattle. The Google I/O developers conference, May 12-14 in Mountain View, Calif., also has been canceled.

 

YouTube Remains No. 1 Video Platform (Except in China)

Google-owned YouTube was the most-popular video platform in the third quarter of 2019 — a distinction the service has maintained since the advent of streaming media.

Ampere Analysis found that YouTube attracted the most eyeball globally, except in China, where government-backed services such as iQiYi reign supreme. Runner-ups included Netflix and Facebook.

London-based Ampere said YouTube (57%) also bested the BBC’s free iPlayer (55%) for the first time since 2016.

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Notably, Netflix has the highest user penetration (83%) in South Africa followed by the United States (68%), with Turkey generating the largest spike in subscriber usage (77% from 63%).

Overall, Ampere found 70% of Internet users in the U.S. and Europe have watched a video on a social video service in the last month — a 4% increase from the previous-year period. SVOD use has risen 8% to 55%.

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“The strength of short-form video is evident in YouTube’s dominant position as the most viewed in each market surveyed outside of China,” analyst Minal Modha said in a statement. “Looking at the Top 5, three of them are social video platforms which highlights its importance in the viewing mix for consumers.”

FandangoNow Launches on Facebook’s Portal TV

FandangoNow, the transactional video-on-demand service from Fandango, has launched the first-ever on-demand movies and TV store on Facebook’s Portal TV.

The new FandangoNow store will provide Portal TV users access to more than 100,000 new release and catalog movies and next-day TV shows to rent or buy, no subscription required.

FandangoNow also offers the largest library of movies and TV shows in 4K, according to the service.

“We’re always looking for new ways to connect fans with the highest quality entertainment content and are proud to be launching the FandangoNow movie and TV store on Portal TV,” said Fandango president Paul Yanover. “We have a long history of working with Facebook to create innovative new experiences for entertainment fans to discover, enjoy and share their passion for movies and TV.”

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FandangoNow on Portal TV will offer content curated by FandangoNow’s sister company, Rotten Tomatoes, a resource for entertainment recommendations. Fans will be able to peruse the “Best Movies of the Decade” and “Top Holiday Movies” according to the Tomatometer, “Rotten Christmas Movies We Love” as suggested by Rotten Tomatoes editors, and more.

FandangoNow also recently launched a movie and TV store on Facebook’s Oculus VR headsets, allowing Facebook audiences to build and access its library of movies and TV shows across the Facebook ecosystem.

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FandangoNow is available on 200 million devices including Roku, smart TVs from LG, Samsung, Vizio, Xbox and many other platforms.

Fans using Portal TV will be able to access FandangoNOW’s collection of Golden Globe-nominated movies and TV shows, which are on sale at 50% off through Dec. 15, using the promo code “GLOBES2020” at checkout (terms apply).

‘Mad Money’ Host Jim Cramer Wants Netflix Removed From ‘FAANG’

In the world of high-profile Wall Street analysts, CNBC’s frenetic “Mad Money” host Jim Cramer has helped define a cottage TV industry of fast-talking  personalities targeting consumer and business investors.

On CNBC’s “Squawk on the Street,” Cramer said Netflix should be removed from a basket of top-performing tech stocks, dubbed “FAANG” (Facebook, Amazon, Apple, Netflix and Google).

Speaking Oct. 3, Cramer said that with Netflix’s stock down 29% in 2019, compared to a 18% rise for Microsoft, the subscription streaming video pioneer’s status should be re-evaluated.

“We gotta get Netflix the hell out of FAANG,” Cramer said. “I tell you that right now. I don’t know how to do it.”

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Cramer contends Microsoft should replace Netflix (and apparently Google too), thus rendering the tech group “FAAM.”

Tough love from an analyst who just five months ago penned an article in high praise of the streamer and co-founder/CEO Reed Hastings.

“Netflix is about something to talk about Monday morning,” he wrote in April. “It’s about not feeling like a stooge when everyone watched Bird Box. You can’t be a stooge! In other words, as ethereal as it sounds, Reed Hastings is right when he says ‘the real metric is can we keep our members happy.'”

Apparently keeping subscribers and investor happy can be mutually exclusive. That’s because investors care not so much about subscriber happiness, but rather subscriber growth, according to Cramer.

And Netflix laid an egg of sorts during the last fiscal period when it failed to meet sub growth projections worldwide — including losing domestic subs for the first time in more than five years.

“I’m not a Netflix fan, here,” Cramer said, alluding to the pending arrival of SVOD competition from Disney, Apple, AT&T and Comcast — the latter parent to NBC Universal’s CNBC network.

“There’s too many competitors,” he said.

Netflix reports third-quarter (ended Sept. 30) financials on Oct. 16.