The GiD Report#142 — Your WhatsApp data belongs to FB now

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GlobaliD

7 min readJan 12, 2021

Welcome to The GiD Report, a weekly newsletter that covers GlobaliD team and partner news, market perspectives, and industry analysis. You can check out last week’s report here.

What we’ve got this week:

Big Tech pulls plug on Parler
Your WhatsApp data belongs to FB
New Senate majority bad for Big Tech
Paypal + Square v. Regulators
Vaccine rollout needs better messaging + identity platforms
Losing trust in the Federal Reserve
Stuff happens

1. Big Tech pulls the plug on Parler

Most of you likely already know this story. Violence in DC last week sparked a swift reaction from Tech’s heavy hitters with Apple, Google and Amazon all pulling to plug on Parler, an alternative social media platform preferred by conservatives.

Two big takeaways:

Moderation is a must in today’s digital reality. Really, it’s a part of growing up and the internet is so intertwined with our daily lives, we can no longer have the expectation of some Wild West. Plus, we have an obligation to keep our communities safe — whether in the real world or online. Clearly, the two worlds have collided and have spilled into each other.
Big Tech is very powerful — so powerful that they can swiftly shutdown an incredibly popular platform literally overnight, one that boasted over ten million users. Which only raises further questions.

Both are weighty challenges to tackle.

Via Todd — Apple Has Threatened To Ban Parler From The App Store
Social media platforms muzzle Trump after Capitol melee
Amazon and Apple pull the plug on Parler
Parler is gone for now as Amazon terminates hosting
Ben Thompson — Trump and Twitter
Ben Thompson — New Defaults

2. Your WhatsApp data now belongs to Facebook.

Well, it’s not like we didn’t see it coming. After all, how else will Facebook make money on all those users?

It’s a reality that we’ve come to expect in this era of our tech evolution — the chapter where “we’re the product.” That’s why it’s “free.”

But evolution is a continuous process and there are alternatives now (such as GlobaliD).

There’s also Signal, which got the thumbs up from the new richest man on the planet on Twitter:

(Naturally, Signal saw a huge spike in new users.)

This part of how change happens — from the bottom up, from innovation, from users deciding that they want something better.

3. The other way change happens is from the top down. You can bet that the new Democratic Senate majority is going after Big Tech.

Here’s The Information:

Democrats have discussed sweeping changes to antitrust laws to make it easier for prosecutors to win antitrust convictions against companies with dominant market power, but Republicans have stood in the way of such legislation. Federal anti-monopoly lawyers recently filed legal claims against both Google and Facebook under existing antitrust law. Incoming Democratic president Joe Biden also is expected to try to reverse corporate tax cuts and reform a law known as Section 230 that shields internet companies like Google and Facebook from lawsuits over content posted by their users. Legislation to update online privacy-related rules also would be more likely to pass. To be sure, the Senate currently has a cloture rule requiring 60 members to end debate on most topics to move them to a chamber-wide vote.

4. But the top-down method is always reliable or effective. Sometimes, it misses the mark or has unintended consequences.

One example was the CFPB’s (well-intentioned) prepaid card regulations — which the regulatory body wanted to expand into Paypal’s territory. That, of course, never really made sense and would have strapped Paypal’s innovative potential without actually protecting consumers.

As Greg noted on Twitter:

Paypal wins bid to strike down CFPB prepaid card regulations

Another example could be FINCEN’s midnight crypto wallet regulations. Square’s response was on point:

With this rulemaking, FinCEN seeks to expand reporting and Know Your Customer (“KYC”) type obligations to parties who are not our customers. Instead of leveraging blockchain tracing with wallet addresses (which to date has proven effective in tracking the unlawful activity cited in the Proposal leading to indictments and convictions), FinCEN proposes a static requirement that would have us collect names and physical addresses from non-customers. To put it plainly — were the Proposal to be implemented as written, Square would be required to collect unreliable data about people who have not opted into our service or signed up as our customers.
This creates unnecessary friction and perverse incentives for cryptocurrency customers to avoid regulated entities for cryptocurrency transactions, driving them to use non-custodial wallets or services outside the U.S. to transfer their assets more easily (non-custodial, or “unhosted” wallets are a type of software that lets individuals store and use cryptocurrency, instead of relying on a third party). By adding hurdles that push more transactions away from regulated entities like Square into non-custodial wallets and foreign jurisdictions, FinCEN will actually have less visibility into the universe of cryptocurrency transactions than it has today.
The impact of the Proposal would not only hamstring law enforcement capabilities, but also limit American innovation by hindering our ability to create a competitive service that allows customers to seamlessly transfer and transact in cryptocurrency the way the technology was designed. The burdensome information collection and reporting requirements deprive U.S. companies like Square of the chance to compete on a level playing field to enable cryptocurrency as a tool of economic empowerment.

5. The COVID-19 vaccine rollout in the U.S. has been clunky at best. And at its core, it’s because we need better identity and messaging systems.

Axios:

The big picture: Historically, the federal government has established systems to help local governments deploy emergency information, like tornado and hurricane warnings that are broadcast on local television, as well as localized text alerts.
But the government hasn’t set up emergency communication systems to convey localized information about the vaccine, forcing citizens to turn to less reliable sources of information online.
“We’re going to have to think through systems that will reach people when they need information that’s highly specific — and in this case, time sensitive,” says Kathleen Hall Jamieson, director of the Annenberg Public Policy Center at the University of Pennsylvania. “We’ll need to institutionalize that structure and keep track of it.”
“The fact that we don’t already have it is a real indictment,” she told Axios. “We should’ve thought this through before.”
What to watch: A lack of coordinated messaging around the vaccine rollout has left millions of people to search for answers online and via social media, opening space for confusion and misinformation.
Experts worry that big tech platforms, already reeling from election misinformation problems, are not equipped to help vet and verify vaccine rollout information.
Of note: Almost all of the experts Axios spoke to said that the best way to tackle this problem would be through a massive, federal government-backed awareness campaign educating consumers about the importance of getting a vaccine and directing them to some sort of a federal directory with links to verified local resources.
Since the U.S. has no centralized database with citizens’ addresses and health records, that’s likely the fastest thing the federal government can do to support local governments with the rollout at this point.

6. This week in society’s trust deficit: The Federal Reserve.

Axios:

Big names in the world of finance are beginning to call out the Fed and other central banks for their role in ramping up economic inequality and manipulating financial markets — a departure from the praise they received for most of last year.
Why it matters: Wall Street was the only pillar of solid support. Most Americans say they don’t trust the Fed and politicians look to be taking aim at the central bank for overreaching with its unprecedented actions in March.

GOP efforts to curb Fed’s lending powers signal future hostility under Biden administration

Chart of the day: