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Apple bans Facebook’s Research app that paid users for data – TechCrunch

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In the wake of TechCrunch’s investigation yesterday, Apple blocked Facebook’s Research VPN app before the social network could voluntarily shut it down. The Research app asked users for root network access to all data passing through their phone in exchange for $20 per month. Apple tells TechCrunch that yesterday evening it revoked the Enterprise Certificate that allows Facebook to distribute the Research app without going through the App Store. This not only breaks the Research app, but all of Facebook’s internal-use employee apps for collaboration and logistics too, from workplace chat to the lunch menu.

TechCrunch had reported that Facebook was breaking Apple’s policy that the Enterprise system is only for distributing internal corporate apps to employees, not paid external testers. That was actually before Facebook released a statement last night saying that it had shut down the iOS version of the Research program without mentioning that it was forced by Apple to do so.

TechCrunch’s investigation discovered that Facebook has been quietly operated the Research program on iOS and Android since 2016, recently under the name Project Atlas. It recruited 13 to 35 year olds, 5 percent of which were teenagers, with ads on Instagram and Snapchat and paid them a monthly fee plus referral bonuses to install Facebook’s Research app, the included VPN app that routes traffic to Facebook, and to ‘Trust’ the company with root network access to their phone. That lets Facebook pull in a user’s web browsing activity, what apps are on their phone and how they use them, and even decrypt their encrypted traffic. Facebook went so far as to ask users to screenshot and submit their Amazon order history. Facebook uses all this data to track competitors, assess trends, and plan its product roadmap.

Facebook was forced to remove its similar Onavo Protect app in August last year after Apple changed its policies to prohibit the VPN app’s data collection practices. But Facebook never shut down the Research app with the same functionality it was running in parallel. In fact, TechCrunch commissioned security expert Will Strafach to dig into the Facebook Research app, and we found that it featured tons of similar code and references to Onavo Protect. That means Facebook was purposefully disobeying the spirit of Apple’s 2018 privacy policy change while also abusing the Enterprise Certificate program.

Sources tell us that Apple revoking Facebook’s Enterprise Certificate has broken all of the company’s legitimate employee-only apps. Those include pre-launch internal-testing versions of Facebook and Instagram, as well as the employee apps for coordinating office collaboration, commutes, seeing the day’s lunch schedule, and more. That’s causing mayhem at Facebook, disrupting their daily work flow and ability to do product development. We predicted yesterday that Apple could take this drastic step to punish Facebook much harder than just removing its Research app. The disruption will translate into a huge loss of productivity for Facebook’s 33,000 employees.

[Update: Facebook later confirmed to TechCrunch that its internal apps were broken by Apple’s punishment Wednesday morning and that it’s in talks with Apple to try to resolve the issue and get their employee tools running again. Around 3pm pacific on Thursday, Apple restored Facebook’s Enterprise Certificate, thereby reactivating its internal employee apps. The nearly two work day-long disrupt to its workflow might make Facebook think twice about messing with Apple again.]

For reference, Facebook’s main iOS app still functions normally. Also, you can’t get paid for installing Onavo Protect on Android, only for the Facebook Research app. And Facebook isn’t the only one violating Apple’s Enterprise Certificate policy, as TechCrunch discovered Google’s Screenwise Meter surveillance app breaks the rules too.

This morning, Apple informed us it had banned Facebook’s Research app yesterday before the social network seemingly pulled it voluntarily. Apple provided us with this strongly worded statement condemning the social network’s behavior:

“We designed our Enterprise Developer Program solely for the internal distribution of apps within an organization. Facebook has been using their membership to distribute a data-collecting app to consumers, which is a clear breach of their agreement with Apple. Any developer using their enterprise certificates to distribute apps to consumers will have their certificates revoked, which is what we did in this case to protect our users and their data.”

That comes in direct contradiction to Facebook’s initial response to our investigation. Facebook claimed it was in alignment with Apple’s Enterprise Certificate policy and that the program was no different than a focus group.

Seven hours later, a Facebook spokesperson said it was pulling its Research program from iOS without mentioning that Apple forced it to do so, and issued this statement disputing the characterization of our story:

“Key facts about this market research program are being ignored. Despite early reports, there was nothing ‘secret’ about this; it was literally called the Facebook Research App. It wasn’t ‘spying’ as all of the people who signed up to participate went through a clear on-boarding process asking for their permission and were paid to participate. Finally, less than 5 percent of the people who chose to participate in this market research program were teens. All of them with signed parental consent forms.”

We refute those accusations by Facebook. As we wrote yesterday night, Facebook did not publicly promote the Research VPN itself and used intermediaries that often didn’t disclose Facebook’s involvement until users had begun the signup process. While users were given clear instructions and warnings, the program never stresses nor mentions the full extent of the data Facebook can collect through the VPN. A small fraction of the users paid may have been teens, but we stand by the newsworthiness of its choice not to exclude minors from this data collection initiative.

Senator Mark Warner has since called on Facebook CEO Mark Zuckerberg to support legislation requiring individual informed consent for market research initiatives like Facebook Research. Meanwhile, Senator Richard Blumenthal issued a fierce statement that “Wiretapping teens is not research, and it should never be permissible.”

The situation will surely worsen the relationship between Facebook and Apple after years of mounting animosity between the tech giants. Apple’s Tim Cook has repeatedly criticized Facebook’s data collection practices, and Zuckerberg has countered that it offers products for free for everyone rather than making products few can afford like Apple. Flared tensions could see Facebook receive less promotion in the App Store, fewer integrations into iOS, and more jabs from Cook. Meanwhile, the world sees Facebook as having been caught red-handed threatening user privacy and breaking Apple policy.

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Musk says Twitter will offer “amnesty” to suspended accounts • TechCrunch

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Elon Musk said Thursday Twitter will grant “a general amnesty” to accounts that had been suspended from the platform beginning next week. The CEO posted a poll the day earlier over whether the platform should restore affected accounts.

The news comes within a week of Musk also ending former president Donald Trump’s ban from the platform after running a similar poll. Trump was banned after the January 6, 2021 attack on the U.S. Capitol, but said he doesn’t intend to return to the platform.

Musk’s poll to users included a caveat that suspended account holders could rejoin the platform “provided they have not broken the law or engaged in egregious spam.” Around 3.2 million users responded to the poll, which voted 72.4% in favor of amnesty.

“The people have spoken. Amnesty begins next week. Vox Populi, Vox Dei,” Musk said, using a Latin phrase that means “The voice of the people is the voice of god.”

Historically, Twitter has banned accounts that glorify hate and harassment, have the potential to incite violence or rampantly spread misinformation that can lead to harm. Some high profile individuals who were banned include MyPillow CEO Mike Lindell after he made a series of claims that Trump actually won the 2020 presidential election; former Trump advisor and former executive chairman of Breitbart Steve Bannon after he said Anthony Fauci and FBI Director Christopher Wray should be beheaded; and Proud Boys founder Gavin McInnes for violating the site’s policy of prohibiting violent extremist groups.

It’s unclear from Musk’s brief tweet how Twitter will deal with content moderation in the future, now that more potentially problematic voices will be returning to the platform. These concerns have only been exacerbated by Musk’s mass layoffs and the general exodus of employees who’d rather quit than be “hardcore.”

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Amazon is working on a TV series about FTX drama with Russo Brothers • TechCrunch

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The FTX drama is not over yet — and Amazon wants a piece of it. The company is partnering with Russo Brothers, best known for Marvel movies, to make a show on the spectacular collapse of the giant cryptocurrency empire.

Amazon has partnered with the duo’s production house AGBO to make the show, which will go into production in Spring 2023, Variety first reported. Amazon is also trying to rope in the brothers to direct the show, the report added.

The company confirmed the news in a statement and said “Hunters” creator David Weil will write the pilot.

“We are excited to be able to continue our great working relationship with David, Joe, Anthony, and the AGBO team with this fascinating event series I can’t think of better partners to bring this multifaceted story to our global Prime Video audience,” Amazon Studios head Jennifer Salke said.

The Russos are also working with Amazon to create a multinational international spy series called “Citadel.”

“This is one of the most brazen frauds ever committed. It crosses many sectors — celebrity, politics, academia, tech, criminality, sex, drugs, and the future of modern finance,” the Russos said of the upcoming show surrounding FTX in a statement. “At the center of it all sits an extremely mysterious figure with complex and potentially dangerous motivations. We want to understand why.”

FTX collapse

FTX and its former CEO Sam Bankman-Fried have been at the center of media coverage across the world after the celebrated cryptocurrency exchange imploded earlier this month.

Coindesk reported earlier about the concerning finances of Alameda Research, the trading firm founded by Bankman-Fried and intertwined closely with the exchange. The report triggered a set of events, culminating in Binance chief executive Changpeng “CZ” Zhao unveiling plans to sell FTX’s native token FTT that it had received as part of an investment exit from the firm.

The move shook the confidence of retail investors and prompted a bank run on FTX and unraveled fraudulent misuse of FTX customers’ data.

Bankman-Fried, who along with his firm have attracted regulatory scrutiny in recent weeks, attempted to salvage FTX by signing a deal to be acquired by Binance, its chief rival then. Binance pulled out of the deal after finding FTX had dug too deep of a hole in its balance sheet. Within days, FTX filed for bankruptcy with Bankman-Fried stepping down from the CEO post.

In the aftermath of this chaos, Bankman-Fried gave a Vox reporter an interview over Twitter direct messages in which he criticized regulators and expressed regrets about filing for bankruptcy and walked back on many of the long-believes he had portrayed about himself to the world. Reports have since also found that FTX used corporate funds to purchase houses for employees and owes the top 50 creditors over $3 billion.

Time for the show

All of this makes for a good TV, for sure. It also helps that startup founders doing things has become a sleeper hit of a genre in recent years as evidenced by hits like “WeCrashed” (Apple TV+) on the WeWork and Adam Neumann fiasco, “Dropout” (Hulu) on the Theranos-Elizabeth Holmes saga, and “Super Pumped” (Showtime) on Uber led by Travel Kalanick. So Amazon is keen to get a hit show centering on a controversial tech founder on its catalog. But we could see more adoption of the FTX story.

Earlier this week, Deadline reported that buyers — including Apple — are chasing to sign celebrated author Michael Lewis’ yet-to-be-published book. Lewis — who has previously written hits that were later adapted into movies such as “The Big Short,” “Moneyball,” and “The Blind Side” — had been closely following Bankman-Fried for over six months before the recent implosion.

Amazon’s show will be based on “insider reporting” from various journalists who have covered the issue extensively, according to Variety.

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Mark Cuban-backed streaming app Fireside acquires Stremium to bring live, interactive shows to your TV • TechCrunch

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Mark Cuban-backed streaming app Fireside, which today offers podcasters and other creators a way to host interactive, live shows with audience engagement, will soon expand to the TV’s big screen. Variety reported, and Fireside confirmed, it’s acquired the open streaming TV platform Stremium, which will allow Fireside’s shows to become available to a range of connected TV devices, including Amazon Fire TV, Roku, smart TVs and others.

Deal terms were not disclosed. Cuban retweeted Variety’s reporting but made no other public comment.

A company spokesperson confirmed the deal to TechCrunch, noting it was for a combination of IP and talent.

“Fireside has acquired all of Stremium including its full team and intellectual property,” the spokesperson said. “The company is the first interactive web3 streaming platform and the acquisition will help Fireside accelerate delivering on being the only platform that turns creators, celebrities, brands, and IP owners into the studio, networks, and streaming services of the future. Expect other major announcements coming soon on this front,” they added.

Launched just over a year ago, Fireside arrived on the heels of the pandemic-fueled demand for startups offering live entertainment as well as a growing number of startups catering to the creator economy.

Despite some early — and erroneous — comparisons between Fireside and other live audio platforms like Twitter Spaces or Clubhouse, the startup gained traction due to a differentiated feature set that also prioritizes video content. Shows on Fireside’s platform could be streamed live to its app, recorded, saved, or even simulcast to other social networks. The app additionally includes audience engagement tools and other features to aid creators with promotion, editing, measurement, distribution, monetization, and audience growth, all of which are part of Fireside’s end-to-end content production experience. More recently, the company had been exploring web3 technologies, including NFTs.

Co-founded by Cuban, early Yammer employee Mike Ihbe, and former Googler, YouTuber and Node co-founder Falon Fatemi, who sold her last company to SugarCRM, Fireside has managed to attract some high-profile creators like Jay Leno, Michael Dell, Melissa Rivers, Craig Kilborn, and screenwriter and Entourage creator Doug Ellin over the past year.

In a letter to Fireside investors published by Variety, Fatemi shared that the Stremium acquisition would help Fireside to offer a “second screen experience where the audience can use their phones to engage and interact in real-time while watching on their TVs.”

“Imagine watching a live cookalong show with your favorite chef simultaneously on your TV and your phone where you can interact and get invited to talk directly to them and even show them what you are cooking from the palm of your hand,” Fatemi explained. Plus, Stremium’s infrastructure would allow creators to upload, publish, program and distribute their live shows across both mobile and TV, she added. (Stremium confirmed to us the letter’s accuracy.)

TechCrunch this February reported Fireside was in talks to raise a $25 million Series A that valued its business at $125 million. That round has since closed, but Fireside hasn’t yet made a formal announcement about raise, investors, or its valuation. We understand this may be because Fireside is still adding some additional strategic investors to the deal, and it plans to detail the fundraise soon. Of course, the funding may have helped pave the way for Fireside to make this new acquisition.

Other investors in Fireside include the Chainsmokers, HBSE, Goodwater, Animal Capital, and NFL stars Larry Fitzgerald and Kelvin Beachum and former NBA star Baron Davis, in addition to Cuban. Ahead of its Series A, Fireside had raised around $8 million.

Stremium had been developing a service that allowed consumers to aggregate all their favorite channels using their “TV Everywhere” credentials and use a cloud DVR instead of downloading separate streaming apps. It also included a selection of free streaming channels. But the service faced an increasingly competitive landscape where there are now numerous ways to watch free streaming content, like Tubi, Pluto TV, The Roku Chanel, Freevee (formerly IMDb TV), Plex, and more. Meanwhile, cord-cutting is accelerating leaving fewer people with cable TV logins for Stremium to market its services to.

The Stremium website is now pointing visitors to Fireside and confirms the acquisition. Fireside is aiming to release its TV product sometime next year as a result of the deal.

 

 

 

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