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Consumer advocacy groups call on FTC to investigate kids’ apps on Google Play – TechCrunch

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A coalition of 22 consumer and public health advocacy groups, led by Campaign for a Commercial-Free Childhood (CCFC) and Center for Digital Democracy (CDD), have today filed a complaint with the Federal Trade Commission asking them to investigate and sanction Google for how its Google Play Store markets apps to children. The complaint states that Google features apps designed for very young children in its Play Store’s “Family” section, many of which are violating federal children’s privacy law, exposing kids to inappropriate content and disregarding Google’s own policies by luring kids into making in-app purchases and watching ads.

Google Play ‘Family’ section

Google first introduced its “Designed for Families” program back in 2015, which gives developers of kid-friendly apps meeting certain guidelines additional visibility in the Play Store. This includes a placement in the Family section, where apps are organized by age appropriateness.

To qualify, “Family” apps must abide by specific content policies, Google’s Developer Distribution Agreement and the Designed for Families DDA Addendum. The apps also must meet the Designed for Families program requirements. Legal compliance with federal privacy laws, including COPPA (Children’s Online Privacy Protection Rule), are among the requirements.

COPPA is designed to protect children under the age of 13 by giving parents control over what information sites and apps can collect from their kids.

Above: Google Play store showcases children’s content in its own dedicated sections

COPPA violations

But the new FTC complaint claims that Google is not verifying COPPA compliance when it accepts these apps and, as a result, many are in continual violation of the law.

“Our research revealed a surprising number of privacy violations on Android apps for children, including sharing geolocation with third parties,” said Serge Egelman, a researcher at the University of California, Berkeley, in a statement shared by the group. “Given Google’s assertion that Designed for Families apps must be COPPA compliant, it’s disappointing these violations still abound, even after Google was alerted to the scale of the problem,” he added.

TechCrunch asked the coalition if it had some idea about how many apps were in violation of COPPA, and were told the groups don’t know an exact number.

“From our survey — and more comprehensive analyses like the PET Study — it seems fairly prevalent,” Lindsey Barrett, Staff Attorney at Georgetown’s Institute for Public Representation, told us.

“The PET Study found that 73 percent of the kids apps in the Play store transmitted sensitive data over the internet, and we saw apps sending geolocation without notice and verifiable parental consent, and sending personal information unencrypted,” Barrett said. “Further, under COPPA, children’s PII cannot be used for behavioral advertising. Yet, many of the children’s apps we looked at were sending information to ad networks which say their services should not be used with children’s apps,” she added.

Other harms

The apps also engage in other bad behaviors, like regularly showing ads that are difficult to exit or showing those that require viewing in order to continue the current game, according to the complaint. Some apps pressure kids into making in-app purchases — in one example, the game characters were crying if the kids didn’t buy the locked items, it notes. Others show ads for alcohol and gambling, despite those being barred by Google’s Ad Policy.

Above: disturbing images from TabTale apps

The coalition additionally called out some apps for containing “graphic, sexualized images” like TutoTOONS “Sweet Baby Girl Daycare 4 – Babysitting Fun,” which has more than 10 million downloads. (The game has a part where kids change a baby’s diaper, wipe their diaper area, then rub powder all over the baby’s body.) Others model harmful behavior, like TabTale’s “Crazy Eye Clinic,” which teaches children to clean their eyes with a sharp instrument, and has more than one million downloads. (The game is currently not available on Google Play and its webpage is down.)

The complaint also broadly takes issue with apps that use common SDKs like those from Unity or Flurry (disclosure: Flurry and TechCrunch share a corporate parent) to collect device identifiers from the children’s apps.

“Nearly three-quarters of the apps in the Family section transmit device identifiers to third parties,” reads the complaint. “There is no way for us to know for sure what the device identifiers are used for. Since many of the apps send device identifiers to third parties that specialize in monetizing apps and/or engaging in interest-based (behavioral) advertising, it seems unlikely that this information is being used solely to support internal operations,” it says.

Above: Strawberry Shortcake Puppy Palace was called out for aggressive monetization efforts. Strawberry tells kids to buy things to keep the puppy happy — the implication is if you don’t pay, you’re making puppies sad.

The groups say that Google has been aware of all these problems for some time, but hasn’t taken adequate steps to enforce its criteria for developers. As a result, the consumer advocacy groups are urging the FTC to investigate the Play Store’s practices.

The coalition had previously asked the FTC to investigate developers of children’s apps aimed at preschoolers who were using manipulative advertising. But today’s complaint is focused on Google.

“Google (Alphabet, Inc.) has long engaged in unethical and harmful business practices, especially when it comes to children,” explained Jeff Chester, executive director of the Center for Digital Democracy. “And the Federal Trade Commission has for too long ignored this problem, placing both children and their parents at risk over their loss of privacy, and exposing them to a powerful and manipulative marketing apparatus. As one of the world’s leading providers of content for kids online, Google continues to put the enormous profits they make from kids ahead of any concern for their welfare,” Chester said.

Apple was not similarly called out because a similar analysis has not yet been done on its app marketplace, Josh Golin, executive director at CCFC told us. In Google’s case, he explained, two major studies found widespread issues with the Play Store apps for kids. One from Berkeley researchers found widespread COPPA non-compliance; the other, by University of Michigan researchers, found children’s play experience was often completely interrupted and undermined by aggressive marketing tactics.

The complaint comes at a time where there is increased scrutiny as to how tech companies are misusing and abusing consumer data and violating privacy. Kids game have already been the subject of some concern. And this morning, an NYT investigation into Facebook revealed it had shared more of users’ personal data than disclosed with major tech companies, following a year of data scandals.

The issue of data privacy is an industry-wide problem. Tech companies’ failures on this front will likely lead to increased regulation going forward.

Not all the named developers were immediately available to comment this morning. We’ll update if comments are provided. (Update: TutoToons says they removed the inappropriate content from the app after becoming aware of the complaint. They urged parents and child advocacy groups to reach out to them directly in the future.)

Google says it’s taking the complaint seriously. It has removed thousands of apps from its Designed for Families program this year, and rejects a third of applications.

“Parents want their children to be safe online and we work hard to protect them. Apps in our Designed for Families program have to comply with strict policies on content, privacy and advertising, and we take action on any policy violations that we find,” a Google spokesperson says. “We take these issues very seriously and continue to work hard to remove any content that is inappropriately aimed at children from our platform,” they added.

The full complaint is below.

 

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Paris-based VC firm Partech unveils Chapter54 accelerator to help European startups cross into Africa – TechCrunch

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Partech Shaker, the innovation division of the Paris-based VC firm Partech, has launched an accelerator program christened Chapter54 to help European startups launch in African markets.

The accelerator will take in 10 technology startups annually over the next four years for the Chapter54 program, which will last up to eight months. Application for the inaugural cohort will open next month, and successful startups will begin the acceleration journey in April.

Chapter54 will be funded to a tune of $5.7 million (EUR 5 million) by the KfW Development Bank on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).

“Investors from all sectors are welcome – but they must have business experience, be registered in a European country and active in two European countries, and have a solid financial foundation and regular income,” said KfW.

Vincent Previ, the managing director of Chapter54 told TechCrunch that startups will be taken through several preparation stages including mentorship programs with founders running successful enterprises across the continent, and with c-suite tech or startup executives.

“We have a very good knowledge of the European tech ecosystem because we are one of the most prominent investors in European tech. We are now a major investor in African tech, and we have the capacity to run innovative projects through Partech Shaker… From KfW’s view, we were a good player to run this acceleration program,” said Previ.

Chapter54 will match mentors with startups based on their business models, conduct webinars with different speakers and review startups’ operation roadmaps “to check if what they have designed is consistent with the reality on the ground.”

Previ said that during these sessions, they will “check that the participating companies have the right level of knowledge of what it means to run a tech business in Africa, and have what it takes to hire tech people.”

“We are going to have a session where we will compare the gig economies in Europe and Africa, and another where we will help them do a B2C market sizing in Africa (which is not similar to Europe).”

“If you want to enter Africa, you have to do it properly, and as per legal requirements. You have to tweak the way you work. We are going to help them to reinvent the way they operate their businesses (to enter African markets).”

Chapter54 is targeting startups in growth stage with some sizable traction in the countries they operate in across Europe.

Partech has 15 investments in nine different countries across Africa including Wave; a U.S. and Senegal-based mobile money service provider, Tugende, a Ugandan mobility-tech company, and Trade Depot, a Nigeria and U.S.- based company that connects consumer goods brands to retailers.

Africa’s growing young and tech-savvy population, deepening internet penetration, developing digital infrastructure, and fast uptake of modern technologies by its people has made the continent the next growth frontier. KfW said it is supporting Chapter54 to promote growth and create jobs.

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Ahead of a February event, Samsung teases Galaxy S/Note merger – TechCrunch

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Last summer, Samsung announced that – for the first time in a decade – it wouldn’t be releasing a new Note. The future of the well-loved phablet was a big, open question, as the hardware giant acknowledged a shift in focus to foldables, a form factor it felt was finally ready for a truly mainstream push.

Further muddying the waters is the Galaxy S line – Samsung’s primary flagship, which has steadily been blurring the line separating itself from the Note. “Instead of unveiling a new Galaxy Note this time around,” the company’s president wrote at the time, “we will further broaden beloved Note features to more Samsung Galaxy devices.”

That’s meant a fairly steady increase in the S series’ screen sizes over the years, culminating with the addition of S-Pen functionality for the S21 Ultra last January. In August, the company also brought its proprietary stylus to the Galaxy Fold line leaving some wondering whether the Note was quietly being phased out.

Coming fresh off CES and staring down the face of MWC, we find ourselves entering Unpacked territory – the time of year when the company announces the latest additions to the S series. Roh is back with another somewhat vaguely worded post that celebrates the life of the Note’s life, pointing out how its 5.3-inch display caused a minor stir back in 2011. It seems quaint now, though it’s worth pointing out for those who weren’t at the IFA unveiling, that big screens meant much larger and thicker devices than they do now.

The post strongly suggests a proper merging of the two flagships to make more room for its foldables.

“With every fresh evolution of Samsung Galaxy devices, we have introduced features that redefine the entire mobile category,” the executive writes. “And we’re about to rewrite the rules of industry once again. At Unpacked in February 2022, we’ll introduce you to the most noteworthy S series [emphasis added by TC] device we’ve ever created. The next generation of Galaxy S is here, bringing together the greatest experiences of our Samsung Galaxy into one ultimate device.”

“Noteworthy” could mean a lot of things in this context. The most obvious seems to be an S22 Ultra becoming the S22 Note. Does that mean a proper stylus slot? Could we be seeing further S Pen integration across the lines? I’d say most likely not to that one, if only because the carefully worded post uses the singular “noteworthy device.” There are still some big questions in the lead up to the event – which may or may not be answered early, given the frequency of leaks surrounding these devices. Also on-tap for the line are improved night/low-light photos and a more sustainable design, which has become a priority for the company in recent years.

Samsung is once again betting that consumer excitement and brand loyalty will be enough to get users on-board, sight unseen as it gets set to open reservations for the new smartphone and an unnamed Galaxy tablet tomorrow.

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a16z, Avenir and Google back South African mobile games publisher Carry1st in $20M round – TechCrunch

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Carry1st, a South African publisher of social games and interactive content across Africa, has raised a $20 million Series A extension led by Andreessen Horowitz (a16z). This is a16z’s first investment in an Africa-headquartered company (the firm has previously invested in Branch and Zipline, companies with some of its operations in Africa but headquartered in the U.S).

Carry1st also received investments from Avenir and Google; it’s the latter’s second check from its Africa Investment Fund.

A couple of prominent individual investors, including Nas and the founders of Chipper Cash, Sky Mavis and Yield Guild Games, took part.

The round — which is an extension of the Series A Carry1st raised last May from Riot Games, Konvoy Ventures, Raine Ventures and TTV Capital — also saw the same investors double down on their investments in the company. 

Andreessen Horowitz general partners David Haber and Jonathan Lai will join Carry1st’s board as observers. 

Cordel Robbin-Coker, Lucy Hoffman and Tinotenda Mundangepfupfu founded Carry1st in 2018. The South Africa-based company, which currently has a team of 37 people across 18 countries, wants to use this additional capital to scale interactive content across Africa.

The company started as a game studio where it conceptualized, developed (from system designs to artwork and engineering), and launched mobile games. Over time, it switched to a hybrid model, adopting a publishing role and handling distribution, marketing and operations.

Carry1st co-founder and chief executive Robbin-Coker told TechCrunch that Carry1st has mainly focused on its publishing arm since it went hybrid.

The three-year-old company has signed publishing deals for seven games from six studios globally, including Tilting Point, publisher of Nickelodeon’s SpongeBob: Krusty Cook-Off, which Carry1st recently launched in Africa. Others include CrazyLabs and Sweden’s Raketspel, a studio with over 120 million downloads across its portfolio.

Carry1st said it provides a full-stack publishing solution, handling user acquisition, live operations, community management and monetization for its partners.

“We have a full-suite service that starts with distribution and partnerships. We help them create bespoke marketing materials from short-form advertising videos to statics, and we customize their content to resonate with individuals in different countries,” said Robbin-Coker.

“And then we operate the game and we also monetize. So we’ve built out our monetization engine to allow users to be able to pay for content that they want more easily across Africa.”

It also enhances monetization in the region through its embedded payments solutions, where customers can pay via a range of local payment options, including bank transfers, crypto and mobile money.

L-R: Tinotenda Mundangepfupfu, Lucy Hoffman and Cordel Robbin-Coker

Shortly after closing its Series A round, Carry1st launched its online marketplace for virtual goods. On this marketplace, called Carry1st Shop, users of a Carry1st game can purchase virtual goods such as airtime, mobile data, entertainment vouchers, grocery store vouchers and gaming currency.

Games revenue has increased 90% month-on-month since the second half of last year, the company said. It’s not unexpected considering the astonishing growth of games in terms of quantity and revenue (gaming apps accounted for nearly 70% of all App Store revenue last year) on both Apple and Google stores since the pandemic.

The company’s online marketplace is noticing even faster growth, said Robbin-Coker, especially among users in South Africa and Nigeria.

Carry1st will use this funding to expand its content portfolio, grow its product and engineering teams, and obtain “tens of millions” of new users on the back of this revenue growth in its games and marketplace products.

In a statement, the company said it intends to acquire more users by expanding into game co-development with studios. It is also eyeing the possibility of developing infrastructure to support play-to-earn gaming in Africa, thus venturing into web3.

Cryptocurrency tokens such as SLP, AXS and MANA are used in play-to-earn games. They can be withdrawn to a crypto wallet and traded for another cryptocurrency like bitcoin or ultimately sold for fiat cash to be used in the real world. Carry1st wants to create on- and off-ramps (platforms that convert fiat into crypto and back) and accept crypto at point-of-sale in its marketplace.

“When we think about Carry1st, we want to be the leading consumer internet company in the region. And we think that the best kind of wedge would be able to do that is a combination of gaming and micropayments and online commerce,” the CEO said.

“These industries are being pretty significantly disrupted or augmented with web3 and crypto. And as more gaming content starts to integrate with NFTs and cryptocurrencies, we think there’s a really big opportunity to partner with those studios the same way we partner with free-to-play studios.”

Africa is the next major growth market for gaming globally. The rapid tech adoption from its 1.1 billion millennials and GenZs is a significant driver for this. Carry1st released a report last year with Newzoo showing that the number of games in sub-Saharan Africa will increase by 275% in the next decade. Gaming revenues are projected to see a 728% increase in the same period.

These stats present a much bigger addressable market than what Carry1st envisioned when it launched four years ago. And with the company’s converging at the intersection of gaming, fintech and web3, there is a broader set of opportunities (which we can see in other emerging markets) to go after in Africa. It’s one factor that piqued a16z’s interest in the company.

“We are delighted to be making our first investment in an Africa-headquartered company in Carry1st, a next-generation mobile games and fintech platform,” Haber said in a statement. “We see immense opportunity for the company to mirror outstanding successes we’ve seen in markets like India, China, and Southeast Asia. We couldn’t be more thrilled to partner with founders Cordel, Lucy, Tino, and the Carry1st team on their mission to build the Garena of Africa.”

Carry1st was seemingly intentional about the investors it brought into this round, especially as it looks to move deep in gaming, web3 and fintech across Africa.

As one of the largest crypto-centric funds, at over $3 billion, a16z brings unmatched expertise in gaming and web3. Google, via its products and phones, will help Carry1st deepen penetration and engagement in Africa. At the same time, Avenir continues to make a big push in African fintech following its big-sized check in Flutterwave.

As for the individual investors, Nas has been fairly prolific with his crypto investments, and Axie Infinity founders own the world’s biggest web3 gaming company.

“It’s a heavyweight group. We’re excited, and we think that their combination will be beneficial for us. Hopefully, it’s a sign that we’re on the right track and this helps drive strategic partnerships for us in the future,” said Robbin-Coker.

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