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Tencent-backed news app Qutoutiao nabs $171M from Alibaba – TechCrunch

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The race to give Chinese users their daily dose of news intensifies as Qutoutiao, a rival to TikTok parent Bytedance, net an installment of sizable backing.

Alibaba is injecting $171 million in a convertible loan to Qutoutiao, the three-year-old news and video aggregation startup, according to an announcement released Thursday. The transaction will convert into about 11.4 million shares of Qutoutiao at a price of $15 per American depositary shares, representing about 4 percent of Qutoutiao. The deal arrived just six months after Qutoutiao raised $84 million in a downsized initial public offering through Nasdaq.

TechCrunch has reached out Qutoutiao for more details on its new funding and will update the story if we hear back.

Qutoutiao, which means “Fun headlines” in Chinese, runs a news app that feeds users content based on their past habit and an e-book reading app for those with a longer attention span. The Shanghai-based company is among a handful of startups alongside ecommerce challenger Pinduoduo that are piling into the largely untapped, smaller cities outside China’s major urban centers of Beijing and Shanghai for growth.

The fresh capital will make Qutoutiao one of the unusual Chinese tech startups with backings from both Alibaba and Tencent, the arch-foes that compete in many realms. The other companies that have enjoyed fundings from both heavyweights include car-hailing service Didi Chuxing and youth-focused media company Bilibili.

Alibaba’s support is also a significant boost for Qutoutiao as it fights a relentless battle with Bytedance, a growing threat to China’s tech veterans. Unlike most of China’s emerging startups, Bytedance has not taken fundings from Baidu, Alibaba and Tencent, collectively known as the “BAT” to acknowledge their dominance in the Chinese internet.

Bytedance has had a history of hostility with social media leader Tencent while it has been more pally with Alibaba the e-commerce giant, which agreed to facilitate ecommerce sales for Bytedance influencers.

Bytedance runs an empire of popular new media products that include short-form video app Douyin and news distribution platform Jinri Toutiao. TikTok, which is the international version of Douyin, is turning heads across the globe including in the United States and has reportedly spurred a Facebook clone.

Battling in the relentless Chinese market has come at huge costs for Qutoutiao, which sees itself spending heavily on marketing to collect and retain users. While its 2018 revenues jumped 484 percent to $440 million, net loss soared to $283 million in the year compared to just $14.3 million in the previous period. But the startup is ready to spend more as it works on a new app that could take on Douyin in China’s blossoming short-form video market.

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Geico security breach exposed customers’ driver’s license numbers

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A letter submitted by insurance company Geico to the California attorney general’s office details a data breach that took place earlier this year, exposing customers’ driver’s license numbers. The letter doesn’t include certain pertinent details such as how many people were potentially impacted by the security issue, though it did note the numbers may be used as part of unemployment benefits fraud.

The letter, which was first spied by TechCrunch, is dated April 9 and explains that the security incident took place from January 21 to March 1. During that time, the hacker(s) used customer data “acquired elsewhere” to get access to Geico subscribers’ driver’s license numbers using the company’s online sales system.

The company’s letter explains that it believes “this information could be used to fraudulently apply for unemployment benefits” in the customers’ names. For this reason, Geico customers who receive any unexpected mail from their state’s unemployment agency are encouraged to check it for signs of fraud taking place in their name.

Geico notes that it secured its website when it learned about the issue and that it investigated the cause of the breach. The company’s letter says that Geico has “implemented — and continues to implement — additional security enhancements to help prevent future fraud and illegal activities on our website.”

The company hasn’t yet published a security breach note on its website, but the letter is written to customers and explains that they will be offered a year’s subscription to IdentityForce for identity theft protection. The letter, it seems, includes a one-time code the customers can use to activate the free data monitoring service.

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Nextdoor app targets toxic behavior with anti-racism warning

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Nextdoor, the app that allows neighbors to connect with each other and share details about their communities, is introducing a new feature that will detect and warn against potentially racist content. The company announced the new feature today, explaining that it will ask users to reconsider their posts before sharing them if certain offensive language is detected.

If you’ve ever used Nextdoor, you’re likely familiar with some of the drama that can take place on community boards — as well as abusive behavior that not only ruins the experience for everyone, but that can also be harmful to people living in the community. Nextdoor’s new feature aims to reduce those messages.

The company says that it has rolled out an anti-racism prompt that will appear in the app when certain phrases are detected. Though the user won’t be blocked from posting, they will be asked to consider editing their content before publishing it to ensure it doesn’t violate the company’s policy and bring harm to users.

For example, Nextdoor has banned the use of the phrase ‘White Lives Matter’ and doesn’t allow the use of ‘Blue Lives Matter’ or ‘All Lives Matter’ if the post aims to ‘undermine racial equality.’ Users will see the warning starting this week on mobile devices.

This isn’t the first time Nextdoor has introduced a prompt designed to reduce problematic content on its platform. Back in 2019, Nextdoor introduced a warning called the ‘Kindness Reminder’ that spots ‘offensive language’ and encourages the user to edit their post or comment before sharing it.

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Facebook plans huge audio push with Soundbites, podcasts, and tools

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Facebook has announced some big plans related to audio and its place on the company’s primary social media platform. Starting later this year, the company plans to introduce multiple changes for its users, including the addition of sound creation tools backed by artificial intelligence and a new audio format the company calls Soundbites.

Podcasts are quite popular at the moment, and so it makes sense that Facebook would want to get in on the audio market. According to the company, it has ‘seen the continuing rise of audio on’ Messenger and WhatsApp, both of which enable users to record short voice clips rather than typing out messages.

Facebook plans to build upon this feature in a way that makes it both easier and more fun, it said in an announcement on Monday. This can include the ability to send the audio equivalent of reaction GIFs, such as a sound clip of cricket chirping to get your point across to someone.

These will be joined by some larger efforts, the first of which will be what Facebook calls ‘a sound studio in your pocket.’ Put simply, the company plans to introduce audio creation tools on mobile, making it possible for users to produce ‘magically great’ audio using AI tech. What would be the point of this?

Facebook says users can, for example, create background audio for their Stories, including the use of content from the company’s Sound Collection. Joining these tools will be Facebook’s new Soundbites audio format, which will be reserved for short audio clips — someone could, for example, share a Soundbite of them telling a joke rather than typing it out.

Likewise, Facebook says you’ll soon be able to play podcasts directly in its app, including in the background with your phone’s screen turned off. The feature will include podcast episodes and show recommendations made based on the user’s expressed interests, plus users will be able to follow and share shows.

Finally, Facebook says it will soon test Live Audio Rooms, a groups feature that will enable communities of people to participate in live audio sessions. This feature will enter testing this summer, while the podcasts will arrive ‘in the next few months,’ the same timeframe in which the company plans to start testing its Soundbites format.

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