Category: Google

Mobile payments firms in India are now scrambling to make money

Vijay Shekhar Sharma, founder and chief executive of India’s most valuable startup, Paytm, posed an existential question in a recent press conference.

“What do you think of the commercial model for digital mobile payments. How do we make money?” Sharma asked Nandan Nilekani, one of the key architects of the Universal Payments Infrastructure that created a digital payments revolution in the country.

It’s the multi-billion-dollar question that scores of local startups and international giants have been scrambling to answer as many of them aggressively shift their focus to serving merchants and building lending products and other financial services .

New Delhi’s abrupt move to invalidate much of the paper bills in the cash-dominated nation in late 2016 sent hundreds of millions of people to cash machines for months to follow.

For a handful of startups such as Paytm and MobiKwik, this cash crunch meant netting tens of millions of new users in a span of a few months.

India then moved to work with a coalition of banks to develop the payments infrastructure that, unlike Paytm and MobiKwik’s earlier system, did not act as an intermediary “mobile wallet” to serve as an intermediary between users and their banks, but facilitated direct transaction between two users’ bank accounts.

Silicon Valley companies quickly took notice. For years, Google and the likes have attempted to change the purchasing behavior of people in many Asian and African markets, where they have amassed hundreds of millions of users.

In Pakistan, for instance, most people still run errands to neighborhood stores when they want to top up credit to make phone calls and access the internet.

With China keeping its doors largely closed for foreign firms, India, where many American giants have already poured billions of dollars to find their next billion users, it was a no-brainer call.

“Unlike China, we have given equal opportunities to both small and large domestic and foreign companies,” said Dilip Asbe, chief executive of NPCI, the payments body behind UPI.

And thus began the race to participate in the grand Indian experiment. Investors have followed suit as well. Indian fintech startups raised $2.74 billion last year, compared to 3.66 billion that their counterparts in China secured, according to research firm CBInsights.

And that bet in a market with more than half a billion internet users has already started to pay off.

“If you look at UPI as a platform, we have never seen growth of this kind before,” Nikhil Kumar, who volunteered at a nonprofit organization to help develop the payments infrastructure, said in an interview.

In October, just three years after its inception, UPI had amassed 100 million users and processed over a billion transactions. It has sustained its growth since, clocking 1.25 billion transactions in March — despite one of the nation’s largest banks going through a meltdown last month.

“It all comes down to the problem it is solving. If you look at the western markets, digital payments have largely been focused on a person sending money to a merchant. UPI does that, but it also enables peer-to-peer payments and across a wide-range of apps. It’s interoperable,” said Kumar, who is now working at a startup called Setu to develop APIs to help small businesses easily accept digital payments.

Vice-president of Google’s Next Billion Users Caesar Sengupta speaks during the launch of the Google “Tez” mobile app for digital payments in New Delhi on September 18, 2017 (Photo: Getty Images via AFP PHOTO / SAJJAD HUSSAIN)

The Google Pay app has amassed over 67 million monthly active users. And the company has found the UPI pipeline so fascinating that it has recommended similar infrastructure to be built in the U.S.

In August, the Federal Reserve proposed to develop a new inter-bank 24×7 real-time gross settlement service that would support faster payments in the country. In November, Google recommended (PDF) that the U.S. Federal Reserve implement a real-time payments platform such as UPI.

“After just three years, the annual run rate of transactions flowing through UPI is about 19% of India’s Gross Domestic Product, including 800 million monthly transactions valued at approximately $19 billion,” wrote Mark Isakowitz, Google’s vice president of Government Affairs and Public Policy.

Paytm itself has amassed more than 150 million users who use it every year to make transactions. Overall, the platform has 300 million mobile wallet accounts and 55 million bank accounts, said Sharma.

Search for a business model

But despite on-boarding more than a hundred million users on their platform, payment firms are struggling to cut their losses — let alone turn a profit.

At an event in Bangalore late last year, Sajith Sivanandan, managing director and business head of Google Pay and Next Billion User Initiatives, said current local rules have forced Google Pay to operate in India without a clear business model.

Mobile payment firms never levied any fee to users as a strategy to expand their reach in the country. A recent directive from the government has now put an end to the cut they were receiving to facilitate UPI transactions between users and merchants.

Google’s Sivanandan urged the local payment bodies to “find ways for payment players to make money” to ensure every stakeholder had incentives to operate.

Paytm, which has raised more than $3 billion to date, reported a loss of $549 million in the financial year ending in March 2019.

The firm, backed by SoftBank and Alibaba, has expanded to several new businesses in recent years, including Paytm Mall, an e-commerce venture, social commerce, financial services arm Paytm Money and a movies and ticketing category.

This year, Paytm has expanded to serve merchants, launching new gadgets such as a stand that displays QR check-out codes that comes with a calculator and a battery pack, a portable speaker that provides voice confirmations of transactions and a point-of-sale machine with built-in scanner and printer.

In an interview with TechCrunch, Sharma said these devices are already garnering impressive demand from merchants. The company is offering these gadgets to them as part of a subscription service that helps it establish a steady flow of revenue.

The firm’s Money arm, which offers lending, insurance and investing services, has amassed over 3 million users. The head of Paytm Money, Pravin Jadhav, resigned from the company this week, a person familiar with the matter said. A Paytm spokeswoman declined to comment. (Indian news outlet Entrackr first reported the development.)

Flipkart’s PhonePe, another major player in India’s payments market, today serves more than 175 million users, and over 8 million merchants. Its app serves as a platform for other businesses to reach users, explained Rahul Chari, co-founder and CTO of the firm, in an interview with TechCrunch. The company is currently not taking a cut for the real estate on its app, he added.

But these startups’ expansion into new categories means that they now have to face off even more rivals, and spend more money to gain a foothold. In the social commerce category, for instance, Paytm is competing with Naspers-backed Meesho and a handful of new entrants; and heavily-backed OkCredit and KhataBook today lead the bookkeeping market.

BharatPe, which raised $75 million two months ago, is digitizing mom and pop stores and granting them working capital. And PineLabs, which has already become a unicorn, and MSwipe have flooded the market with their point-of-sale machines.

A vendor holds an Mswipe terminal, operated by M-Swipe Technologies Pvt Ltd., in an arranged photograph at a roadside stall in Bengaluru, India, on Saturday, Feb. 4, 2017. (Photographer: Dhiraj Singh/Bloomberg via Getty Images)

“They have no choice. Payment is the gateway to businesses such as e-commerce and lending that you can monetize. In Paytm’s case, their earlier bet was Paytm Mall,” said Jayanth Kolla, founder and chief analyst at research firm Convergence Catalyst.

But Paytm Mall has struggled to compete with giants Amazon India and Walmart’s Flipkart. Last year, Mall pivoted to offline-to-online and online-to-offline models, wherein orders placed by customers are serviced from local stores. The company also secured about $160 million from eBay last year.

An executive who previously worked at Paytm Mall said the venture has struggled to grow because its goal-post has constantly shifted over the years. It has recently started to focus on selling fastags, a system that allows vehicle owners to swiftly pay toll fees. At least two more executives at the firm are on their way out, a person familiar with the matter said.

Kolla said the current dynamics of India’s mobile payments market, where more than 100 firms are chasing the same set of audience, is reminiscent of the telecom market in the country from more than a decade ago.

“When there were just four to five players in the telecom market, the prospect of them becoming profitable was much higher. They were scaling like crazy. They grew with the lowest ARPU in the world (at about $2) and were still profitable.

“But the moment that number grew to more than a dozen overnight, and the new players started offering more affordable plans to subscribers, that’s when profitability started to become elusive,” he said.

To top that off, the arrival of Reliance Jio, a telecom operator run by India’s richest man, in 2016 in the country with the cheapest tariff plans in the world, upended the market once again, forcing several players to leave the market, or declare bankruptcies, or consolidate.

India’s mobile payments market is now heading to a similar path, said Kolla.

If there were not enough players fighting for a slice of India’s mobile payments market that Credit Suisse estimate could reach $1 trillion by 2023, WhatsApp, the most popular app in the country with more that 400 million users, is set to roll out its mobile payments service in the country in a couple of months.

At the aforementioned press conference, Nilekani advised Sharma and other players to focus on financial services such as lending.

Unfortunately, the coronavirus outbreak that promoted New Delhi to order a three-week lockdown last month is likely going to impact the ability of millions of people to use such services.

“India has more than 100 million microfinance accounts, serviced in cash every week by gig-economy workers, who hawk vegetables on street corners or embroider saris sold in malls, among other things. Three out of four workers make a living by working casually for others or at their family firms and farms. Prolonged shutdowns will impair their ability to repay loans of 2.1 trillion rupees ($28.5 billion), putting the world’s largest microfinance industry at risk,” wrote Bloomberg columnist Andy Mukherjee.

Smart telescope startups vie to fix astronomy’s satellite challenge

Starlink, the satellite branch of Elon Musk’s SpaceX company, has come under fire in recent months from astronomers over concerns about the negative impact that its planned satellite clusters have reportedly had — and may continue to have — on nighttime observation.

According to a preliminary report released last month by the International Astronomical Union (IAU), the satellite clusters will interfere with the ability of telescopes to peer deep into space, and will limit the amount of observable hours, as well as the quality of images taken, by observatories.

The stakes involved are high, with projects like Starlink potentially being central to the future of global internet coverage, especially as new infrastructure implements 5G and edge computing. At the same time, satellite clusters — whether from Starlink or national militaries — could threaten the foundations of astronomical research.

Musk himself has been inconsistent in his response. Some days, he promises collaboration with scientists to solve the issue; on others, such as two weeks ago at the Satellite 2020 conference, he declared himself “confident that we will not cause any impact whatsoever in astronomical discoveries.” 

Critics have pointed fingers in many directions in search of a solution to the issue. Some astronomers demand that spacefaring companies like Musk’s look after the interests of science (Amazon and Facebook have also been developing satellite projects similar to SpaceX’s) . Others ask national or international governing bodies to step in and create regulations to manage the problem. But there’s another sphere altogether that may provide a solution: startups looking to develop “smart telescopes” capable of compensating for cluster interference.

Should they deliver on their promise, smart telescopes and shutter units will save observatories time and money by protecting images that are incredibly complicated to generate.

IBM, Amazon, Google and Microsoft partner with White House to provide compute resources for COVID-19 research

During today’s White House coronavirus task force press conference, President Trump announced the launch of a new public/private consortium to “unleash the power of American supercomputing resources.” The members of this consortium are the White House, the Department of Energy and IBM . Other companies, including Google, Amazon and Microsoft, as well as a number of academic institutions, are also “contributing lots of different things,” the president said.

While Trump’s comments were characteristically unclear, IBM provided more details, noting that it is working with a number of national labs and other institutions to offer a total of 330 petaflops of compute to various projects in epidemiology, bioinformatics and molecular modeling. Amazon, Google and Microsoft are also part of the consortium, which is being led by IBM, the White House Office of Science and Technology Policy, and the Department of Energy.

IBM and its partners will coordinate the efforts to evaluate proposals and provide access to high-performance computing resources to those that are most likely to have an immediate impact.

“How can supercomputers help us fight this virus? These high-performance computing systems allow researchers to run very large numbers of calculations in epidemiology, bioinformatics, and molecular modeling. These experiments would take years to complete if worked by hand, or months if handled on slower, traditional computing platforms,” writes Dario Gil, IBM’s Director of Research.

AWS has already dedicated $20 million to support COVID-19 research while Microsoft has already announced a number of different initiatives, though mostly around helping businesses cope with the fallout of this crisis. Google has now launched its own coronavirus website (though it’s very different from the one Trump once promised) and Alphabet’s Verily is helping Bay Area residents find testing sites if needed. It’s unclear what exactly Google and Microsoft will contribute to these current efforts, though. We’ve reached out to both companies and will update this post if we hear back.

“Today I’m also announcing the launch of a new public/private consortium organized by the White House, the Department of Energy and IBM to unleash the power of American supercomputing resources to fight the Chinese virus,” Trump, who continues to insist on calling COVID-19 ‘the Chinese virus,’ said in today’s press briefing.

“The following leaders from private industries, academia and government will be contributing and they are gonna be contributing a lot of different things, but compute primarily — computing resources to help researchers discover new treatments and vaccine. They will be working along with NIH and all of the people working on this. But tremendous help from IBM, Google, Amazon, Microsoft, MIT, Rensselaer Polytechnic Institute, the Department of Energy’s, the National Science Foundation and NASA. They are all contributing to this effort.”

This Week in Apps: YouTube TV cancels Apple’s rev share, more bad news for mobile voting, WhatsApp hits 2B users

Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.

The app industry is as hot as ever, with a record 204 billion downloads in 2019 and $120 billion in consumer spending in 2019, according to App Annie’s recently released “State of Mobile” annual report. People are now spending 3 hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.

In this Extra Crunch series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.

This week, we look at YouTube TV’s decision to stop revenue-sharing with Apple, another mobile voting app with serious flaws, new Apple launches in coding and AR, Microsoft’s game-streaming service Project xCloud arrival on iOS and other notable app news and trends, including WhatsApp’s big 2 billion user milestone, and more.

Headlines

YouTube TV fights back against Apple’s cut of in-app subscription revenue

This week, YouTube emailed customers subscribed to its YouTube TV service by way of Apple’s in-app purchases to let them know that this subscription offering will be discontinued starting on March 13, 2020. Current subscribers will have their subscription canceled automatically on their billing date after March 13, the letter said.

This is a pretty severe way for Google to end its subscription revenue-sharing with Apple, however. Most companies that decide to shut off in-app subscriptions still continue to honor those from existing subscribers — they just stop selling to new customers. In YouTube TV’s case, it’s actually ending its relationship with all its customers on Apple devices with the hope they’ll return and resubscribe. That’s quite a risk, given that YouTube TV is not the only streaming TV service out there, and customers getting their subscription canceled may take this opportunity to shop around. The timing is also poorly thought-out, given that YouTube TV just picked up new subs following Sony’s PlayStation Vue shutdown — and now it’s kicking them out.

The move makes Google the latest company to rebel against Apple’s 30% cut of all in-app payments (which drops to 15% in year two). A growing number of app publishers are refusing to share a cut of their revenue with Apple — even saying that Apple’s decision to charge this fee is anti-competitive. For example, Spotify believes Apple’s fee makes it more difficult to compete with Apple’s built-in music service, and has raised the issue repeatedly to regulators. Netflix also stopped paying the “Apple tax” over a year ago.

Mobile voting app Voatz, used by several states, was filled with security flaws

Above: Voatz, via The NYT

Last week, we looked at how a smartphone app meant to tabulate votes from the caucuses really screwed things up in Iowa. This week, MIT researchers took a look at mobile voting app Voatz, which has been used to tally votes for federal elections in parts of West Virginia, Oregon, Utah and Washington as part of various mobile voting pilot programs. The researchers found the app was riddled with security flaws that would let attackers monitor votes or even change ballots or block them without users’ knowledge. Attackers could also create a tainted paper trail, making a reliable audit impossible — despite Voatz’s promise of using blockchain technology to increase security. One security expert, speaking to VICE, called the app “sloppy” and filled with “elementary” mistakes.

Coming on the heels of the Iowa caucus mobile voting disaster, this latest news delivers another huge blow to the promise of mobile voting in the U.S.

Google Assistant now works with Tile to find your lost stuff

Google Assistant is today rolling out support for Tile’s Bluetooth tracker, designed to help you keep up with your often misplaced items — like your keys, purse, wallet, remote, and more. The new integration will allow Google Assistant users on any Nest device to ask questions like, “Hey Google, where is my purse?” They can instruct the Assistant to ring their device” by saying things like “Hey Google, make my backpack ring.”

Variations on these commands are also supported, like, “Hey Google, find my…” or “Hey Google, ring my…”

In addition, you can ask for the location of an item. If the item is in the house, the Assistant will return an appropriate location using Tile’s Bluetooth capabilities, by saying something like “your keys were last seen today at 9 PM near the Kitchen speaker.” If the item is out of Bluetooth range, the Assistant will instead return the item’s last known location, based on Tile’s location services.

 

Tile leverages its large network of Tile app users as a crowd-finding platform to help when items are missing. To date, the company has sold 22+ million Tile devices worldwide and is locating more than 5 million items per day across 230 countries.

Google announced its partnership with Tile back in September 2019, but had said at the time the feature would launch later that year.

The partnership arrives at a critical time for Tile’s business. Apple is reportedly preparing to launch a Tile competitor, possibly called AirTags, that integrates deeply with iOS. According to the latest forecast from well-known Apple analyst Ming-Chi Kuo, Apple in the first half of 2020 will introduce the product. But unlike Tile, Apple’s are ultra-wideband tags that promise greater accuracy than Bluetooth LE and Wi-Fi.

Evidence of Apple’s tags was already found in iOS 13 code, as well.

Apple’s plan to move into Tile’s business was one of the examples brought up in a recent congressional hearing about Apple’s anti-competitive practices. At the hearing, Tile general counsel Kirsten Daru commented on how hard it is to compete with Apple.

“You might be the best team in the league, but you’re playing against a team that owns the field, the ball, the stadium, and the entire league, and they can change the rules of the game at any time,” she said.

In this context, Tile’s move to partner with Google isn’t just about expanding its business — it’s also about saving it.

To take advantage of the new feature, you’ll need to set up your Tile to sync with the Google Home app.

Google wants to phase out support for third-party cookies in Chrome within two years

Google today announced its plans to phase out support for third-party cookies in Chrome within the next two years. The fact that Google will drop support for these cookies, which are typically used to track users across the web, doesn’t necessarily come as a surprise, given Google’s announcements around privacy in Chrome, including its proposed ‘privacy sandbox.’  But this aggressive timeline is new and puts the company on a track that will have repercussions for a lot of other industries as well.

“This is our strategy to re-architect the standards of the web, to make it privacy-preserving by default,” Justin Schuh, Google’s director for Chrome engineering, told me. “There’s been a lot of focus around third-party cookies, and that certainly one of the tracking mechanisms, but that’s just a tracking mechanism and we’re calling it out because it’s the one that people are paying attention to.” Preventing fingerprinting, among other things, is also something Google’s team is working on.

Starting this February, Google will already implement some techniques for limiting cross-site tracking by enforcing its new SameSite rules and by requiring that cookies that are labeled for third-party use can only be accessed over an HTTPS connection. The new SameSite rules, which Google had already tested with a subset of users in Chrome over the last few months, are somewhat complex, but the over idea here is that developers who want others to be able to use their cookies will have to explicitly label them as such.

Over the next two years, though, Google plans to go far beyond this and completely remove support for third-party cookies from Chrome. That, however, marks a massive change for the advertising industry and the publishers that often depend on marketers’ ability to (for better or worse) track users across the web. Google’s solution to this is the ‘privacy sandbox,’ which would ideally still allow advertisers to show you relevant ads while also allowing you to share as little about you and your browsing history as possible.

What exactly this will look like still remains to be seen, though, as a lot of the ideas are still in flux. Schuh, however, noted that Google doesn’t want to go this alone and that it plans to go through the web standards process for this. He noted that Google plans to start some trials over the next year or so and start migrating advertisers and publishers to some of the new systems it is working on.

This is a massive change, though, and Google will surely face some pushback. “I’m not going to say that everyone has been on board for all of our proposals,” Schuh admitted. “But in all corners, some of the proposals have been received very well. For the ones that haven’t, we’re open to alternative solutions as long as they have the kind of privacy and security properties — as long as they have the same kind of predictability that we expect — because we don’t want to put bandaid solutions on top of the web, we would rather fix the architecture of the web, […] we just don’t see any alternative but to fix the architecture of the web.”

Others, however, will have to get on board — including other browser vendors. Schuh seems optimistic that this will happen, in part because it is also in the best interest of the users. “We don’t want the web to be fragmented,” he said. “We don’t want people to have to figure out every different thing they have to do on every different browser. We want a level of consistency here, even if there are details that browsers choose to be different.”

Right now, a lot of Chrome’s competitors like Mozilla’s Firefox have taken pretty radical approaches to simply blocking many third-party cookies. Google argues that this will be to the detriment of the web and only drive the industry to find workarounds.

As with all of Google’s recent privacy proposals, it’ll be interesting to watch how the industry will react to this one. Given Google’s own role in the advertising ecosystem, Google has some clear financial interests in getting this right — and to keep the advertising ecosystem on the web healthy.

 

Waymo’s Anca Dragan and Ike Robotics CTO Jur van den Berg are coming to TC Sessions: Robotics+AI

The road to “solving” self-driving cars is riddled with challenges, from perception and decision making to figuring out the interaction between humans and robots.

Today we’re announcing that joining us at TC Sessions: Robotics+AI on March 3 at UC Berkeley are two experts who play important roles in the development and deployment of autonomous vehicle technology: Anca Dragan and Jur van den Berg.

Dragan is an assistant professor in UC Berkeley’s electrical engineering and computer sciences department, as well as a senior research scientist and consultant for Waymo, the former Google self-driving project that is now a business under Alphabet. She runs the InterACT Lab at UC Berkeley, which focuses on algorithms for human-robot interaction. Dragan also helped found, and serves on, the steering committee for the Berkeley AI Research Lab, and is co-PI of the Center for Human-Compatible AI.

Last year, Dragan was awarded the Presidential Early Career Award for Scientists and Engineers.

Van den Berg is the co-founder and CTO of Ike Robotics, a self-driving truck startup that last year raised $52 million in a Series A funding round led by Bain Capital  Ventures. Van den Berg has been part of the most important, secretive and even controversial companies in the autonomous vehicle technology industry. He was a senior researcher and developer in Apple’s special projects group, before jumping to self-driving trucks startup Otto. He became a senior autonomy engineer at Uber after the ride-hailing company acquired Otto .

All of this led to Ike, which was founded in 2018 with Nancy Sun and Alden Woodrow, who were also veterans of Apple, Google and Uber Advanced Technologies Group’s self-driving truck program.

TC Sessions: Robotics+AI returns to Berkeley on March 3. Make sure to grab your early-bird tickets today for $275 before prices go up by $100. Students, grab your tickets for just $50 here.

Startups, book a demo table right here and get in front of 1,000+ of Robotics/AI’s best and brightest — each table comes with four attendee tickets.

Facebook won’t ban political ads, prefers to keep screwing democracy

It’s 2020 — a key election year in the US — and Facebook is doubling down on its policy of letting people pay it to fuck around with democracy.

Despite trenchant criticism — including from US lawmakers accusing Facebook’s CEO to his face of damaging American democracy the company is digging in, announcing as much today by reiterating its defence of continuing to accept money to run microtargeted political ads.

Instead of banning political ads Facebook is trumpeting a few tweaks to the information it lets users see about political ads — claiming it’s boosting “transparency” and “controls” while leaving its users vulnerable to default settings that offer neither.  

Political ads running on Facebook are able to be targeted at individuals’ preferences as a result of the company’s pervasive tracking and profiling of Internet users. And ethical concerns about microtargeting led the UK’s data protection watchdog to call in 2018 for a pause on the use of digital ad tools like Facebook by political campaigns — warning of grave risks to democracy.

Facebook isn’t for pausing political microtargeting, though. Even though various elements of its data-gathering activities are also subject to privacy and consent complaints, regulatory scrutiny and legal challenge in Europe, under regional data protection legislation.

Instead, the company made it clear last fall that it won’t fact-check political ads, nor block political messages that violate its speech policies — thereby giving politicians carte blanche to run hateful lies, if they so choose.

Facebook’s algorithms also demonstrably select for maximum eyeball engagement, making it simply the ‘smart choice’ for the modern digitally campaigning politician to run outrageous BS on Facebook — as long time Facebook exec Andrew Bosworth recently pointed out in an internal posting that leaked in full to the NYT.

Facebook founder Mark Zuckerberg’s defence of his social network’s political ads policy boils down to repeatedly claiming ‘it’s all free speech man’ (we paraphrase).

This is an entirely nuance-free argument that comedian Sacha Baron Cohen expertly demolished last year, pointing out that: “Under this twisted logic if Facebook were around in the 1930s it would have allowed Hitler to post 30-second ads on his solution to the ‘Jewish problem.’”

Facebook responded to the take-down with a denial that hate speech exists on its platform since it has a policy against it — per its typical crisis PR playbook. And it’s more of the same selectively self-serving arguments being dispensed by Facebook today.

In a blog post attributed to its director of product management, Rob Leathern, it expends more than 1,000 words on why it’s still not banning political ads (it would be bad for advertisers wanting to reaching “key audiences”, is the non-specific claim) — including making a diversionary call for regulators to set ad standards, thereby passing the buck on ‘democratic accountability’ to lawmakers (whose electability might very well depend on how many Facebook ads they run…), while spinning cosmetic, made-for-PR tweaks to its ad settings and what’s displayed in an ad archive that most Facebook users will never have heard of as “expanded transparency” and “more control”. 

In fact these tweaks do nothing to reform the fundamental problem of damaging defaults.

The onus remains on Facebook users to do the leg work on understanding what its platform is pushing at their eyeballs and why.

Even as the ‘extra’ info now being drip-fed to the Ad Library is still highly fuzzy (“We are adding ranges for Potential Reach, which is the estimated target audience size for each political, electoral or social issue ad so you can see how many people an advertiser wanted to reach with every ad,” as Facebook writes of one tweak.)

The new controls similarly require users to delve into complex settings menus in order to avail themselves of inherently incremental limits — such as an option that will let people opt into seeing “fewer” political and social issue ads. (Fewer is naturally relative, ergo the scale of the reduction remains entirely within Facebook’s control — so it’s more meaningless ‘control theatre’ from the lord of dark pattern design. Why can’t people switch off political and issue ads entirely?)

Another incremental setting lets users “stop seeing ads based on an advertiser’s Custom Audience from a list”.

But just imagine trying to explain WTF that means to your parents or grandparents — let alone an average Internet user actually being able to track down the ‘control’ and exercise any meaningful agency over the political junk ads they’re being exposed to on Facebook.

It is, to quote Baron Cohen, “bullshit”.

Nor are outsiders the only ones calling out Zuckerberg on his BS and “twisted logic”: A number of Facebook’s own employees warned in an open letter last year that allowing politicians to lie in Facebook ads essentially weaponizes the platform.

They also argued that the platform’s advanced targeting and behavioral tracking tools make it “hard for people in the electorate to participate in the public scrutiny that we’re saying comes along with political speech” — accusing the company’s leadership of making disingenuous arguments in defence of a toxic, anti-democratic policy. 

Nothing in what Facebook has announced today resets the anti-democratic asymmetry inherent in the platform’s relationship to its users.

Facebook users — and democratic societies — remain, by default, preyed upon by self-interested political interests thanks to Facebook’s policies which are dressed up in a self-interested misappropriation of ‘free speech’ as a cloak for its unfettered exploitation of individual attention as fuel for a propaganda-as-service business.

Yet other policy positions are available.

Twitter announced a total ban on political ads last year — and while the move doesn’t resolve wider disinformation issues attached to its platform, the decision to bar political ads has been widely lauded as a positive, standard-setting example.

Google also followed suit by announcing a ban on “demonstrably false claims” in political ads. It also put limits on the targeting terms that can be used for political advertising buys that appear in search, on display ads and on YouTube.

Still Facebook prefers to exploit “the absence of regulation”, as its blog post puts it, to not do the right thing and keep sticking two fingers up at democratic accountability — because not applying limits on behavioral advertising best serves its business interests. Screw democracy.

“We have based [our policies] on the principle that people should be able to hear from those who wish to lead them, warts and all, and that what they say should be scrutinized and debated in public,” Facebook writes, ignoring the fact that some of its own staff already pointed out the sketchy hypocrisy of trying to claim that complex ad targeting tools and techniques are open to public scrutiny.