Facebook plans crackdown on ad targeting by email without consent

Facebook is scrambling to add safeguards against abuse of user data as it reels from backlash over the Cambridge Analytica scandal. Now TechCrunch has learned Facebook will launch a certification tool that demands that marketers guarantee email addresses used for ad targeting were rightfully attained. This new Custom Audiences certification tool was described by Facebook representatives to their marketing clients, according to two sources. Facebook will also prevent the sharing of Custom Audience data across Business accounts.

This snippet of a message sent by a Facebook rep to a client notes that “for any Custom Audiences data imported into Facebook, Advertisers will be required to represent and warrant that proper user content has been obtained.”

Once shown the message, Facebook spokesperson Elisabeth Diana told TechCrunch “I can confirm there is a permissions tool that we’re building.” It will require that advertisers and the agencies representing them pledge that “I certify that I have permission to use this data”, she said.

Diana noted that “We’ve always had terms in place to ensure that advertisers have consent for data they use but we’re going to make that much more prominent and educate advertisers on the way they can use the data.” The change isn’t in response to a specific incident, but Facebook does plan to re-review the way it works with third-party data measurement firms to ensure everything is responsibly used. This is a way to safeguard data” Diana concluded.The company declined to specify whether it’s ever blocked usage of a Custom Audience because it suspected the owner didn’t have user consent. ”

The social network is hoping to prevent further misuse of ill-gotten data after Dr. Aleksandr Kogan’s app that pulled data on 50 million Facebook users was passed to Cambridge Analytica in violation of Facebook policy. That sordid data is suspected to have been used by Cambridge Analytica to support the Trump and Brexit campaigns, which employed Custom Audiences to reach voters.

Facebook launched Custom Audiences back in 2012 to let businesses upload hashed lists of their customers email addresses or phone numbers, allowing advertisers to target specific people instead of broad demographics. Custom Audiences quickly became one of Facebook’s most powerful advertising options because businesses could easily reach existing customers to drive repeat sales. The Custom Audiences terms of service require that businesses have “provided appropriate notice to and secured any necessary consent from the data subjects” to attain and use these people’s contact info.

But just like Facebook’s policy told app developers like Kogan not to sell, share, or misuse data they collected from Facebook users, the company didn’t go further to enforce this rule. It essentially trusted that the fear of legal repercussions or suspension on Facebook would deter violations of both its app data privacy and Custom Audiences consent policies. With clear financial incentives to bend or break those rules and limited effort spent investigating to ensure compliance, Facebook left itself and its users open to exploitation.

Last week Facebook banned the use of third-party data brokers like Experian and Acxiom for ad targeting, closing a marketing featured called Partner Categories. Facebook is believed to have been trying to prevent any ill-gotten data from being laundered through these data brokers and then directly imported to Facebook to target users. But that left open the option for businesses to compile illicit data sets or pull them from data brokers, then upload them to Facebook as Custom Audiences by themselves.

The Custom Audiences certification tool could close that loophole. It’s still being built, so Facebook wouldn’t say exactly how it will work. I asked if Facebook would scan uploaded user lists and try to match them against a database of suspicious data, but for now it sounds more like Facebook will merely require a written promise.

Meanwhile, barring the sharing of Custom Audiences between Business Accounts might prevent those with access to email lists from using them to promote companies unrelated to the one to which users gave their email address. Facebook declined to comment on how the new ban on Custom Audience sharing would work.

Now Facebook must find ways to thwart misuse of its targeting tools and audit anyone it suspects may have already violated its policies. Otherwise it may receive the ire of privacy-conscious users and critics, and strengthen the case for substantial regulation of its ads (though regulation could end up protecting Facebook from competitors who can’t afford compliance). Still the question remains why it took such a massive data privacy scandal for Facebook to take a tougher stance on requiring user consent for ad targeting. And given that written promises didn’t stop Kogan or Cambridge Analytica from misusing data, why would they stop advertisers bent on boosting profits?

For more on Facebook’s recent scandals, check out TechCrunch’s coverage:

The real threat to Facebook is the Kool-Aid turning sour

Facebook will cut off access to third party data for ad targeting

Regulation could protect Facebook, not punish it

 

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Original Content podcast: We drop by Netflix’s ‘Terrace House’

Terrace House is a tough show to explain.

Like The Real World and other reality TV, the show puts a group of largely young and attractive strangers together in a house. But that’s about where the similarities end.

On Terrace House, most of the cast members genuinely seem to be rooting for each other. And while there’s drama, it’s scaled way back, so that passive aggressive remarks about soup can end up dominating an episode.

Darrell’s a big fan, so on this week’s episode of the Original Content podcast, we checked out the latest season, Opening New Doors (a co-production of Netflix and Japanese TV network Fuji). Sadly, this is his final episode as a regular host, but at least he got to go out with a bang. (And we’re hoping to lure him back.)

We also covered the week’s streaming and entertainment news, like the (distant) launch date for Apple’s TV efforts, Netflix’s plans for Carmen Sandiego and new trailers for The Handmaid’s Tale and Westworld. Plus, Jordan finishes watching the entire Star Wars saga.

You can listen in the player below, subscribe using Apple Podcasts or find us in your podcast player of choice. If you like the show, please let us know by leaving a review on Apple. You also can send us feedback directly.

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Arbtr wants to create an anti-feed where users can only share one thing at a time

At a time when the models of traditional social networks are being questioned, it’s more important than ever to experiment with alternatives. Arbtr is a proposed social network that limits users to sharing a single thing at any given time, encouraging “ruthless self-editing” and avoiding “nasty things” like endless feeds filled with trivial garbage.

It’s seeking funds on Kickstarter and could use a buck or two. I plan to.

Now, I know what you’re thinking. “Why would I give money to maybe join a social network eventually that might not have any of my friends on it on it? That is, if it ever even exists?” Great question.

The answer is: how else do you think we’re going to replace Facebook? Someone with a smart, different idea has to come along and we have to support them. If we won’t spare the cost of a cup of coffee for a purpose like that, then we deserve the social networks we’ve got. (And if I’m honest, I’ve had very similar ideas over the last few years and I’m eager to see how they might play out in reality.)

The fundamental feature is, of course, the single-sharing thing. You can only show off one item at a time, and when you post a new one, the old one (and any discussion, likes, etc) will be deleted. There will be options to keep logs of these things, and maybe premium features to access them (or perhaps metrics), but the basic proposal is, I think, quite sound — at the very least, worth trying.

Some design ideas for the app. I like the text one but it does need thumbnails.

If you’re sharing less, as Arbtr insists you will, then presumably you’ll put more love behind those things you do share. Wouldn’t that be nice?

We’re in this mess because we bought wholesale the idea that the more you share, the more connected you are. Now that we’ve found that isn’t the case – and in fact we were in effect being fattened for a perpetual slaughter — I don’t see why we shouldn’t try something else.

Will it be Arbtr? I don’t know. Probably not, but we’ve got a lot to gain by giving ideas like this a shot.

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Does Ready Player One reveal the future of VR?

Knitting machines power up with computer-generated patterns for 3D shapes

At last, a use for that industrial knitting machine you bought at a yard sale! Carnegie Mellon researchers have created a method that generates knitting patterns for arbitrary 3D shapes, opening the possibility of “on-demand knitting.” Think 3D printing, but softer.

The idea is actually quite compelling for those of us who are picky about their knitwear. How often have we picked up a knit cap, glove, or scarf only to find it too long, too short, too tight, too loose, etc?

If you fed your sartorial requirements (a 3D mesh) into this system from James McCann and students at CMU’s Textiles Lab, it could quickly spit out a pattern that a knitting machine could follow easily yet is perfectly suited for your purposes.

This has to be done carefully — the machines aren’t the same as human knitters, obviously, and a poorly configured pattern might lead to yarn breaking or jamming the machine. But it’s a lot better than having to build that pattern purl by purl.

With a little more work, “Knitting machines could become as easy to use as 3D printers,” McCann said in a CMU news release.

Of course, it’s unlikely you’ll have one of your own. But maker spaces and designer ateliers (I believe that’s the term) will be more likely to if it’s this easy to create new and perfectly sized garments with them.

McCann and his team will be presenting their research at SIGGRAPH this summer.

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Who gains from Facebook’s missteps?

When Facebook loses, who wins?

That’s a question for startups that may be worth contemplating following Facebook’s recent stock price haircut. The company’s valuation has fallen by around $60 billion since the Cambridge Analytica scandal surfaced earlier this month and the #DeleteFacebook campaign gained momentum.

That’s a steep drop, equal to about 12 percent of the company’s market valuation, and it’s a decline Facebook appears to be suffering alone. As its shares fell over the past couple of weeks, stocks of other large-cap tech and online media companies have been much flatter.

So where did the money go? It’s probably a matter of perspective. For a Facebook shareholder, that valuation is simply gone. And until executives’ apologies resonate and users’ desire to click and scroll overcomes their privacy fears, that’s how it is.

An alternate view is that the valuation didn’t exactly disappear. Investors may still believe the broad social media space is just as valuable as it was a couple of weeks ago. It’s just that less of that pie should be the exclusive domain of Facebook.

If one takes that second notion, then the possibilities for who could benefit from Facebook’s travails start to get interesting. Of course, there are public market companies, like Snap or Twitter, that might pick up traffic if the #DeleteFacebook movement gains momentum without spreading to other big brands. But it’s in the private markets where we see the highest number of potential beneficiaries of Facebook’s problems.

In an effort to come up with some names, we searched through Crunchbase for companies in social media and related areas. The resulting list includes companies that have raised good-sized rounds in the past couple of years and could conceivably see gains if people cut back on using Facebook or owning its stock.

Of course, people use Facebook for different things (posting photos, getting news, chatting with friends and so on), so we lay out a few categories of potential beneficiaries of a Facebook backlash.

Messaging

Facebook has a significant messaging presence, but it hasn’t been declared the winner. Alternatives like Snap, LINE, WeChat and plain old text messages are also massively popular.

That said, what’s bad for Messenger and Facebook-owned WhatsApp is probably good for competitors. And if more people want to do less of their messaging on Facebook, it helps that there are a number of private companies ready to take its place.

Crunchbase identified six well-funded messaging apps that could fit the bill (see list). Collectively, they’ve raised well over $2 billion — if one includes the $850 million initial coin offering by Telegram.

Increasingly, these private messaging startups are focused on privacy and security, including Wickr, the encrypted messaging tool that has raised more than $70 million, and Silent Circle, another encrypted communications provider that has raised $130 million.

Popular places to browse on a screen

People who cut back on Facebook may still want to spend hours a day staring at posts on a screen. So it’s likely they’ll start staring at something else that’s content-rich, easy-to-navigate and somewhat addictive.

Luckily, there are plenty of venture-backed companies that fit that description. Many of these are quite mature at this point, including Pinterest for image collections, Reddit for post and comment threads and Quora for Q&A (see list).

Granted, these will not replace the posts keeping you up to date on the life events of family and friends. But they could be a substitute for news feeds, meme shares and other non-personal posts.

Niche content

A decline in Facebook usage could translate into a rise in traffic for a host of niche content and discussion platforms focused on sports, celebrities, social issues and other subjects.

Crunchbase News identified at least a half-dozen that have raised funding in recent quarters, which is just a sampling of the total universe. Selected startups run the gamut from The Players’ Tribune, which features first-hand accounts for top athletes, to Medium, which seeks out articles that resonate with a wide audience.

Niche sites also provide a more customized forum for celebrities, pundits and subject-matter experts to engage directly with fans and followers.

Community and engagement

People with common interests don’t have to share them on Facebook. There are other places that can offer more tailored content and social engagement.

In recent years, we’ve seen an increase in community and activity-focused social apps gain traction. Perhaps the most prominent is Nextdoor, which connects neighbors for everything from garage sales to crime reports. We’re also seeing some upstarts focused on creating social networks for interest groups. These include Mighty Networks and Amino Apps.

Though some might call it a stretch, we also added to the list WeWork, recent acquirer of Meetup, and The Guild, two companies building social networks in the physical world. These companies are encouraging people to come out and socially network with other people (even if just means sitting in a room with other people staring at a screen).

Watch where the money goes

Facebook’s latest imbroglio is still too recent to expect a visible impact in the startup funding arena. But it will be interesting to watch in the coming months whether potential rivals in the above categories raise a lot more cash and attract more users.

If there’s demand, there’s certainly no shortage of supply on the investor front. The IPO window is wide open, and venture investors are sitting on record piles of dry powder. It hasn’t escaped notice, either, that social media offerings, like Facebook, LinkedIn and Snap, have generated the biggest exit total of any VC-funded sector.

Moreover, those who’ve argued that it’s too late for newcomers have a history of being proven wrong. After all, that’s what people were saying about would-be competitors to MySpace in 2005, not long before Facebook made it big.

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Red Hat looks beyond Linux

The Red Hat Linux distribution is turning 25 years old this week. What started as one of the earliest Linux distributions is now the most successful open-source company, and its success was a catalyst for others to follow its model. Today’s open-source world is very different from those heady days in the mid-1990s when Linux looked to be challenging Microsoft’s dominance on the desktop, but Red Hat is still going strong.

To put all of this into perspective, I sat down with the company’s current CEO (and former Delta Air Lines COO) Jim Whitehurst to talk about the past, present and future of the company, and open-source software in general. Whitehurst took the Red Hat CEO position 10 years ago, so while he wasn’t there in the earliest days, he definitely witnessed the evolution of open source in the enterprise, which is now more widespread than every.

“Ten years ago, open source at the time was really focused on offering viable alternatives to traditional software,” he told me. “We were selling layers of technology to replace existing technology. […] At the time, it was open source showing that we can build open-source tech at lower cost. The value proposition was that it was cheaper.”

At the time, he argues, the market was about replacing Windows with Linux or IBM’s WebSphere with JBoss. And that defined Red Hat’s role in the ecosystem, too, which was less about technological information than about packaging. “For Red Hat, we started off taking these open-source projects and making them usable for traditional enterprises,” said Whitehurst.

Jim Whitehurst, Red Hat president and CEO (photo by Joan Cros/NurPhoto via Getty Images)

About five or six ago, something changed, though. Large corporations, including Google and Facebook, started open sourcing their own projects because they didn’t look at some of the infrastructure technologies they opened up as competitive advantages. Instead, having them out in the open allowed them to profit from the ecosystems that formed around that. “The biggest part is it’s not just Google and Facebook finding religion,” said Whitehurst. “The social tech around open source made it easy to make projects happen. Companies got credit for that.”

He also noted that developers now look at their open-source contributions as part of their resumé. With an increasingly mobile workforce that regularly moves between jobs, companies that want to compete for talent are almost forced to open source at least some of the technologies that don’t give them a competitive advantage.

As the open-source ecosystem evolved, so did Red Hat. As enterprises started to understand the value of open source (and stopped being afraid of it), Red Hat shifted from simply talking to potential customers about savings to how open source can help them drive innovation. “We’ve gone from being commeditizers to being innovators. The tech we are driving is now driving net new innovation,” explained Whitehurst. “We are now not going in to talk about saving money but to help drive innovation inside a company.”

Over the last few years, that included making acquisitions to help drive this innovation. In 2015, Red Hat bought IT automation service Ansible, for example, and last month, the company closed its acquisition of CoreOS, one of the larger independent players in the Kubernetes container ecosystem — all while staying true to its open-source root.

There is only so much innovation you can do around a Linux distribution, though, and as a public company, Red Hat also had to look beyond that core business and build on it to better serve its customers. In part, that’s what drove the company to launch services like OpenShift, for example, a container platform that sits on top of Red Hat Enterprise Linux and — not unlike the original Linux distribution — integrates technologies like Docker and Kubernetes and makes them more easily usable inside an enterprise.

The reason for that? “I believe that containers will be the primary way that applications will be built, deployed and managed,” he told me, and argued that his company, especially after the CoreOS acquisition, is now a leader in both containers and Kubernetes. “When you think about the importance of containers to the future of IT, it’s a clear value for us and for our customers.”

The other major open-source project Red Hat is betting on is OpenStack. That may come as a bit of a surprise, given that popular opinion in the last year or so has shifted against the massive project that wants to give enterprises an open source on-premise alternative to AWS and other cloud providers. “There was a sense among big enterprise tech companies that OpenStack was going to be their savior from Amazon,” Whitehurst said. “But even OpenStack, flawlessly executed, put you where Amazon was five years ago. If you’re Cisco or HP or any of those big OEMs, you’ll say that OpenStack was a disappointment. But from our view as a software company, we are seeing good traction.”

Because OpenStack is especially popular among telcos, Whitehurst believes it will play a major role in the shift to 5G. “When we are talking to telcos, […] we are very confident that OpenStack will be the platform for 5G rollouts.”

With OpenShift and OpenStack, Red Hat believes that it has covered both the future of application development and the infrastructure on which those applications will run. Looking a bit further ahead, though, Whitehurst also noted that the company is starting to look at how it can use artificial intelligence and machine learning to make its own products smarter and more secure, but also at how it can use its technologies to enable edge computing. “Now that large enterprises are also contributing to open source, we have a virtually unlimited amount of material to bring our knowledge to,” he said.

 

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Google needs your help finding Waldo

At some point in the not-so-distant past, April Fools was about pranks and hoaxes, but given that we apparently have enough of those on the web, the day has somehow morphed into a celebration of random jokey things. This year’s Google Maps gag is no exception.

Starting today, when you open Google Maps on your phone or desktop, you’ll see Waldo in his trademark red and white sweater, waving at you you from the side of your screen. That’s because Waldo is sharing his location with you for the next few days and he really wants to be found (or not… I’m never quite sure about what Waldo’s real motivations are…). You can also ask the Google Assistant “Hey Google. Where’s Waldo?”

Then, when you click on Waldo in the map, you get to see a standard “Where is Waldo” image and your job is to find him, as well as Woof, Wenda, Wizard Whitebeard and Odlaw.

Now if Google had wanted to make this a real April Fools joke, it would’ve announced this and then never released it or just shown you a standard “Where is Waldo” image without Waldo. That way, it would’ve driven everybody mad. But I’m pretty sure it’s for real, so head over to Google Maps and give it a try.

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