What Facebook did not do in India
Also in today’s edition: It’s getting worse in China, US tech stocks snap on guidance, Match box prices to go up after 14 years
Good morning! “Go to bed,” Douyin, super popular short-video app TikTok’s Chinese sibling tells users when it notices them bingeing for too long. Sometimes it tells them to put down the phone. Users cannot swipe away the messages as the app hijacks their screen and remains frozen. Douyin is merely the messenger. It’s President Xi Jinping’s tough love really.
Btw, our podcast has been going strong for over a month now. Tune in on your daily jog, drive to the office, or even as you WFH-ers have breakfast in bed. We promise it’ll be music to your ears.
The Market Signal
Stocks: The BSE Sensex and NSE’s Nifty trended lower towards the end of the week as investors booked profits and awaited fresh cues. US Fed chairman, Jerome Powell, said Friday that prices are likely to continue to rise as supply chains remain disrupted and major US ports choked. Even though Powell indicated the Fed was nowhere close to a rate hike, it may weigh on investors’ minds in the final quarter of 2021.
Worse Than They Think
Markets know that the Chinese economy is slowing down, but they don’t know how bad it is. Beijing has cancelled IPOs, fined tech and education companies, a property giant is on the brink of disaster, and, not to forget, a power shortage and the pandemic has crippled industries.
According to a 'bearish scenario' painted by Bank of America strategists, China's economic growth could fall to 7.5% this year and 2.2% in 2022. Experts believe that Xi Jinping will change the economic model to ease the financial risks. China already saw a huge slowdown in growth this quarter to 4.9% from 7.9% in the previous quarter.
Covid-19 fear is back: The country fears another surge in Covid-19 cases, which could pull down an already sluggish economy further.
Not all bad: China may soon end its ongoing clampdown on tech giants. But Guo Shuqing, party chief of the People’s Bank of China said that they will still hold strict regulations to curb monopolies.
The Apple Effect Zaps Tech Stocks
It was a tech stock bloodbath on Friday. Stocks of Snap, Facebook, Google, and other ad-dependent media companies lost more than $142 billion in value in a single trading session.
Snap’s Warning: Snap’s shares fell 27%, its biggest single-day drop ever after it issued an unexpected warning that companies were holding back ad spends after Apple changed its privacy policies and global supply chain remained disrupted.
What exactly? Apple changed privacy settings on the iOS 14, making it harder for advertisers to track, measure and monitor campaign performance. Anyway, products are not reaching store shelves as US ports are so choked that nothing’s moving.
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Yesterday I rented a boat and took the leader of one of Flexport's partners in Long Beach on a 3 hour of the port complex. Here's a thread about what I learned. | |||
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While supply chain shortages are expected to continue into the first few months of the next year, iOS privacy changes will have a long-term impact.
The Facebook Files Come To India
Over the weekend, a consortium of newspapers and agencies, thanks to the whistleblower Frances Haugen, revealed how Facebook’s own researchers were aware of the problems dogging its platforms — hate speech, algorithmic amplification, and related harms. Here’s some more, and this concerns India, the company’s largest market by user base.
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Boom! The India/Facebook stories are here. wsj.com/articles/faceb… (WSJ) | |||
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The TLDR:
“Inflammatory content on Facebook spiked 300% above previous levels at times during the months following December 2019.” (Wall Street Journal)
“Facebook was so concerned about how its services were tied to communal conflict that it dispatched researchers to interview dozens of users.” (WSJ)
“Facebook researchers determined two Hindu nationalist groups with ties to India’s ruling party post inflammatory anti-Muslim content on the platforms, according to two separate reports by teams investigating abuse of the company’s services.” (WSJ)
In a report, “Adversarial Harmful Networks: India Case Study”, researchers said that “much of the content posted by users, groups, and pages from the…RSS is never flagged…because Facebook lacks sufficient technical systems for detecting material in the Hindi and Bengali languages.” (WSJ)
“Facebook hasn’t designated the RSS for removal given political sensitivities.” (WSJ)
“I’ve seen more images of dead people in the past three weeks, than I have in my entire life total (sic),” a Facebook researcher wrote after creating a test account that went down the rabbit hole. (New York Times)
“In a separate report produced after the elections, Facebook found that over 40 percent of top views, or impressions, in…West Bengal…were “fake or inauthentic.” One inauthentic account had amassed more than 300 million impressions.” (The New York Times)
“In a document titled “Lotus Mahal”, the company noted that members with links to the BJP had created multiple Facebook accounts to amplify anti-Muslim content…” (The Associated Press)
India’s median group size (Facebook) is 140,000 users (The New York Times)
The Signal
Coupled with another Facebook whistleblower Sophie Zhang’s recent revelations, these reports have revealed how much of a blind spot India (and the larger “global South”) is for Facebook, despite its importance in user metrics.
In this regard, one cold, lopsided statistic stands out: 87% of Facebook’s global budget for misinformation, is set aside for the US despite only accounting for 10% (including Canada) of “daily active users,” while the remaining 13% of the budget is set aside for “ROW” or Rest of World, including India. This is concerning given the country’s (and the larger global South’s) social complexities and huge user base.
Of bigger concern is how Facebook allowed its platforms to be repeatedly abused in the name of free speech. Its algorithms, its own researchers noted, amplify and recommend content that was “an inundation of hate speech, misinformation, and celebrations of violence”. Add conspiracy theories to that list, and it’s inaction gets starker.
A rebrand might be coming soon, but without a reset, Facebook might well continue to dominate news cycles.
Match Box Prices On Fire
Lighting a fire would become a wee bit more expensive starting December. For the first time in 14 years, the price of matchboxes is set to double from ₹1 to ₹2 on the back of costlier raw materials.
Inflation spares nothing: From wood and phosphorus to powdered glass and wax, a number of ingredients go into manufacturing the little boxes of light sticks. Rising inflation has pushed up the cost of 14 of its components.
The cost of one kilogram of red phosphorus has almost doubled from ₹425 to ₹810, while wax and the outer and inner boards of the box have risen at least 38%.
Pricing decision: While initially the All India Chamber of Matches in Sivakasi debated increasing the price only by 50p a box, they decided against it for it would make it hard for shopkeepers to return change.
What Else Made The Signal?
Privacy win: In a win for internet security, A Swiss court ruled that Geneva-based encrypted email services provider Proton does not have to retain data required for any surveillance as it does not classify as a telecommunications provider.
Arabian pledge: Saudi Arabia, which supplies one out of every 10 barrels of crude oil consumed globally, has vowed to spend $186 billion to reduce its carbon emissions to zero by 2060. But its oil exports won’t be counted.
Get out: Turkey has thrown out 10 ambassadors, including those of the US, France and Germany after they called for the release of businessman and philanthropist, Osman Kavala.
Twitter bias: An internal Twitter study showed that its algorithms promoted right-leaning political content. Germany, which has an agreement with social media apps to take down hate speech within 24 hours, is the only country where it did not show a bias.
Clear stand: Fintech company Stripe has invested $75 million in Bangalore-based Clear, formerly ClearTax.
Virus mutant: Seven cases of a new variant of Covid-19 Delta, AY.4, have been detected in Indore.
New IPL teams: The BCCI expects two new IPL team franchises to fetch between ₹7000 crore and ₹10,000 crore each when the 22 companies in the fray begin bidding today.
FWIW
Animal play: Kitties and puppies are great on Instagram reels. Guess what else they make a good prop for? Elections. That’s right. Japan’s upcoming general elections slated for October 31st have animal rights on the agenda, including law that increases charges for abuse and mandatory microchipping of pets.
Lipstick Bro’s day: China’s Li Jiaqi or Lipstick King is clearly the salesman of the year. The male beauty influencer broke records once again by selling goods worth $1.9 billion on day one of Alibaba’s Taobao livestream sale.
Trump card: Trump Media & Technology Group that may go public via a special purpose acquisition company seems to be getting more traction than the former POTUS’s memes. Retail investors are flocking to it with so much enthusiasm that its implied valuation is now pegged at $8.2 billion and it could make him the richest he has ever been.
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