Category: UNCATEGORIZED

This afternoon Airbnb, a well-known private company that connects travelers with places to stay, announced that it was laying off around a quarter of its workforce. The company cited revenue declines and a need to curtail costs in a memo that TechCrunch viewed.

In the note, written by Airbnb CEO and co-founder Brian Chesky, the company said that 1,900 employees will be laid off, or 25.3% of its 7,500 workers. The layoffs will impact a number of internal product groups, including Transportation and Airbnb Studios, efforts that will be placed on hold, and its Hotels and Lux work, which will be “scale[d] back.”

The company declined to break down per-country totals for the layoffs in a phone call with TechCrunch, but its memo did note that its staffing cuts are “mapped to a more focused business.” The former startup appears to be narrowing its efforts, targeting core operations and shedding more experimental and costly endeavours.

According to Chesky’s missive, Airbnb anticipates its 2020 revenue coming in under 50% of 2019’s total; Airbnb saw around $4.8 billion in revenue last year, according to reports.

Airbnb had previously admitted that layoffs were a possibility in light of the COVID-19 pandemic impacting tourism and travel. The company has rapidly added capital in recent weeks including two $1 billion tranches of debt, providing extra liquidity as the world came to a standstill, freezing travelers in-place and decimating global travel spend. Airbnb couldn’t dodge a trend that hits its world directly.

In an effort to keep both the demand and supply sides of its marketplace healthy enough to survive hibernation, Airbnb has allowed users to cancel some reservations without penalty, and provided financial succor to its hosts. Presumably part of its new capital went to fund those efforts, along with providing the firm with enough cash to reach 2021 in reasonable shape.

The company had previously promised a 2020 IPO; many expected the previously wealthy and occasionally profitable firm to pursue a direct listing instead of a traditional IPO as it had a sufficiently strong financial footing heading into 2020. While those days are now behind it, the company did state plainly in its note that it expects that its business “will fully recover” in time.

The question now is when. Airbnb was a long-touted example in Silicon Valley of a highly-valued, lavishly-funded unicorn that could make money and go public on its own terms. None of those expectations had a pandemic written into them.

Separated employees will receive 14 weeks of pay, and one more week for each year served at the company (rounding partial years up). The firm is also dropping its one-year equity cliff so that employees who are laid off with under 12 months of tenure can buy their vested options; Airbnb will also provide 12 months of health insurance through COBRA in the United States, and health care coverage through 2020 in the rest of the world.

In its latest effort to deal with rampant harassment on its platform, Twitter will look into giving users a second chance before they tweet. In a new feature the company is testing, users who use “harmful” language will see a prompt suggesting that they self-edit before posting a reply.

The framing here is a bit disingenuous — harassment on Twitter certainly doesn’t just happen in the “heat of the moment” by otherwise well-meaning individuals — but anything that can reduce toxicity on the platform is probably better than what we’ve got now.

Last year at F8, Instagram rolled out a similar test for its users that would “nudge” them with a warning before they post a potentially offensive comment. In December, the company offered an update on its efforts. “Results have been promising, and we’ve found that these types of nudges can encourage people to reconsider their words when given a chance,” the company wrote in a blog post.

This kind of thing is particularly relevant right now, as companies conduct moderation across their massive platforms with relative skeleton crews. All of the major social networks have announced an increased reliance on AI detection as the pandemic keeps tech workers away from the office. In Facebook’s case, content moderators are among the employees they’d like to bring back first.

We’ve reached out to Twitter for more information about the kind of language that triggers the new test feature and if the company will also consider the prompt for regular tweets that aren’t replies. We’ll update the story if we receive additional info about what this experiment will look like.

Facebook has been struggling to keep its VR hardware supply chains open for months, but at the same time they’ve reportedly been hard at work on the next generation of their popular Quest headset.

According to a report in Bloomberg, Facebook had been planning to release a new version of the Oculus Quest later this year, though the smaller, lighter headset is now likely being delayed to a 2021 launch due to the coronavirus pandemic. The report largely focused on the new device’s form factor and aesthetics. The big updates in the next-generation reportedly include a 10-15% reduction in size, a similar reduction in weight, an updated display and possibly a shift to a plastic housing.

We’re reached out to Oculus for comment on the report.

The most surprising thing in this report is that Oculus was planning a follow-up release to the Quest around 18 months after the first device launched, but what’s also interesting is that none of these updates seem to push new capabilities in the device’s next-generation.

There’s always been a question on how Oculus would decide how to update its hardware. While phone manufacturers deliver updates on an annual basis like clockwork, game console makers have stuck to 5-7 year timelines for pushing big updates. In interviews I’ve had with Oculus execs, they’ve seen this as a bit of an open question themselves, largely inferring that the refresh cycle would sit somewhere in between that of consoles and phones.

For early tech platforms, it isn’t really in the best interest of the dominant player to meaningfully update the hardware very often because the devices fork the user base. Developers create games for differently powered hardware, users can’t play games online with their friends because they have a different iteration device, network effects lessen for an already new platform etc etc.

What pushes early hardware forward past this uncomfortable stage of progressions is competition, but just four years into the consumer VR industry, Oculus doesn’t really have much competition to one-up. The company’s Rift S headset has almost no competition as Oculus has essentially priced out competitors like Samsung and HTC, really only leaving Valve competing on the PC high-end in a niche of a niche. Sony is the only real threat, though its user base is tied to the PlayStation 4. With the Quest headset, there really is no worthwhile competition, leaving Oculus in an more pleasant position when it comes to planning its future.

This gives Oculus some breathing room to focus on aesthetic and usability-driven updates as they did with the Rift S and as it sounds like they may be pursuing with this new reported Quest successor. This may make life a little easier for Facebook’s hardware engineering teams, but it proves most beneficial on the content side, giving titles developed for the system longer shelf lives with users getting a bigger library of games to choose from when they enter the ecosystem as a result.

An “S” or “Pro” update schedule certainly makes sense for Oculus devices right now. While nobody is buying a new headset every 18 months, going three years between updates is an eternity when you’re aiming to court the first generation of users to a platform. The question will be how this shifts once a worthwhile competitor enters the space and disrupts this approach. They’ve probably got some time before this happens.

Daniel Carraway spent his entire career working in paper and bioplastics.

The serial entrepreneur began his career at International Paper working in their research division before founding two previous companies which became cornerstones of the bioplastics industry. His latest venture, RWDC Industries, has raised $133 million in a recent financing to build a new sustainable manufacturing juggernaut in the small city of Athens, Ga.

With offices in Athens and Singapore, RWDC is the fruit of a partnership between Carraway and Roland Wee, an engineer with decades of experience in the chemicals and construction business across Asia.

The two men met through mutual connections as Carraway sought new opportunities to pursue his longtime vision of commercializing bioplastics.  The serial entrepreneur had just stepped away from his work with  Meredian Holdings Group and its subsidiary, Danimer Scientific — companies that sprung from work Carraway started at his kitchen table with his wife back in 2004, he said.

In 2019, bioplastics represented a $95 million opportunity according to a report in Market Data Forecast, but the small size of the current market belies how big the opportunity can be, according to Carraway.

RWDC, Danimer, and Kaneka are all pursuing an opportunity to replace plastic packaging, which was a $234.14 billion market, according to GrandViewResearch. It’s that potential market for plastics that has drawn countless companies over the years — including Carraway’s own — to raise hundreds of millions of dollars.

Several of those companies failed. Perhaps the most successful of the early high-flyers was Metabolix, which had a public offering before the financial crisis hit in 2008. That company sold its bioplastics division to CJ CheilJedang for roughly $10 million and pivoted to crop science.

Carraway insists that the market has changed over the last few decades and the time is finally right for biology to supplant chemistry in industrial manufacturing.

“If you look back at the history of new materials development… especially polymers.. There has never been a new polymer that had been invented that didn’t take twenty to thirty years for it to make wide scale adoption,” said Carraway. “When a polymer is first developed it takes a while to get the manufacturing right to get it at wide scale. [And] it takes time for polymer converters to understand how to use a new material… it’s not that technologically it’s not viable it’s about figuring out how to use the new material.”

Scale is important too, said Carraway. “You have to reach a certain critical availability in metric tons available in the global market to create a situation where people can use the new material,” he said.

RWDC can already make about 5,000 tons of PHA and expects to grow its capacity to make half a million tons of material, but that barely scratches the surface of available capacity for traditional plastics. “For the next decade we’re going to be in a mad scramble to grow production capacity because we’re going to be behind the demand curve,” said Carraway.

Industry observers have seen this story before. Because the new material Carraway is talking about isn’t actually all that new. For at least the past twenty years companies have been working on ways to cheaply manufacture polyhydroxyalkanoates (PHAs). The material is produced by the fermentation of oil or sugars and serve as a replacement for the chemicals that are made from cracking ethane (a product of oil processing) to make plastic.

However, as concerns continue to mount over the environmental degradation caused by plastic pollutants and the contributions the plastics industry makes to emissions causing global climate change, the push for replacing plastics with more sustainable products has gained momentum.

Regulations in Europe will ban many single use plastic products next year forcing companies to build out their supply of bioplastic alternatives or abandon the use of plastics altogether.

Market moves like these have the potential to spur the bioplastics industry and shift production into high gear. Carraway said demand hasn’t been effected by the collapse of oil prices which has driven down the costs of chemicals and plastics.

“Even though our materials are initially more expensive… the amount that they cost over the commodities in normal circumstances isn’t that much,” Carraway said. “Every customer we’re working with has asked us to speed up and give them more. No one has said we want to slow down or scale back or change our plans.”

And propelling the industry forward could provide a lift to local economies that have been financially ravaged by the worldwide COVID-19 pandemic.

At least, that’s what Carraway is hoping will happen in Athens, Ga.

The company is using some of the money it raised from international and US-based investors including the Singapore-based venture capital firm Vickers Venture Partners; IKEA’s investment company; a Swiss pension fund; a Northeastern energy provider; and an industrial chemical company owned by Koch Industries to revive an old factory in the city as its new production plant. 

RWDC said the new facility will bring in 200 jobs to northeastern Georgia.

“We are excited to see RWDC expand its operations in Athens and add a substantial number of new well-paying jobs,” said Athens-Clarke County Mayor, Kelly Girtz. “Athens is the home of the University of Georgia, and we have a long record of supporting innovation and industry. Like communities across America and the world, we want to see a reduction in plastic pollution, and we have high hopes that RWDC, with the help of the Athens community at their new facility, will be able to solve that problem.”

Daniel Carraway spent his entire career working in paper and bioplastics.

The serial entrepreneur began his career at International Paper working in their research division before founding two previous companies which became cornerstones of the bioplastics industry. His latest venture, RWDC Industries, has raised $133 million in a recent financing to build a new sustainable manufacturing juggernaut in the small city of Athens, Ga.

With offices in Athens and Singapore, RWDC is the fruit of a partnership between Carraway and Roland Wee, an engineer with decades of experience in the chemicals and construction business across Asia.

The two men met through mutual connections as Carraway sought new opportunities to pursue his longtime vision of commercializing bioplastics.  The serial entrepreneur had just stepped away from his work with  Meredian Holdings Group and its subsidiary, Danimer Scientific — companies that sprung from work Carraway started at his kitchen table with his wife back in 2004, he said.

In 2019, bioplastics represented a $95 million opportunity according to a report in Market Data Forecast, but the small size of the current market belies how big the opportunity can be, according to Carraway.

RWDC, Danimer, and Kaneka are all pursuing an opportunity to replace plastic packaging, which was a $234.14 billion market, according to GrandViewResearch. It’s that potential market for plastics that has drawn countless companies over the years — including Carraway’s own — to raise hundreds of millions of dollars.

Several of those companies failed. Perhaps the most successful of the early high-flyers was Metabolix, which had a public offering before the financial crisis hit in 2008. That company sold its bioplastics division to CJ CheilJedang for roughly $10 million and pivoted to crop science.

Carraway insists that the market has changed over the last few decades and the time is finally right for biology to supplant chemistry in industrial manufacturing.

“If you look back at the history of new materials development… especially polymers.. There has never been a new polymer that had been invented that didn’t take twenty to thirty years for it to make wide scale adoption,” said Carraway. “When a polymer is first developed it takes a while to get the manufacturing right to get it at wide scale. [And] it takes time for polymer converters to understand how to use a new material… it’s not that technologically it’s not viable it’s about figuring out how to use the new material.”

Scale is important too, said Carraway. “You have to reach a certain critical availability in metric tons available in the global market to create a situation where people can use the new material,” he said.

RWDC can already make about 5,000 tons of PHA and expects to grow its capacity to make half a million tons of material, but that barely scratches the surface of available capacity for traditional plastics. “For the next decade we’re going to be in a mad scramble to grow production capacity because we’re going to be behind the demand curve,” said Carraway.

Industry observers have seen this story before. Because the new material Carraway is talking about isn’t actually all that new. For at least the past twenty years companies have been working on ways to cheaply manufacture polyhydroxyalkanoates (PHAs). The material is produced by the fermentation of oil or sugars and serve as a replacement for the chemicals that are made from cracking ethane (a product of oil processing) to make plastic.

However, as concerns continue to mount over the environmental degradation caused by plastic pollutants and the contributions the plastics industry makes to emissions causing global climate change, the push for replacing plastics with more sustainable products has gained momentum.

Regulations in Europe will ban many single use plastic products next year forcing companies to build out their supply of bioplastic alternatives or abandon the use of plastics altogether.

Market moves like these have the potential to spur the bioplastics industry and shift production into high gear. Carraway said demand hasn’t been effected by the collapse of oil prices which has driven down the costs of chemicals and plastics.

“Even though our materials are initially more expensive… the amount that they cost over the commodities in normal circumstances isn’t that much,” Carraway said. “Every customer we’re working with has asked us to speed up and give them more. No one has said we want to slow down or scale back or change our plans.”

And propelling the industry forward could provide a lift to local economies that have been financially ravaged by the worldwide COVID-19 pandemic.

At least, that’s what Carraway is hoping will happen in Athens, Ga.

The company is using some of the money it raised from international and US-based investors including the Singapore-based venture capital firm Vickers Venture Partners; IKEA’s investment company; a Swiss pension fund; a Northeastern energy provider; and an industrial chemical company owned by Koch Industries to revive an old factory in the city as its new production plant. 

RWDC said the new facility will bring in 200 jobs to northeastern Georgia.

“We are excited to see RWDC expand its operations in Athens and add a substantial number of new well-paying jobs,” said Athens-Clarke County Mayor, Kelly Girtz. “Athens is the home of the University of Georgia, and we have a long record of supporting innovation and industry. Like communities across America and the world, we want to see a reduction in plastic pollution, and we have high hopes that RWDC, with the help of the Athens community at their new facility, will be able to solve that problem.”

The UK has this week started testing a coronavirus contacts tracing app which NHSX, a digital arm of the country’s National Health Service, has been planning and developing since early March. The test is taking place in the Isle of Wight, a 380km2 island off the south coast of England, with a population of around 140,000.

The NHS COVID-19 app uses Bluetooth Low Energy handshakes to register proximity events (aka ‘contacts’) between smartphone users, with factors such as the duration of the ‘contact event’ and the distance between the devices feeding an NHS clinical algorithm that’s being designed to estimate infection risk and trigger notifications if a user subsequently experiences COVID-19 symptoms.

The government is promoting the app as an essential component of its response to fighting the coronavirus — the health minister’s new mantra being: ‘Protect the NHS, stay home, download the app’ — and the NHSX has said it expects the app to be “technically” ready to deploy two to three weeks after this week’s trial.

However there are major questions over how effective the tool will prove to be, especially given the government’s decision to ‘go it alone’ on the design of its digital contacts tracing system — which raises some specific technical challenges linked to how modern smartphone platforms operate, as well as around international interoperability with other national apps targeting the same purpose.

In addition, the UK app allows users to self report symptoms of COVID-19 — which could lead to many false alerts being generated. That in turn might trigger notification fatigue and/or encourage users to ignore alerts if the ratio of false alarms exceeds genuine alerts.

Keep calm and download the app?

How users will generally respond to this technology is a major unknown. Yet mainstream adoption will be needed to maximize utility; not just one-time downloads. Dealing with the coronavirus will be a marathon not a sprint — which means sustaining usage will be vital to the app functioning as intended. And that will require users to trust that the app is both useful for the claimed public health purpose, by being effective at shrinking infection risk, and also that using it will not create any kind of disadvantages for them personally or for their friends and family.

The NHSX has said it will publish the code for the app, the DPIA (data protection impact assessment) and the privacy and security models — all of which sounds great, though we’re still waiting to see those key details. Publishing all that before the app launches would clearly be a boon to user trust.

A separate consideration is whether there should be a dedicated legislation wrapper put around the app to ensure clear and firm legal bounds on its use (and to prevent abuse and data misuse).

As it stands the NHS COVID-19 app is being accelerated towards release without this — relying on existing legislative frameworks (with some potential conflicts); and with no specific oversight body to handle any complaints. That too could impact user trust.

The overarching idea behind digital contacts tracing is to leverage uptake of smartphone technology to automate some contacts tracing, with the advantage that such a tool might be able to register fleeting contacts, such as between strangers on the street or public transport, that may more difficult for manual contacts tracing methods to identify. Though whether these sorts of fleeting contacts create a significant risk of infection with the SARS-CoV-2 virus has not yet been quantified.

All experts are crystal clear on one thing: Digital contacts tracing is only going to be — at very best — a supplement to manual contact tracing. People who do not own or carry smartphones or who do not or cannot use the app obviously won’t register in any captured data. Technical issues may also create barriers and data gaps. It’s certainly not a magic bullet — and may, in the end, turn out to be ill-suited for this use case (we’ve written a general primer on digital contacts tracing here).

One major component of the UK approach is that it’s opted to create a so-called ‘centralized’ system for coronavirus contacts tracing — which leads to a number of specific challenges.

While the NHS COVID-19 app stores contacts events on the user’s device initially, at the point when (or if) a user chooses to report themselves having coronavirus symptoms then all their contacts events data is uploaded to a central server. This means it’s not just a user’s own identifier but a list of any identifiers they have encountered over the past 28 days — so, essentially, a graph of their recent social interactions.

This data cannot be deleted after the fact, according to the NHSX, which has also said it may be used for “research” purposes related to public health — raising further questions around privacy and trust.

Questions around the legal bases for this centralized approach also remain to be answered in detail by the government. UK and EU data protection law emphasize data minimization as a key principle; and while there’s flexibility built into these frameworks for a public health emergency there is still a requirement on the government to detail and justify key data processing decisions.

The UK’s decision to centralize contacts data has another obvious and immediate consequence: It means the NHS COVID-19 app will not be able to plug into an API that’s being jointly developed by Apple and Google to provide technical support for Bluetooth-based national contacts tracing apps — and due to be release this month.

The tech giants have elected to support decentralized app architectures for these apps — which, conversely, do not centralize social graph data. Instead, infection risk calculations are performed locally on the device.

By design, these approaches avoid providing a central authority with information on who infected whom.

In the decentralized scenario, an infected user consents to their ephemeral identifier being shared with other users so apps can do matching locally, on the end-user device — meaning exposure notifications are generated without a central authority needing to be in the loop. (It’s also worth noting there are ways for decentralized protocols to feed aggregated contact data back to a central authority for epidemiological research, though the design is intended to prevent users’ social graph being exposed. A system of ‘exposure notification’, as Apple and Google are now branding it, has no need for such data, is their key argument. The NHSX counters that by suggesting social graph data could provide useful epidemiological insights — such as around how the virus is being spread.)

At the point a user of the NHS COVID-19 app experiences symptoms or gets a formal coronavirus diagnosis — and chooses to inform the authorities — the app will upload their recent contacts to a central server where infection risk calculations are performed.

The system will then send exposure notifications to other devices — in instances where the software deems there may be at risk of infection. Users might, for example, be asked to self isolate to see if they develop symptoms after coming into contact with an infected person, or told to seek a test to determine if they have COVID-19 or not.

A key detail here is that users of the NHS COVID-19 app are assigned a fixed identifier — basically a large, random number — which the government calls an “installation ID”. It claims this identifier is ‘anonymous’. However this is where political spin in service of encouraging public uptake of the app is being allowed to obscure a very different legal reality: A fixed identifier linked to a device is in fact pseudonymous data, which remains personal data under UK and EU law. Because, while the user’s identity has been ‘obscured’, there’s still a clear risk of re-identification.

Truly ‘anonymous’ data is a very high bar to achieve when you’re dealing with large data-sets. In the NHS COVID-19 app case there’s no reason beyond spin for the government to claim the data is “anonymous”; given the system design involves a device-linked fixed identifier that’s uploaded to a central authority alongside at least some geographical data (a partial postcode: which the app also asks users to input — so “the NHS can plan your local NHS response”, per the official explainer).

The NHSX has also said future versions of the app may ask users to share even more personal data, including their location. (And location data-sets are notoriously difficult to defend against re-identification.)

Nonetheless the government has maintained that individual users of the app will not be identified. But under such a system architecture this assertion sums to ‘trust us with your data’; the technology itself has not been designed to remove the need for individual users to trust a central authority, as is the case with bona fide decentralized protocols.

This is why Apple and Google are opting to support the latter approach — it cuts the internationally thorny issue of ‘government trust’ out of their equation.

However it also means governments that do want to centralize data face a technical headache to get their apps to function smoothly on the only two smartphone platforms that matter.

Technical and geopolitical headaches

The specific technical issue here relates to how these mainstream platforms manage background access to Bluetooth.

Using Bluetooth as a proxy for measuring coronavirus infection risk is of course a very new and novel technology. Singapore was reported to be the first country to attempt this. Its TraceTogether app, which launched in March, reportedly gained only limited (<20%) uptake — with technical issues on iOS being at least partly blamed for the low uptake.

The problem that the TraceTogether app faced initially is the software needed to be actively running and the iPhone open (not locked) for the tracing function to work. That obviously interferes with the normal multitasking of the average iPhone user — discouraging usage of the app.

It’s worth emphasizing that the UK is doing things a bit differently vs Singapore, though, in that it’s using Bluetooth handshakes rather than a Bluetooth advertising channel to power the contacts logging.

The NHS COVID-19 app has been designed to listen passively for other Bluetooth devices and then wake up in order to perform the handshake. This is intended as a workaround for these platform limits on background Bluetooth access. However it is still a workaround — and there are ongoing questions over how robustly it will perform in practice. 

An analysis by The Register suggests the app will face a fresh set of issues in that iPhones specifically will fail to wake each other up to perform the handshakes — unless there’s also an Android device in the vicinity. If correct, it could result in big gaps in the tracing data (around 40% of UK smartphones run iOS vs 60% running Android).

Battery drain may also resurface as an issue with the UK system, though the NHSX has claimed its workaround solves this. (Though it’s not clear if they’ve tested what happens if an iPhone user switches on a battery saving mode which limits background app activity, for example.)

Other Bluetooth-based contract tracing apps that have tried to workaround platforms limits have also faced issues with interference related to other Bluetooth devices — such as Australia’s recently launched app. So there are a number of potential issues that could trouble performance.

Being outside the Apple-Google API also certainly means the UK app is at the mercy of future platform updates which could derail the specific workaround. Best laid plans that don’t involve using an official interface as your plug are inevitably operating on shaky ground.

Finally, there’s a huge and complex issue that’s essentially being glossed over by government right now: Interoperability with other national apps.

How will the UK app work across borders? What happens when Brits start travelling again? With no obvious route for centralized vs decentralized systems to interface and play nice with each other there’s a major question mark over what happens when UK citizens want to travel to countries with decentralized systems (or indeed vice versa). Mandatory quarantines because the government picked a less interoperable app architecture? Let’s hope not.

Notably, the Republic of Ireland has opted for a decentralized approach for its national app, whereas Northern Ireland, which is part of the UK but shares a land border with the Republic, will — baring any NHSX flip — be saddled with a centralized and thus opposing choice. It’s the Brexit schism all over again in app form.

Earlier this week the NHSX was asked about this cross-border issue by a UK parliamentary committee — and admitted it creates a challenge “we’ll have to work through”, though it did not suggest how it proposes to do that.

And while that’s a very pressing backyard challenge, the same interoperability gremlins arise across the English Channel — where a number of European countries are opting for decentralized apps, including Estonia, Germany and Switzerland. While Apple and Google’s choice at the platform level means future US apps may also be encouraged down a decentralized route. (The two US tech giants are demonstrably flexing their market power to press on and influence governments’ app design choices internationally.)

So countries that fix on a ‘DIY’ approach for the digital component of their domestic pandemic response may find it leads to some unwelcome isolation for their citizens at the international level.

The UK has this week started testing a coronavirus contacts tracing app which NHSX, a digital arm of the country’s National Health Service, has been planning and developing since early March. The test is taking place in the Isle of Wight, a 380km2 island off the south coast of England, with a population of around 140,000.

The NHS COVID-19 app uses Bluetooth Low Energy handshakes to register proximity events (aka ‘contacts’) between smartphone users, with factors such as the duration of the ‘contact event’ and the distance between the devices feeding an NHS clinical algorithm that’s being designed to estimate infection risk and trigger notifications if a user subsequently experiences COVID-19 symptoms.

The government is promoting the app as an essential component of its response to fighting the coronavirus — the health minister’s new mantra being: ‘Protect the NHS, stay home, download the app’ — and the NHSX has said it expects the app to be “technically” ready to deploy two to three weeks after this week’s trial.

However there are major questions over how effective the tool will prove to be, especially given the government’s decision to ‘go it alone’ on the design of its digital contacts tracing system — which raises some specific technical challenges linked to how modern smartphone platforms operate, as well as around international interoperability with other national apps targeting the same purpose.

In addition, the UK app allows users to self report symptoms of COVID-19 — which could lead to many false alerts being generated. That in turn might trigger notification fatigue and/or encourage users to ignore alerts if the ratio of false alarms exceeds genuine alerts.

Keep calm and download the app?

How users will generally respond to this technology is a major unknown. Yet mainstream adoption will be needed to maximize utility; not just one-time downloads. Dealing with the coronavirus will be a marathon not a sprint — which means sustaining usage will be vital to the app functioning as intended. And that will require users to trust that the app is both useful for the claimed public health purpose, by being effective at shrinking infection risk, and also that using it will not create any kind of disadvantages for them personally or for their friends and family.

The NHSX has said it will publish the code for the app, the DPIA (data protection impact assessment) and the privacy and security models — all of which sounds great, though we’re still waiting to see those key details. Publishing all that before the app launches would clearly be a boon to user trust.

A separate consideration is whether there should be a dedicated legislation wrapper put around the app to ensure clear and firm legal bounds on its use (and to prevent abuse and data misuse).

As it stands the NHS COVID-19 app is being accelerated towards release without this — relying on existing legislative frameworks (with some potential conflicts); and with no specific oversight body to handle any complaints. That too could impact user trust.

The overarching idea behind digital contacts tracing is to leverage uptake of smartphone technology to automate some contacts tracing, with the advantage that such a tool might be able to register fleeting contacts, such as between strangers on the street or public transport, that may more difficult for manual contacts tracing methods to identify. Though whether these sorts of fleeting contacts create a significant risk of infection with the SARS-CoV-2 virus has not yet been quantified.

All experts are crystal clear on one thing: Digital contacts tracing is only going to be — at very best — a supplement to manual contact tracing. People who do not own or carry smartphones or who do not or cannot use the app obviously won’t register in any captured data. Technical issues may also create barriers and data gaps. It’s certainly not a magic bullet — and may, in the end, turn out to be ill-suited for this use case (we’ve written a general primer on digital contacts tracing here).

One major component of the UK approach is that it’s opted to create a so-called ‘centralized’ system for coronavirus contacts tracing — which leads to a number of specific challenges.

While the NHS COVID-19 app stores contacts events on the user’s device initially, at the point when (or if) a user chooses to report themselves having coronavirus symptoms then all their contacts events data is uploaded to a central server. This means it’s not just a user’s own identifier but a list of any identifiers they have encountered over the past 28 days — so, essentially, a graph of their recent social interactions.

This data cannot be deleted after the fact, according to the NHSX, which has also said it may be used for “research” purposes related to public health — raising further questions around privacy and trust.

Questions around the legal bases for this centralized approach also remain to be answered in detail by the government. UK and EU data protection law emphasize data minimization as a key principle; and while there’s flexibility built into these frameworks for a public health emergency there is still a requirement on the government to detail and justify key data processing decisions.

The UK’s decision to centralize contacts data has another obvious and immediate consequence: It means the NHS COVID-19 app will not be able to plug into an API that’s being jointly developed by Apple and Google to provide technical support for Bluetooth-based national contacts tracing apps — and due to be release this month.

The tech giants have elected to support decentralized app architectures for these apps — which, conversely, do not centralize social graph data. Instead, infection risk calculations are performed locally on the device.

By design, these approaches avoid providing a central authority with information on who infected whom.

In the decentralized scenario, an infected user consents to their ephemeral identifier being shared with other users so apps can do matching locally, on the end-user device — meaning exposure notifications are generated without a central authority needing to be in the loop. (It’s also worth noting there are ways for decentralized protocols to feed aggregated contact data back to a central authority for epidemiological research, though the design is intended to prevent users’ social graph being exposed. A system of ‘exposure notification’, as Apple and Google are now branding it, has no need for such data, is their key argument. The NHSX counters that by suggesting social graph data could provide useful epidemiological insights — such as around how the virus is being spread.)

At the point a user of the NHS COVID-19 app experiences symptoms or gets a formal coronavirus diagnosis — and chooses to inform the authorities — the app will upload their recent contacts to a central server where infection risk calculations are performed.

The system will then send exposure notifications to other devices — in instances where the software deems there may be at risk of infection. Users might, for example, be asked to self isolate to see if they develop symptoms after coming into contact with an infected person, or told to seek a test to determine if they have COVID-19 or not.

A key detail here is that users of the NHS COVID-19 app are assigned a fixed identifier — basically a large, random number — which the government calls an “installation ID”. It claims this identifier is ‘anonymous’. However this is where political spin in service of encouraging public uptake of the app is being allowed to obscure a very different legal reality: A fixed identifier linked to a device is in fact pseudonymous data, which remains personal data under UK and EU law. Because, while the user’s identity has been ‘obscured’, there’s still a clear risk of re-identification.

Truly ‘anonymous’ data is a very high bar to achieve when you’re dealing with large data-sets. In the NHS COVID-19 app case there’s no reason beyond spin for the government to claim the data is “anonymous”; given the system design involves a device-linked fixed identifier that’s uploaded to a central authority alongside at least some geographical data (a partial postcode: which the app also asks users to input — so “the NHS can plan your local NHS response”, per the official explainer).

The NHSX has also said future versions of the app may ask users to share even more personal data, including their location. (And location data-sets are notoriously difficult to defend against re-identification.)

Nonetheless the government has maintained that individual users of the app will not be identified. But under such a system architecture this assertion sums to ‘trust us with your data’; the technology itself has not been designed to remove the need for individual users to trust a central authority, as is the case with bona fide decentralized protocols.

This is why Apple and Google are opting to support the latter approach — it cuts the internationally thorny issue of ‘government trust’ out of their equation.

However it also means governments that do want to centralize data face a technical headache to get their apps to function smoothly on the only two smartphone platforms that matter.

Technical and geopolitical headaches

The specific technical issue here relates to how these mainstream platforms manage background access to Bluetooth.

Using Bluetooth as a proxy for measuring coronavirus infection risk is of course a very new and novel technology. Singapore was reported to be the first country to attempt this. Its TraceTogether app, which launched in March, reportedly gained only limited (<20%) uptake — with technical issues on iOS being at least partly blamed for the low uptake.

The problem that the TraceTogether app faced initially is the software needed to be actively running and the iPhone open (not locked) for the tracing function to work. That obviously interferes with the normal multitasking of the average iPhone user — discouraging usage of the app.

It’s worth emphasizing that the UK is doing things a bit differently vs Singapore, though, in that it’s using Bluetooth handshakes rather than a Bluetooth advertising channel to power the contacts logging.

The NHS COVID-19 app has been designed to listen passively for other Bluetooth devices and then wake up in order to perform the handshake. This is intended as a workaround for these platform limits on background Bluetooth access. However it is still a workaround — and there are ongoing questions over how robustly it will perform in practice. 

An analysis by The Register suggests the app will face a fresh set of issues in that iPhones specifically will fail to wake each other up to perform the handshakes — unless there’s also an Android device in the vicinity. If correct, it could result in big gaps in the tracing data (around 40% of UK smartphones run iOS vs 60% running Android).

Battery drain may also resurface as an issue with the UK system, though the NHSX has claimed its workaround solves this. (Though it’s not clear if they’ve tested what happens if an iPhone user switches on a battery saving mode which limits background app activity, for example.)

Other Bluetooth-based contract tracing apps that have tried to workaround platforms limits have also faced issues with interference related to other Bluetooth devices — such as Australia’s recently launched app. So there are a number of potential issues that could trouble performance.

Being outside the Apple-Google API also certainly means the UK app is at the mercy of future platform updates which could derail the specific workaround. Best laid plans that don’t involve using an official interface as your plug are inevitably operating on shaky ground.

Finally, there’s a huge and complex issue that’s essentially being glossed over by government right now: Interoperability with other national apps.

How will the UK app work across borders? What happens when Brits start travelling again? With no obvious route for centralized vs decentralized systems to interface and play nice with each other there’s a major question mark over what happens when UK citizens want to travel to countries with decentralized systems (or indeed vice versa). Mandatory quarantines because the government picked a less interoperable app architecture? Let’s hope not.

Notably, the Republic of Ireland has opted for a decentralized approach for its national app, whereas Northern Ireland, which is part of the UK but shares a land border with the Republic, will — baring any NHSX flip — be saddled with a centralized and thus opposing choice. It’s the Brexit schism all over again in app form.

Earlier this week the NHSX was asked about this cross-border issue by a UK parliamentary committee — and admitted it creates a challenge “we’ll have to work through”, though it did not suggest how it proposes to do that.

And while that’s a very pressing backyard challenge, the same interoperability gremlins arise across the English Channel — where a number of European countries are opting for decentralized apps, including Estonia, Germany and Switzerland. While Apple and Google’s choice at the platform level means future US apps may also be encouraged down a decentralized route. (The two US tech giants are demonstrably flexing their market power to press on and influence governments’ app design choices internationally.)

So countries that fix on a ‘DIY’ approach for the digital component of their domestic pandemic response may find it leads to some unwelcome isolation for their citizens at the international level.

Cutting the cord with cable or satellite TV used to mean a cost savings. But with the growing number of streaming services on the market, many consumers are finding that becoming a cord cutter is just as expensive, if not more so, as being a pay TV customer. As a result, many consumers continue to “borrow” a friend or family member’s subscription. According to a new study by Cordcutting.com, there are now over 44 million U.S. adults who are “mooching” a streaming service subscription today.

Specifically, the number of moochers is going up for both Netflix and Amazon Prime Video, but is declining slightly for Hulu.

The streaming services haven’t yet cracked down on password-sharing, despite the potential revenue loss attributed to mooching.

For example, if Netflix were to charge everyone who’s mooching for their own account, it could generate a estimated $356 million in additional membership fees per month. Combined, the top four streaming services — Netflix, Prime Video, Hulu and Disney+ — could generate $2.72 billion in revenue from subscription fees if they were able to get all their moochers to pay.

In reality, though, not everyone borrowing a subscription would pay if access was taken away.

The study found that only 47% of Netflix moochers said they would buy a subscription if they lost access, followed by 41% of Disney+ viewers, 38% of Prime Video viewers, and just 36% of Hulu viewers.

The streaming service operators often see these halfway-committed consumers as in the process of being addicted to their content, which may translate to their own subscription in time — when they ween themselves off mom or dad, for example, or get a better-paying job.

In most cases, moochers are borrowing an account belonging to their parents, the study found. Others borrow from siblings or a partner, and in a few cases, some moochers are still streaming from an ex’s account.

There are even apps designed to make mooching easier. For example, Do Not Pay in March launched an extension designed to share Netflix passwords with friends. An app called Jam is preparing to launch its own questionably legal password-sharing service, too.

Despite the sizable number of moochers today, the overall percentage is declining, the report found.

Compared with its 2019 survey, the percentage of moochers has dropped to 11.6% down from 17%. The change was largely attributed to declines in those sharing Amazon Prime Video credentials.

As it turns out, many Prime Video moochers have since turned into Prime members, where Prime Video is included. Over the past couple of years, Amazon has added on some 50 million new subscribers to its membership program, which now tops 150 million worldwide. With built-in access, these new members no longer need to mooch.

Of course, the number of moochers may change as the impacts of the pandemic and unemployment play out.

One thing we do know, however, is that COVID-19 has sent streaming skyrocketing.

Nielsen recently reported streaming was up 36% between February and March, with the average person watching doubling the amount of streaming video compared with the same time last year.

Cordcutting.com’s analysis estimates there are now 142.5 million streaming consumers in the U.S., and now 34% — or 63.4 million — have fully cut the cord with pay TV. That’s up 4 percentage points since its last survey in 2019. Gen Z is the most likely demographic to have cut the the cord, as 45% are streaming-only customers, while just 17% of Baby Boomers are.

Netflix continues to be the most popular, followed by Prime Video, Hulu, then newcomer Disney+.

The full report is here.

Cutting the cord with cable or satellite TV used to mean a cost savings. But with the growing number of streaming services on the market, many consumers are finding that becoming a cord cutter is just as expensive, if not more so, as being a pay TV customer. As a result, many consumers continue to “borrow” a friend or family member’s subscription. According to a new study by Cordcutting.com, there are now over 44 million U.S. adults who are “mooching” a streaming service subscription today.

Specifically, the number of moochers is going up for both Netflix and Amazon Prime Video, but is declining slightly for Hulu.

The streaming services haven’t yet cracked down on password-sharing, despite the potential revenue loss attributed to mooching.

For example, if Netflix were to charge everyone who’s mooching for their own account, it could generate a estimated $356 million in additional membership fees per month. Combined, the top four streaming services — Netflix, Prime Video, Hulu and Disney+ — could generate $2.72 billion in revenue from subscription fees if they were able to get all their moochers to pay.

In reality, though, not everyone borrowing a subscription would pay if access was taken away.

The study found that only 47% of Netflix moochers said they would buy a subscription if they lost access, followed by 41% of Disney+ viewers, 38% of Prime Video viewers, and just 36% of Hulu viewers.

The streaming service operators often see these halfway-committed consumers as in the process of being addicted to their content, which may translate to their own subscription in time — when they ween themselves off mom or dad, for example, or get a better-paying job.

In most cases, moochers are borrowing an account belonging to their parents, the study found. Others borrow from siblings or a partner, and in a few cases, some moochers are still streaming from an ex’s account.

There are even apps designed to make mooching easier. For example, Do Not Pay in March launched an extension designed to share Netflix passwords with friends. An app called Jam is preparing to launch its own questionably legal password-sharing service, too.

Despite the sizable number of moochers today, the overall percentage is declining, the report found.

Compared with its 2019 survey, the percentage of moochers has dropped to 11.6% down from 17%. The change was largely attributed to declines in those sharing Amazon Prime Video credentials.

As it turns out, many Prime Video moochers have since turned into Prime members, where Prime Video is included. Over the past couple of years, Amazon has added on some 50 million new subscribers to its membership program, which now tops 150 million worldwide. With built-in access, these new members no longer need to mooch.

Of course, the number of moochers may change as the impacts of the pandemic and unemployment play out.

One thing we do know, however, is that COVID-19 has sent streaming skyrocketing.

Nielsen recently reported streaming was up 36% between February and March, with the average person watching doubling the amount of streaming video compared with the same time last year.

Cordcutting.com’s analysis estimates there are now 142.5 million streaming consumers in the U.S., and now 34% — or 63.4 million — have fully cut the cord with pay TV. That’s up 4 percentage points since its last survey in 2019. Gen Z is the most likely demographic to have cut the the cord, as 45% are streaming-only customers, while just 17% of Baby Boomers are.

Netflix continues to be the most popular, followed by Prime Video, Hulu, then newcomer Disney+.

The full report is here.

California Attorney General Xavier Becerra along with city attorneys from Los Angeles, San Diego and San Francisco filed a lawsuit asserting Uber and Lyft gain an unfair and unlawful competitive advantage by misclassifying workers as independent contractors.

The suit argues Uber and Lyft are depriving workers of the right to minimum wage, overtime, access to paid sick leave, disability insurance and unemployment insurance.

The lawsuit, filed in the Superior Court of San Francisco, seeks $2,500 in penalties for each violation under the California Unfair Competition Law, and another $2,500 for violations against senior citizens or people with disabilities.

“The companies, we believe and argue are shirking their obligation to their workforce,” Becerra said in a call today. By shirking those obligations, Becerra said, Uber and Lyft are shifting those costs to California taxpayers.

“American taxpayers end up having to help carry the load that Uber and Lyft don’t want to accept,” Becerra said. “These companies will take the workers’ labor, but they won’t accept the worker protections.”

This lawsuit comes after Uber and Lyft have spent millions of dollars to try to combat California law AB 5, which makes it harder for tech companies to classify workers as independent contractors.

Labor issues have been front and center amid the COVID-19 pandemic. Just yesterday, Amazon Web Services VP Tim Bray resigned from the company, citing Amazon’s firings of employees that were critical of the company. Meanwhile, gig workers have organized a number of strikes and protests to demand basic workplace protections like masks and gloves while they’re on the job.

But Uber and Lyft drivers have long been advocating for themselves. Last year, as both Uber and Lyft were gearing up to make their debuts on the public market, drivers staged a number of protests to demand better pay, benefits and the right to form a union.

We’ve reached out to Uber and Lyft and will update this story if we hear back.

This story is developing. Check back for updates.