EU antitrust regulators are asking Microsoft's users and rivals whether Bing should comply with new tough tech rules and also whether that should be the case for Apple's iMessage, Reuters reported Monday, citing people familiar with the matter. From the report: The European Commission in September opened investigations to assess whether Microsoft's Bing, Edge and Microsoft Advertising as well as Apple's iMessage should be subject to the Digital Markets Act (DMA). The probes came after the companies contested the EU competition regulator labelling these services as core platform services under the DMA.

The DMA requires Microsoft, Apple, Alphabet's Google, Amazon, Meta Platforms and ByteDance to allow for third-party apps or app stores on their platforms and to make it easier for users to switch from default apps to rivals, among other obligations. The Commission sent out questionnaires earlier this month, asking rivals and users to rate the importance of Microsoft's three services and Apple's iMessage versus competing services.

An economist testified that Google made billions of dollars in extra ad revenue starting in 2017 — by making a secret change to its auction algorithm that bumped their revenues up 15%. Bloomberg reports: Michael Whinston, a professor of economics at the Massachusetts Institute of Technology, said Friday that Google modified the way it sold text ads via "Project Momiji" — named for the wooden Japanese dolls that have a hidden space for friends to exchange secret messages. The shift sought "to raise the prices against the highest bidder," Whinston told Judge Amit Mehta in federal court in Washington.

Google's advertising auctions require the winner to pay only a penny more than the runner-up. In 2016, the company discovered that the runner-up had often bid only 80% of the winner's offer. To help eliminate that 20% between the runner-up and what the winner was willing to pay, Google gave the second-place bidder a built-in handicap to make their offer more competitive, Whinston said, citing internal emails and sealed testimony by Google finance executive Jerry Dischler earlier in the case...

About two-thirds, more than 60%, of Google's total revenue comes from search ads, Dischler said previously, amounting to more than $100 billion in 2020.
In 2021 Google was also accused of running "a secret program to track bids on its ad-buying platform," according to the New York Post (citing reporting by the Wall Street Journal). A Texas-led antitrust suit accused Google "of using the information to gain an unfair market advantage that raked in hundreds of millions of dollars annually, according to a report."

And the Post's article also mentioned "an alleged hush-hush deal in which Google allegedly guaranteed that Facebook would win a fixed percentage of advertising deals."

An anonymous reader quotes a report from Ars Technica: Within the past year, there have been approximately five times more school shooting hoaxes called in to police than actual school shootings reported in 2023. Where data from Everytown showed "at least 103 incidents of gunfire on school grounds" in 2023, The Washington Post recently uncovered what seems to be a coordinated campaign of active shooter hoaxes causing "swattings" -- where police respond with extreme force to fake crimes -- at more than 500 schools nationwide over the past year. In just one day in February, "more than 30 schools were targeted," The Post reported.

The Post "examined police reports, emergency call recordings, body-camera footage, or call logs in connection with incidents in 24 states," which seemed to reveal a "distinct pattern" potentially linking swatting hoaxes nationwide. A man who "speaks with a heavy accent" -- and possibly uses a device or app to alter his voice in real time -- relies on a virtual private network (VPN) to mask his IP address, then places the hoax calls on non-emergency lines using free Internet-calling services. He frequently pretends to be a teacher hiding from the fake shooter on campus and sometimes falsely reports student shootings. To some law enforcement officials, the voice sounds too similar from call to call to be chalked up to coincidence. The Post stitched together audio that shows why many authorities believe these hoax calls might be coming from the same caller, whose motivations are currently unknown. It's possible the hoax calls are being orchestrated by one person with a hostile compulsion or by one or several perpetrators advertising swatting services available for hire online. [...]

According to The Post, the FBI has been investigating this string of school shooting hoaxes, but it's unclear how far that investigation has gotten -- mostly because tracing the hoax calls has perplexed many law enforcement agencies nationwide. Tracing calls is difficult partly because many VPN providers outside the US don't always cooperate with law enforcement, and some of the most popular free Internet-calling services only require an email address to sign up. However, The Post reported that it has increasingly become clear to law enforcement that one particular Internet-calling service appears to be the most popular choice for hoax callers reporting school shootings: TextNow. One police captain in Lousiana, Shannon Mack -- who is described as specializing in "cases involving Internet-based phone services -- told The Post that "nine times out of 10," hoax calls she has investigated have come from a TextNow number.

Microsoft chief executive Satya Nadella said Monday tech giants were competing for vast troves of content needed to train artificial intelligence, and complained Google was locking up content with expensive and exclusive deals with publishers. From a report: Testifying in a landmark U.S. trial against its rival Google, the first major antitrust case brought by the U.S. since it sued Microsoft in 1998, Nadella testified the tech giants' efforts to build content libraries to train their large language models "reminds me of the early phases of distribution deals." Distribution agreements are at the core of the U.S. Justice Department's antitrust fight against Google. The government says that Google, with some 90% of the search market, illegally pays $10 billion annually to smartphone makers like Apple and wireless carriers like AT&T and others to be the default search engine on their devices.

The clout in search makes Google a heavy hitter in the lucrative advertising market, boosting its profits. Nadella said building artificial intelligence took computing power, or servers, and data to train the software. On servers, he said: "No problem, we are happy to put in the dollars." But without naming Google, he said it was "problematic" if other companies locked up exclusive deals with big content makers. "When I am meeting with publishers now, they say Google's going to write this check and it's exclusive and you have to match it," he said.

America's Department of Justice "has finally posted what judge Amit Mehta described at the Google search antitrust trial as an 'embarrassing' exhibit that Google tried to hide from the public," reports Ars Technica: The document in question contains meeting notes that Google's vice president for finance, Michael Roszak, "created for a course on communications," Bloomberg reported. In his notes, Roszak wrote that Google's search advertising "is one of the world's greatest business models ever created" with economics that only certain "illicit businesses" selling "cigarettes or drugs" "could rival."

At trial, Roszak told the court that he didn't recall if he ever gave the presentation. He said that the course required that he tell students "things I don't believe as part of the presentation." He also claimed that the notes were "full of hyperbole and exaggeration" and did not reflect his true beliefs, "because there was no business purpose associated with it." According to Bloomberg, Google repeatedly objected to the document being shared in court, claiming it was irrelevant to the DOJ's case. Then, after Mehta allowed the DOJ to present the document as evidence, Google tried to seal off Roszak's testimony on the document...

Beyond likening Google's search advertising business to illicit drug markets, Roszak's notes also said that because users got hooked on Google's search engine, Google was able to "mostly ignore the demand side" of "fundamental laws of economics" and "only focus on the supply side of advertisers, ad formats, and sales." This was likely the bit that actually interested the DOJ. "We could essentially tear the economics textbook in half," Roszak's notes said. Part of the DOJ's case argues that because Google has a monopoly over search, it's less incentivized to innovate products that protect consumers from harm like invasive data collection.

A Google spokesman told Bloomberg that Roszak's statements "don't reflect the company's opinion" and "were drafted for a public speaking class in which the instructions were to say something hyperbolic and attention-grabbing." The spokesman also noted that Roszak "testified he didn't believe the statements to be true."

Anyone who has used H&R Block's tax return preparation services since 2015 "may have unintentionally helped line Meta and Google's pocket," reports Gizmodo: That's according to a new class action lawsuit which alleges the three companies "jointly schemed" to install trackers on the H&R Block site to scan and transmit tax data back to the tech companies which then used elements of the data to engage in targeted advertising.

Attorneys bringing the case forward claim the three companies' conduct amounts to a "pattern of racketeering activity" covered under the Racketeer Influenced and Corrupt Organizations Act (RICO), a tool typically reserved for organized crime. "H&R Block, Google, and Meta ignored data privacy laws, and passed information about people's financial lives around like candy," Brent Wisner, one of the attorneys bringing forward the complaint said.

The lawsuit, filed in the Northern District of California this week, stems from a bombshell Congressional report released earlier this year detailing the way multiple tax preparation firms, including H&R Block, "recklessly" shared the sensitive tax data of tens of millions of Americans without proper safeguards. At issue are the tax preparation firms' use of tracking "pixels" placed on their websites. These trackers, which the lawsuit refers to as "spy cams" would allegedly scan tax documents and reveal a variety of personal tax information, including a filer's name, filing status, federal taxes owed, address, and number of dependents. That data was then anonymized and used for targeted advertising and to train Meta's AI algorithms, the congressional report notes.
The attorneys argue that H&R Block, Meta, and Google "explicitly and intentionally" entered into an agreement to violate taxpayers' privacy rights for financial gain, according to the article. The suit seeks refunds and punitive damages.

Jude Karabus writes via The Register: Norway has told the European Data Protection Board (EDPB) it believes a countrywide ban on Meta harvesting user data to serve up advertising on Facebook and Instagram should be made permanent and extended across Europe. The Scandinavian country's Data Protection Authority, Datatilsynet, had been holding back Facebook parent Meta from scooping up data on its citizens with the threat of fines of one million Kroner (about $94,000) per day if it didn't comply.

In August, it said Meta hadn't been playing ball and started serving up the daily fines. However, the ban that resulted in these fines, put into place in July, expires on November 3 â" hence Norway's request for a "binding decision." The July order came after a Court of Justice of the European Union (CJEU) ruling [PDF] earlier that month stating Meta's data processing operation was also hauling in protected data â" race and ethnicity, religious affiliation, sexual orientation etc. â" when it cast its behavioral ads net.

Norway is not a member of the EU but is part of the European single market, and the CJEU, as Europe's top court, has the job of making sure the application and interpretation of law within the market is compliant with European treaties (this part would apply to Norway) as well as ensuring that legislation adopted by the EU is applied the same way across all Member States. Datatilsynet's ruling said the central processing of that data by the American company was putting Meta in violation of the EU's General Data Protection Regulation. A spokesperson for Meta said it was "surprised" by the Norwegian authority's actions, "given that Meta has already committed to moving to the legal basis of consent for advertising in the EU/EEA."

It added: "We remain in active discussions with the relevant data protection authorities on this topic via our lead regulator in the EU, the Irish Data Protection Commission, and will have more to share in due course."

Ivan Mehta writes via TechCrunch: Reddit said Wednesday that the platform is revamping its privacy settings with an aim to make ad personalization and account visibility toggles consistent. Most notably though, it is removing the ability to opt out of ad personalization based on Reddit activity. The company said that it will still have opt-out controls in "select countries" without specifying which ones. It mentioned in a blog post that users won't see more ads but they will see better-targeted ads following this change.

The company is essentially removing the option to not track you based on whatever you do on Reddit. Additionally, Reddit is consolidating two toggles on showing ads based on activity and information from partners into one toggle. So there is no way to separate those two settings now. Reddit is seemingly removing toggles for getting post recommendations based on "general location" and activity on partner sites and apps. It's not clear if this means those parameters will be used for post suggestions by default and there is no way to turn them off.

The social network said it will also roll out controls to limit certain advertising categories such as alcohol, weight loss, dating, gambling pregnancy and parenting. The company noted that ad-limiting controls will possibly show you fewer ads from mentioned categories if the toggles are turned off, but won't possibly filter out all ads. Reddit justified this by saying it uses manual tagging and machine learning to label ads, so there is a chance that it is not 100% accurate. Reddit is also simplifying its location customization setting under a single menu, which will be easily accessible through settings on apps and on the web.

A Microsoft executive said the company has tried for years to displace Alphabet's Google as the default web browser on iPhones, but that Apple never seriously considered switching to Microsoft's Bing and was content to use it as a "bargaining chip" with the search giant. From a report: "Apple is making more money on Bing existing than Bing does," Mikhail Parakhin, the head of Microsoft's advertising and web services, testified during the US government's antitrust trial against Google in Washington. "We are always trying to convince Apple to use our search engine." Parakhin, who joined Microsoft in 2019 from Russian search engine Yandex NV, said Microsoft met with Apple as recently as 2021 to discuss a potential switch to Bing, but didn't make any progress.

In response to Google's lawyers, Parakhin said it was "uneconomical for Microsoft to invest more" in technology for the mobile search market. "Unless Microsoft gets a more significant, or firmer guarantee of distribution, it makes it uneconomical to invest." Apple has used Google as the default search engine in its Safari browser since 2003 in exchange for a share of the advertising revenue earned through searches made on its devices.

Kyle Orland writes via Ars Technica: The "first official Unity user group in the world" has announced that it is dissolving after 13 years because "the trust we used to have in the company has been completely eroded." The move comes as many developers are saying they will continue to stay away from the company's products even after last week's partial rollback of some of the most controversial parts of its fee structure plans.

Since its founding in 2010, the Boston Unity Group (BUG) has attracted thousands of members to regular gatherings, talks, and networking events, including many technical lectures archived on YouTube. But the group says it will be hosting its last meeting Wednesday evening via Zoom because the Unity of today is very different from the Dave Helgason-led company that BUG says "enthusiastically sanctioned and supported" the group at its founding.

"Over the past few years, Unity has unfortunately shifted its focus away from the games industry and away from supporting developer communities," the group leadership wrote in a departure note. "Following the IPO, the company has seemingly put profit over all else, with several acquisitions and layoffs of core personnel. Many key systems that developers need are still left in a confusing and often incomplete state, with the messaging that advertising and revenue matter more to Unity than the functionality game developers care about."

BUG says the install-fee terms Unity first announced earlier this month were "unthinkably hostile" to users and that even the "new concessions" in an updated pricing model offered late last week "disproportionately affect the success of indie studios in our community." But it's the fact that such "resounding, unequivocal condemnation from the games industry" was necessary to get those changes in the first place that has really shaken the community to its core. "We've seen how easily and flippantly an executive-led business decision can risk bankrupting the studios we've worked so hard to build, threaten our livelihoods as professionals, and challenge the longevity of our industry," BUG wrote. "The Unity of today isn't the same company that it was when the group was founded, and the trust we used to have in the company has been completely eroded."

An anonymous reader shares a report: Why is it that so many companies that rely on monetizing the data of their users seem to be extremely hot on AI? If you ask Signal president Meredith Whittaker (and I did), she'll tell you it's simply because "AI is a surveillance technology." Onstage at TechCrunch Disrupt 2023, Whittaker explained her perspective that AI is largely inseparable from the big data and targeting industry perpetuated by the likes of Google and Meta, as well as less consumer-focused but equally prominent enterprise and defense companies. "It requires the surveillance business model; it's an exacerbation of what we've seen since the late '90s and the development of surveillance advertising. AI is a way, I think, to entrench and expand the surveillance business model," she said.

"The Venn diagram is a circle." "And the use of AI is also surveillant, right?" she continued. "You know, you walk past a facial recognition camera that's instrumented with pseudo-scientific emotion recognition, and it produces data about you, right or wrong, that says 'you are happy, you are sad, you have a bad character, you're a liar, whatever.' These are ultimately surveillance systems that are being marketed to those who have power over us generally: our employers, governments, border control, etc., to make determinations and predictions that will shape our access to resources and opportunities."

Emma Roth reporting via The Verge: Facebook can be sued over allegations that its advertising algorithm is discriminatory, a California state court of appeals ruled last week. The decision stems from a class action lawsuit filed against Facebook in 2020, which accused the company of not showing insurance ads to women and older people in violation of civil rights laws. The case centers around Samantha Liapes, a 48-year-old woman who turned to Facebook to find an insurance provider. The lawsuit alleges that Facebook's ad delivery system didn't show Liapes ads for insurance due to her age and gender.

In a September 21st ruling, the appeals court reversed a previous decision that said Section 230 (which protects online platforms from legal liability if users post illegal content) shields Facebook from accountability. The appeals court concluded that the case "adequately" alleges that Facebook "knew insurance advertisers intentionally targeted its ads based on users' age and gender" in violation of the Unruh Civil Rights Act. It also found significant similarities between Facebook's ad platform and Roommates.com, a service that exceeded the protections of Section 230 by including dropdown menus with options that allowed for discrimination. "There is little difference with Facebook's ad tools" and their targeting capabilities, the court concluded. "Facebook does not merely proliferate and disseminate content as a publisher ... it creates, shapes, or develops content" with the tools.

Amazon, following other streaming platforms looking to further monetize their content, will run ads on its Prime Video service in key markets -- a move that will help offset rising costs and provide a boost to an already robust advertising business. From a report: Ad-supported streaming will be the default on Prime Video in US, UK, Germany and Canada starting early next year, the company said in a statement on Friday. The company has long offered video streaming as part of a package that also includes speedy shipping, music and other perks. Amazon said Prime subsribers will continue to pay $139 annually in the US but will be able to pay an additional $2.99 a month to avoid ads. Pricing in other countries will be anounced later, the company said.

An anonymous reader quotes a report from Reuters: The U.S. Justice Department on Monday objected to removing the public from the court during some discussions of how Google prices online advertising, one of the issues at the heart of the antitrust trial under way in Washington. The government is seeking to show that Alphabet's Google broke antitrust law to maintain its dominance in online search. The search dominance led to fast-increasing advertising revenues that made Google a $1 trillion company. [Throughout the trial, Google's defense is that its high market share reflects the quality of its product rather than any illegal actions to build monopolies in some aspects of its business.]

David Dahlquist, speaking for the government, pointed to a document that was redacted that had a short back and forth about Google's pricing for search advertising. Dahlquist then argued to Judge Amit Mehta, who will decide the case, that information like the tidbit in the document should not be redacted. "This satisfies public interest because it's at the core of the DOJ case against Google," he said. Speaking for Google, John Schmidtlein urged that all discussions of pricing be in a closed session, which means the public and reporters must leave the courtroom. [...]

Case in point was testimony given early Monday by a Verizon executive, Brian Higgins, about the company's decision to always pre-install Google's Chrome browser with Google search on its mobile phones. After about 30 minutes of testimony, Higgins' testimony was closed for the next two hours. It's possible that he was asked about Google's payments to Verizon but the public will never know. Those payments -- which the government said are $10 billion annually to mobile carriers and others -- helped the California-based tech giant win powerful default positions on smartphones and elsewhere.

A federal judge has granted a request to block the California Age-Appropriate Design Code Act (CAADCA), a law that requires special data safeguards for underage users online. The Verge reports: In a ruling (PDF) issued today, Judge Beth Freeman granted a preliminary injunction for tech industry group NetChoice, saying the law likely violates the First Amendment. It's the latest of several state-level internet regulations to be blocked while a lawsuit against them proceeds, including some that are likely bound for the Supreme Court. The CAADCA is meant to expand on existing laws -- like the federal COPPA framework -- that govern how sites can collect data from children. But Judge Freeman objected to several of its provisions, saying they would unlawfully target legal speech. "Although the stated purpose of the Act -- protecting children when they are online -- clearly is important, NetChoice has shown that it is likely to succeed on the merits of its argument that the provisions of the CAADCA intended to achieve that purpose do not pass constitutional muster," wrote Freeman.

Freeman cites arguments made by legal writer Eric Goldman, who argued that the law would force sites to erect barriers for children and adults alike. Among other things, the ruling takes issue with the requirement that sites estimate visitors' ages to detect underage users. The provision is ostensibly meant to cut down on the amount of data collected about young users, but Freeman notes that it could involve invasive technology like face scans or analyzing biometric information -- ironically requiring users to provide more personal information.

The law offers sites an alternative of making data collection for all users follow the standards for minors, but Freeman found that this would also chill legal speech since part of the law's goal is to avoid targeted advertising that would show objectionable content to children. "Data and privacy protections intended to shield children from harmful content, if applied to adults, will also shield adults from that same content," Freeman concluded.

According to The Information, Google is nearing the release of Gemini, its conversational artificial intelligence software intended to compete with OpenAI's GPT-4 model. Reuters reports: For Google, the stakes of Gemini's launch are high. Google has intensified investments in generative AI this year as it plays catch-up after Microsoft-backed OpenAI's launch of ChatGPT last year took the tech world by storm. Gemini is a collection of large-language models that power everything from chatbots to features that either summarize text or generate original text based on what users want to read like email drafts, music lyrics, or news stories, the report said. It is also expected to help software engineers write code and generate original images based on what users ask to see.

Google is currently giving developers access to a relatively large version of Gemini, but not the largest version it is developing which would be more on par with GPT-4, the report said. The search and advertising giant plans to make Gemini available to companies through its Google Cloud Vertex AI service.

An anonymous reader quotes a report from Reuters: Google agreed to pay $155 million to settle claims by California and private plaintiffs that the search engine company misled consumers about how it tracks their locations, and used their data without consent. Both settlements resolve claims that the Alphabet unit deceived people into believing they maintained control over how Google collected and used their personal data. The company was accused of being able to "profile" people and target them with advertising even if they turned off their "Location History" setting, and deceive people about their ability to block ads they did not want.

The California settlement requires Google to pay $93 million, and disclose more about how it tracks people's whereabouts and uses data it collects. Money from Google's $62 million settlement with private plaintiffs would, after deducting legal fees, go to court-approved nonprofit groups that track internet privacy concerns. Lawyers for the plaintiffs said this made sense because it was "infeasible" to distribute money to the approximately 247.7 million U.S. adults with mobile devices. "Google was telling its users one thing--that it would no longer track their location once they opted out--but doing the opposite and continuing to track its users' movements for its own commercial gain," California Attorney General Rob Bonta said in a statement. "That's unacceptable."

The Justice Department will press its argument Thursday that Google sought to strike agreements with mobile carriers to win powerful default positions on smartphones to dominate search in an antitrust trial that could change the future of the internet. From a report: The government will wrap up questioning Thursday of Antonio Rangel, who teaches behavioral biology at the California Institute of Technology. Other witnesses will be James Kolotouros, for Google, and Brian Higgins, from Verizon Communications. The government says the Alphabet unit paid $10 billion annually to wireless companies like AT&T, device makers like Apple and browser makers like Mozilla to fend off rivals and keep its search engine market share near 90%. The government has also alleged that Google illegally took steps to protect communications about the payments.

The government called witnesses on Tuesday and Wednesday to show that Google, as far back as the mid-2000s, sought to attract a large number of search queries by winning default status on mobile devices. Another witness, Rangel, discussed how powerful default status was, although data he used to show this was largely redacted. Google's clout in search, the government alleges, has helped Google build monopolies in some aspects of online search advertising. Search is free so Google makes money through advertising.

The Justice Department sought on Wednesday to show how Google did all it could to get people to use its search engine and build itself into a $1 trillion search and advertising giant on the second day of a once-in-a-generation antitrust trial. From a report: First out of the gate, the government questioned a former Google executive, Chris Barton, about billion-dollar deals with mobile carriers and others that helped make Google the default search engine. Barton, who was at Google from 2004 to 2011, said the number of Google executives working to win default status with mobile carriers grew dramatically when he was with the company, recognizing the potential growth of handheld devices and early versions of smartphones.

Google's clout in search, the government argues, has helped Google build monopolies in some aspects of online search advertising. Since search is free, Google makes money through advertising. The government says the Alphabet unit paid $10 billion annually to wireless companies like AT&T, device makers like Apple and browser makers like Mozilla to fend off rivals and keep its search engine market share near 90%. In revenue-sharing deals with mobile carriers and Android smartphone makers, Google pressed for its search to be the default and exclusive. If Microsoft's search engine Bing was the default on an Android phone, Barton said, then users would have a "difficult time finding or changing to Google."

Barton said on his LinkedIn profile that he was responsible for leading Google's partnerships with mobile carriers like Verizon and AT&T, estimating that the deals "drive hundreds of millions in revenue." Hal Varian, Google's chief economist, told the court that scale, or the number of search queries Google received, was important, but pushed back during questioning on how important. He also acknowledged giving a speech in which he said certain search queries, for instance for a tennis racquet, were important in effectively advertising to the person who made the query and to subsequent ad revenues.

The FTC's chief administrative law judge (ALJ) ruled that Intuit, the parent company of TurboTax, "deceived consumers" and "engaged in deceptive advertising" by advertising its "Free Edition" tax filing service as free when users ultimately had to pay. The Verge reports: The ruling (PDF) includes several pages of commercials and online ads where Intuit advertised its "Free Edition" software. While the name implies that the service is, well, free, people wound up having to pay to use it -- sparking a lawsuit from the FTC and a $141 million payout to affected users. Meanwhile, Intuit's actually no-cost Free File version, which it launched in partnership with the IRS, remained exceedingly difficult to find. In 2021, Intuit exited the program after the IRS stopped letting companies hide their free filing services from search engines.

The FTC's ALJ determined that there is a "cognizant danger of a recurring violation" by Intuit and issued a cease-and-desist order that prohibits the company from "engaging in deceptive practices in the future." The ruling prevents Intuit from representing a product as free unless it actually is free for everyone to use and "clearly and conspicuously discloses any terms that would limit the offer." In a statement, Intuit called the FTC's investigation process "flawed and highly questionable," noting "Intuit already adheres to most of the advertising practices in the FTC's erroneous decision." The company adds that it has "been clear, fair, and transparent" with customers and remains "committed to free tax preparation."