Author name: Mike M.

illinois-changes-biometric-privacy-law-to-help-corporations-avoid-big-payouts

Illinois changes biometric privacy law to help corporations avoid big payouts

Biometric Information Privacy Act —

Possible damages payments dramatically lowered by change to 2008 Illinois law.

Illustration of a woman's face being scanned for a facial recognition system.

Getty Images | imaginima

Illinois has changed its Biometric Information Privacy Act (BIPA) to dramatically limit the financial penalties faced by companies that illegally obtain or sell biometric identifiers such as eye scans, face scans, fingerprints, and voiceprints.

The 2008 law required companies to obtain written consent for the collection or use of biometric data and allowed victims to sue for damages of $1,000 for each negligent violation and $5,000 for each intentional or reckless violation. But an amendment enacted on Friday states that multiple violations related to a single person’s biometric data will be counted as only one violation.

The amendment, approved by the Illinois Legislature in May and signed by Gov. J.B. Pritzker on August 2, provides “that a private entity that more than once collects or discloses a person’s biometric identifier or biometric information from the same person in violation of the Act has committed a single violation for which the aggrieved person is entitled to, at most, one recovery.”

As Reuters reports, the “changes to the law effectively overturn a 2023 Illinois Supreme Court ruling that said companies could be held liable for each time they misused a person’s private information and not only the first time.” That ruling came in a proposed class action brought against the White Castle restaurant chain by an employee.

Change lowers potential for big settlements

The change to the privacy law “will significantly reduce the potential damages and lower the settlement value of BIPA claims. The amendment also provides that an e-signature satisfies the written requirements for the release,” Squire Patton Boggs lawyer Alan Friel wrote in National Law Review yesterday.

In 2020, Facebook agreed to a $650 million settlement after being sued by users who alleged violations of the Illinois law. Settlement class members received over $400 each.

The Illinois law is unique in letting individuals sue for damages, Friel wrote. “Colorado recently enacted a BIPA-like biometrics law, but like other states except only Illinois, it does not have a privacy right of action and can only be enforced by the state,” he wrote. “However, states are active in enforcing their privacy laws as illustrated by a recent Texas settlement with a social media company for biometric consent claims that included a 9-figure civil penalty payment.”

Friel was referring to Facebook-owner Meta agreeing to a $1.4 billion settlement with Texas Attorney General Ken Paxton. The Texas AG alleged that Meta “unlawfully captur[ed] the biometric data of millions of Texans without obtaining their informed consent as required by Texas law.” The claim was over Facebook using facial recognition for a feature that makes it easier to tag people in photographs.

The Information Technology and Innovation Foundation, a research group funded by various corporations, said the change to BIPA “makes a bad law slightly better.”

“BIPA is a prime example of privacy legislation gone too far,” ITIF Senior Policy Manager Ash Johnson said. “With steep fines for even minor violations and a private right of action that has gone out of control, with multiple multi-million-dollar settlements. This has led companies to limit the technology available to Illinois consumers or even pull out of the state entirely.”

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parody-site-clownstrike-refused-to-bow-to-crowdstrike’s-bogus-dmca-takedown

Parody site ClownStrike refused to bow to CrowdStrike’s bogus DMCA takedown

Parody site ClownStrike refused to bow to CrowdStrike’s bogus DMCA takedown

Doesn’t CrowdStrike have more important things to do right now than try to take down a parody site?

That’s what IT consultant David Senk wondered when CrowdStrike sent a Digital Millennium Copyright Act (DMCA) takedown notice targeting his parody site ClownStrike.

Senk created ClownStrike in the aftermath of the largest IT outage the world has ever seen—which CrowdStrike blamed on a buggy security update that shut down systems and incited prolonged chaos in airports, hospitals, and businesses worldwide.

Although Senk wasn’t personally impacted by the outage, he told Ars he is “a proponent of decentralization.” He seized the opportunity to mock “CrowdStrike’s ability to cause literal billions of dollars of damage” because he viewed this as “collateral from the incredible amount of ‘centralization’ in the tech industry.”

Setting up the parody site at clownstrike.lol on July 24, Senk’s site design is simple. It shows the CrowdStrike logo fading into a cartoon clown, with circus music blasting throughout the transition. For the first 48 hours of its existence, the site used an unaltered version of CrowdStrike’s Falcon logo, which is used for its cybersecurity platform, but Senk later added a rainbow propeller hat to the falcon’s head.

“I put the site up initially just to be silly,” Senk told Ars, noting that he’s a bit “old-school” and has “always loved parody sites” (like this one).

It was all fun and games, but on July 31, Senk received a DMCA notice from Cloudflare’s trust and safety team, which was then hosting the parody site. The notice informed Senk that CSC Digital Brand Services’ global anti-fraud team, on behalf of CrowdStrike, was requesting the immediate removal of the CrowdStrike logo from the parody site, or else Senk risked Cloudflare taking down the whole site.

Senk immediately felt the takedown was bogus. His site was obviously parody, which he felt should have made his use of the CrowdStrike logos—altered or not—fair use. He immediately responded to Cloudflare to contest the notice, but Cloudflare did not respond to or even acknowledge receipt of his counter notice. Instead, Cloudflare sent a second email warning Senk of the alleged infringement, but once again, Cloudflare failed to respond to his counter notice.

This left Senk little choice but to relocate his parody site to “somewhere less-susceptible to DMCA takedown requests,” Senk told Ars, which ended up being a Hetzner server in Finland.

Currently on the ClownStrike site, when you click a CSC logo altered with a clown wig, you can find Senk venting about “corporate cyberbullies” taking down “content that they disagree with” and calling Cloudflare’s counter notice system “hilariously ineffective.”

“The DMCA requires service providers to ‘act expeditiously to remove or disable access to the infringing material,’ yet it gives those same ‘service providers’ 14 days to restore access in the event of a counternotice!” Senk complained. “The DMCA, like much American legislation, is heavily biased towards corporations instead of the actual living, breathing citizens of the country.”

Reached for comment, CrowdStrike declined to comment on ClownStrike’s takedown directly. But it seems like the takedown notice probably never should have been sent to Senk. His parody site likely got swept up in CrowdStrike’s anti-fraud efforts to stop bad actors attempting to take advantage of the global IT outage by deceptively using CrowdStrike’s logo on malicious sites.

“As part of our proactive fraud management activities, CrowdStrike’s anti-fraud partners have issued more than 500 takedown notices in the last two weeks to help prevent bad actors from exploiting current events,” CrowdStrike’s statement said. “These actions are taken to help protect customers and the industry from phishing sites and malicious activity. While parody sites are not the intended target of these efforts, it’s possible for such sites to be inadvertently impacted. We will review the process and, where appropriate, evolve ongoing anti-fraud activities.”

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startup-roundup-#2

Startup Roundup #2

Previously: Startup Roundup #1.

This is my periodic grab bag coverage of various issues surrounding startups, especially but not exclusively tech-and-VC style startups, that apply over the longer term.

I always want to emphasize up front that startups are good and you should do one.

Equity and skin in the game are where it is at. Building something people want is where it is at. This is true both for a startup that raises venture capital, and also creating an ordinary business. The expected value is all around off the charts.

That does not mean it is the best thing to do.

One must go in with eyes open to facts such as these:

  1. It is hard.

  2. There are many reasons it might not be for you.

  3. There are also lots of other things also worth doing.

  4. If you care largely about existential risk and lowering the probability of everyone dying from AI, a startup is not the obvious natural fit for that cause.

  5. The ecosystem is in large part a hive of scum and villainy and horrible epistemics.

I warn of a lot of things. The bottom line still remains that if you are debating between a conventional approach of going to school or getting a regular job, versus starting a business? If it is at all close? I would start the business every time.

This seems promising.

Deedy: HUGE Immigration News for International Entrepreneurs!!

If you own 10%+ of a US startup entity founded <5yrs ago with $264k+ of [qualified investments from qualified investors], you+spouses of up to 3 co-founders can come work in the US for 2.5yrs with renewal to 5yrs.

Startups globally can now come build in SF!

A “qualified investor” has to be a US citizen or PR who has made $600-650k in prior investments with 2+ startups creating 5+ jobs or generating $530k revenue growing 20% YoY.

If you don’t meet the funding requirement, don’t lose hope. You CAN provide alternate evidence.

For the renewal to 5yrs, you need to maintain 5% ownership, create 5+ jobs and reach $530k+ revenue growing 20% YoY or $530k+ in investment, although alternative criteria can be used.

While on the International Entrepreneur Rule (IER) program, I believe an entrepreneur can just apply directly for an O-1 to have a more renewable work permit not tied to their startup and/or an EB-1A to directly go to a green card.

Here is the official rule for it. Notice that once someone is a ‘qualified investor’ in this sense, their investments become a lot more valuable to such companies. So there is a lot of incentive to get a win-win deal.

If you are in AI, it’s time to build. Everyone wants to invest in you.

If you are not, times are tough for startups. Ian Rountree lays out exactly how tough.

Matt Truck: Brace for it: hearing from big companies corp dev departments that they’re flooded with requests of startups looking for a home. In some categories, pretty much all companies are/would be up for sale. This too shall pass but this long-predicted tough moment seems to be upon us.

Ian Rountree (late 2023): ’ve been saving my first mega-tweet for this! I’ll tell you what the next 3-12 months will probably look like for startups/venture…

But 1st let’s rewind to Spring 2022. As soon as rates spiked we had a period where private markets went flat for as long as companies had runway since companies don’t have to price their shares unless they like the price OR need the money. (Whereas liquid assets repriced pretty much immediately.)

Very few startups outside of AI—and some in climate and defense—liked the prices they were being offered so most didn’t raise capital or raised extensions from insiders incentivized to hold prices steady.

Now most startups are running out of the money they raised in 2020-2021 + those extensions so they’re forced to raise.

The great startups are raising mostly on flat rounds or slight up rounds—which is a big win when your public comps have faced multiple compression but no startup CEO I know will admit this publicly. They may kick and scream but they’re smart enough to face the music. That’s been happening the last couple months and it’s felt good as a VC. At @cantos we’ve seen 7-8 term sheets in our portfolio since September 1st. We’ve been calling it BOBA for “bounce off the bottom autumn”. (Feel free to steal that.)

But now WINTER IS COMING. The startups that can’t raise this Fall, probably the majority, will soon start failing and the headlines will NOT be pretty. It will look like an absolute bloodbath next year. Some may even claim venture is over, that this whole startup thing was a fad.

Here’s the thing though: this is all just a very slow ripple effect of rising rates that started ~18 months ago. These coming bankruptcies will be a LAGGING indicator. As inflated valuations come down (Google “multiple compression” if that triggered you) and VCs write many positions off, LPs will likely get MORE active (no longer held back by their denominator problem) and it will probably be a GREAT time to invest in startups or start a brand new company.

So when those headlines get published in the coming months fear not; be “greedy” instead. Painful as these failures will be—we’ll feel those in our portfolio viscerally, to be sure—it will be an inevitable, foreseeable, and ultimately healthy reset.

VCs always talk like this. Always it is a good time to start a new company, the great ones will make it, whatever we are offering you will work out, and so on.

Startups (overally, not specifically in tech or backed by VC), meaning firms less than one year old, are now producing more than all of the net new jobs, and there are a lot more of them than pre-pandemic.

Alec Stapp: Incredible statistics on US startup boom:

“In the four years before the pandemic, established firms added one net job for every four created by startups.

In the four years since the pandemic, established firms have actually lost one job for every four created by startups.”

Seth Burn: I think this is darker than you realize. Established firms shrinking is not a good thing in general.

The reconciliation is that venture capital is not that important as a share of new firms. Venture capitalists talk as if they are the source of all new firms, yet they fund companies responsible for only (Claude’s estimate) 5%-10% of new jobs at firms less than a year old.

The venture capital response is those firms are the ones that grow to be giants, that change the world. And that is indeed disproportionally true. Yet one should not neglect the possibility of creating other types of firms. With AI in play, you can more easily raise venture capital for AI projects, but also consider whether it means you are in less need of such funding as well.

No matter how tough, yes Esther Crawford made it work, but as Paul Graham reminds us do not put all your savings into your startup and yolo when you cannot raise money. Decide what you are prepared to put at risk early on, and stop there. If it dies then it dies. Take the inability to raise money or make money as strong evidence. Otherwise, you are taking on the worst kind of adverse selection, and forgetting that you are the easiest one to fool, and that being a founder involves intentionally fooling yourself quite a bit.

VCs will often promise to fund you in the future if you do X. Do not believe them. They are lying. Period. VCs use this to string you along and get a free option. I mean, there’s not actual 0% they will fund you if you meet the condition. Chances are higher than if you don’t do X. But the chance is still low.

Also, startups are just flat out really hard and require solving lots of hard problems, and you never hear about most of them, my experience confirms this.

Paul Graham: Even in the most successful startups, even many years in, the founders are dealing with hair-raising problems. They mostly conceal these struggles from the outside world and even from their own employees. There’s no upside in talking about them. But I hear about them.

Because startups are so much harder than they look, a lot of people think that successful startup founders just got lucky and had piles of money dropped in their laps. But this is so not true. Between t=0 and piles of money, they deal with novel crises every couple months.

What’s uniquely hard about running a startup is that you don’t merely have to endure adversity, but have to solve intellectually difficult problems while doing so. It’s like trying to find integrals while being chased by a lion.

The weirdness is that founders also, by the Graham theory, need to be overconfident, and it would be good for more people starting out to not appreciate how hard it is going to get.

Some key red flags to avoid in your startup, including on your YC application.

Melia Russell: Applying to YC?

@daltonc and @mwseibel reveal their biggest application icks:

– too many extracurriculars tied to startups (their advice: just start building)

– hedging that they might still go to business school

– bloated founding teams

– ownership weighted toward biz cofounder [as in, highly lopsided]

Paul Graham: The point about extracurriculars is a subtle one, but it’s a red flag for me too. The best founders don’t spend college *talkingabout startups. They spend their time working on projects, whether they’re meant to be startups or not.

I’d rather fund someone who knew zero about startups and had a lot of experience building things. Startup basics are easy enough that you can learn them during YC. But you can’t learn to build things.

Evan LaPointe: Bummer. They’re just penalizing honesty around extremely fixable issues. Too easy to manipulate these answers (and too obvious to those who would).

These are real red flags. As in they are things founders should be avoiding whether or not anyone will find out about them. They do not bode well. They are partly causal.

I strongly endorse that you want to be building things first and foremost, that you should avoid a bloated founding team or a lopsided equity distribution, and that you should not be in the ‘maybe business school’ mindset.

I do also notice this advice favors YC and VC. Learning the startup side later is underrated, but also is what a venture capitalist would want you to do, for their own business. VCs are always telling you not to worry about such things, except when they are explaining the importance of a particular detail. Which often happen exactly when it is too late to fix the problem this go around.

This post is full of advice given freely at least twice over. Why is that?

Paul Graham: The techniques for getting rich from startups are very valuable, but the people who know most about them make no effort to keep them secret. Founders and investors publish them openly.

The investors are motivated partly by self-interest. They want more people to get rich so they can invest in them. But mostly (and almost entirely in the case of founders) those who publish the techniques for getting rich just want to help people. This is not a zero-sum world.

Since people who get rich from startups demonstrably get richer than those who get rich in other ways, there should be zero market for people selling “secrets of getting rich.” Why would you pay for something inferior to the free alternative?

Now that I think about it, I bet I know how the people who sell “secrets of getting rich” manage to do it. Presumably they’re claiming to sell secrets of getting rich without doing much work. Yeah, good luck with that.

I do think a lot of people offering advice purely want to give back and help people, and make the world a better place with more wealth and nice things and cool toys. That is totally a thing.

I would be precise with the self-interest argument.

The VC does not want you to get rich so they can invest in you. They want to invest in you now, on favorable terms, and for you to then make them and ideally also yourself rich after.

If you are literally (or at least approximately) Paul Graham, sure, you can plausibly rise the tide enough and benefit enough from the rising tide can lifting your boat that this makes sense. That is a very small club.

What is largely going on instead is that the VCs are trying to compete for deal flow, and they are trying to shape investor attitudes in ways that benefit themselves and other VCs. If you are known for giving great advice, founders will think of and think well of you, and you will get more opportunities. Getting the best opportunities is key, perhaps the most important key, to success in VC.

The other half is promoting techniques that make founders do what VCs want in general, which raises your status and valuable connections with other VCs. You want the founder to build a useful product and a great company that you can get a lot of for not that much. You do not want the founder to care about positioning themselves to get a good deal from VCs or taking advantage of the flaws in the system.

If you give advice that makes founders give VCs good opportunities, you are well-poised to capture exactly the customers you generate. And other VCs will notice you helping VC interests and cooperate with you.

There is still lots of very good advice on how to found and run startups. Mostly what the VCs want you to do is a good idea for you as well. You can do well mostly following the standard advice playbook, and you will probably do quite poorly if you are unaware of the contents of that playbook. To do the best, you need to recognize how the playbook was crafted, and where it is a trap.

If you are tall, you can hope to be allowed to run someone else’s company. If you are short, perhaps start your own instead? Also, reminder: How much of discrimination against women is actually discrimination against short people?

Noor Siddiqui: In the US, 14.5% of men are 6ft or taller.

Among CEOs of Fortune 500 companies, 58% are 6ft or taller (4x increase)

3.9% of men are 6’2’’ or taller, among F500 CEOs, 30% are 6’2’’ or taller (7.6x increase)

From Blink, by Malcolm Gladwell

Dave Lu: Self-made American billionaires who didn’t have to get picked for the CEO job and built their own Fortune 500 companies:

Mark Zuckerberg: 5’ 7”

Jensen Huang: 5’ 7”

Jeff Bezos: 5’ 7”

Michael Bloomberg: 5’ 7”

Eric Yuan: 5’ 7”

Tony Xu: 5’ 7”

Sergey Brin: 5’ 8”

Bill Gates: 5’ 10”

But also, notice that women have their own cheat code, and unlike height it is something they can change if they want to…

Noor Siddiqui: In the US, 5% of women are blonde. Among female CEOs of Fortune 500 companies, 48% are blonde.

Female senators: 35% blonde.

Blonde privilege but not height privilege for women apparently. Just 2.2% of male F500 CEOs are blonde.

Correlation is not causation, the decision to change one’s hair color is indicative of various other things as might be having that hair color naturally. But yes, if you are looking to be a female CEO or politician or do anything similar, you want to choose to have blonde hair.

I found this illustrative in multiple ways.

Paul Graham: Doordash has to win because Tony Xu is the optimal founder of such a business. If you were designing someone for the job, you wouldn’t change a thing. So if there is a business there at all, which there clearly is, Doordash will inevitably dominate it.

Serpunk: What makes Tony the perfect founder for this business paul?

Paul Graham: He loves the parts of it that would bore or frighten or confuse a normal person.

That certainly is an asset. But what I found most illustrative here is the extreme faith by many venture capitalists that the right founder will win, no matter what else is happening, even this late in the game. I do think it’s easy to underestimate such impacts, but there are a lot of things going on and indeed do many things come to pass.

DoorDash seems ahead, and I think Caviar, which they own, is the best option in NYC by a lot if you’re not going low end on your order. But I don’t think anyone ever ‘has to’ anything, and in many ways the original DoorDash actually has substantial issues that I would have thought a detail oriented founder would deal with.

It’s not the incentives, it’s you, but also it’s the incentives.

Gokul Rajaram: Friend in venture: “I think half of the mania in venture growth is explained by young deal makers who want to just jam shit in the portfolio and make a name for themselves.

There’s a nice good business that’s single digit ARR, 3x’ing this year, and ahead of plan. But principals and junior partners at many firms are chomping at the bit to deploy capital and so are treating it like God’s gift to humanity.”

Like @garrytan said, this is a prime example of a principal-agent problem.

The way most firms (VC/PE) evaluate junior team members is deals done vs. outcome. Promotions happen long before the expected exit becomes apparent. So junior investors are incentivised to do deals that the firm will sign off on vs. be patient for the right deal.

The challenge with “right deal” is junior investors don’t have the ability to pick their deals, so even if you find the Coinbase/Doordash Series B and advocate the hell out of it, the IC may pass.

So ultimately the incentive structure (at most firms) makes you advocate for deals you believe the IC will do. If it does well then you can claim it as your own. If it doesn’t then you a) either got promoted and found some deal that worked b) work somewhere else and sweep it under the rug c) leave for the operating side.

Garry Tan: Principal agent problem meets OPM.

Founders, if you wonder why VC’s act so weird, it’s basically this.

VCs act mostly via mimesis based on social consensus, but the future is built by founders who are contrarian AND right.

The unfair result is that “hot” spaces get a lot of money and “cold” spaces get no money, and the reality is great companies are somewhat arbitrarily either showered with outside capital or never get any.

It’s one of the strangest examples of pervasive capital misallocation.

A claim.

Tyler Hoggle: 🐑 vc.

Garry Tan (CEO of YC): Nailed it.

Yes. Unfortunately, this means most VCs cannot get you a lead or first investor to recruit the rest.

It took very little direct experience advising a venture capital firm to see these dynamics in action, even if everyone involved was doing their best to avoid them. It is very hard to deploy the strategy ‘do what maximizes returns’ or to go outside of the social consensus. There are huge gains for venture capital willing to play to win.

Remember that even Paul Graham, who I am sure is doing great anyway, has said that he knows he could get even better returns by changing his investment heuristics away from consensus, yet in practice he can’t execute on that.

Given that, why would one claim that VCs must be acting efficiently? There is so much to unpack here:

Paul Graham: People casually claiming that VCs discriminate against this or that group should also mention that VCs have the strongest incentive not to discriminate of any group in the world. They personally lose money if they pick the wrong founders.

Because of this, they’re very quick to change their behavior if they realize they’ve been discriminating against some kind of startup. In fact, they are famously, comically quick to.

VCs are constantly, and rightly, ridiculed for jumping on one bandwagon after another. But think about what that means: they previously refused to invest in such startups, and now are eager to. I.e. they realized they were discriminating against them, and now are overcorrecting.

How do they realize they discriminated against startups of type x? When startups of type x start to do much better than they expected. That may seem a strange definition of discrimination. But actually it’s the only definition that makes sense.

If multiple companies founded by Martians with eyes on stalks started growing really fast, VCs would be falling over one another to invest in more companies founded by Martians with eyes on stalks. You know they would.

It would be nice if people responded to incentives this way. The discrimination literature makes clear that they do not, and also some amount of discrimination (in this sense) makes sense for founders socially and also financially, because those around them are doing the same, and also they are messing up.

If one takes this story at face value, it is saying that VCs update too strongly on recent outcomes, and pattern match to prior successful companies without understanding what matters. They are in the overcorrection business, in the ‘what’s hot’ business and the pattern matching business.

If you are in the overcorrection business, you are discriminating against most groups most of the time. You are looking for a set of patterns, and woe to anyone lacking those patterns. Which is indeed how I believe VCs operate. And also that is what discrimination means here.

Why do they do this?

Because VCs are largely concerned with how they look to other VCs and socially justifying their decisions.

And also VCs who invest are and should be very concerned about who will invest in subsequent rounds, and how easy it will be to raise.

Eliezer Yudkowsky (responding to top of thread): I put that claim to Peter Thiel once, and he replied to me that VCs need to be very concerned about every kind of fashion; because a startup investment won’t thrive unless other VCs want to fund its later stages downstream.

Paul Graham: Are you sure? It’s unlikely that he would say that, because the later the stage of investment, the more all that matters is revenue growth, and surely Peter is experienced enough to know that.

Eliezer Yudkowsky: I am reasonably sure that it is what Peter Thiel said to me; it stuck in my mind at the time.

Paul’s statement here is not credible. Of course things other than revenue growth matter. You would be crazy to ignore all other factors. Even if all other VCs only care about revenue growth, in which case you would mostly also have to only care about it, you would still be wise to look at other things.

Things people say when not currently talking price.

Paul Graham: There is no such thing as value investing in venture capital. The steep power law distribution of returns means you want to be in the best startups at whatever the price happens to be.

What’s the difference between a high valuation and a low one for a comparable company? 5x? If you use that as a selection criterion in a domain where the difference between a big success and a small one is 100x, you’re innumerate.

Price always matters. Every good gambler knows. Every trader knows. A VC is both. That which is a good deal at $1X is often a bad deal at $2X.

True, it will probably either pay out $100X or $0, but so what? You don’t know which is which yet, you only know your guess on the odds. The key is getting a good price, which gives you good odds. What counts as a good price is different with startups, since they are all growing rapidly. The best ones really are worth a lot more relative to their baseline numbers, and you should pay that extra amount.

What Paul is actually saying here, as I understand it, is that the most valuable startups are indeed underpriced. That they are the value.

And I think this is actually true. Relatively unpromising startups find winner’s curse investors who give them a reasonable price, and they hold out for that solid price because if you take a bad price your chances of success drop enough you might as well go home.

Whereas if you have an amazing startup, what do you do? You go after the best investors that can offer strategic help and will reliably follow in future rounds, and you do not need to worry so much about the exact price, whereas you do have to worry about a potential down round or other strangeness if you leverage your position now and then things go badly. And all those top VCs are of course telling you to price ‘only’ 5x what the unpromising companies charge, when we all know you are 10x or 20x as valuable. But that’s because people are making the wrong comparisons.

What is an underrated good sign to look for as a VC? How about fun.

Paul Graham: YC is different from most other businesses in that you don’t have to trade off fun vs money. The founders who are fun to work with also as a rule tend to be the ones who are most successful.

As with many similar Paul Graham observations, it is wise, and the consideration underrated, yet it is overstated. The question is why Graham and also other VCs are unable to properly update based on such factors.

Another Graham observation is that you want to let startups be themselves rather than telling them to copy others. To what extent does practice follow this principle?

Paul Graham: Someone at a dinner party last night was curious why YC doesn’t provide office space to startups. I explained that it was because successful startups have a very strong flavor of themselves, and you don’t want to do anything to dilute that.

It’s good for each startup to be in the same place much of the time, but they don’t have to be in the same place as other startups more than a few hours a week.

The key is ‘when faced with a choice’:

Greg Brockman (cofounder OpenAI): In startups, when faced with the choice between an easy and a hard path, the hard one tends to be where the value gets created.

Easy is better than hard. You knew that. It is when the choice is tricky that the hard path likely creates value.

Especially beware when things are hard that should be easy. In particular, when raising funds or getting customers is hard, that is not a sign that pushing harder will create value. It might, but the sign is that you likely are going down a wrong path.

Thus: Paul Graham gives the good advice to only raise funds if it is going to succeed. Of course, that means you have to figure out if you will succeed.

Paul Graham: It’s a mistake to try to raise money if you’re not quite attractive enough to investors. They don’t say no immediately. They suck up a lot of your time and hope, and then say no. It’s a huge distraction and crushingly bad for morale.

The most important factor is your growth rate, if you’ve been launched for long enough to estimate it reliably. If your growth rate is 4x a year you’re definitely attractive. If it’s only 1.5x a year, you’re not, unless it’s a late stage round.

One key is that when you get a yes, it’s usually much faster than a no. Raising funds is likely either easy or impossible. If you fail to get a quick yes when you ask, you can interpret this as likely nos. The nos not being quick is better news than them being quick, but does more damage.

Thus, with the latest company I considered founding, we asked a few people, noticed fundraising wasn’t easy, and decided fine we will go do something else.

The obsession with growth rate that Graham observes is dumb, and of course there are many other elements in play. VCs are not that simple minded.

What is missing here is the impetus to think backwards. If you can only raise under some conditions, are you backchaining to ensure you get those conditions?

Paul Graham would say no, that’s doing it wrong, you should build something people want, do the right things, and let the VCs take care of themselves. That is what a VC wants you to do, but any gamer knows how dumb it is not to check your victory conditions or what gets you past the checkpoints.

When pitching your seed stage startup, Y Combinator’s Michael Siebel and Paul Graham say avoid the flash and concisely get to the point, among other things in an hourlong presentation. Again, keep it easy.

Another thing he says up front is that founders hold a special place of hatred for investors who reject them. That was not my experience.

I hold a special place for those investors who strung us along. Who made us think they would invest, then didn’t. Or, especially, for those who did that, then announced they were altering the deal, and told us to prey that they would not alter it any further. They can go ahead and rot in hell.

If you heard the pitch, and you said no, not interested? I had zero problem with that. On the few cases they also explained why, they have my sincere thanks.

On a similar note: Patrick McKenzie notes that if you write an investment in a startup down to zero, it is your moral obligation to ensure the founder knows this, and it would be good if you outright returned the investment so you were no longer in any sense their boss (or, I would add, crippling their cap table). Most importantly you want to let the founders know not to waste everyone’s time any further, and let them know they have failed with honor. When someone finally did essentially tell me this at MetaMed, it was refreshing and helpful, even if their ‘we will back your next play because we still believe in you’ did not go so well.

Brett Adcock, who says he has raised $1.7 billion, says most of it was via cold emails. He says cold is better because this is a shots-on-goal game, and cold emails scale, whereas networks do not scale so well and it is hard to get people to actually advocate for you.

Except, this number might be a hint something is odd.

To state the obvious, no one converts to a phone call at 70%. That’s why he calls it a ‘shots-on-goal’ situation. To the extent that email is working reasonably often it is because people know who he is or what his prior companies are. This is the opposite of a traditional cold email scenario, where no one has any reputational reason to listen to you. I mean, sure, if Taylor Swift ‘cold emailed’ me I would take the meeting.

Your periodic reminder, here from Patrick McKenzie, that talking to an associate at a VC firm is probably a waste of your time. They have no authority. This time spent is not going to lead to a deal very often.

Darren Marble: Talking with a VC Associate will almost never convert into actual funding.

Just stating the facts.

Yuri Sagalov: A lot of GPs at big funds that have associates are quote-tweeting this saying this is not true.

Notably missing are founders quote tweeting this saying that it is not true.

Empirically, it *istrue.

Darren said almost never, not never. And almost never is correct.

Greg Brockman: Common mistake in a startup is to serialize subprojects that could be parallelized.

I worry about selection effects here as well. A large portion of startups I have seen attempt to do too many different things at once, and would have been wise instead to focus. If there are multiple steps that are part of the right focus, then by all means work in parallel. But this in sharp contrasts to staying lean, shipping quicky and so on.

What good are hackathons? I agree with Patrick McKenzie here, that the point is to prove to everyone especially yourself and have a culture of You Can Just Make Things. And also to have a chance to brainstorm some of those things and see which are worth just making, and networking, but that is secondary. Understand how much trivial inconveniences and paperwork barriers, let alone bigger problems, stop progress.

Don’t play house. Rather than go through expected motions, instead do things for reasons, try specific things and so on. Only go through expected motions when you are being evaluated and rewarded by those checking for the motions and you mostly care about those evaluations and rewards (such as is often true in school), start-ups are different. That much is wise.

I do think Paul Graham takes it too far, trying to convince founders to be fully genuine and build things people want without caring about investors, because that is what is best for the investors.

You do need to do the actual building. Focusing only on fundraising won’t work. But also acting like you don’t also need to invoke Goodhart’s Law or target what gets you funded won’t work either.

We are teaching our most talented children not to follow their curiosity.

Paul Graham: I gave a talk about startups to 14 and 15 year olds, and their questions afterward were better than I get at top universities. I puzzled over this, then realized why. Their questions were motivated by genuine curiosity, rather than to make some kind of comment or to seem smart.

The best one was one I hadn’t even considered when I was writing the talk. I listed three things you needed to start a startup — to be good at some technology, an idea, and cofounders — and one kid asked what other things besides startups this recipe worked for.

Patrick McKenzie: We are very good about teaching people to play bad games, and not very good about teaching them introspection on whether the game is a good or bad one, in part because you have to win the bad games repeatedly for years to end up teaching them.

Here’s another fun thought.

Paul Graham: The more I learned about how badly US college admissions are done, the more puzzled I was that there was any correlation between where startup founders went to college and how their companies did. Then I got it: mismanaged college admissions are ideal for selecting founders.

US admissions departments make applicants jump through arbitrary hoops that have nothing to do with intellectual ability. How could this test matter? Answer: the more arbitrary a test is, the more it’s simply a test of determination and resourcefulness.

Determination and resourcefulness are the best predictors of startup success. So the worse a job admissions departments do of selecting potential students — the more arbitrary their criteria — the better a job they do of selecting startup founders.

If you are measuring determination and resourcefulness, that doesn’t seem like such a bad admissions policy? Except of course that it means it eats your entire childhood. But that is not the school’s problem.

Replit has a course called 100 days of code. A lot of people do day 1.

Paul Graham: How many people make it through each day of Replit’s online 100 Days of Code tutorial.

This is ‘Emergents TCG user retention’ levels of not retaining users. How should we think about it?

Andrew Davidson: After day 10 or so I just wanted to start experimenting on real stuff… which coincidentally Replit makes really easy with its Al generate and explain features.

You can just ask Replit to create you some bespoke lessons on the fly. More fun!

Amjad Masad (CEO Replit): Most people don’t need to go past day 14 to start making things & learning on the job.

Samuel Path: In the course description it says 15 minutes per day. But then later it turns out that many days require more than 30 minutes. For busy individuals, finding 35 minutes a day is not the same challenge as finding 15 minutes. Maybe they should be more precise in the intro.

Michael McGill: You become part of the 99th percentile just be consistently showing up.

There are not literally zero stupid questions, but in math, basically, yeah.

Daniel Litt: In my experience “asking stupid questions” in mathematics is often correlated with “wanting deep understanding.” (And, in my experience, being annoyed at “stupid questions” is often correlated with “wanting to look smart.”)

QC: Agreed. I can’t remember the last time i was annoyed at someone for asking a “stupid question” in math. literally all of the questions I’ve ever been asked directly 1-on-1 are great and i love answering them, and i deeply appreciate people’s hunger for deep understanding

The closest i get to “being annoyed at stupid questions” is sometimes I’ll come across questions on, like, quora that either 1) are just word salad, or 2) that reveal really large gaps in understanding that sometimes feel like they’d be incredibly exhausting to try to explain.

It is essentially impossible to ask a stupid question in math if you indeed are curious and do not know the answer. In other areas it is easier, but it is still hard.

Especially if you also note you are asking a kind of a stupid question, and even better if you have even checked with an LLM? Very hard.

Do you need to learn to code?

Paul Graham: Someone asked me if they need to learn to program to start a startup, and I realized my answer depends mostly on two things: how old they are, and whether they already have a cofounder who can.

If you’re 20 I’m always going to say you should learn. 20 is too young to start claiming you’re “not technical.” It’s too young to claim you’re not anything. Whereas if you’re 40 and already have a cofounder who can program, ok, you can skip learning to yourself.

My experience is that it is a serious handicap if you cannot code well enough to contribute. Do your best to fix that. Even if you do not directly contribute, if you do not know how to code at all you will not understand what is going on or make good decisions. You need to learn enough to be able to discuss problems and solutions, at least on the architect level, no matter what.

AI is going to change the equation. There is increasingly little excuse for not knowing how to code. You could instead say you will no longer need to know how to code. I disagree. My experience is that AI coding goes dramatically better if you understand what is going on.

New Paul Graham essay on the value of Superlinear Returns. His case is that in many places wins compound and there are increasing marginal returns, so you want to go all out and be more ambitious and focus on growth and work on your own projects and follow your curiosity and take risks and do all the Paul Graham things and YC things.

Seemed like a lesser work to me, an attempt to deliver the message (that I mostly agree with) in a new way that didn’t really work. But then, the whole point is to take risks that aren’t actually risks.

Reid Hoffman echoes the standard rule that the best founders don’t have work-life balance. Startups are all about concentrated effort and super-linear returns and going all out. That does not mean that it is not worth creating a startup if you cannot work 80 hour weeks. Non-best founding efforts are still worthwhile. But yeah, if you get traction, look into not having any balance for a while.

A fun story about the kinds of things startups do when they have to, such as showing up at the back-office document processing arm of your lender when they demand you file physical copies of forms and won’t process your loan without them and there’s a backlog.

Yes, it’s illegal discrimination, but is it wise?

Kevin Fisher: I was in a discussion with a young founder who said “no kids” was their metric for hiring because “they’re not committed” 🙈

@ Young Founders – Hours are a bad proxy for commitment. People can work long hours for all sorts of reasons.

What you’re looking for is emotional and spiritual alignment with what you’re bringing forth into the world. You want people who are putting their life energy into your vision for the future.

Going to sleep, waking up, and thinking about how to move your mission forward. Dreaming in your vision. Hours are a byproduct of alignment not the goal.

I had one job that very explicitly said to me during the hiring process that they prefer to hire people without families. And indeed I can see why. I worked very long hours, lived and breathed the work for years, and this was highly profitable for all concerned. If I’d had other demands on my time, I would have been less effective. Yes, life requires that we all indeed do have other demands on my time, and I did indeed pick those up later. Also having a family and especially children is a great inspiration and motivator. But whatever the law might say, we should not kid ourselves that some jobs greatly benefit from a lack of commitments.

At one point, after many years of competitions, it was observed that no (at the time) parent had ever made the top 8 of a Magic Pro Tour. I do not know if that is still true.

The good news is that most other jobs are not like all this. He said, working a lot more than forty hours.

Revenue, or at least profit, wins in the end. Eventually.

Paul Graham: Startups get compared by how much they raise and at what valuation, because that’s public information. But this has the unfortunate side effect of making fundraising read as success. So I’m glad YC publishes a list of the top companies by revenue.

I would have been impressed if that list was for the 2024 YC class. Instead, it is a list that draws from all of YC’s history, so it includes firms like AirBnB. At that point, I am not sure it makes that much difference.

Why are you told to focus so much on revenue?

There are three distinct reasons. It is important to understand all three and know which ones matter to your business.

  1. Revenue gives you money. That money means you have to raise less funds, perhaps even zero funds, and do it less soon.

  2. Revenue is a proxy metric. If you seek revenue you will be forced to learn how to sell, you will encounter real customers, you will build something people want.

  3. Revenue determines investability and valuation. You can raise more, easier and at higher valuations, often dramatically more than the actual revenues involved.

Beware also that these can backfire.

  1. You can try to bootstrap or focus on small revenues. This can distract you from understanding your actual business model, and dramatically slow you down.

  2. All the usual Goodhart’s Law problems apply. Often this is not a good proxy, or it is but you can easily lean on it too hard.

  3. Having revenue can shift VCs into ‘revenue mode’ where they start doing different calculations, and dismiss you as a failure or as worth less than if you had kept that angle mysterious for longer. Or you might get revenue too early that makes it hard to ‘show growth.’

My startup MetaMed experienced forms of all three of these failure modes.

Garry Tan moves YC from Mountain View to San Francisco proper, says its startups must follow.

Lee Edwards: Imagine sitting down with a mid-sized city mayor and being like – In our city, this guy made one rules change at his co to bring hundreds of tech startups to the city.

“That’s great, so they probably gave that guy the keys to the city, huh?”

No. Uh. Actually…they hate him.

To be fair to San Francisco, he is actively trying to overthrow the city government and would have tech people running the place, calling the current regime the height of incompetence and self-sabotage that has ruined a city capable of greatness.

To be fair to Garry Tan, he is actively trying to overthrow the city government and would have tech people running the place because the current regime is the height of incompetence and self-sabotage that has ruined a city capable of greatness.

San Francisco does seem like the right choice over Mountain View. The city is where the AI action is, so that is where YC should be as well. If you base in Mountain View, you are not close to the action, and you are still paying infinity dollars to be there. Yeah, the city proper is quite the dump at the moment, but if you care about that so much then YC is presumably not for you anyway.

Startups are constantly told they absolutely must be in San Francisco. That this is the only place to raise money, if you are not here you are not serious, and so on. And yes it is number one by volume, but not by so much? A factor of less than two, New York is often remarkably close although it had a bad 2023 for whatever reason:

There is no doubt greater imbalance specifically in technology and especially in AI. Also there are far more sources of funding than one startup can attempt to tap, and planes exist.

The bigger story here is of course the big overall decline from the 2021 peak.

When you enable the fundraising, and also when you build better stuff, and when your connections make everything easier, you make the startups better.

Max Brodeur-Urbas: Today is day 80 and the end of YC.

Final results:

– MRR +4100%

– Daily automation runs +650%

– Finally feel confident saying we’re making something people love

Legitimately sad @ycombinator is over but grateful it happened. So excited for what’s next.

Going for another 80 [days of work].

Paul Graham: A lot of people unconsciously think of Y Combinator as a marketplace for fundraising, but this is what it’s really for: making the startups better. When YC is done right, fundraising is just a victory lap at the end.

YC changes your circumstances in ways that allow you to build something people love, and where you get rewarded based on your ability to demonstrate progress in terms of what you build and who is using it, while having a rocket that helps you find those early users, exactly because it takes care of the things that would otherwise distract you from building and shipping.

Hardware is a hard business, also a chance to do something great.

Always also ask, would it be something good? Most of the time the answer will be yes, but in the age of AI there are important exceptions. If you are making hardware that enables frontier AI, perhaps that is not a good idea.

An overview of YC’s advice to hardware startups, and a YouTube video on their hardware startups this round with Garry Tan.

Presumably an overstatement, still:

David Lieb: I’ve made or seen hundreds of hires, and one thing I have never seen is a B player hire an A player. Not once.

If you play that out, you realize that compromising on even a single role can destroy a team forever.

I have seen it happen. I do agree it is rare. The thing is, if you are an A-player and looking to hire, that’s an easy problem, you take care to hire A-players. What about if you are an A-player looking for work? How hard should you work to ensure only an A-player gets to hire you? How much should that be your priority?

I do not buy that A-players are always in such high demand that they always have A-players chasing them. If you do believe that, then your definition of A-player is different from mine. Also note that there are people who are superstars in some ways, but who should absolutely not be doing the hiring.

The ancient art of the reference check. Basic advice is to drill down into conflict during the main interview to prep, force everyone to cite an ‘area of improvement’ or otherwise say something negative and then see how far they’ll take it when paraphrased to nonchalantly sound terrible, check if they had impact, and ask about top X% (for 10/5/1) and what they’d need to get in that if no.

If they say someone else is top 1%, the suggestion is to go try and steal them. Dishonorable scum. So if they are calling you for the reference, maybe don’t tell the guy that part.

If you are debating whether to fire someone, you should probably fire them?

aviel: No one has ever regretted firing someone.

Paul Graham: This is not quite true, but it’s remarkable how close to true it is, for such a blanket statement. I know people who regret layoffs they were forced to do by higher management, but I can’t call to mind an example of anyone who regrets firing someone they chose to.

Eliezer Yudkowsky: “In those rare cases where they get to see how a fired employee performs in their next job, almost nobody reports that they inferred they should not have fired that person.” Not saying false, just observing number of filter steps.

Two examples raised in reply were Steve Jobs and Sam Altman, so yes, technically some people have importantly regretted firing someone. And as Eliezer notes, if you should with full information regret the firing, that does not mean you know that information.

Still, I believe it is true that, once you actually works up the nerve to fire someone without anything forcing you to fire someone, it is usually highly overdetermined that they had to go. You will make the occasional mistake, or turn out to be wrong, but this error mostly goes in one direction.

Mike Solana offers a warning that yes, obviously the anti-tech people will go around ambushing CEOs in tech regardless of gender or anything else, so be aware of this.

Jason: Honest question: Would these conference producers ever ambush a male CEO like that?

Mike Solana: this is an important point for founders and CEOs actually: yes, the producers ABSOLUTELY would have ambushed a male CEO like this. The failure here is entirely on Linda Vaccarino’s part for accepting an invite to code. We all know who kara swisher is. Stop feeding the serpents.

It’s just no longer possible to be angry with journalists for attacking founders and executives… who regularly open themselves up to attack. This is on x, not code (which, to be clear, sucks). now cancel your subscriptions to the media companies that hate you, and learn. ffs.

I feel this:

Steph Mui: founders and investors obsess over cash runway, but a founder friend recently brought up the idea of ’emotional runway’ and i can’t get it out of my head.

Running out of money kills lots of companies, but i think not enough people talk about how running out of willpower kills just as many.

Running out of money or willpower is often a sign that things are not working and you should give up, but not always. One must know when to quit, and when not to. What you do not want to to do is quiet quit on a start-up where you are emotionally bankrupt, and prolong the agony. You do not owe anyone that, you should fold.

What goes around comes around, even if someone believes it doesn’t.

Amjad Masad (CEO Replit): Someone asked me if HBO’s Silicon Valley was accurate and I said “no it is much weirder”—he thought I was joking until I told him about a talented VC friend who believes in Flat Earth yet still invests in space tech because “the government has to make it look like it works.”

Ryan Peterson: I love showing him the 3d globe with all of Flexport’s shipments.

Bob Cactaur: I could probably vibe with that VC ngl.

Amjad Masad: I heavily fwith him.

What someone whose company got acquired by Google learned at Google, about Google and how it works, interesting throughout. You have unique resources that enable great work, exacting standards to meet, potential limitless resources, and quite the gauntlet of office politics and corporate barriers to run if you want to turn any of that into a worthwhile product. Patrick McKenzie confirms the story, and offers thoughts.

Patrick McKenzie: An undercurrent of this and similar pieces, which I would like to highlight: “Firm-specific human capital” is a real thing in the world. Being effective at Google is a skill you can specialize in, independent of (and on top of) the thing you *actually do.*

And a challenge of working there is “How much of my brainsweat/care/identity is entangled with playing the game that is Google and Getting Good at Googling? And how much is everything else?” Neither extreme of spectrum is optimal for most interesting values systems.

I have had the opportunity to work with many people who previously worked at Google, and enjoy the vast majority of those interactions. But I will say a thing that must be said, for the benefit of people who will otherwise learn it the hard way:

The culture that is Google embeds a memeplex which sees organizations that do not operate as Google operates, and interprets this deviance as damage. Some people who previously worked at Google are extremely steeped in this culture and less than reflective of this fact.

Patrick warns, essentially, that if you hire ex-Googlers especially at high positions, they will be very talented, but also they will then attempt to turn their new company into an echo of Google, which likely will not be what your company needs or you want.

PoliMath adds this wise observation: When people say that something is obviously fake, they need to give a straight answer to the obvious follow-up question: If this *istrue, how would that change your view of the situation?

No more of the “this is fake but if it is real then it is good” No more of that. Don’t tell us why you think it is fake.

Tell us why you think it is *wrong*. What are the fake people in the fake story doing that you think is wrong or gross or worthy of reprimand?

This is a great example to engage the hypothetical & demonstrate your willingness to reprimand your “side.”

It’s entirely costless because (as you have said) it’s fake. So you’re not reprimanding any real people. You’re safe. No consequences, just tell us what is wrong about it.

Startup Roundup #2 Read More »

google-loses-doj’s-big-monopoly-trial-over-search-business

Google loses DOJ’s big monopoly trial over search business

Huge loss for Google —

Google’s exclusive deals maintained monopolies in two markets, judge ruled.

Google loses DOJ’s big monopoly trial over search business

Google just lost a massive antitrust trial over its sprawling search business, as US district judge Amit Mehta released his ruling, showing that he sided with the US Department of Justice in the case that could disrupt how billions of people search the web.

“Google is a monopolist, and it has acted as one to maintain its monopoly,” Mehta wrote in his opinion. “It has violated Section 2 of the Sherman Act.”

The verdict will likely come as a shock to Google, which had long argued that punishing Google for being the best in search would be “unprecedented” and frequently pointed to the DOJ’s lack of direct evidence. However, Mehta found the limited direct evidence compelling, especially “Google’s admission that it does not ‘consider whether users will go to other specific search providers (general or otherwise) if it introduces a change to its Search product.'”

“Google’s indifference is unsurprising,” Mehta wrote. “In 2020, Google conducted a quality degradation study, which showed that it would not lose search revenue if were to significantly reduce the quality of its search product. Just as the power to raise price ‘when it is desired to do so’ is proof of monopoly power, so too is the ability to degrade product quality without concern of losing consumers.”

He also wrote that the DOJ’s indirect evidence “easily establishes Google’s monopoly power in search” and concluded that “the fact that Google makes product changes without concern that its users might go elsewhere is something only a firm with monopoly power could do.”

Google didn’t lose every battle in this big fight with the DOJ. Mehta ruled that Google did not have monopoly power in search advertising, agreed that there was no market for general search advertising, and declined to sanction Google for allegedly destroying evidence by “failing to preserve its employees’ chat messages.”

Google’s president of global affairs, Kent Walker, provided a statement to Ars, confirming that Google plans to appeal.

“This decision recognizes that Google offers the best search engine, but concludes that we shouldn’t be allowed to make it easily available,” Walker said. “We appreciate the Court’s finding that Google is ‘the industry’s highest quality search engine, which has earned Google the trust of hundreds of millions of daily users,’ that Google ‘has long been the best search engine, particularly on mobile devices,’ ‘has continued to innovate in search,’ and that ‘Apple and Mozilla occasionally assess Google’s search quality relative to its rivals and find Google’s to be superior.’ Given this, and that people are increasingly looking for information in more and more ways, we plan to appeal. As this process continues, we will remain focused on making products that people find helpful and easy to use.”

Google monopolizes two markets, judge ruled

Mehta ruled that Google spending billions on exclusive distribution agreements with companies like Apple helped the tech giant maintain monopolies in two markets, general search services and general text advertising.

The US government had argued that Google used these exclusive deals to block out competitors like Bing or DuckDuckGo, “by ensuring that all of Android and Apple and mobile users are offered Google, either as the default general search engine or the only general search engine, Google’s deals with Android and Apple clearly have a significant effect in preserving its monopoly.” The DOJ successfully argued that blocks rivals from reaching the “critical level necessary” to “pose a real threat to Google’s monopoly.”

Mehta noted that Google’s dominance had “gone unchallenged for well over a decade,” partly due to a “largely unseen advantage over its rivals: default distribution.” He found that Google’s exclusive distribution deals foreclosed a “substantial share” of the markets and allowed Google to earn more revenues. Google then shared spiking revenues with device and browser developers—spending up to $26 billion in 2021 alone for exclusive deals, the trial revealed.

Google did all this, Mehta said, to ensure that “most devices in the United States come preloaded exclusively with Google” and to force “Google’s rivals to find other ways to reach users.” The DOJ successfully argued that this posed “significant barriers that protect Google’s market dominance in general search,” with rivals having to overcome “high capital costs—”to the tune of billions of dollars,” Mehta wrote—”Google’s control of key distribution channels, brand recognition, and scale.”

Barriers to entry in general text advertising are similarly “high,” Mehta said, with new entrants facing “the same major obstacles as would the developer of a new” search engine.

One of the most scrutinized exclusive deals was between Google and Apple, which was estimated at $20 billion in 2022. “This is nearly double the payment made in 2020,” Mehta noted, suggesting that Google increasingly valued the deal locking its search engine as the default in Safari as a way to shore up its search dominance.

“Google has long recognized that, if Apple were to develop and deploy its own search engine as the default” search tool “in Safari, it would come at great cost to Google,” Mehta wrote. Without the deal, Google “would lose around 65 percent of its revenue, even assuming that it could retain some users without the Safari default” placement. But “Apple has decided not to enter general search,” Mehta said, likely because it “would forego significant revenues” and potentially face user backlash if it stopped partnering with Google. Similarly high revenue loss would occur if “Google were to lose the Android defaults,” Mehta said.

None of the pro-competitive benefits that Google claimed justified the exclusive deals persuaded Mehta, who ruled that “importantly,” Google “exercised its monopoly power by charging supracompetitive prices for general search text ads”—and thus earned “monopoly profits.”

“That Google makes changes to its text ads auctions without considering its rivals’ prices is something that only a firm with monopoly power is able to do,” Mehta wrote. And “Google in fact has profitably raised prices substantially above the competitive level. That makes ‘the existence of monopoly power” “clear.”

Ultimately, Mehta ruled that “Google has no true competitor” in general search and without any “genuine” competition, “over the last decade, Google’s grip on the market has only grown stronger.” Further, he found that “Google understands there is no genuine competition for the defaults because it knows that its partners cannot afford to go elsewhere,” disagreeing with Google’s arguments that the default deals were not exclusive.

“The key question then is this: Do Google’s exclusive distribution contracts reasonably appear capable of significantly contributing to maintaining Google’s monopoly power in the general search services market?” Mehta wrote. “The answer is ‘yes.'”

This is a developing story and is being updated.

Google loses DOJ’s big monopoly trial over search business Read More »

historic-flooding-possible-as-ts-debby-bears-down-on-southeastern-united-states

Historic flooding possible as TS Debby bears down on southeastern United States

Not so little Debby —

Tropical rainfall and training bands, it’s going to be a soggy mess.

Satellite image of Tropical Storm Debby on Sunday morning.

Enlarge / Satellite image of Tropical Storm Debby on Sunday morning.

NOAA

As often happens during the month of July, the Atlantic tropics entered a lull after Hurricane Beryl struck Texas and short-lived Tropical Storm Chris moved into Mexico. But now, with African dust diminishing from the atmosphere and August well under way, the oceans have awoken.

Tropical Storm Debby formed this weekend, and according to forecasters with the National Hurricane Center, the system is likely to reach Category 1 hurricane status before making landfall along the coastal bend of western Florida on Monday.

As hurricanes go, this is not the most threatening storm the Sunshine State has seen in recent years. Yes, no one likes a hurricane, or the storm surge it brings. But Debby is likely to strike a relatively unpopulated area of Florida, venting much of its fury on preserves and wildlife areas. This won’t be pleasant by any means, but as hurricanes go this one should be fairly manageable from a wind and surge standpoint.

Major flood storm expected

But there is a far larger threat from Debby that will unfold well into next week over the southeastern United States—a major flood storm. Historic flooding is likely in areas of Florida, Georgia, and South Carolina.

Debby is motoring along to the north-northwest at a fairly good clip as of Sunday morning, at 13 mph. This is a fairly common path for hurricanes as they skirt around the edge of high-pressure systems. Then, when they gain a sufficient amount of latitude—as Debby is now doing—they turn poleward and eventually move toward the northeast.

Debby is expected to meander next week.

Debby is expected to meander next week.

National Hurricane Center

And this is just what Debby is likely to do through about Monday. However, after this time it appears that high pressure building over the central Atlantic Ocean will strengthen enough to block an escape path for Debby to the northeast. Should this occur, it will bottle up the storm in the vicinity of the Georgia and Carolina coasts for two or three days.

There remains a lot of uncertainty about just where Debby will go after striking Florida. Most likely it crosses Georgia on Tuesday and, then its center may reemerge into the Atlantic Ocean. Regardless, its center will likely be near, or just offshore. From there it will be able to tap into very warm seas, in the vicinity of 83 to 85 degrees Fahrenheit.

In such a pattern, with a nearly stationary storm, rainfall bands can be continually replenished by moisture drawn in from the ocean. This produces intense tropical rainfall and “training” in which a band of rainfall more or less comes to rest over a given area, fed by offshore moisture.

Because we are still a few days from this pattern setting up, and due to the uncertainty in Debby’s path, we cannot say precisely where the heaviest rains will occur. However the Weather Prediction Center, the arm of the National Weather Service tasked with predicting rainfall amounts, is forecasting some pretty staggering totals for the period of now through Friday.

Rainfall accumulation forecast for next week from NOAA.

Enlarge / Rainfall accumulation forecast for next week from NOAA.

WeatherBell

From Savannah, Georgia, north through Hilton Head Island and Charleston, South Carolina, the Weather Prediction Center is calling for accumulations of 20 to 25 inches, with higher totals possible in some areas. Moreover, it is possible that these high rainfall totals extend dozens of miles inland.

The African wave train gets rolling

Parts of Florida and North Carolina may also see extremely high rainfall totals over the next several days, due to the uncertainty in Debby’s motion.

And that is not all. As we get deeper into August, tropical waves are starting to fire off of the west coast of Africa. One of these is now approaching the Windward Islands, and should move into the Caribbean Sea next week. There, it has a chance of developing into a tropical storm, or more. This is likely the beginning of a period of frenetic activity characteristic of August, September, and the first half of October in the Atlantic tropics.

All of this is in line with expectations from forecasters for an exceptionally busy Atlantic hurricane season. This is due both to an anomalously warm Atlantic Ocean—seas fueled by climate change are at all-time highs in the modern era—and the imminent development of La Niña in the Pacific Ocean, which creates conditions favorable for the development of hurricanes in the Atlantic basin, which includes the Caribbean Sea and Gulf of Mexico.

Historic flooding possible as TS Debby bears down on southeastern United States Read More »

“screaming-woman”-mummy-may-have-died-in-agony-3,500-years-ago,-study-finds

“Screaming Woman” mummy may have died in agony 3,500 years ago, study finds

why is this mummy screaming? —

Scientists performed a “virtual autopsy” but could not determine exact cause of death.

The Screaming Woman mummy, closeup of head/skull surrounded by elaborate wig

Enlarge / CT scans and other techniques allowed scientists to “virtually dissect” this 3,500-year-old “Screaming Woman” mummy.

There have been a handful of ancient Egyptian mummies discovered with their mouths wide open, as if mid-scream. This has puzzled archaeologists because Egyptian mummification typically involved bandaging the mandible to the skull to keep the mouth closed. Scientists have “virtually dissected” one such “Screaming Woman” mummy and concluded that the wide-open mouth is not the result of poor mummification, according to a new paper published in the journal Frontiers in Medicine. There was no clear cause of death, but the authors suggest the mummy’s expression could indicate she died in excruciating pain.

“The Screaming Woman is a true ‘time capsule’ of the way that she died and was mummified,” said co-author Sahar Saleem, a professor of radiology at Cairo University in Egypt. “Here we show that she was embalmed with costly, imported embalming material. This, and the mummy’s well-preserved appearance, contradicts the traditional belief that a failure to remove her inner organs implied poor mummification.”

Saleem has long been involved in paleoradiology and archaeometry of “screaming”  Egyptian mummies. For instance, she co-authored a 2020 paper applying similar techniques to the study of another “Screaming Woman” mummy, dubbed Unknown Woman A by the then-head of the Egyptian Antiquities Service, Gaston Maspero, and one of two such mummies discovered in the Royal Cache at Deir el Bahari near Luxor in 1881. This was where 21st and 22nd Dynasty priests would hide the remains of royal members from earlier dynasties to thwart grave robbers.

The male mummy, which also had a screaming expression, was identified in a 2012 study (also co-authored by Saleem) as Pentawer, son of 20th Dynasty pharaoh Ramses III (1186–1155 BCE), thanks to CT scans and DNA testing. Prince Pentawer was involved in the “harem conspiracy,” resulting in the assassination of his father, although the attempted coup failed in its objective of placing Pentawer on the throne. (The 2012 CT scans of Ramses III’s mummy revealed that the pharaoh’s throat had been cut to the bone, severing the trachea, esophagus, and blood vessels.)

The prince was forced to commit suicide by hanging as punishment. His body was not properly mummified; his organs were not removed (evisceration), and no embalming fluids were placed inside his body cavity. Instead, he was ignominiously wrapped in a goat’s skin (deemed ritually “impure”) and placed in an unmarked coffin.

  • “Screaming Mummy” of a man identified as Prince Pentawer, son of Ramesses III.

    Public domain

  • Picture of the head and upper torso of the “Screaming Woman” mummy known as Unknown Woman A, possibly Meritamun, daughter of 17th Dynasty Pharaoh Seqenenre Taa.

    Zahi Hawass and Sahar N. Saleem

Maspero noted that Unknown Woman A’s wraps included inscriptions that translated into “Royal daughter, royal sister Meritamun,” but there were several princesses of that name, so this “screaming woman” mummy was officially declared unknown. The two most likely candidates were the daughter of late 17th Dynasty pharaoh Seqenenre Taa II (1558–1553 BCE) or the daughter of Nefertiti and Ramses II (1279–1213 BCE), aka Ramses the Great. Maspero thought that the unusual wide-open mouth may have been the result of improper mummification (or no mummification, like Pentawer.)

Saleem and her 2020 co-author, archaeologist Zahi Hawass, took CT scans of the mummy to learn more about who she might have been and how she died. They identified her as an older woman who likely died in her 50s and was just under 5 feet tall. The scans revealed high calcification in many of her arteries (severe atherosclerosis), indicating serious heart disease. This likely led to her sudden death from a heart attack or stroke; the authors suggest the woman was not discovered right away, so her muscles and joints stiffened—hence the unusual body position (bent legs) and the wide open mouth. In addition, or alternatively, some kind of cadaveric spasm at the moment of death may have occurred.

Unlike the remains of the patricidal Pentawer, this woman had been eviscerated; her body cavity was filled with resin and scents, and she had been wrapped in pure linen. Her brain, however, was still in the skull, desiccated and shifted to the right. Based on that detail—brain removal was more common during the 19th Dynasty, and leaving it intact was more common during the 17th Dynasty—Saleem et al. concluded that the mummy is most likely that of Meritanum, daughter of Seqenenre Taa.

“Screaming Woman” mummy may have died in agony 3,500 years ago, study finds Read More »

nasa-says-it-is-“evaluating-all-options”-for-the-safe-return-of-starliner-crew

NASA says it is “evaluating all options” for the safe return of Starliner crew

Boeing's Starliner spacecraft is seen docked at the International Space Station on June 13.

Enlarge / Boeing’s Starliner spacecraft is seen docked at the International Space Station on June 13.

It has now been eight weeks since Boeing’s Starliner spacecraft launched into orbit on an Atlas V rocket, bound for the International Space Station. At the time NASA officials said the two crew members, Butch Wilmore and Suni Williams, could return to Earth as soon as June 14, just eight days later.

Yes, there had been some problems on Starliner’s ride to the space station that involved helium leaks and failing thrusters. But officials said they were relatively minor and sought to downplay them. “Those are pretty small, really, issues to deal with,” Mark Nappi, vice president and manager of Boeing’s Commercial Crew Program, said during a post-docking news conference. “We’ll figure them out for the next mission. I don’t see these as significant at all.”

But days turned to weeks, and weeks turned to months as NASA and Boeing continued to study the two technical problems. Of these issues, the more pressing concern was the failure of multiple reaction control system thrusters that are essential to steering Starliner during its departure from the space station and setting up a critical engine burn to enter Earth’s atmosphere.

In the last few weeks, ground teams from NASA and Boeing completed testing of a thruster on a test stand at White Sands, New Mexico. Then, last weekend, Boeing and NASA fired the spacecraft’s thrusters in orbit to check their performance while docked at the space station. NASA has said preliminary results from these tests were helpful.

Dragon becomes a real option

One week ago, the last time NASA officials spoke to the media, the agency’s program manager for commercial crew, Steve Stich, would not be drawn into discussing what would happen should NASA conclude that Starliner’s thrusters were not reliable enough for the return journey to Earth.

“Our prime option is to complete the mission,” Stich said one week ago. “There are a lot of good reasons to complete this mission and bring Butch and Suni home on Starliner. Starliner was designed, as a spacecraft, to have the crew in the cockpit.”

For a long time, it seemed almost certain that the astronauts would return to Earth inside Starliner. However, there has been a lot of recent activity at NASA, Boeing, and SpaceX that suggests that Wilmore and Williams could come home aboard a Crew Dragon spacecraft rather than Starliner. Due to the critical importance of this mission, Ars is sharing what we know as of Thursday afternoon.

One informed source said it was greater than a 50-50 chance that the crew would come back on Dragon. Another source said it was significantly more likely than not they would. To be clear, NASA has not made a final decision. This probably will not happen until at least next week. It is likely that Jim Free, NASA’s associate administrator, will make the call.

Asked if it was now more likely than not that Starliner’s crew would return on Dragon, NASA spokesperson Josh Finch told Ars on Thursday evening, ” NASA is evaluating all options for the return of agency astronauts Butch Wilmore and Suni Williams from the International Space Station as safely as possible. No decisions have been made and the agency will continue to provide updates on its planning.”

NASA says it is “evaluating all options” for the safe return of Starliner crew Read More »

metropolis-1998-lets-you-design-every-building-in-an-isometric,-pixel-art-city

Metropolis 1998 lets you design every building in an isometric, pixel-art city

Have you ever really thought about living rooms? —

Devs cite Rollercoaster Tycoon, Dwarf Fortress, and, yes, SimCity as inspiration.

Designing the pieces of a house in Metropolis 1998, with a series of bookshelves and couches open in the menu picker on-screen.

Enlarge / There is something so wonderfully obscene about having a town with hundreds of people living their lives, running into conflict, hoping for better, and your omnipotent self is stuck on which bookcase best fits this living room corner.

YesBox

Naming a game must be incredibly hard. How many more Dark Fallen Journeys and Noun: Verb of the Noun games can fit into the market? And yet certain games just appear with a near-perfect, properly descriptive label.

Metropolis 1998 is just such a game, telling you what you’ll be doing, how it will look and feel, and what era it harkens back to. You can verify this with its “pre-alpha” demo on Steam and Itch.io. There’s plenty more to come, but what is already in place is impressive. And it’s simply pleasant to play, especially if you’re the type who wants to make something entirely yours. Not just “put the park inside the commercial district,” but The Sims-style “choose which wood color for the dining room table in a living room you framed up yourself.”

You start out in a big field with no features (yet) and the sounds of birds chirping. Once you lay down a road, you can add things at a few different levels. You can, SimCity-style, simply plot out colored zones and let the people figure it out themselves. You can add pre-made buildings individually. Or you can really get in there, spacing out individual rooms, choosing the doors and windows and objects inside, and realizing how hard it is to shape multi-floor houses so the roof doesn’t look grotesque. You can save the filled-out house for later reuse or just hold on to its core aspects as a blueprint.

  • The author is quite proud of his first real home build, though he now realizes that living rooms have a big empty space, and it’s up to us to figure out just how empty it should remain.

    Kevin Purdy

  • It takes a bit to get used to it, but the detailed building designer is full of wonderful little pieces, like this classic speaker cabinet with the black and red wire clips visible on the back.

The game is still early in development, so its mechanics are not introduced in tutorials, and the interface requires a lot of clicking, reading, and wondering. I got a reasonable feel for it after about 30 minutes of tentative placing and bulldoze-deletion. You can save your game and come back to it, though the developers note that your saves may not transfer to future versions. You’re putting your time in now, so you’ll be ready to start fresh when the game releases into early access (“ETA sometime between Q4 2024 and Q2 2025”). If you’re into this kind of fine-toothed builder, a fresh start is a gift, anyway.

Developer video describing how the Metropolis 1998 algorithm scales to track hundreds of thousands of working objects.

Bank robberies and zombie scenarios ahead (maybe)

What will the game look like when it’s finished? Developer YesBox has a detailed roadmap and a blog detailing how it’s going. The very small team, seemingly a solo developer with art help from two others, started off in December 2021 and has achieved quite a lot, including an algorithm seemingly ready to handle big populations. A key promise of the game is that you won’t just lay down zones and wait for people and problems to show up. You will lay down specific buildings, like hospitals and police stations, and manage the usual concerns of traffic, zone demand, and the like. The “Post-1.0 Aspirations” hint at the game’s direction: “Visible Crime (e.g., watch a bank robbery),” “Zombie Mode (your police vs. your zombie population),” and “Live in your own city” in a “Sims-like mode” imply more of a toybox mentality than a “Highly realistic ports and infrastructure” ambition.

  • There’s a top-down mode in the game, useful for when you’re looking more into data than design.

    YesBox

  • With enough time and object rotation, streets look like they can get mighty pretty.

    YesBox

  • Screenshots suggest cities more complex than suburban plots are possible in Metropolis 1998.

    YesBox

  • Letting your imagination go wild with the building designer can yield all kinds of city designs

    YesBox

  • Check, check, check, check, this list of game inspirations works out, yep.

    YesBox

Metropolis 1998 is not alone in seeking out city-builder fans living in the long wake of any proper SimCity release. But unlike games like Cities: Skylines 2, it’s not seeking the kind of mechanical complexity that would see it, say, figuring out eerily familiar housing cost crises. Building this kind of game is still fiendishly complex, of course. But how that complexity is presented to the player is something else.

The most interesting line in the roadmap is “player starts with land purchased from successful business exit.” I can’t help but think of Stardew Valley, which can also sprawl to ridiculous levels but has at its core the arc of a person who got tired of the rat race and inherited a farm. I’m looking forward to this invitingly retro and human-scale city-builder, with patience and respect for what seems like a massive developer undertaking.

Metropolis 1998 lets you design every building in an isometric, pixel-art city Read More »

intel-is-offering-extended-warranties-for-crashing-13th-and-14th-gen-desktop-cpus

Intel is offering extended warranties for crashing 13th- and 14th-gen desktop CPUs

trying to make good —

Intel’s microcode fix won’t help CPUs that are already damaged.

Even mainstream CPUs like the Core i5-13400 could theoretically be affected by Intel's crashing issues.

Enlarge / Even mainstream CPUs like the Core i5-13400 could theoretically be affected by Intel’s crashing issues.

Andrew Cunningham

Intel will be releasing a microcode update to prevent further damage to crashing 13th- and 14th-generation desktop processors sometime this month if it can stick to its previously announced schedule. This fix should be available via BIOS updates from PC and motherboard makers and from Microsoft as a Windows update. But it will take time for those updates to roll out to users, and Intel has said that processors that are already exhibiting crashes have been permanently damaged and won’t be fixed by the microcode update.

In an effort to provide peace of mind to buyers and cover anyone whose CPU is subtly damaged but not showing explicit signs of instability, Intel is extending the warranty on all affected 13th- and 14th-generation CPUs by an additional two years, Tom’s Hardware reports. This raises the warranty on a new boxed Intel CPU from three years to five. For processors that came installed in pre-built PCs, Intel says users should reach out to their PC’s manufacturer for support instead.

Though owners of high-end chips like the Core i9-13900K and Core i9-14900K were the most frequently affected by the crashing issue, Intel says that any 13th- or 14th-generation desktop CPU with a base power of 65 W or higher could ultimately be affected. This means that even slower, more budget-oriented chips like the Core i5-13400 could end up having problems.

According to Intel, the root cause of the issue was “a microcode algorithm resulting in incorrect voltage requests to the processor,” a bug that caused motherboards to supply too much power to a CPU. This resulted in damage to the silicon over time, leading to crashing and instability. The problem was also exacerbated by enthusiast motherboards that didn’t stick to Intel’s recommended default power and performance settings.

Intel says it is “investigating options to easily identify affected processors” to help give users peace of mind, and it will have more to share on both these testing options and the details of the extended warranty “in the coming days.” Anyone experiencing problems should reach out to Intel or their PC’s manufacturer, depending on whether they bought a separate CPU or a complete system.

Intel is offering extended warranties for crashing 13th- and 14th-gen desktop CPUs Read More »

san-francisco-to-ban-software-that-“enables-price-collusion”-by-landlords

San Francisco to ban software that “enables price collusion” by landlords

Algorithmic devices —

Software helps landlords “indirectly coordinate” by sharing nonpublic information.

View of a San Francisco street with apartment buildings and parked cars along the side of the road.

Enlarge / View of San Francisco with Russian Hill in the background.

Getty Images | Terraxplorer

San Francisco’s Board of Supervisors this week approved a ban on software that is allegedly used by landlords to collude on rent prices. Board of Supervisors President Aaron Peskin recently proposed what his office called “the first local ordinance in the country banning the sale or use of software which enables price collusion among large corporate landlords for the purpose of rent-gouging.”

The ordinance was approved on a first reading by a 10-0 vote by the board on Tuesday. It still needs to pass a final vote scheduled for September 3, Bloomberg wrote.

The ban targets software companies RealPage and Yardi. “RealPage has exacerbated our rent crisis and empowered corporate landlords to intentionally keep units vacant. So we’re taking action locally to ensure our working renters can afford to live here,” Peskin said.

RealPage and Yardi “collect and combine proprietary large landlord data and make pricing and occupancy recommendations,” Peskin’s office said. “These recommendations then effectively become the lay of the land, with multiple investigations finding they amount to illegal price-fixing. RealPage’s own executives have told investors that its software has driven double-digit increases in rents, increased ‘turnover’ of units, and increased vacancy rates.”

A March 2024 White House statement criticized the use of algorithms to set rent prices. “In a recent filing, the Department of Justice (DOJ) made clear its position that inflated rents caused by algorithmic use of sensitive nonpublic pricing and supply information violate antitrust laws,” the White House statement said. “Earlier this month, the Federal Trade Commission and DOJ filed a joint brief further arguing that it is illegal for landlords and property managers to collude on pricing to inflate rents—including when using algorithms to do so.”

The FTC/DOJ brief was filed in a class-action case against Yardi and property owners in US District Court for the Western District of Washington. There were also numerous lawsuits against RealPage and property owners, and those cases were consolidated into one case in a Tennessee federal court. The District of Columbia’s attorney general sued RealPage and landlords as well.

RealPage says its software helps renters

In June, RealPage issued a statement addressing what it called “false and misleading claims about RealPage and its revenue management software.” RealPage said its software “benefits both housing providers and residents.”

“RealPage revenue management software makes price recommendations in all directions—up, down, or no change—to align with property-specific objectives of the housing providers using the software,” the company said. RealPage said its property-owning customers can accept or reject the software’s price recommendations, and that the “revenue management software never recommends that a customer withhold vacant units from the market.”

The consolidated class action complaint alleged that vacancy rates rose because property owners “could (and did) allow a larger share of their units to remain vacant, thereby artificially restricting supply, while maintaining higher rental prices across their properties. This behavior is only rational if Defendants know that their competitors are setting rental prices using RealPage’s RMS [revenue management software] and thus would not attempt to undercut them.”

We asked RealPage and Yardi whether they plan to challenge the San Francisco ordinance in court and will update this article if we get any comment.

“While we share the San Francisco Board of Supervisors’ goal of helping renters, this ordinance will do nothing to make housing more affordable in the city, where there is a severe supply shortage of rental units that needs to be addressed,” a RealPage spokesperson told KRON4 after the vote.

RealPage told KRON4 that its “software is purposely built to be legally compliant and can be configured to comply with the new ordinance should it pass a final vote.” It also criticized the San Francisco board for what it called a “misplaced focus on nonpublic information.”

Ban on “algorithmic devices”

The San Francisco proposal said the software “programs enable landlords to indirectly coordinate with one another through the sharing of nonpublic competitively sensitive data, in order to artificially inflate rents and vacancy rates for rental housing. Participating landlords provide vast amounts of proprietary data to the programs, which in turn do not just summarize statistical data, but also perform calculations with the data to then set or provide recommendations for rent and occupancy levels.”

The ordinance “would prohibit the sale or use of ‘algorithmic devices’ to set, recommend, or advise on rents or occupancy levels for residential rental units in San Francisco.” It defines “algorithmic device” as including revenue management software “that uses algorithms to analyze nonpublic competitor rental data for the purposes of providing a landlord recommendations on whether to leave their unit vacant or on what rent to charge.”

“An entity that sold such a device for use on residential rental units in San Francisco, or a San Francisco landlord that used such a device, could face a civil action and be ordered to pay damages, restitution, civil penalties of up to $1,000 per violation, and/or attorneys’ fees,” the proposal said.

San Francisco to ban software that “enables price collusion” by landlords Read More »

senators-propose-“digital-replication-right”-for-likeness,-extending-70-years-after-death

Senators propose “Digital replication right” for likeness, extending 70 years after death

NO SCRUBS —

Law would hold US individuals and firms liable for ripping off a person’s digital likeness.

A stock photo illustration of a person's face lit with pink light.

On Wednesday, US Sens. Chris Coons (D-Del.), Marsha Blackburn (R.-Tenn.), Amy Klobuchar (D-Minn.), and Thom Tillis (R-NC) introduced the Nurture Originals, Foster Art, and Keep Entertainment Safe (NO FAKES) Act of 2024. The bipartisan legislation, up for consideration in the US Senate, aims to protect individuals from unauthorized AI-generated replicas of their voice or likeness.

The NO FAKES Act would create legal recourse for people whose digital representations are created without consent. It would hold both individuals and companies liable for producing, hosting, or sharing these unauthorized digital replicas, including those created by generative AI. Due to generative AI technology that has become mainstream in the past two years, creating audio or image media fakes of people has become fairly trivial, with easy photorealistic video replicas likely next to arrive.

In a press statement, Coons emphasized the importance of protecting individual rights in the age of AI. “Everyone deserves the right to own and protect their voice and likeness, no matter if you’re Taylor Swift or anyone else,” he said, referring to a widely publicized deepfake incident involving the musical artist in January. “Generative AI can be used as a tool to foster creativity, but that can’t come at the expense of the unauthorized exploitation of anyone’s voice or likeness.”

The introduction of the NO FAKES Act follows the Senate’s passage of the DEFIANCE Act, which allows victims of sexual deepfakes to sue for damages.

In addition to the Swift saga, over the past few years, we’ve seen AI-powered scams involving fake celebrity endorsements, the creation of misleading political content, and situations where school kids have used AI tech to create pornographic deepfakes of classmates. Recently, X CEO Elon Musk shared a video that featured an AI-generated voice of Vice President Kamala Harris saying things she didn’t say in real life.

These incidents, in addition to concerns about actors’ likenesses being replicated without permission, have created an increasing sense of urgency among US lawmakers, who want to limit the impact of unauthorized digital likenesses. Currently, certain types of AI-generated deepfakes are already illegal due to a patchwork of federal and state laws, but this new act hopes to unify likeness regulation around the concept of “digital replicas.”

Digital replicas

An AI-generated image of a person.

Enlarge / An AI-generated image of a person.

Benj Edwards / Ars Technica

To protect a person’s digital likeness, the NO FAKES Act introduces a “digital replication right” that gives individuals exclusive control over the use of their voice or visual likeness in digital replicas. This right extends 10 years after death, with possible five-year extensions if actively used. It can be licensed during life and inherited after death, lasting up to 70 years after an individual’s death. Along the way, the bill defines what it considers to be a “digital replica”:

DIGITAL REPLICA.-The term “digital replica” means a newly created, computer-generated, highly realistic electronic representation that is readily identifiable as the voice or visual likeness of an individual that- (A) is embodied in a sound recording, image, audiovisual work, including an audiovisual work that does not have any accompanying sounds, or transmission- (i) in which the actual individual did not actually perform or appear; or (ii) that is a version of a sound recording, image, or audiovisual work in which the actual individual did perform or appear, in which the fundamental character of the performance or appearance has been materially altered; and (B) does not include the electronic reproduction, use of a sample of one sound recording or audiovisual work into another, remixing, mastering, or digital remastering of a sound recording or audiovisual work authorized by the copyright holder.

(There’s some irony in the mention of an “audiovisual work that does not have any accompanying sounds.”)

Since this bill bans types of artistic expression, the NO FAKES Act includes provisions that aim to balance IP protection with free speech. It provides exclusions for recognized First Amendment protections, such as documentaries, biographical works, and content created for purposes of comment, criticism, or parody.

In some ways, those exceptions could create a very wide protection gap that may be difficult to enforce without specific court decisions on a case-by-case basis. But without them, the NO FAKES Act could potentially stifle Americans’ constitutionally protected rights of free expression since the concept of “digital replicas” outlined in the bill includes any “computer-generated, highly realistic” digital likeness of a real person, whether AI-generated or not. For example, is a photorealistic Photoshop illustration of a person “computer-generated?” Similar questions may lead to uncertainty in enforcement.

Wide support from entertainment industry

So far, the NO FAKES Act has gained support from various entertainment industry groups, including Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA), the Recording Industry Association of America (RIAA), the Motion Picture Association, and the Recording Academy. These organizations have been actively seeking protections against unauthorized AI re-creations.

The bill has also been endorsed by entertainment companies such as The Walt Disney Company, Warner Music Group, Universal Music Group, Sony Music, the Independent Film & Television Alliance, William Morris Endeavor, Creative Arts Agency, the Authors Guild, and Vermillio.

Several tech companies, including IBM and OpenAI, have also backed the NO FAKES Act. Anna Makanju, OpenAI’s vice president of global affairs, said in a statement that the act would protect creators and artists from improper impersonation. “OpenAI is pleased to support the NO FAKES Act, which would protect creators and artists from unauthorized digital replicas of their voices and likenesses,” she said.

In a statement, Coons highlighted the collaborative effort behind the bill’s development. “I am grateful for the bipartisan partnership of Senators Blackburn, Klobuchar, and Tillis and the support of stakeholders from across the entertainment and technology industries as we work to find the balance between the promise of AI and protecting the inherent dignity we all have in our own personhood.”

Senators propose “Digital replication right” for likeness, extending 70 years after death Read More »

the-10-things-car-buyers-say-they-want-in-their-next-car

The 10 things car buyers say they want in their next car

how much will you pay though? —

The data explains why we keep seeing certain features on many new cars.

Salesman handling car keys to customer

Getty Images

A wireless charging pad is now the most-desired in-car feature among people intending to buy a new vehicle. Being able to forget about a USB cable and still not run down one’s battery topped the list of 163 features that AutoPacific asked about in its annual survey on future demand. Almost 15,000 people intending to buy a new car within the next three years replied to the survey, with 44 percent ticking the box for wireless charging for the front passengers.

This market research data is rather illuminating; as we test new cars, they’re increasingly equipped with features or gadgets that don’t seem exactly necessary—an extra infotainment screen for the front seat passenger, for example, or remote parking via a smartphone app. Sometimes, the features are even mandatory—several luxury brands won’t let you order certain cars without a glass moonroof.

These decisions are justified by product planners as responding to customer demand, so it’s helpful to see one of the sources that feeds into that.

In joint second place were a second wireless charging pad for the back seats and heated and ventilated seats. These were each picked by 37 percent, narrowly beating out rain-sensing windscreen wipers (36 percent).

The aforementioned moonroof (or sunroof) shared fifth place (35 percent) with having the ability to store more than one driver profile. Interestingly, this feature has grown in popularity over the years, rising from 19th-most requested in 2022 up to 10th-most in 2023. More and more automakers are moving to Android Automotive OS, which uses Google accounts to bring a driver’s digital life seamlessly into their vehicle; others are building their own solutions on private clouds, but either way, it’s increasingly becoming built into every new car we test. (It’s probably time I created a Google account to test out those features on AAOS cars going forward, too.)

Seventh on the list is a feature that requires a car to be electrified—it’s a household 110 V socket (34 percent). Ford’s much in-demand Maverick hybrid pickup—now in AWD, too—is a good example, with some EVs offering enough onboard juice to run a little outdoor office or movie theater.

I’m not sure I can remember seeing rear sunshades in a car—I probably wasn’t looking—but a third of survey respondents wanted them in their next vehicle. Only 32 percent showed interest in rear-cross traffic alert with automatic emergency braking.

I’m surprised this safety tech didn’t rate higher—its value is easily proven when reversing in a crowded parking lot when the spaces on either side of your car are occupied by gargantuan SUVs and pickups. Perhaps the other two-thirds only ever reverse into parking spaces? That’s certainly safer and much easier to do now that backup cameras have been legally required for the past few years.

Who wants hands-free?

Finally, 31 percent of the people who replied to AutoPacific also said that a built-in air compressor would be on their list, too. Notably, hands-free driving tech like Super Cruise or Autopilot did not crack the top 10.

But perhaps first place should really have gone to unresponsive driver detection. AutoPacific says that this idea was represented by two different options: a system that stops the car in its lane and a system that pulls the car over to the shoulder in the event of an unresponsive driver. When combined (45 percent), the demand for these two features edged out the demand seen in 2023 (43 percent) for a less well-defined unresponsive driver system.

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