For years, the tiny startup Kytch worked to invent and sell a device designed to fix McDonald's notoriously broken ice cream machines, only to watch the fast food Goliath crush their business like the hopes of so many would-be McFlurry customers. Now Kytch is instead seeking to serve out cold revenge -- nearly a billion dollars worth of it. Wired: Late Tuesday night, Kytch filed a long-expected legal complaint against McDonald's, accusing the company of false advertising and tortious interference in its contracts with customers. Kytch's cofounders, Melissa Nelson and Jeremy O'Sullivan, are asking for no less than $900 million in damages.

Since 2019, Kytch has sold a phone-sized gadget designed to be installed inside McDonald's ice cream machines. Those Kytch devices would intercept the ice cream machines' internal communications and send them out to a web or smartphone interface to help owners remotely monitor and troubleshoot the machines' many foibles, which are so widely acknowledged that they've become a full-blown meme among McDonald's customers. The two-person startup's new claims against McDonald's focus on emails the fast food giant sent to every franchisee in November 2020, instructing them to pull Kytch devices out of their ice cream machines immediately.

Those emails warned franchisees that the Kytch devices not only violated the ice cream machines' warranties and intercepted their "confidential information" but also posed a safety threat and could lead to "serious human injury," a claim that Kytch describes as false and defamatory. Kytch also notes that McDonald's used those emails to promote a new ice cream machine, built by its longtime appliance manufacturing partner Taylor, that would offer similar features to Kytch. The Taylor devices, meanwhile, have yet to see public adoption beyond a few test installations.

The imperfect, scattershot search tool delivers just enough usefulness and serendipity to keep one hooked. From a report: Google Alerts can cast a wonderful net, but mesh size matters: large holes and it catches nothing, too small and it catches everything. Consider the earliest and one of the most persistent reasons for setting these alerts: tracking yourself. All is vanity, perhaps especially on the Internet, so it's no surprise that one of the things that we're most eager to know is what the world is saying about us. The engineer who developed the alert system for Google told CNN that when he first presented the idea, twenty years ago, his manager was skeptical, worrying that it would starve the search-engine of traffic: rather than consumers constantly searching for fresh mentions of whatever topic interested them, they would wait for the alert, then follow its links not to Google but to outside Web sites, leaching away potential advertising revenue. In response, the engineer, one of the first forty or so employees of the company, took his prototype to Google's co-founders, who approved it after watching him demonstrate only two search terms: "Google" and "Larry Page," the name of one of the co-founders.

Learning what other people thought about us used to take either a great deal of luck, like Tom Sawyer being mistaken for dead and then getting to eavesdrop on his own funeral, or a great deal of effort, like Harun al-Rashid, a caliph of the Abbasid dynasty, in the "Arabian Nights," disguising himself in order to venture out into the streets and talk with his subjects candidly. But the Internet has made it easy -- made it, in fact, almost unavoidable. The same Google Alert can make sure you know that your long-lost bunkmate from summer camp has mentioned you in an essay, that a friend of your deceased uncle has written a memoir of their time together in the Marines (including the care packages you sent them), and that the local newspaper has digitized its archives, thereby offering up to the Internet your high-school football averages and your arrest for vandalism.

A new claim that Microsoft and Google are gaming the online advertising market to the detriment of smaller rivals threatens to set up a new antitrust clash in Europe, according to previously unseen data. Politico: The two U.S. giants appear to be flooding smaller search engine partners with spam ads and keeping some of the most valuable ads for themselves, according to data reviewed by POLITICO, in a move that draws parallels with the infamous $2.7 billion Google Shopping case. While EU competition chief Margrethe Vestager's 2015 offensive against Google's abuses in the search market got the backing of the EU General Court in November, there are some who say that blind spots in the case have allowed for certain violations to continue -- illustrated by Swedish price-comparison site PriceRunner's decision earlier this month to sue Google for $2.4 billion in damages. And now, according to the same data, both Google and its closest rival in the search engine space, Microsoft, are siphoning off so-called spam ads to smaller search engines that use their search results, as well as limiting the quantity of higher-value ads that appear on these partner search engines.

Industry analysts and former Mozilla employees are concerned about Firefox's future, reports Ars Technica, warning that the ultimate fate of Firefox "has larger implications for the web as a whole." Since its release in 2008, [Google's] Chrome has become synonymous with the web: it's used by around 65 percent of everyone online and has a huge influence on how people experience the Internet. When Google launched its AMP publishing standard, websites jumped to implement it. Similar plans to replace third-party cookies in Chrome — a move that will impact millions of marketers and publishers — are shaped in Google's image.

"Chrome has won the desktop browser war," says one former Firefox staff member, who worked on browser development at Mozilla but does not want to be named, as they still work in the industry. Their hopes for a Firefox revival are not high. "It's not super reasonable for Firefox to expect to win back even any browser share at this point." Another former Mozilla employee, who also asked not to be named for fear of career repercussions, says: "They're just going to have to accept the reality that Firefox is not going to come back from the ashes...."

Mozilla's financial declarations from 2020 said that despite the layoffs it is in a healthy place, and it expects its financial results for 2021 to show revenue growth. However, Mozilla and Firefox acknowledge that for its long-term future it needs to diversify the ways it makes money. These efforts have ramped up since 2019. The company owns read-it-later service Pocket, which includes a paid premium subscription service. It has also launched two similar VPN-style products that people can subscribe to. And the company is pushing more into advertising as well, placing ads on new tabs that are opened in the Firefox browser.... Selena Deckelmann, senior vice president of Firefox, says Firefox is likely to continue looking for ways to keep personalizing people's online browsing. "I'm not sure that what's going to come out of that is going to be what people traditionally expect from a browser, but the intention will always be to put people first," she says. Just this week, Firefox announced a partnership with Disney — linked to a new Pixar film — that involves changing the color of the browser and ads to win subscriptions to Disney+. The deal speaks both to Firefox's personalization push and the strange roads its search for revenue streams can lead down.

Deckelmann adds that Firefox doesn't need to be as big as Chrome or Apple's Safari, the second largest browser, to succeed. "All we really want is to be a viable choice," Deckelmann says. "Because we think that this makes a better Internet for everybody to have these different options."
Interesting stats from the article:

• "Mozilla's own statistics show a drop of around 30 million monthly active users from the start of 2019 to the start of 2022."

• Mozilla's figures now also show around 215 million Firefox Desktop clients active in the past 28 days — a number which has stayed stable.

• Yet In 2008, a full 20% of the 1.5 billion people online were using Firefox to surf the web — including more than half the web surfers in Indonesia, Macedonia, and Slovenia.

• "Across all devices, the browser has slid to less than 4 percent of the market," writes Ars Technica. "On mobile it's a measly half a percent..."

• Next year, Firefox's "lucrative search deal with Google — responsible for the vast majority of its revenue" — is set to expire.

Slashdot reader McGruber shares a scathing column from New York magazine arguing that "There has never been a self-immolation quite like Meta Platforms, the parent company of Facebook. Mark Zuckerberg's social-media company has lost more than half a trillion dollars in market value since its August peak — about half of that vaporized in a single day, the biggest drop ever — as it starts to weaken from the constant siege of competitors and dissenters without and within.

"The fallout is so bad that Meta, once the sixth-largest company in the world by market capitalization, has fallen out of the top ten, replaced by two computer-chip makers, Warren Buffett's Berkshire Hathaway, and the Chinese e-commerce company Tencent..."

They're calling it "an ignominious fall from a rarefied group of world-dominating companies." Facebook's once unbeatable ad-tracking system — the engine that made it a more than $1 trillion company — has effectively been neutralized by the likes of Apple, which allows users to block the company's trackers. (Google is set to start phasing in similar protections to its users over the next two years.) Facebook's user base has started to shrink after revelations by whistleblowers and leaks that showed how harmful social media could be to teen users, who are flocking to less toxic competitors like TikTok anyway. And Zuckerberg — clearly bored with the company he founded 18 years ago — has shifted his vision into an immersive version of the internet, complete with headsets and digital avatars, that he calls the metaverse, an ambition that sets up Facebook's competition not with another Silicon Valley company but with reality itself....

Apple and Google have decided they're going to allow their users to disable code that tracks people across the internet, which happens to be good for their business model. According to The Wall Street Journal, the fallout has been so severe that advertisers are shifting their entire ad budgets to Google since Facebook is no longer profitable.
The article's final point is that in the middle of all this, Zuckerberg has committed the company to a "metaverse" future — even though Wall Street investors seem almost unanimously unconvinced.

"Clearly, Zuckerberg has plenty of money to burn on his ambitions, but what's less clear is if he'll be able to bring back the armies of people who once believed in his ability to conquer the world."

The Washington Post reports: Google announced it will begin the process of getting rid of long-standing ad trackers on its Android operating system, upending how advertising and data-collection work on phones and tablets used by more than 2.5 billion people around the world.

Right now, Google assigns special IDs to each Android device, allowing advertisers to build profiles of what people do on their phones and serve them highly targeted ads. Google will begin testing alternatives to those IDs this year and eventually remove them completely, the company said in a Wednesday blog post. Google said the changes will improve privacy for Android users, limiting the massive amounts of data that app developers collect from people using the platform.

But the move also could give Google even more power over digital advertising, and is likely to deepen concerns regulators have already expressed about the company's competitive practices... It made $61 billion in advertising revenue in the fourth quarter of 2021 alone....

The announcement comes over a year after Apple began blocking trackers on its own operating system, which runs on its iPhones, giving customers more tools to limit the data they share with app developers.... Google contrasted its plan with Apple's, saying it would make the changes over the next two years, working closely with app developers and the advertising industry to craft new ways of targeting ads and measuring their effectiveness before making any drastic changes.

"We realize that other platforms have taken a different approach to ads privacy, bluntly restricting existing technologies used by developers and advertisers," said Anthony Chavez, vice president of product management for Android security and privacy, in the blog post. "We believe that without first providing a privacy-preserving alternative path such approaches can be ineffective and lead to worse outcomes for user privacy and developer businesses."
The Post also includes this quote from the chief security office of Mozilla (which began restricting ad tracking in Firefox several years ago). "Google's two year plan is too long. People deserve better privacy now."

Google said on Wednesday that it was working on privacy measures meant to limit the sharing of data on smartphones running its Android software. But the company promised those changes would not be as disruptive as a similar move by Apple last year. From a report: Apple's changes to its iOS software on iPhones asked users for permission before allowing advertisers to track them. Apple's permission controls -- and, ultimately, the decision by users to block tracking -- have had a profound impact on internet companies that built businesses on so-called targeted advertising. Google did not provide an exact timeline for its changes, but said it would support existing technologies for at least two more years.

This month, Meta, the company founded as Facebook, said Apple's privacy changes would cost it $10 billion this year in lost advertising revenue. The revelation weighed on Meta's stock price and led to concerns about other companies reliant on digital advertising. Anthony Chavez, a vice president at Google's Android division, said in an interview before the announcement that it was too early to gauge the potential impact from Google's changes, which are meant to limit the sharing of data across apps and with third parties. But he emphasized that the company's goal was to find a more private option for users while also allowing developers to continue to make advertising revenue.

An anonymous reader quotes a report from Motherboard: The most insufferable part of every Super Bowl Sunday has historically, without fail, been the ads. This year was no exception, with an unrelenting barrage of ads trying to manifest the metaverse, convince viewers they're missing out on crypto, and lure new blood to online and physical casinos. Results were mixed. Coinbase, in one ad named WAGMI ("we're all going to make it"), crafted an advertisement that bounced a QR code around the screen, changing colors each time it hit the edge like an old-school DVD menu. Scanning the QR codewhich immediately forfeits your right to enter heaventakes the user to this page, where Coinbase offers $15 in Bitcoin for signing up as well as a chance to enter a contest to win one of three prizes for $1 million worth of Bitcoin. The linked webpage went down almost immediately thanks to the increased traffic from the ad, and ridicule at the idea of paying millions of dollars to send millions of viewers to a down site poured in from around the web.

To Coinbase, though, the ad was a success. In a blog post congratulating itself on the advertisement and interviewing Coinbase Chief Marketing Officer Kate Rouch about why the ad was so good, the company revealed it saw "20M+ hits on our landing page in one minute" which "led to us temporarily throttling our systems." Chief executive Brian Armstrong took to Twitter to gloat about the ad: ranked #1 by AdWeek and peaking at #2 in the Apple App Store, just ahead of apps for the Pepsi Super Bowl Halftime Show and the NFL. As it turns out, putting up nothing but a QR code in the middle of a widely-watched sports event and offering free money as well as a chance to win $3 million is a good way to build interest in your app. When Motherboard reached out to Coinbase about the ad, the company directed Motherboard to Rouch's blog post and reiterated its main points.

While taking a victory lap for the apparent success of its ad, Coinbase took the time to explain why this is definitely not at all like the dotcom bubble, which many critics have said is an apt comparison for Sunday's ads. "There have been a lot of comparisons to the dot.com era and speculation that many of the crypto companies advertising in this year's Super Bowl will inevitably fail," said Rouch in Coinbase's blog post. "We don't think about it that way and judging from the early response we've seen, Super Bowl viewers don't either." Rouch insisted that the sheer number of crypto ads in the Super Bowl was "yet another signal that crypto is bursting into the mainstream, and at the center of the cultural zeitgeist." Further reading: This Year's Super Bowl Broadcast May Seem 'Crypto-Happy'. But the NFL Isn't

During today's telecast of the Super Bowl, 100 million Americans will see at least three commercials promoting cryptocurrency, reports the Washington Post, "and though Tom Brady may be gone from the game, he hovers over it, hawking crypto exchange FTX."

"Yet the hype belies a more complicated relationship. Unlike the National Basketball Association, the National Football League, the country's most popular sports league, has essentially prohibited its teams from using crypto." It's a microcosm of the broader cultural battle between those touting the currency as the shiny future and others warning of its dangers.... [T]he headlines often come with a negative tint. New York Times columnist and economist Paul Krugman warned last month about crypto's parallels to the subprime mortgage crisis. This week, the FBI arrested a New York couple for allegedly conspiring to launder billions in crypto. That can scare the large corporate entities of professional sports, particularly the NFL, whose love of fresh revenue sources is matched only by its fear of public relations disasters.... In September, a memo revealed by the Athletic showed the league's restrictive attitude toward crypto... "Clubs are prohibited from selling, or otherwise allowing within club controlled media, advertisements for specific cryptocurrencies, initial coin offerings, other cryptocurrency sales or any other media category as it relates to blockchain, digital asset or as blockchain company, except as outlined in this policy," it said.

The NFL has made some forays into NFTs, or non-fungible tokens, the digitally watermarked tools that are crypto's less controversial cousin, signing up for a partnership with Ticketmaster for NFTs of Super Bowl tickets and an NFT video highlight program with Dapper Labs, one of the leaders in the space. And of course the Super Bowl is taking place at SoFi Stadium, named for the digitally minded financial firm. But sponsorships from crypto exchanges remain off-limits, and the idea of the NFL creating a cryptocurrency, which some enthusiasts have advocated, is the stuff of fantasy. Even the Super Bowl commercials going for as much as $7 million for 30 seconds — which the league authorizes — include only exchanges such as FTX and not currencies themselves....

The NFL has formed an internal working group to study the regulatory, brand and other consequences of partnering with crypto companies but has set no timetable for when its rules could be revised. Renie Anderson, the NFL's chief revenue officer, said the league is moving slowly by design. "We don't want to put everything and the kitchen sink into this," she said by phone from the site of Super Bowl events in Los Angeles. "We don't know where a lot of this is going, so what we're trying to do is testing and learning so we can understand." She cited regulatory and market forces that are still coming into focus. (The Treasury Department and other federal agencies have been ramping up their efforts to create a regulatory framework for crypto, but there remains a degree of murkiness around what the future limits might be.) The NFL, Anderson said, would rather act after there's clarity. "It's hard to unwind something like a naming rights deal," she said, "and I'd rather not have to undo opportunities two years later because there are rules against advertising or marketing certain things."

National Basketball Association executives, however, say they see a major opportunity right now.
The article also points out that one football star even says he converted his $750,000 salary to Bitcoin. Though one sports analyst calculates that if the purchase was made on November 12th, after federal and state taxes it's now worth about $35,000.

Mozilla engineer Martin Thomson reveals they've been collaborating with Meta (formerly Facebook) on new technology that can measure "conversions" from advertising while still preserving privacy.

The proposed new technology is called Interoperable Private Attribution, or IPA. IPA has two key privacy-preserving features. First, it uses Multi-Party Computation (MPC) to avoid allowing any single entity — websites, browser makers, or advertisers — to learn about user behavior. Mozilla has some experience with MPC systems as we've deployed Prio for privacy-preserving telemetry. Second, it is an aggregated system, which means that it produces results that cannot be linked to individual users. Together these features mean that IPA cannot be used to track or profile users.

IPA is designed to provide a lot of flexibility for advertising businesses in terms of how they use the system. Cross-device and cross-browser attribution options in IPA enable new and more robust attribution capabilities, while maintaining privacy. The IPA proposal aims to ensure that all sites benefit from these features with the match key concept, which allows smaller players to access the greater reach of entities to cross-device attribution.
"Advertising provides critical support for the Web," the blog post argues — and they've now proposed IPA to the World Wide Web Consortium's dedicated Private Advertising Technology Community Group, while calling their idea "still a work in progress."

In the early 2000s, the U.S. Army released America's Army, a video game meant as a recruitment tool. "The free-to-play tactical shooter was wildly successful, reaching 20 million players," reports Fast Company. "But come May 5, the servers will be shut down -- and America's Army will surrender to the forces of time." From the report: To date, no industry has embraced games as warmly as the military, though. America's Army, for example, started with an initial budget of $7 million of your tax dollars at play -- and quickly grew from there. Recognizing that players know a quality title when they see one (and ignore and ridicule poor-quality efforts), it assembled a team of proven developers and bought a license for the Unreal Engine, which was (and remains) one of the premier game engines on the market. America's Army was only supposed to be a seven-year project, but its success encouraged the Defense Department to stay with the game, with the Pentagon spending more than $3 million a year to evolve and promote it -- a drop in the bucket compared to the overall $8 billion recruiting budget.

How well did it work? A 2008 study from the Massachusetts Institute of Technology found that "30% of all Americans ages 16 to 24 had a more positive impression of the Army because of the game and, even more amazingly, the game had more impact on recruits than all other forms of Army advertising combined." The end of America's Army is hardly the end of the military's use of games as recruiting tools. The Army has its own Twitch channel (with more than 23,000 followers) and has an e-sports team that competes at tournaments -- with recruiters in tow.

It's not just the office pool anymore. More than half of U.S. states now allow legalized sports betting, and in many cases it's as easy as opening an app on your smartphone and making a wager. From a report: A whopping 17.6 million people are expected to place a bet on Sunday's Super Bowl online or in person at a sportsbook, according to the American Gaming Association. It's not all profits for the operators, though. Sportsbooks are putting up their own money in the form of a massive advertising campaign targeting the millions of sports fans who will be glued to their TVs for the matchup between the Los Angeles Rams and the Cincinnati Bengals. "TV sportsbook advertising has grown exponentially this year and in the last couple of years overall," Adam Candee, managing editor of the trade publication Legal Sports Report, told NPR.

Candee said the sudden growth of legalized gambling in states across the country has sportsbook operators jockeying for a piece of the huge new customer base -- and the Super Bowl is their latest opportunity to sell themselves to potential bettors. "It is happening in the here and now, moment to moment, as they compete for customers. That is because this is essentially a new industry that is rising up from the ground," he said. Sports gambling could become a $37 billion industry by 2025, according to the investment management company ARK.

Google's plan to phase out third-party cookies and replace them with a bundle of new standards referred to as the "Privacy Sandbox" just overcame a key regulatory hurdle. From a report: The UK's competition regulator, the Competition and Markets Authority (CMA), has formally accepted Google's commitments about how it'll develop the new standards so they don't harm competition or unfairly benefit the search giant's own advertising business, the regulator announced today. Google's plans are still in flux, and it's not yet clear exactly what technologies Privacy Sandbox will use to replace third-party cookies. Just last month, Google abandoned one planned approach, FLoC, in favor of a new system called Topics API. Today's approval is for Google's approach, rather than any one specific technology. The regulator notes that in the next phase it will "supervise Google to ensure the Privacy Sandbox is developed in a way that benefits consumers."

An anonymous reader quotes a report from TechCrunch: Use of Google Analytics has now been found to breach European Union privacy laws in France -- after a similar decision was reached in Austria last month. The French data protection watchdog, the CNIL, said today that an unnamed local website's use of Google Analytics is non-compliant with the bloc's General Data Protection Regulation (GDPR) -- breaching Article 44 which covers personal data transfers outside the bloc to so-called third countries which are not considered to have essentially equivalent privacy protections. The U.S. fails this critical equivalence test on account of having sweeping surveillance laws which do not provide non-U.S. citizens with any way to know whether their data is being acquired, how it's being used or to seek redress for any misuse.

France's CNIL has been investigating one of 101 complaints filed by European privacy advocacy group, noyb, back in August 2020 -- after the bloc's top court invalidated the EU-U.S. Privacy Shield agreement on data transfers. Since then (indeed, long before) the legality of transatlantic transfers of personal data have been clouded in uncertainty. While it has taken EU regulators some time to act on illegal data transfers -- despite an immediate warning from the European Data Protection Board of no grace period in the wake of the July 2020 CJEU ruling (aka 'Schrems II) -- decisions are now finally starting to flow. Including another by the European Data Protection Supervisor last month, also involving Google Analytics. In France, the CNIL has ordered the website which was the target of one of noyb's complaints to comply with the GDPR -- and "if necessary, to stop using this service under the current conditions" -- giving it a deadline of one month to comply.

"[A]lthough Google has adopted additional measures to regulate data transfers in the context of the Google Analytics functionality, these are not sufficient to exclude the accessibility of this data for U.S. intelligence services," the CNIL writes in a press release announcing the decision. "There is therefore a risk for French website users who use this service and whose data is exported." The CNIL does leave open the door to continued use of Google Analytics -- but only with substantial changes that would ensure only "anonymous statistical data" gets transferred. The French regulator is also very emphatic that under "current conditions" use of Google Analytics is non-compliant -- and may therefore need to cease in order for the site in question to comply with the GDPR. The CNIL also suggests use of an alternative analytics tool which does not involve a transfer outside the EU to end the breach. Additionally, it says it's launched an evaluation program to determine which website audience measurement and analysis services may be exempt from the need to obtain user consent (i.e. because they only produce anonymous statistical data which can be exported legally under GDPR). Which suggests the CNIL could issue guidance in future that recommends GDPR compliant alternatives to Google Analytics.

Twitter reported weaker-than-expected quarterly advertising revenue and user growth on Thursday and forecast revenue short of Wall Street targets, indicating that its turnaround plan has yet to bear fruit. Reuters reports: Still, the social networking site said it made "meaningful progress" toward its goal of reaching 315 million users and $7.5 billion in annual revenue by the end of 2023, and said user growth should accelerate in the United States and internationally this year. Shares of the San Francisco-based company rose more than 8% after the results, but pared those gains in morning trading.

Monetizable daily active users, or users who see ads, grew 13% to 217 million in the fourth quarter ended Dec. 31, missing consensus estimates of 218.5 million, according to IBES data from Refinitiv. That was up from 211 million users in the previous quarter. [...] Advertising revenue for the fourth quarter grew 22% year over year to $1.41 billion, missing analysts' estimates of $1.43 billion. Twitter gained 6 million users during the quarter, but will need to add over 12 million each quarter over the next two years to hit its target of 315 million people by the end of 2023, said Jasmine Enberg, principal analyst at Insider Intelligence, calling it "an incredibly lofty goal."

Players generate a wealth of revealing psychological data -- and some companies are soaking it up. From a report: While there are no numbers on how many video game companies are surveilling their players in-game (although, as a recent article suggests, large publishers and developers like Epic, EA, and Activision explicitly state they capture user data in their license agreements), a new industry of firms selling middleware "data analytics" tools, often used by game developers, has sprung up. These data analytics tools promise to make users more amenable to continued consumption through the use of data analysis at scale.

Such analytics, once available only to the largest video game studios -- which could hire data scientists to capture, clean, and analyze the data, and software engineers to develop in-house analytics tools -- are now commonplace across the entire industry, pitched as "accessible" tools that provide a competitive edge in a crowded marketplace by companies like Unity, GameAnalytics, or Amazon Web Services. (Although, as a recent study shows, the extent to which these tools are truly "accessible" is questionable, requiring technical expertise and time to implement.) As demand for data-driven insight has grown, so have the range of different services -- dozens of tools in the past several years alone, providing game developers with different forms of insight. One tool -- essentially Uber for playtesting -- allows companies to outsource quality assurance testing, and provides data-driven insight into the results. Another supposedly uses AI to understand player value and maximize retention (and spending, with a focus on high-spenders).

Developers might use data from these middleware companies to further refine their game (players might be getting overly frustrated and dying at a particular point, indicating the game might be too difficult) or their monetization strategies (prompting in-app purchases -- such as extra lives -- at such a point of difficulty). But our data is not just valuable to video game companies in fine-tuning design. Increasingly, video game companies exploit this data to capitalize user attention through targeted advertisements. As a 2019 eMarketer report suggests, the value of video games as a medium for advertising is not just in access to large-scale audience data (such as the Unity ad network's claim to billions of users), but through ad formats such as playable and rewarded advertisements -- that is, access to audiences more likely to pay attention to an ad.

An anonymous reader shares a report: If Meta is not given the option to transfer, store and process data from its European users on US-based servers, Facebook and Instagram may be shut down across Europe, the social media giants' owner reportedly warned in its annual report. The key issue for Meta is transatlantic data transfers, regulated via the so-called Privacy Shield and other model agreements that Meta uses or used to store data from European users on American servers. The current agreements to enable data transfers are currently under heavy scrutiny in the EU. In its annual report to the U.S. Securities and Exchange Commission, Meta warns that if a new framework is not adopted and the company is no longer allowed to use the current model agreements "or alternatives," the company will "probably" no longer be able to offer many of its "most significant products and services," including Facebook and Instagram, in the EU, according to various media reports, including in iTWire, The Guardian newspaper and Side Line Magazine.

Sharing data between countries and regions is crucial for the provision of its services and targeted advertising, Meta stressed. Therefore, it previously used the transatlantic data transfer framework called Privacy Shield as the legal basis to carry out those data transfers. However, this treaty was annulled by the European Court of Justice in July 2020, because of data protection violations. Since then, the EU and the US did stress they are working on a new or updated version of the treaty.

"Facebook is threatening it will simply pull out of Europe altogether if it is no longer able to share data about European users with its U.S. operations, applications, and data centres," reports ITWire.

It's customary for regulatory filings to preemptively declare a wide variety of possible future hazards, and in that spirit a recently-filed Meta financial statement cites a ruling by the EU's Court of Justice (in July of 2020) voiding a U.S. law called the Privacy Shield (which Meta calls one legal basis for its current dara-transferring practices). Though courts are now determining the ruling's ramifications, ITWire notes that "with the European General Data Protection Regulation (GDPR) well in force, the U.S. Privacy Shield principles were found non-compliant and consequently invalid." So while that ruling affects every American company, including cloud companies like Google, Microsoft, and Amazon, it's Facebook/Meta that "says stopping transatlantic data transfers will have a devastating impact on its targeted online advertisements capabilities."

Read it yourself, in Meta's own words:

"If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on Standard Contractual Clauses [now also subject to new judical scrutiny] or rely upon other alternative means of data transfers from Europe to the United States, we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe, which would materially and adversely affect our business, financial condition, and results of operations."

Of course, the filing also cites other hazards like the possibility of new legislation restricting Facebook's ability to collect data about minors, complaining that such legislation "may also result in limitations on our advertising services or our ability to offer products and services to minors in certain jurisdictions."

And in addition, "We are, and expect to continue to be, the subject of investigations, inquiries, data requests, requests for information, actions, and audits by government authorities and regulators in the United States, Europe, and around the world, particularly in the areas of privacy, data protection, law enforcement, consumer protection, civil rights, content moderation, and competition..."

"Orders issued by, or inquiries or enforcement actions initiated by, government or regulatory authorities could cause us to incur substantial costs, expose us to unanticipated civil and criminal liability or penalties (including substantial monetary remedies), interrupt or require us to change our business practices in a manner materially adverse to our business, result in negative publicity and reputational harm, divert resources and the time and attention of management from our business, or subject us to other structural or behavioral remedies that adversely affect our business."

(Thanks to Slashdot reader juul_advocate for sharing the story!)

Apple's privacy push could cost Meta $10 billion in lost 2022 advertising revenue — and that news alone erased $250 billion in Meta's value, notes long-time Slashdot reader theodp.

But this leads them to a thought experiment: What would happen to Meta's and Google's business models if the privacy invasion behind the companies' lucrative advertising model were actually criminalized? While there would likely still be the same massive demand for the free services provided by Meta and Google, being unable to target customers of interest to advertisers based on snooped behaviors and demographics seems likely to throw the duopoly's lucrative cost-per-click (CPC) and cost-per-thousand-impressions (CPM) advertising model that powers these free services into disarray.

So what might the end game look like for Facebook and Google in a Web world where privacy was enforced by law? One imagines the pair could try to incur the additional cost of delivering many times more untargeted impressions in an effort to reach the same number of behavior and demographic-targeted impressions desired by advertisers, assuming they could get that to work and gain advertisers' trust in the new model. But one wonders if advertisers might start diverting more ad dollars away from Meta and Google to other sources such as media providers, whose varied content naturally segments audiences and could deliver greater assurance to advertisers that more relevant viewers are being reached. Might Meta and Google pivot to become syndicators of media content and be forced to share more of the advertising loot?

And what about the Metaverse — could Meta-sponsored events and interest groups hosted there provide Meta with opportunities to naturally segment its massive user base into areas that could facilitate targeting audiences relevant to advertisers even without privacy invasion?

Finally — if worse comes to worst — would users actually pay to use Meta's and Google's services if the new advertising model failed to deliver sufficient revenue to keep services free?

Meta's stock plunged 26% Thursday — its biggest one-day drop ever, lowering its marketing valuation by more than $230 billion. And then on Friday it dropped just a little bit more.

A New York Times technology correspondent offers six reasons Meta is in trouble: User growth has hit a ceiling. The salad days of Facebook's wild user growth are over. Even though the company on Wednesday recorded modest gains in new users across its so-called family of apps — which includes Instagram, Messenger and WhatsApp — its core Facebook social networking app lost about half a million users over the fourth quarter from the previous quarter.

That's the first such decline for the company in its 18-year history, during which time it had practically been defined by its ability to bring in more new users. The dip signaled that the core app may have reached its peak. Meta's quarterly user growth rate was also the slowest it has been in at least three years. Meta's executives have pointed to other growth opportunities, like turning on the money faucet at WhatsApp, the messaging service that has yet to generate substantial revenue. But those efforts are nascent. Investors are likely to next scrutinize whether Meta's other apps, such as Instagram, might begin to hit their top on user growth....

Apple's changes are limiting Meta and Google is stealing online advertising share. Last spring, Apple introduced an "App Tracking Transparency" update to its mobile operating system, essentially giving iPhone owners the choice as to whether they would let apps like Facebook monitor their online activities. Those privacy moves have now hurt Meta's business and are likely to continue doing so...

On Wednesday, David Wehner, Meta's chief financial officer, noted that as Apple's changes have given advertisers less visibility into user behaviors, many have started shifting their ad budgets to other platforms. Namely Google. In Google's earnings call this week, the company reported record sales, particularly in its e-commerce search advertising. That was the very same category that tripped up Meta in the last three months of 2021. Unlike Meta, Google is not heavily dependent on Apple for user data. Mr. Wehner said it was likely that Google had "far more third-party data for measurement and optimization purposes" than Meta's ad platform. Mr. Wehner also pointed to Google's deal with Apple to be the default search engine for Apple's Safari browser. That means Google's search ads tend to appear in more places, taking in more data that can be useful for advertisers. That's a huge problem for Meta in the long term, especially if more advertisers switch to Google search ads.
Meta's other problems include competition from TikTok (and the problems with monetizing "Reels," Meta's own TikTok clone on Instagram), as well as pending antitrust investigations (and the way it hampers future social media acquisitions). But with Meta expected to continue spending more than $10 billion a year on virtual reality, "still the province of niche hobbyists [that] has yet to really break into the mainstream," the article also suggests its final reason for why Meta is in trouble: that "Spending on the metaverse is bonkers."