Twitter forms crypto team, Facebook fires back at Wall Street Journal and other notable stories from this week. Welcome to “#SocialStocks,” The Fly’s weekly recap of Wall Street’s reactions to social media stock news.
Founders of defunct photography app Phhhoto, namely Champ Bennett, Omar Elsayed, and Russell Armand, are suing Facebook (FB), claiming that CEO Mark Zuckerberg and other executives at the company made overtures to integrate the app on the social media platform but actually just wanted to squash the competition, the New York Times’ Sheera Frenkel and Daisuke Wakabayshi reported, citing the suit filed in the Eastern District of New York. According to the startup’s founders, Zuckerberg downloaded the app and approached the startup about a partnership, though no deal materialized and Facebook instead rolled out a competing product that mirrored Phhhoto’s features. The suit also claims the social media giant suppressed Phhhoto’s content within Instagram. “This suit is without merit and we will defend ourselves vigorously,” Joe Osborne, a spokesman for Meta said late Thursday night.
EU LOOKS TO FURTHER REGULATE SOCIAL MEDIA:
After a series of meetings with Facebook whistleblower Frances Haugen, European Union policy makers called to act quickly to toughen and enact measures in a bill that aims to impose tighter rules on social media platforms, The Wall Street Journal’s Sam Schechner reported. The bill, as currently drafted, would require large tech platforms to actively look for and mitigate risks from content that is illegal, or face steep fines. “Europe is serious about regulating what still resembles a digital Wild West,” said Thierry Breton, the EU’s digital commissioner. He added that the EU must race to pass its package of tech legislation in the first half of 2022. “Speed is everything,” he said..
Twitter (TWTR) is launching a dedicated crypto team, marking the latest push by chief executive Jack Dorsey to embrace digital assets and decentralized apps and the ballooning communities around them, Financial Times’s Hannah Murphy reported. The social media company has hired Tess Rinearson to lead the new Twitter Crypto team and “set the strategy for the future of crypto at (and on) Twitter,” it said. Twitter Crypto is designed to be “a center of excellence for all things blockchain and web3,” the company added, referring to the term given to the growing number of decentralized apps that run on public blockchains, the author noted. Dorsey, a bitcoin (BTC) enthusiast, has let it be known that he wants to integrate digital assets into Twitter’s future after doing so with Square (SQ), a company that he also runs, two years ago.
CONTENT WITHOUT CONSENT:
According to the tech giant’s researchers, Facebook has allowed plagiarized content to grow and thrive on its platform, Keach Hagey and Jeff Horwitz of The Wall Street Journal reported, citing Facebook’s internal memos. In 2018, about 40% of traffic to Facebook pages went to pages that stole or repurposed most of its content, according to a research report reviewed by the Journal. The researchers added Facebook has been slow to crack down on copyright infringements out to fear doing so will open itself to legal liability. In the report, Jeff Allen, a senior data scientist at the time, wrote, “Step 1: Find an existing, engaged community on FB. Step 2: Scrape/Aggregate content popular in that community. Step 3: Repost most popular content on your Page.” Facebook researchers found this tactic is effective in building a large audience by both foreign and domestic groups that post divisive content and false information. Based on newer data released this year, posting unoriginal content reportedly continues to be successful on Facebook.
Earlier in the week, Facebook took aim back at the Wall Street Journal which has a series dedicated to reviewing internal documents from the social media giant. Pratiti Raychoudhury, Vice President, Head of Research at Facebook stated in a blog post: “The Wall Street Journal has once again chosen to selectively pick and choose from internal company documents to present a narrative that is simply wrong about how we use research to address an important issue – this time about problematic use. Our company has been engaged and supportive throughout our multiyear effort to better understand and empower people who use our services to manage problematic use. That’s why this work has taken place over multiple years, including now. We’ve been working to conduct research and not in secret but in public… We want people to have a positive experience on our services so even though there isn’t an industry-established definition of problematic use, it’s something we’re invested in understanding… While a causal link between social media and addiction has not been found, and overall, research suggests that, on average, social media does not have a major detrimental impact on well-being, we still want to provide people with tools to help them manage it however they see fit… Platforms like ours still have a role to play in addressing this problem. At Meta, we’ve been doing exactly that for many years – and that work is continuing to move full steam ahead.”
YOU GOT A DEAL:
ViacomCBS (VIACA, VIAC) and Twitter announced a new, multi-year global agreement to deliver premium digital content around ViacomCBS’ biggest live events, hit shows and iconic franchises from the company’s leading portfolio of entertainment, news and sports brands, including BET, CBS Television Network, CBS News, CBS Sports, Channel 5, CMT, Comedy Central, MTV, Network 10, Nickelodeon, Paramount Network and Telefe. Paramount+ will also host three Twitter Watch Parties, in partnership with Twitter, to bring fans together, fuel conversation and build community around select highly anticipated original series. Each of the tentpole programs will be eligible for Twitter marketing support and brand sponsorship sales rights via Twitter’s Amplify program, which marries ViacomCBS’ premium video with Twitter’s paid reach and targeting. ViacomCBS will also tap into a broad range of Twitter marketing features from live video and real-time highlights to Twitter Moments. The partnership covers all global markets in which Twitter and ViacomCBS operate. Financial terms of the agreement were not disclosed.
Meta (MVRS) said that, starting January 19, 2022, it will remove Detailed Targeting options for advertisements that relate to topics people may perceive as sensitive, such as options referencing causes, organizations, or public figures that relate to health, race or ethnicity, political affiliation, religion, or sexual orientation. Examples include health causes, sexual orientation, religious practices, and political beliefs. “It is important to note that the interest targeting options we are removing are not based on people’s physical characteristics or personal attributes, but instead on things like people’s interactions with content on our platform,” said Grahm Mudd, VP of Product Markets, Ads. “However, we’ve heard concerns from experts that targeting options like these could be used in ways that lead to negative experiences for people in underrepresented groups. We routinely review, update and remove targeting options to simplify our ads system, provide more value for advertisers and people, and reduce the potential for abuse. The decision to remove these Detailed Targeting options was not easy and we know this change may negatively impact some businesses and organizations. Some of our advertising partners have expressed concerns about these targeting options going away because of their ability to help generate positive societal change, while others understand the decision to remove them. Like many of our decisions, this was not a simple choice and required a balance of competing interests where there was advocacy in both directions. We feel confident that we can evolve our ads system to meet the needs of everyone we serve, while working diligently to continue supporting one of the best things about our platforms — helping people connect with and discover the businesses and organizations they care about.”
In a company blog post, Twitter said, “We are excited to share that Twitter Blue is now available in the United States and New Zealand across iOS, Android and web. Twitter Blue is available for a monthly price of US $2.99 / NZD 4.49 and with it, we’re bringing subscribers even more features, more content, and more ways to participate in the conversation. Earlier this year, we introduced Twitter Blue in Australia and Canada. Since then, we’ve been listening to and learning from the most passionate and vocal people on Twitter as to what will make their experience more customizable, more frictionless, and simply put – better. We’re invigorated by the feedback we’ve received so far. On iOS and desktop, Twitter Blue members will enjoy a fast-loading, ad-free reading experience when they visit many of their favorite news sites available in the US from Twitter, such as The Washington Post, L.A. Times, USA TODAY, The Atlantic, Reuters, The Daily Beast, Rolling Stone, BuzzFeed, Insider and The Hollywood Reporter…In continuing our commitment to strengthen and support publishers and a free press, a portion of the revenue from Twitter Blue subscription fees goes directly to publishers within our network. Our goal is to help each publishing partner make 50% more per person than they would’ve made from serving ads to that person. A better experience for readers – and more support for the journalism they care about…Subscribers can add more flair to their Twitter experience with exclusive app icons and colorful themes2 and Bookmark Folders. We are also introducing Custom Navigation3, which gives subscribers the ability to customize what appears in their navigation bar for quick access to the Twitter destinations they care about most. ..With Undo Tweet, subscribers can preview and perfect Tweets before they are sent. Subscribers also have access to Reader, which turns long threads into an easier-to-read experience. They can also change the text size within Reader to tailor their experience even further…Finally, subscribers get early access to features we’re testing – before anyone else! These features might eventually become available to the rest of Twitter, graduate to a feature of Twitter Blue, or sunset based on feedback we hear from subscribers.”
META ADOPTS AMD EPYC CPUs:
AMD (AMD) held the virtual Accelerated Data Center Premiere, launching the new AMD Instinct MI200 series accelerators, which it calls “the world’s fastest accelerator for high performance computing and artificial intelligence workloads,” and provided a preview of the third Gen AMD EPYC processors with AMD 3D V-Cache. AMD also revealed new information about its next generation “Zen 4” processor core and announced the new “Zen 4c” processor core, both of which will power future AMD server processors and are “designed to extend the company’s leadership products for the data center.” AMD announced Meta (MVRS) is the latest major hyperscale cloud company that has adopted AMD EPYC CPUs to power its data centers. “AMD and Meta worked together to define an open, cloud-scale, single-socket server designed for performance and power efficiency, based on the 3rd Gen EPYC processor. Further details will be discussed at the Open Compute Global Summit later this week,” AMD announced. Facebook is in the process of being rebranded as Meta. AMD shares were up 10% afterwards. Stifel analyst Patrick Ho said that AMD’s partnership with Meta (MVRS) provides another sign that his equipment secular growth thesis is “gaining momentum.” Ho said the announcement places AMD into direct competition with Nvidia (NVDA), and bigger picture also brings Intel (INTC) into the fold. Ho believes this data center/hyperscale/web services opportunity is one that can be several hundreds of billions of dollars, particularly as many of these major players seek to develop their own ships and find technology partners to foster these goals. The analyst added that, from an equipment standpoint, he believes this is another sign of the “significant” foundry opportunity ahead for the industry.
Originally Posted on November 10, 2021 – #SocialStocks: EU Eyes Tech Legislation in First Half of 2022
Disclosure: Interactive Brokers
Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.
This material is from The Fly and is being posted with permission from The Fly. The views expressed in this material are solely those of the author and/or The Fly and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
In accordance with EU regulation: The statements in this document shall not be considered as an objective or independent explanation of the matters. Please note that this document (a) has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and (b) is not subject to any prohibition on dealing ahead of the dissemination or publication of investment research.
Any trading symbols displayed are for illustrative purposes only and are not intended to portray recommendations.
Disclosure: Digital Assets
Trading in digital assets, including cryptocurrencies, is especially risky and is only for individuals with a high risk tolerance and the financial ability to sustain losses. Eligibility to trade in digital asset products may vary based on jurisdiction.