December 30, 2019 • 48 mins
Jonathan looks back at some of the biggest (and saddest) tech stories of 2019. From bankruptcies to data breaches, this one is kind of a bummer, but still important!
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Episode Transcript
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Speaker 1 (00:04):
Welcome to Text Stuff, a production of I Heart Radios
How Stuff Works. Hey there, and welcome to text Stuff.
I'm your host job in Strickland. I'm an executive producer
with iHeart Radio and a lot of all things tech.
And boy feels good to say those words, because you know,
I've been running around traveling doing lots of stuff for
(00:26):
another show called The Restless Ones, which you may have heard, uh,
And it means that I've had a lot of time
away from the studio. But I'm back today, and it's
that time of year when I take a look back
at the previous twelve months and consider some of the
biggest text stories to come out over the course of
(00:48):
the year. Now, this year, twenty nineteen, it was a
pretty darn packed one when it comes to news, and
things changed so quickly, and there are so many high
level stories that it can actually be pretty easy to
good stuff that happened earlier in the year. So I'm
gonna walk us through some of the big themes of
the year and some of the stories that center on
(01:08):
those themes. And there are so many things to talk
about that I'm actually gonna have to do two episodes
about it. I originally was going to really try and
cram it into one, but that just wasn't very practical.
I would just be rattling off headlines, and what good
is that. So this one's going to be filled with
a lot of stories about mistakes and things going wrong
in the world of tech. So I'm calling this episode
(01:30):
the Bummers of twenty nineteen. But um, here's the bad news.
There were a lot of bummer stories, So some of
those are gonna probably spill into the next episode two,
but I'll do my best to to to lighten the
mood of it in the next one occasionally. Now, one
of the big themes has actually become a pretty common
(01:51):
one over the last several years is the theme of
data breaches. Like I have previously called earlier years like
the Year of the Data Breach, but I think the
same thing can be said of twenty nineteen. So a
couple of years ago, the credit reporting company Equifax dealt
with a massive data breach that resulted in a host
(02:13):
of investigations in the United States both the state and
federal levels, and the company ultimately agreed to pay out
somewhere between five and seven hundred million dollars as a
result in fines. They were also giving people the opportunity
to lay a claim for at least some sort of
(02:34):
compensation for this data breach. People were invited to apply
for a payout of one hundred twenty five dollars, not
exactly a princely sum when you consider having your personal
information rated due to insufficient protections on a corporate level.
In September two tho nineteen, Equifax announced that people claiming
(02:56):
a payout would need to provide proof that they had
also enrolled in a credit monitoring service by October, because
that would show that the people had concern about their
own credit rating and their own personal information, that they
weren't just looking for money to get money, but that
they actually were actively trying to keep track of this stuff,
(03:16):
or else the claim could be denied, and the FTC
had previously already warned that due to the number of claims,
people were likely to get far less than a hundred
twenty five dollars because there was only a pool of
around thirty one million dollars that had been set aside
for these payouts. You know that five d seventy five
to seven million dollars that wasn't set aside for payouts.
(03:38):
Only thirty one million was set aside for payouts. And
I know it's crazy to say only thirty one million,
but when you look at the scale of this data breach,
you realize that that means if everyone who was affected
lays claim to a payout, you don't get very much.
But this whole mess has prompted more conversations about data
(03:59):
secure and corporate accountability, which is a good thing. It's
sad that it comes at the expense of this terrible mistake,
but at least people are talking more seriously about this.
Hopefully something will actually happen because of it. Now, we've
seen lots of these stories over the last several years,
and they really do show no sign of slowing down
(04:19):
right now, which is unfortunate. In twenty nineteen, there were
some truly notable examples across different industries. I pulled data
from Norton, the information security company to look at some
of the big ones. One of those would be Capital One,
the financial company, reported that hackers were able to access
a large amount of data, affecting one hundred six million
(04:43):
records in the company's files. Most of those records were
for a credit card applications rather than established accounts. So
it wasn't like the hackers necessarily got a lot of
credit card info, but they got a lot of application information.
And when you think about the info you need to
provide hide when you apply for a credit card, it
(05:03):
includes stuff like, you know, personal information that is really
important to you. And it might be mundane stuff like
your name, which, hey, you know, no big deal, someone
knows your name, okay, But it might include your email,
which again maybe that's more frustrating or or irritating. But
then there's also your physical address, which gets a little
(05:27):
more spooky scary, your credit score, your income, maybe your
Social Security number, essentially all the stuff it would take
for someone to steal your identity and sell it off
on the dark web, which is not very cool. Capital
one hacker named Page Thompson targeted a third party cloud
computing company that Capital One had relied upon to host
(05:50):
the credit application services. She exploited a vulnerability in a
web at firewall to get illegal access to the data.
She was arrested for the data intrusion, and then she
was held in a men's detention center. Uh, she's transgender,
and this gets into a whole thing with criminal justice
systems and the treatment of people who are transgender, which
(06:11):
honestly goes way beyond the scope of this podcast. But
I'll just say that when I read that she was
held in a men's detention center, that really upset me. Now,
I don't disagree with her being detained she broke the law,
or allegedly broke the law. She denies this. I more
object that it wasn't in a more appropriate setting. Anyway,
(06:32):
She's awaiting trial for the case. That trial is scheduled
right now for March twenty. She has pled not guilty
to the charges. Another company to experience a data breach
was door Dash, the food delivery service. The company experienced
the breach in May, but didn't disclose it until September
twenty nineteen. A third party access the information of nearly
(06:55):
five million drivers and customers without permission. The information they
were able to access included personal information, including the last
few digits of credit card and bank account numbers, but
not the whole number. It was just that last little string.
It also included the hashed passwords of many account holders,
so it's always good to change your password if you
(07:17):
make use of services that later reveal that they've been hacked,
it's always a good idea to change that information. And also, well,
I'll get to it, but don't use the same password everywhere.
It's a little spoiler alert for a future discussion. So
early in the year, the service Evite had a data
breach that affected one hundred million records, again exposing customer
(07:40):
information like names, addresses, phone numbers, and the password that
they used for the account. And again the exposure of
passwords drives home that importance right use unique passwords with
different services. That way, if one service is compromised, you
don't have to worry about the hackers accessing everything else
you use using the same password. If you're using one
(08:02):
password for everything, then you're essentially opening up the door.
As soon as one breach is effective, all of your
services have been breached. So don't use the same password
for everything. Use a password vault, UH, use stuff like
two factor authentication. All of that will help minimize your risk.
It doesn't eliminate it, but it minimizes it. And if
(08:24):
you find out one of the services you use was compromised,
change all that log and information right away. Now. The
medical industry also saw its share of data breaches the
American Medical Collection Agency, which is a company that collects
overdue payments for various medical labs. So essentially, these are
the folks who come after you if you haven't paid
certain medical bills. They also had a breach. Hackers access
(08:47):
more than twenty million records, and the information included not
just personal information, but even stuff like credit card information.
The actual breach began back in the summer of eighteen,
but the vulnerability remain unpatched until Arch twenty nineteen. In
June of this year, the company filed for bankruptcy protection.
So you know, things are just going great for them.
(09:09):
And close to home, Georgia Tech suffered a data breach
when some third party gained access to a university owned database.
The database had tons of personal information on current and
former students, as well as staff and faculty at the college,
including things like social security numbers. In total, one point
to six five million people were affected by that data breach.
(09:32):
The college is reaching out to offer credit monitoring and
identity theft protection services for those affected by it, but
still yikes. The U. S Government also was not immune
to data breaches. The Federal Emergency Management Agency, or FEMA
had a data breach, not because some hacker broke into
the system, but because the agency accidentally released files containing
(09:54):
sensitive information, such as the personal info of more than
two million people. So ad trombone noise insert here now.
According to the US Inspector General, FEMA violated the Privacy
Act of nineteen seventy four by releasing this data to
a third party contractor. The contractor was in charge of
securing temporary lodging for people who are affected by emergencies
(10:18):
and disasters, so like a fire or a flood. But
the data FEMA provided was far more extensive than what
was actually needed for this contractor to do its job,
and so that data included stuff like banking information and
bank transit numbers and stuff like that, stuff that did
not need to be shared. Now, considering that this breach
(10:39):
affected people who are already dealing with emergency situations that
were bad enough to necessitate a relocation, that's a that's
a big, big ouch. Making matters worse is that even
some of the companies that are dedicated towards security and
privacy have had data breaches in twenty nineteen. Take nord
VPN for example. That was a service that I've used
(11:02):
in the past. A VPN is a virtual private network,
and the purpose of a VPN is to allow a
user to log into a remote server and then use
various internet services so that they can't be traced back
to the end user. Now, at first glance, that might
sound like it's shady, but it's actually a really useful service.
If you're concerned about your own data security, you can
(11:22):
use a VPN when you're in areas where you can't
be certain of the security of the network, and that
helps improve your own security. But then this year, word
came out that nord vpn had an internal private key
exposed back in which created the possibility for hackers to
create a server and host it on the nord vpn
(11:43):
service as if it were a valid Nord VPN server. Now,
that would mean that an end user who was relying
on nord vpn might end up logging into one of
the hackers computers thinking it was a secure VPN server,
and the hacker we get to see all the traffic
coming through that computer. Nord vpn has stated that since
(12:04):
the breach, the company has patched this problem and that
the company doesn't keep a log of any user activity,
So hackers would only capture any traffic that happened on
their own server during that breach. They wouldn't have gotten
traffic information from any other servers on the nord VPN network.
They wouldn't be able to look at historic data because
the company doesn't keep any Still, that might come as
(12:27):
a little comfort to a community of users who presumably
have subscribed to the service out of a desire to
maintain privacy and security. Now, these stories are pretty discouraging,
and to be honest, it's just the tip of a
huge iceberg. According to a report from Javelin Strategy and Research,
there were five thousand, one hundred eighty three reported data
(12:48):
breaches in the first nine months of two thousand nineteen alone.
Now keep in mind those are reported data breaches. There
are likely many more that have either gone discovered or unreported.
Now those breaches represent nearly eight billion records exposed. The
rate shows a thirty three increase in breaches compared to
(13:11):
two thousand eighteen. Most of those breaches happened to companies
with fewer than one employees, so these weren't like the
big big news items like Capital One or door Dash.
There were some good news items in the report. However,
not everything was dour. Credit Card security has improved thanks
to chip technology, so there was actually a decline in
(13:32):
credit card frauds. That's something to be thankful for. Now.
It can be a hassle just to practice good secure
internet habits, as I've covered in previous episodes of tech Stuff.
As users, we all have a responsibility to protect our
data as best we can, But if we want to
do useful stuff with that data, ultimately we eventually have
(13:53):
to hand it over to other entities, and when these
other entities have data breaches, it's also a breach of trust.
If we don't trust in the systems, things fall apart. Now,
I think it highly unlikely that we're going to see
fewer attempts at data breaches as time goes on. It
only makes sense we're gonna keep seeing them and probably
(14:13):
see efforts increase over time. So hopefully we'll have more
success stories revolving around foiling a data breach. But the
world of information security is typically a see saw type
of thing. The hackers get better at cracking systems and
exploiting vulnerabilities, companies get better at patching the holes, but
then the hackers look for different holes, and the entire
(14:35):
cycle repeats itself. Meanwhile, people like you and me get
caught up with our data potentially at risk, which is
kind of gross. Well, let's stick with some more bummers.
Um I figured if I frontload the episodes with bummers,
then I can make some space in the back half
for some more fun stuff. But first, let's talk about
financial performance. So two thousand nineteen saw some pretty rough
(14:58):
quarters for a you companies. One of those was Uber.
Now I mentioned this in an earlier episode this year
about fake it until you Make it, but Uber leads
the way among ride hailing companies in a category you
don't want to appear in, which is the most money
lost per quarter. Now, to be clear, all ride hailing
companies are losing money. None of them are profitable. No
(15:20):
one has figured out how to make a business model
that has a profitable side as of yet. But Uber
is losing money on a scale that's pretty monumental. During
the second quarter of twenty nineteen, the company posted revenues
of three billion dollars, which, come on, that's that's a
lot of chadder, But they posted losses of five billion dollars.
(15:42):
Wolf Uber CEO stated that a large part of those
losses came from the I P O process that Uber
went through the initial public offering. The company had bought
back shares that belonged to employees, which posted in the
company records as an expense, but that was a one
time expen Uber won't be buying back shares again in
the future. Still, analysts say that even taking into account
(16:06):
the stock compensation cost, Uber would have lost more than
a billion dollars. And that's just one quarter. That's not
all of twenty nineteen, So if my math is right,
there are four quarters every year. So the question is,
can Uber find a way to be profitable in the
right hailing and related businesses or will it have to
bank on investors bailing the company out again. I'm worried
(16:28):
we're looking at another bubble that's just about to burst.
But I hold out hope that companies like Uber Left
and other right hailing services are able to turn things
around preferably while also treating their employees well and ensuring
the safety of their customers, which are also ongoing issues
with many of these right hailing companies. More to say
about that in just a moment, but first let's take
(16:49):
a quick break now. Speaking of safety and right inhaling,
it's also important to hold up Lift to the magnifying
glass and not give that company a free pass while
raking Uber over the coals. Numerous women have come forward
(17:11):
in lawsuits against Lift, stating that they were the victims
of assault. They also say the company did nothing to
prevent those assaults, and they didn't do enough to ensure
passengers safety. And on top of all that, they say
that Lift ignored complaints filed after the assaults took place
and then downplayed the events to the media. One lawyer
(17:32):
states that there's evidence that Lift purposefully withheld cooperation from
law enforcement officers who are investigating these claims. Now Lift
is not the only right hailing company to come under
scrutiny due to safety concerns and reports of assault, and
there are also cases in which drivers have been assaulted
by passengers. This is an ongoing story, and there are
(17:53):
a lot of discussions about measures that could help protect
passengers and drivers alike. But the rollout is likely to
be re regional and staggered over weeks or months, so
it's not exactly the super fast response you would hope for. Necessarily,
all right, let's keep that bummer train of moving. In
January two thousand, nineteen, the utility company Pacific Gas and
(18:15):
Electric or pg n E, declared bankruptcy. Now, this company
serves customers along the West Coast, and in twenty seventeen,
it was found guilty of starting a series of wildfires
in California, which then put the company thirty billion dollars
in debt. That's billion with a b P. G n
E emerged from bankruptcy in September twenty nineteen after agreeing
(18:38):
on an eleven billion dollar settlement with insurance companies. Now,
this is the same utility company that would shut down
power to California residents in a series of planned blackouts
during a particularly windy season in order to avoid a
similar situation and which perhaps a broken power line might
start a wildfire. The blackouts affected more than half a
(19:00):
million people in the San Francisco region. So that was
not a great story, and the tech sector obviously covered
it quite a bit, with so many tech companies located
in the Bay Area. Now, at least seven coal mining
companies in the United States have declared bankruptcy in twenty nineteen,
which marked the first year in which more US citizens
(19:20):
got electricity from renewable sources than from coal powered plants.
At least thirty three oil and gas producers have gone
bankrupt as well, and the Zoo might imagine this has
made lots of folks in the coal and oil industries upset.
And while I definitely don't want to see people face
hardship as companies closed down, I don't want to see
people out of work. I also think the move away
(19:43):
from fossil fuels is a necessity. So it's my hope
that employees of these companies can find work in the
renewable energy sector. I think it's imperative we rid ourselves
of our dependence upon fossil fuels. But we also have
to make sure that the people who were employed by
that into tree can find good work elsewhere and they're
not just left in the lurch. We have to make
(20:05):
sure that whatever plans we have to transition away from
fossil fuels also take into account the people whose livelihoods
depend upon those industries. Now, speaking of going elsewhere, what
do you do when your company is in financial crisis
and the company's main product is renting out office space
to tech startups. That's the question that we Work has
(20:26):
been trying to answer for much of twenty nineteen. So
we Work was launched back in. The company leases out
office space to tenants and markets around the globe, So
essentially at leases out space and buildings and then sublets
that space to smaller companies. And in that regard, it's
not really a tech company in of itself, but it's
(20:48):
clients are in largely the startup tech space. It's kind
of the market that we Work targets. Specifically, we Work
offices tend to have amenities that you might find in
a art up that has a lot of venture capital
and angel investors behind it. So, you know, a lot
of tech journals have covered the company's rather tumultuous twenty nineteen.
(21:08):
We Work initially planned to hold an initial public offering
in September twenty nineteen, when it would become a publicly
traded company on the stock market. Only things did not
go quite as planned. First, something that would have made
my eyebrows go up was that the founder or co founder,
Adam Newman, liquidated around seven hundred million dollars worth of
(21:30):
we Work stock before it went into its initial public offering. Now,
that does not necessarily mean that Newman lacked confidence about
how the stock market would treat his company, but a
lot of folks tend to interpret those types of moves
as kind of a message that the founder doesn't think
(21:50):
things are gonna go well, so they're cashing out before
the value of their stock tanks. Now, when the I
p O paperwork became public in August twenty nineteen, journalists
pointed out that the company had been experiencing some pretty
massive losses, not unlike the right hailing businesses I talked
about earlier in this episode, there were questions about whether
(22:11):
or not we Work would ever be profitable, so also
like the right hailing services. In fact, I think there
are a lot of parallels between the two. There's also
a report that in some we Work offices the company
had included stuff like these little phone cubbies or phone
booths that had equipment in them that was emitting for
malde hyde fumes, which isn't a great thing either. We
(22:33):
Work ended up scuttling its plans for an I p
O and postponed those plans UH to late twenty nineteen, which,
as far as this recording is concerned, UH still hasn't
happened those those I p O plans. Newman actually would
step down as CEO shortly thereafter. He reportedly got a
one point seven billion dollar buyout from soft Bank, which
(22:56):
effectively controls we Work. Now, we Work began to all
off some other companies it had acquired over recent years,
and it also laid off about twenty percent of its workforce.
Reporters noted that the company had also started to explore
ways it might back out of some leases in various regions,
while simultaneously announcing plans about opening news space in different cities. Also,
(23:21):
just here's a personal note to soft Bank. You can
pay me a billion dollars and I won't even settle
you with a company that has no known pathway to profitability.
It's a bargain. Just show me the money now. Not
to get too sidetracked by all this, but I feel
like we Work and the ride hailing services really fall
(23:42):
into that fake it until you make it category I
covered on a recent episode of Tech Stuff, you know,
the one where I ranted for like forty five minutes.
I find it perplexing that the motivating factor for investment
isn't profitability but just company growth, as in, a company
doesn't need to show it can be profitable if it
can continue to expand rapidly. But in my mind, that
(24:05):
just means that now instead of a small, unprofitable company,
you've got a large, more complex, unprofitable company. And I
suppose the hope is that you will eventually quote unquote
make it up in volume, meaning that whenever you achieve
some predetermined magical scale, your operations will become profitable. But
(24:25):
from my perspective, it seems that that very rarely happens,
and that you're more likely to find yourself pouring money
into a sinking ship, and then people like Newman get
the benefit of a lifeboat that's loaded down with cash. Anyway,
I'm not an expert in corporate finance, so it's entirely
possible that I'm overlooking something obvious. It's just to me,
(24:47):
this model doesn't make much sense. I get the desire
to grow year over year, although I'm not crazy about it,
but without the profitability part in there, and growth is unsustained,
bowl you'll eventually collapse in on yourself because no one's
gonna keep giving you money just to grow. All right,
how about we chat a bit about everyone's favorite social
(25:09):
media platform that continues to play an increasingly pivotal role
in how we access information and misinformation. So it's time
to check in on what Facebook was up to in
twenty nineteen. And boy howdy, there was a lot going on.
I'm not even going to cover all of it, because
you could do a full episode on just the shenanigans
Facebook got up to in nineteen, But anyway, let's look
(25:32):
at some of the big ones. For one thing, the
company received a hefty fine for the Cambridge Analytica scandal,
in which Facebook's app permissions allowed a data collection company
to access not just the information of people who downloaded
the app or who installed the app, but also the
data of all of their contacts on Facebook who did
not opt in. The fine was five billion dollars of
(25:56):
princely some no doubt about it, But there are critics
who said that's not nearly severe enough of a penalty
considering the scope of the betrayal of trust and user information.
After all, Facebook as a company earned twenty two billion
dollars in revenue in so yeah, five billions a lot
of cash, But when you're looking at numbers like twenty
(26:17):
two billion dollars in revenue, a five billion dollar fine
might not be enough to make Facebook actually take greater
steps towards ensuring user security. In June two thousand nineteen,
Facebook announced the launch of Libra, the cryptocurrency project. Facebook
also announced the Libra Association, a consortium of twenty eight
companies that would form the initial group responsible for bringing
(26:41):
this cryptocurrency into reality, with a promise that more companies
would soon follow to join the consortium. So think of
it as a digital currency, not too different from something
like bitcoin, although the Libra cryptocurrency would be based on
real world assets and not just its own own uh
(27:01):
sense of value among the community. However, this announcement Facebook
made was met with scrutiny, particularly on the part of
various governmental agencies around the world, and to be fair,
it's more accurate to say Facebook is the leading voice
in this project UH and is not the only entity
(27:21):
behind it, but for the purposes of most reporting, people
tend to simplify it by saying Facebook now. Governments began
to call for regulations and rules to guide any sort
of cryptocurrency effort, particularly in the wake of some high
profile missteps by Facebook, like the aforementioned Cambridge Analytica scandal.
By October twenty nineteen, more than of those original companies
(27:44):
had walked away from the Libra consortium. The first to
leave was PayPal, and in an interview with Forbes, PayPal
CEO Dan Shulman said that when they were able to
see how far the project needed to go before it
could roll out, and they heard that with the amount
of work that PayPal needed to do to meet its
own internal goals that were not related to Libra, they said, oh, well,
(28:07):
just it makes sense for us to be part of
the consortium. We needed to focus on us first. Now,
whether that was the same justification for the other companies
that bailed on the Libra association, I can't say, but
companies like Visa, Stripe, MasterCard, and eBay also left the association.
With the increased interest among various governments to create rules
(28:29):
to minimize the risk of something like a new cryptocurrency,
it seems like Libra has a long way to go
before it becomes a practical currency, if it ever does.
Another big Facebook story revolves around these social media platforms
role in disseminating information and misinformation. This was a big
theme throughout twenty nineteen, Mark Zuckerberg stated before the US
(28:50):
government that he feels Facebook shouldn't play a role in
fact checking stuff like political ads. So if a politician
wanted to post an ad to face Book that contained
incorrect or outright false information, they could do that and
Facebook would not intervene. As the company continues to deal
with accusations that it is profiting from efforts of political
(29:13):
manipulation and deception, this has been an area of focus
for a lot of folks. Moreover, Facebook's algorithm favors posts
that drive a lot of engagement, so likes, shares comments
that kind of thing. Now, in turn, that generates more
screen time for Facebook and us more revenue for the company.
(29:33):
So the company has a financial incentive to give a
platform for stuff that gets people riled up, which in
turn contributes to things like political extremism, which I'll talk
more about in our next episode. It's a pretty ugly situation,
and Zuckerberg so far seems to be intent on absolving
himself of any responsibility for creating a platform that can
(29:55):
be gamed in this way, and the platform itself benefits
from this. I can't stress that enough. Facebook makes money
by having these sorts of posts on it because it
generates a lot of activity, and that activity translates into
more screen time, which translates into more money for Facebook,
(30:17):
so they have a financial incentive to keep things going
the way they are. Towards the end of twenty nineteen,
the Federal Trade Commission in the United States began to
take a closer look at Facebook's proposed plan to integrating
its various properties together, uh those being Facebook, Messenger, WhatsApp,
and Instagram. So while Facebook is trying to do this,
it is also under investigation by the US government in
(30:40):
an antitrust case. A tighter integration between the different platforms
would make it more difficult to separate down the line,
and it's possible that the US government will demand Facebook
to break up its various properties and spin them off
as independent companies. So there's a chance that by the
time you hear this, the FTC will have filed an
injunction against Facebook from integrating these services further. And the
(31:02):
hits just keep on coming. Between when I started making
notes for this episode and when I actually sat down
in the studio to record it right now, you had
another story about Facebook broke in mid December Facebook sent
a letter to the United States Senate. The letter revealed
that the company could locate users even if they had
opted out of being tracked with location data. Now, I
(31:26):
would argue that this isn't as big a news story
as it was made out to be because Facebook stated
that they could use meta data, such as tagged photos
that indicated a location and time, as well as who
was in the tagged photo. But that seems pretty intuitive
to me. If I go to a party and I
take a photo of you, you're at the party two,
(31:47):
and then I post from the party and I tagged
the location of the party and I tag you, then
Facebook has data on where I am, where you are,
what time we were there, and all of that that.
It's all there in Facebook's data even if we don't
have location information turned on regularly. Other ways Facebook could
(32:08):
make guesses as to where people are depend less on
direct user input and more and stuff like I P addresses,
which aren't as exact. They can give you a general idea,
but they're not full proof. Now, Facebook defended its policies
by stating that it could detect suspicious logins using this approach,
such as if a person in one part of the
(32:29):
country were to suddenly appear as though they were trying
to log into Facebook, but from an IP address located
on the other side of the world. That would indicate
that maybe somebody else had gotten hold of some log
in information and they were trying to steal someone's Facebook account.
Of course, stuff like VPNs could also create this scenario.
(32:50):
You could be using a VPN to log into Facebook
from the other side of the world for various reasons,
and that could raise a false flag. But I do
see what Facebook was trying to say. Now, one last
Facebook story before I take another break. In mid November,
a thief stole several hard drives from the car of
a Facebook employee, and those hard drives included unencrypted payroll
(33:13):
data for thousands of Facebook employees. The data covered about
twenty nine thousand people who are working for Facebook, so
some of those folks presumably no longer work for the company. Now,
in this case, we're talking about physical hardware taken from
a car, so this was not a data breach in
the traditional sense. Now I'm surprised the data was unencrypted.
(33:36):
I would imagine that in most cases you would want
to encrypt that information, even on just a physical hard drive,
but presumably it wasn't because no one ever assumed the
hard drives would leave the possession of Facebook. Still, yikes,
we got a few more bummers to go, but before
we do, let's take another quick break. So a big
(34:03):
story to play out over the course of twenty nineteen
was the world's response to the Chinese telecom company Huawei,
which I've also covered in a previous episode of tech Stuff.
The company isn't that old, but it already stands to
be one of the major players in rolling out the
technology that will enable five G wireless connectivity around the world.
(34:23):
In fact, with the outstanding orders the company already has
in Europe, it leads the pack in terms of five
G equipment sales. This is despite some hefty restrictions placed
upon Huawei, mostly from the United States. In mid December
twenty nineteen, it was revealed that Chinese officials had leveraged
tremendous pressure on European countries to sign contracts to purchase
(34:46):
five G equipment from Huawei or face consequences such as
canceled trade agreements. You know, wider trade agreements throughout China.
Now at the heart of the dispute is a concern
that Huawei has close ties with the Chinese government and
that as a provider of telecommunications equipment, it's possible the
(35:07):
company could potentially build in back doors and other features
that would allow China to access vital communications channels across
the globe. In fact, such back doors had previously been found,
although they could have been vulnerabilities not intentionally placed there,
but still it raises some eyebrows. Huawei argues that it's
(35:28):
actually a private company and it doesn't have any direction
from the Chinese government, and that such fears are unfounded.
But it hasn't stopped countries like the United States from
eyeing Huawei with suspicion, And to be fair, China is
putting some pressure on various countries that are you know,
conflicted about using Huawei, and that seems to send a
(35:51):
message that China's kind of deeply integrated with the company's
you know, day to day operations. Although Huawei says, no, no, no,
this is just a government looking out for a company
that exists within its borders. That's it. It's not a
sign that it's a Chinese government operation. So it's a
(36:13):
complicated thing, and it all depends upon whose perspective you believe.
The truth is probably somewhere in the middle. Speaking of China,
the country's conflicts with Hong Kong have spilled over into
the tech space in various ways. A large number of
Hong Kong citizens mobilized against the Chinese government, initially protesting
a policy that would allow for extradition of Hong Kong
(36:35):
citizens accused of certain crimes and they would be extradited
to mainland China. Now, given China's reputation when it comes
to justice, the too long didn't read version of that is,
it's a very bad reputation. Many Hong Kong citizens protested
against this policy. They stated that it was undermining the
(36:56):
independence of Hong Kong, which was something China had previously
promised it wouldn't mess around with. While China would ultimately
withdraw the extradition bill, this was really the push that
got the ball rolling, and protests continue to this day
because they extend beyond that. You could think of that
as the straw that broke the camel's back. Now the
(37:17):
tech angle of all of this, there's the video game
company Blizzard that I recently covered on tech stuff. While
they make a digital card battle game called Hearthstone, and
during a Hearthstone tournament in Taiwan, a Hong Kong player
named why Chung or blitz Chung that's his gamer handle,
showed support for Hong Kong protesters on camera during an
(37:41):
interview Blizzard band blitz Chung from the tournament. The Blizzard
also banned the UH the people who were conducting the interview,
even though they were doing their best to try and
avoid appearing like they were enabling this UH and that
band of blitz Chung would prevent him from playing in
any grand Master tournament for a year, and he would
(38:02):
have to forfeit the prize money he had accumulated up
to that point in the tournament. When pressed to explain
why they leveled such a harsh ban, Blizzards stated that
blitz Chung had violated a policy that prohibited players from
doing anything that would tarnish the company's image or within
the public. Now, that raised a pretty strong counter objection
(38:24):
among the gaming community at large. Many people hypothesized that
blizzards response was largely motivated by the fact that ten Cent,
a Chinese company, owns a stake of ownership in Activision.
Blizzard they don't own the company outright, they just own
a percentage. There was also speculation that Blizzard didn't want
(38:46):
to endanger operations within the Chinese market. The Chinese market
represents billions of dollars of potential revenue, so they didn't
want to put that at risk. Critics also pointed out
that Blizzards punishments toward other gamers around the world in
response to vulgarity, you know, clear cut cases where someone
has violated that policy. They were rarely as severe as
(39:08):
what blitz Chung experienced. Blizzards subsequently walked back the punishment
a little bit. They returned the prize winnings to blitz Chung,
but they kept a ban in place for half a
year rather than a full year. Interestingly, Chinese companies, namely Tencent,
have partial ownership in other video game companies, not just Blizzard,
(39:29):
and some of these companies also produce games that have
a tournament circuit, and in some of those cases, there
seems to be no restriction on what players can say
about the situation in Hong Kong. So that raises questions
about whether Blizzard was being proactively responsive for fear of
upsetting the Apple cart or if possibly other companies have
seen the backlash that Blizzard faced and they're setting themselves
(39:53):
apart by taking a different approach. Oh and I should
also backtrack just a little bit. So remember how I
mentioned Whahwei is a leading company when it comes to
five G technologies. Well, that reminds me I should quickly
address that a T and T and the company's attempt
to leverage the concept of five G and how that
got a lot of scorn in the tech community. Okay,
(40:14):
so part of this story hinges on the fact that
five G isn't just a single technology or anything like that.
You can't just say five G relates to this specific implementation.
It's really more of a family of technologies and implementations
that enable wireless data throughput at really impressive levels. And
(40:34):
we typically describe it as speed, but the data is
not actually moving faster than it was before. It's just
that more data can travel all at once through a channel.
So instead of thinking of it as like a one
lane road where you can just somehow defy the laws
of physics and drive faster than the speed of light,
it's more like you have an ultra wide highway where
(40:57):
all the cars can travel at the speed of light
simul taneously, so you get more cars, more data, but
they're not traveling faster than they were before. There's just
more of them. The rollout of five G is taking
time because it requires new infrastructure. You can't just send
an update out to existing antenna's out there. You actually
have to go install new ones and make them in
(41:19):
a different density than older generations of wireless technology. You
also need to have phones and other devices that can
actually receive five G signals to take advantage of it.
They can't just do that with their standard stuff, so
it requires a whole lot of hardware upgrades across the board. Now,
A T and T decided to kind of, you know,
(41:40):
leap frog all of that. The company made a change
and they pushed out an update that would replace the
LTE indicator on certain A T and T smartphones with
a symbol saying five G E, and the E stands
for evolution, so is a five G evolution network device. Now.
(42:01):
Critics said that A T and T was purposefully confusing
the market, that it was positioning these phones as if
they were already taking advantage of true five G networks,
and we're operating on actual five G technology, when in
fact they were actually relying on the older lt E
four G technology. Making matters more confusing was that A
(42:24):
T and T was actually rolling out legit five G infrastructure,
but it was only available in limited areas, and sometimes
that would just be a small area within an actual city.
For example, according to analytics company open Signal, the A
T and T five G E service did not outperform
either T Mobile or Verizons LTE service, and so the
(42:45):
general conclusion was that A T and T was trying
to take advantage of an emerging technology to make it
seem like their product, which according to tests wasn't superior
to the competition, was somehow more capable. It was dirty
pool wool, as go maz Adams would say. Now I
should also add that while it looks to me like
(43:05):
A T and T deliberately tried to fool folks with
this whole five G evolution network approach, the situation does
actually get pretty complicated because the generations of wireless connectivity
are kind of lucy goosey. You can't point to say
three G and give a set of firm specifications on
how much data could be sent over a network per
(43:28):
unit of time. The technologies within a generation evolve over
the course of that generation, and if a company can
upgrade hardware to take advantage of those evolutions, it can
see improved data rate. So, in other words, not all
four G networks or devices are equal. Some are capable
of much better data transfer rates than others. It's even
(43:49):
possible to have a really good network and a device
on an earlier generation outperform a later generation. Example, so
it's possible for you to have a really good four
G network and device outperform a five G device on
a five G network. Possibly it's that the Venn diagram
(44:10):
is narrow, but it can happen, so it's not as
simple as saying five G is faster than four G.
It's definitely true that the potential of five G far
outpaces that of four G. In other words, the best
implementation of five G is always going to be better
than the best implementation of four G as far as
data throughput is concerned. But potential and reality are two
(44:32):
different things, so it all depends on how it's implemented
in the area that you are in. And yes, I
find this all to be incredibly frustrating because as a consumer.
I just want my stuff to work really well and
for it to be really fast, and it's not always
an easy thing to determine. I'll wrap up with a
couple of short stories. One is the saga of these
(44:55):
seven thirty seven Macs, which I covered in a recent
tech Stuff episode. After two strop it crashes, governments around
the world ordered that Boeing's seven thirty seven Max aircraft
be grounded, pending a full investigation into what went wrong
and any adjustments that need to be made. Boeing subsequently
made changes to the aircraft's systems. The particular system at
fault was meant to be a safety feature, a system
(45:17):
that would kick in to counter this seven thirty seven
Max's tendency to tilt its nose upward. The problem was
that the safety feature could override pilot commands, and if
you had a single sensor failure sending incorrect information to
the safety system, that's what could cause tragedy. Now, as
(45:37):
of this recording, the fleet of aircraft is still grounded
and Boeing has suspended manufacturing any more of them for
the time being. The last story I wanted to mention
quickly is a follow up on a company that I've
covered in a past episode of Tech Stuff. That company is,
or rather was, movie Pass. So movie Pass aimed to
create a subscription based service in which stomers could purchase
(46:01):
a monthly pass to see first run movies in various
movie theaters. But movie theater chains weren't super keen on
this idea. Movie Pass had many notable ups and downs,
most of which I covered in my episode on the company,
but somehow managed to hang on longer than anyone really
thought was possible. This was despite the company having to
(46:23):
walk back it's unlimited movie Pass for a much more
modest offering, which I imagine must have led to a
pretty large number of customers canceling their subscriptions when suddenly
their unlimited movie Pass became no, you can see three
movies or you can get discounts on tickets. And thus
movie Pass had to secure loans from various sources just
(46:44):
to stay in business. Now, eventually the credits had to
roll on this company, and in September twenty nine, team
that's what happened. Movie Pass CEO Mitch Lowe released a
statement that the company would cease operations immediately, and uh it,
did you know? Movie Pass had failed to turn a
profit and the opposition it faced was considerable. While the
(47:07):
company tried lots of different approaches to right itself, those
choices ultimately either didn't work or actively worked against the company,
alienating the users and inviting various lawsuits to come in.
And it was pretty ugly stuff, all right. That wraps
up this episode, but in our next episode, I'll continue
(47:27):
to look back on technology in twenty nineteen. There's still
a lot of bummers left on that list, including some
they go beyond bummer too outright disastrous. But there are
a few cool things in there too, so we'll get
to those as well. So if you guys have suggestions
for future episodes of tech Stuff, reach out to me.
(47:48):
The best place to do so's on social media over
on Twitter and on Facebook. You can find us at
text stuff, H s W and I'll talk to you
again really soon. Text Stuff is a production of I
Heart Radio's How Stuff Works. For more podcasts from I
(48:08):
heart Radio, visit the i heart Radio app, Apple Podcasts,
or wherever you listen to your favorite shows.
Welcome to Text Stuff, a production of I Heart Radios
How Stuff Works. Hey there, and welcome to text Stuff.
I'm your host job in Strickland. I'm an executive producer
with iHeart Radio and a lot of all things tech.
And boy feels good to say those words, because you know,
I've been running around traveling doing lots of stuff for
(00:26):
another show called The Restless Ones, which you may have heard, uh,
And it means that I've had a lot of time
away from the studio. But I'm back today, and it's
that time of year when I take a look back
at the previous twelve months and consider some of the
biggest text stories to come out over the course of
(00:48):
the year. Now, this year, twenty nineteen, it was a
pretty darn packed one when it comes to news, and
things changed so quickly, and there are so many high
level stories that it can actually be pretty easy to
good stuff that happened earlier in the year. So I'm
gonna walk us through some of the big themes of
the year and some of the stories that center on
(01:08):
those themes. And there are so many things to talk
about that I'm actually gonna have to do two episodes
about it. I originally was going to really try and
cram it into one, but that just wasn't very practical.
I would just be rattling off headlines, and what good
is that. So this one's going to be filled with
a lot of stories about mistakes and things going wrong
in the world of tech. So I'm calling this episode
(01:30):
the Bummers of twenty nineteen. But um, here's the bad news.
There were a lot of bummer stories, So some of
those are gonna probably spill into the next episode two,
but I'll do my best to to to lighten the
mood of it in the next one occasionally. Now, one
of the big themes has actually become a pretty common
(01:51):
one over the last several years is the theme of
data breaches. Like I have previously called earlier years like
the Year of the Data Breach, but I think the
same thing can be said of twenty nineteen. So a
couple of years ago, the credit reporting company Equifax dealt
with a massive data breach that resulted in a host
(02:13):
of investigations in the United States both the state and
federal levels, and the company ultimately agreed to pay out
somewhere between five and seven hundred million dollars as a
result in fines. They were also giving people the opportunity
to lay a claim for at least some sort of
(02:34):
compensation for this data breach. People were invited to apply
for a payout of one hundred twenty five dollars, not
exactly a princely sum when you consider having your personal
information rated due to insufficient protections on a corporate level.
In September two tho nineteen, Equifax announced that people claiming
(02:56):
a payout would need to provide proof that they had
also enrolled in a credit monitoring service by October, because
that would show that the people had concern about their
own credit rating and their own personal information, that they
weren't just looking for money to get money, but that
they actually were actively trying to keep track of this stuff,
(03:16):
or else the claim could be denied, and the FTC
had previously already warned that due to the number of claims,
people were likely to get far less than a hundred
twenty five dollars because there was only a pool of
around thirty one million dollars that had been set aside
for these payouts. You know that five d seventy five
to seven million dollars that wasn't set aside for payouts.
(03:38):
Only thirty one million was set aside for payouts. And
I know it's crazy to say only thirty one million,
but when you look at the scale of this data breach,
you realize that that means if everyone who was affected
lays claim to a payout, you don't get very much.
But this whole mess has prompted more conversations about data
(03:59):
secure and corporate accountability, which is a good thing. It's
sad that it comes at the expense of this terrible mistake,
but at least people are talking more seriously about this.
Hopefully something will actually happen because of it. Now, we've
seen lots of these stories over the last several years,
and they really do show no sign of slowing down
(04:19):
right now, which is unfortunate. In twenty nineteen, there were
some truly notable examples across different industries. I pulled data
from Norton, the information security company to look at some
of the big ones. One of those would be Capital One,
the financial company, reported that hackers were able to access
a large amount of data, affecting one hundred six million
(04:43):
records in the company's files. Most of those records were
for a credit card applications rather than established accounts. So
it wasn't like the hackers necessarily got a lot of
credit card info, but they got a lot of application information.
And when you think about the info you need to
provide hide when you apply for a credit card, it
(05:03):
includes stuff like, you know, personal information that is really
important to you. And it might be mundane stuff like
your name, which, hey, you know, no big deal, someone
knows your name, okay, But it might include your email,
which again maybe that's more frustrating or or irritating. But
then there's also your physical address, which gets a little
(05:27):
more spooky scary, your credit score, your income, maybe your
Social Security number, essentially all the stuff it would take
for someone to steal your identity and sell it off
on the dark web, which is not very cool. Capital
one hacker named Page Thompson targeted a third party cloud
computing company that Capital One had relied upon to host
(05:50):
the credit application services. She exploited a vulnerability in a
web at firewall to get illegal access to the data.
She was arrested for the data intrusion, and then she
was held in a men's detention center. Uh, she's transgender,
and this gets into a whole thing with criminal justice
systems and the treatment of people who are transgender, which
(06:11):
honestly goes way beyond the scope of this podcast. But
I'll just say that when I read that she was
held in a men's detention center, that really upset me. Now,
I don't disagree with her being detained she broke the law,
or allegedly broke the law. She denies this. I more
object that it wasn't in a more appropriate setting. Anyway,
(06:32):
She's awaiting trial for the case. That trial is scheduled
right now for March twenty. She has pled not guilty
to the charges. Another company to experience a data breach
was door Dash, the food delivery service. The company experienced
the breach in May, but didn't disclose it until September
twenty nineteen. A third party access the information of nearly
(06:55):
five million drivers and customers without permission. The information they
were able to access included personal information, including the last
few digits of credit card and bank account numbers, but
not the whole number. It was just that last little string.
It also included the hashed passwords of many account holders,
so it's always good to change your password if you
(07:17):
make use of services that later reveal that they've been hacked,
it's always a good idea to change that information. And also, well,
I'll get to it, but don't use the same password everywhere.
It's a little spoiler alert for a future discussion. So
early in the year, the service Evite had a data
breach that affected one hundred million records, again exposing customer
(07:40):
information like names, addresses, phone numbers, and the password that
they used for the account. And again the exposure of
passwords drives home that importance right use unique passwords with
different services. That way, if one service is compromised, you
don't have to worry about the hackers accessing everything else
you use using the same password. If you're using one
(08:02):
password for everything, then you're essentially opening up the door.
As soon as one breach is effective, all of your
services have been breached. So don't use the same password
for everything. Use a password vault, UH, use stuff like
two factor authentication. All of that will help minimize your risk.
It doesn't eliminate it, but it minimizes it. And if
(08:24):
you find out one of the services you use was compromised,
change all that log and information right away. Now. The
medical industry also saw its share of data breaches the
American Medical Collection Agency, which is a company that collects
overdue payments for various medical labs. So essentially, these are
the folks who come after you if you haven't paid
certain medical bills. They also had a breach. Hackers access
(08:47):
more than twenty million records, and the information included not
just personal information, but even stuff like credit card information.
The actual breach began back in the summer of eighteen,
but the vulnerability remain unpatched until Arch twenty nineteen. In
June of this year, the company filed for bankruptcy protection.
So you know, things are just going great for them.
(09:09):
And close to home, Georgia Tech suffered a data breach
when some third party gained access to a university owned database.
The database had tons of personal information on current and
former students, as well as staff and faculty at the college,
including things like social security numbers. In total, one point
to six five million people were affected by that data breach.
(09:32):
The college is reaching out to offer credit monitoring and
identity theft protection services for those affected by it, but
still yikes. The U. S Government also was not immune
to data breaches. The Federal Emergency Management Agency, or FEMA
had a data breach, not because some hacker broke into
the system, but because the agency accidentally released files containing
(09:54):
sensitive information, such as the personal info of more than
two million people. So ad trombone noise insert here now.
According to the US Inspector General, FEMA violated the Privacy
Act of nineteen seventy four by releasing this data to
a third party contractor. The contractor was in charge of
securing temporary lodging for people who are affected by emergencies
(10:18):
and disasters, so like a fire or a flood. But
the data FEMA provided was far more extensive than what
was actually needed for this contractor to do its job,
and so that data included stuff like banking information and
bank transit numbers and stuff like that, stuff that did
not need to be shared. Now, considering that this breach
(10:39):
affected people who are already dealing with emergency situations that
were bad enough to necessitate a relocation, that's a that's
a big, big ouch. Making matters worse is that even
some of the companies that are dedicated towards security and
privacy have had data breaches in twenty nineteen. Take nord
VPN for example. That was a service that I've used
(11:02):
in the past. A VPN is a virtual private network,
and the purpose of a VPN is to allow a
user to log into a remote server and then use
various internet services so that they can't be traced back
to the end user. Now, at first glance, that might
sound like it's shady, but it's actually a really useful service.
If you're concerned about your own data security, you can
(11:22):
use a VPN when you're in areas where you can't
be certain of the security of the network, and that
helps improve your own security. But then this year, word
came out that nord vpn had an internal private key
exposed back in which created the possibility for hackers to
create a server and host it on the nord vpn
(11:43):
service as if it were a valid Nord VPN server. Now,
that would mean that an end user who was relying
on nord vpn might end up logging into one of
the hackers computers thinking it was a secure VPN server,
and the hacker we get to see all the traffic
coming through that computer. Nord vpn has stated that since
(12:04):
the breach, the company has patched this problem and that
the company doesn't keep a log of any user activity,
So hackers would only capture any traffic that happened on
their own server during that breach. They wouldn't have gotten
traffic information from any other servers on the nord VPN network.
They wouldn't be able to look at historic data because
the company doesn't keep any Still, that might come as
(12:27):
a little comfort to a community of users who presumably
have subscribed to the service out of a desire to
maintain privacy and security. Now, these stories are pretty discouraging,
and to be honest, it's just the tip of a
huge iceberg. According to a report from Javelin Strategy and Research,
there were five thousand, one hundred eighty three reported data
(12:48):
breaches in the first nine months of two thousand nineteen alone.
Now keep in mind those are reported data breaches. There
are likely many more that have either gone discovered or unreported.
Now those breaches represent nearly eight billion records exposed. The
rate shows a thirty three increase in breaches compared to
(13:11):
two thousand eighteen. Most of those breaches happened to companies
with fewer than one employees, so these weren't like the
big big news items like Capital One or door Dash.
There were some good news items in the report. However,
not everything was dour. Credit Card security has improved thanks
to chip technology, so there was actually a decline in
(13:32):
credit card frauds. That's something to be thankful for. Now.
It can be a hassle just to practice good secure
internet habits, as I've covered in previous episodes of tech Stuff.
As users, we all have a responsibility to protect our
data as best we can, But if we want to
do useful stuff with that data, ultimately we eventually have
(13:53):
to hand it over to other entities, and when these
other entities have data breaches, it's also a breach of trust.
If we don't trust in the systems, things fall apart. Now,
I think it highly unlikely that we're going to see
fewer attempts at data breaches as time goes on. It
only makes sense we're gonna keep seeing them and probably
(14:13):
see efforts increase over time. So hopefully we'll have more
success stories revolving around foiling a data breach. But the
world of information security is typically a see saw type
of thing. The hackers get better at cracking systems and
exploiting vulnerabilities, companies get better at patching the holes, but
then the hackers look for different holes, and the entire
(14:35):
cycle repeats itself. Meanwhile, people like you and me get
caught up with our data potentially at risk, which is
kind of gross. Well, let's stick with some more bummers.
Um I figured if I frontload the episodes with bummers,
then I can make some space in the back half
for some more fun stuff. But first, let's talk about
financial performance. So two thousand nineteen saw some pretty rough
(14:58):
quarters for a you companies. One of those was Uber.
Now I mentioned this in an earlier episode this year
about fake it until you Make it, but Uber leads
the way among ride hailing companies in a category you
don't want to appear in, which is the most money
lost per quarter. Now, to be clear, all ride hailing
companies are losing money. None of them are profitable. No
(15:20):
one has figured out how to make a business model
that has a profitable side as of yet. But Uber
is losing money on a scale that's pretty monumental. During
the second quarter of twenty nineteen, the company posted revenues
of three billion dollars, which, come on, that's that's a
lot of chadder, But they posted losses of five billion dollars.
(15:42):
Wolf Uber CEO stated that a large part of those
losses came from the I P O process that Uber
went through the initial public offering. The company had bought
back shares that belonged to employees, which posted in the
company records as an expense, but that was a one
time expen Uber won't be buying back shares again in
the future. Still, analysts say that even taking into account
(16:06):
the stock compensation cost, Uber would have lost more than
a billion dollars. And that's just one quarter. That's not
all of twenty nineteen, So if my math is right,
there are four quarters every year. So the question is,
can Uber find a way to be profitable in the
right hailing and related businesses or will it have to
bank on investors bailing the company out again. I'm worried
(16:28):
we're looking at another bubble that's just about to burst.
But I hold out hope that companies like Uber Left
and other right hailing services are able to turn things
around preferably while also treating their employees well and ensuring
the safety of their customers, which are also ongoing issues
with many of these right hailing companies. More to say
about that in just a moment, but first let's take
(16:49):
a quick break now. Speaking of safety and right inhaling,
it's also important to hold up Lift to the magnifying
glass and not give that company a free pass while
raking Uber over the coals. Numerous women have come forward
(17:11):
in lawsuits against Lift, stating that they were the victims
of assault. They also say the company did nothing to
prevent those assaults, and they didn't do enough to ensure
passengers safety. And on top of all that, they say
that Lift ignored complaints filed after the assaults took place
and then downplayed the events to the media. One lawyer
(17:32):
states that there's evidence that Lift purposefully withheld cooperation from
law enforcement officers who are investigating these claims. Now Lift
is not the only right hailing company to come under
scrutiny due to safety concerns and reports of assault, and
there are also cases in which drivers have been assaulted
by passengers. This is an ongoing story, and there are
(17:53):
a lot of discussions about measures that could help protect
passengers and drivers alike. But the rollout is likely to
be re regional and staggered over weeks or months, so
it's not exactly the super fast response you would hope for. Necessarily,
all right, let's keep that bummer train of moving. In
January two thousand, nineteen, the utility company Pacific Gas and
(18:15):
Electric or pg n E, declared bankruptcy. Now, this company
serves customers along the West Coast, and in twenty seventeen,
it was found guilty of starting a series of wildfires
in California, which then put the company thirty billion dollars
in debt. That's billion with a b P. G n
E emerged from bankruptcy in September twenty nineteen after agreeing
(18:38):
on an eleven billion dollar settlement with insurance companies. Now,
this is the same utility company that would shut down
power to California residents in a series of planned blackouts
during a particularly windy season in order to avoid a
similar situation and which perhaps a broken power line might
start a wildfire. The blackouts affected more than half a
(19:00):
million people in the San Francisco region. So that was
not a great story, and the tech sector obviously covered
it quite a bit, with so many tech companies located
in the Bay Area. Now, at least seven coal mining
companies in the United States have declared bankruptcy in twenty nineteen,
which marked the first year in which more US citizens
(19:20):
got electricity from renewable sources than from coal powered plants.
At least thirty three oil and gas producers have gone
bankrupt as well, and the Zoo might imagine this has
made lots of folks in the coal and oil industries upset.
And while I definitely don't want to see people face
hardship as companies closed down, I don't want to see
people out of work. I also think the move away
(19:43):
from fossil fuels is a necessity. So it's my hope
that employees of these companies can find work in the
renewable energy sector. I think it's imperative we rid ourselves
of our dependence upon fossil fuels. But we also have
to make sure that the people who were employed by
that into tree can find good work elsewhere and they're
not just left in the lurch. We have to make
(20:05):
sure that whatever plans we have to transition away from
fossil fuels also take into account the people whose livelihoods
depend upon those industries. Now, speaking of going elsewhere, what
do you do when your company is in financial crisis
and the company's main product is renting out office space
to tech startups. That's the question that we Work has
(20:26):
been trying to answer for much of twenty nineteen. So
we Work was launched back in. The company leases out
office space to tenants and markets around the globe, So
essentially at leases out space and buildings and then sublets
that space to smaller companies. And in that regard, it's
not really a tech company in of itself, but it's
(20:48):
clients are in largely the startup tech space. It's kind
of the market that we Work targets. Specifically, we Work
offices tend to have amenities that you might find in
a art up that has a lot of venture capital
and angel investors behind it. So, you know, a lot
of tech journals have covered the company's rather tumultuous twenty nineteen.
(21:08):
We Work initially planned to hold an initial public offering
in September twenty nineteen, when it would become a publicly
traded company on the stock market. Only things did not
go quite as planned. First, something that would have made
my eyebrows go up was that the founder or co founder,
Adam Newman, liquidated around seven hundred million dollars worth of
(21:30):
we Work stock before it went into its initial public offering. Now,
that does not necessarily mean that Newman lacked confidence about
how the stock market would treat his company, but a
lot of folks tend to interpret those types of moves
as kind of a message that the founder doesn't think
(21:50):
things are gonna go well, so they're cashing out before
the value of their stock tanks. Now, when the I
p O paperwork became public in August twenty nineteen, journalists
pointed out that the company had been experiencing some pretty
massive losses, not unlike the right hailing businesses I talked
about earlier in this episode, there were questions about whether
(22:11):
or not we Work would ever be profitable, so also
like the right hailing services. In fact, I think there
are a lot of parallels between the two. There's also
a report that in some we Work offices the company
had included stuff like these little phone cubbies or phone
booths that had equipment in them that was emitting for
malde hyde fumes, which isn't a great thing either. We
(22:33):
Work ended up scuttling its plans for an I p
O and postponed those plans UH to late twenty nineteen, which,
as far as this recording is concerned, UH still hasn't
happened those those I p O plans. Newman actually would
step down as CEO shortly thereafter. He reportedly got a
one point seven billion dollar buyout from soft Bank, which
(22:56):
effectively controls we Work. Now, we Work began to all
off some other companies it had acquired over recent years,
and it also laid off about twenty percent of its workforce.
Reporters noted that the company had also started to explore
ways it might back out of some leases in various regions,
while simultaneously announcing plans about opening news space in different cities. Also,
(23:21):
just here's a personal note to soft Bank. You can
pay me a billion dollars and I won't even settle
you with a company that has no known pathway to profitability.
It's a bargain. Just show me the money now. Not
to get too sidetracked by all this, but I feel
like we Work and the ride hailing services really fall
(23:42):
into that fake it until you make it category I
covered on a recent episode of Tech Stuff, you know,
the one where I ranted for like forty five minutes.
I find it perplexing that the motivating factor for investment
isn't profitability but just company growth, as in, a company
doesn't need to show it can be profitable if it
can continue to expand rapidly. But in my mind, that
(24:05):
just means that now instead of a small, unprofitable company,
you've got a large, more complex, unprofitable company. And I
suppose the hope is that you will eventually quote unquote
make it up in volume, meaning that whenever you achieve
some predetermined magical scale, your operations will become profitable. But
(24:25):
from my perspective, it seems that that very rarely happens,
and that you're more likely to find yourself pouring money
into a sinking ship, and then people like Newman get
the benefit of a lifeboat that's loaded down with cash. Anyway,
I'm not an expert in corporate finance, so it's entirely
possible that I'm overlooking something obvious. It's just to me,
(24:47):
this model doesn't make much sense. I get the desire
to grow year over year, although I'm not crazy about it,
but without the profitability part in there, and growth is unsustained,
bowl you'll eventually collapse in on yourself because no one's
gonna keep giving you money just to grow. All right,
how about we chat a bit about everyone's favorite social
(25:09):
media platform that continues to play an increasingly pivotal role
in how we access information and misinformation. So it's time
to check in on what Facebook was up to in
twenty nineteen. And boy howdy, there was a lot going on.
I'm not even going to cover all of it, because
you could do a full episode on just the shenanigans
Facebook got up to in nineteen, But anyway, let's look
(25:32):
at some of the big ones. For one thing, the
company received a hefty fine for the Cambridge Analytica scandal,
in which Facebook's app permissions allowed a data collection company
to access not just the information of people who downloaded
the app or who installed the app, but also the
data of all of their contacts on Facebook who did
not opt in. The fine was five billion dollars of
(25:56):
princely some no doubt about it, But there are critics
who said that's not nearly severe enough of a penalty
considering the scope of the betrayal of trust and user information.
After all, Facebook as a company earned twenty two billion
dollars in revenue in so yeah, five billions a lot
of cash, But when you're looking at numbers like twenty
(26:17):
two billion dollars in revenue, a five billion dollar fine
might not be enough to make Facebook actually take greater
steps towards ensuring user security. In June two thousand nineteen,
Facebook announced the launch of Libra, the cryptocurrency project. Facebook
also announced the Libra Association, a consortium of twenty eight
companies that would form the initial group responsible for bringing
(26:41):
this cryptocurrency into reality, with a promise that more companies
would soon follow to join the consortium. So think of
it as a digital currency, not too different from something
like bitcoin, although the Libra cryptocurrency would be based on
real world assets and not just its own own uh
(27:01):
sense of value among the community. However, this announcement Facebook
made was met with scrutiny, particularly on the part of
various governmental agencies around the world, and to be fair,
it's more accurate to say Facebook is the leading voice
in this project UH and is not the only entity
(27:21):
behind it, but for the purposes of most reporting, people
tend to simplify it by saying Facebook now. Governments began
to call for regulations and rules to guide any sort
of cryptocurrency effort, particularly in the wake of some high
profile missteps by Facebook, like the aforementioned Cambridge Analytica scandal.
By October twenty nineteen, more than of those original companies
(27:44):
had walked away from the Libra consortium. The first to
leave was PayPal, and in an interview with Forbes, PayPal
CEO Dan Shulman said that when they were able to
see how far the project needed to go before it
could roll out, and they heard that with the amount
of work that PayPal needed to do to meet its
own internal goals that were not related to Libra, they said, oh, well,
(28:07):
just it makes sense for us to be part of
the consortium. We needed to focus on us first. Now,
whether that was the same justification for the other companies
that bailed on the Libra association, I can't say, but
companies like Visa, Stripe, MasterCard, and eBay also left the association.
With the increased interest among various governments to create rules
(28:29):
to minimize the risk of something like a new cryptocurrency,
it seems like Libra has a long way to go
before it becomes a practical currency, if it ever does.
Another big Facebook story revolves around these social media platforms
role in disseminating information and misinformation. This was a big
theme throughout twenty nineteen, Mark Zuckerberg stated before the US
(28:50):
government that he feels Facebook shouldn't play a role in
fact checking stuff like political ads. So if a politician
wanted to post an ad to face Book that contained
incorrect or outright false information, they could do that and
Facebook would not intervene. As the company continues to deal
with accusations that it is profiting from efforts of political
(29:13):
manipulation and deception, this has been an area of focus
for a lot of folks. Moreover, Facebook's algorithm favors posts
that drive a lot of engagement, so likes, shares comments
that kind of thing. Now, in turn, that generates more
screen time for Facebook and us more revenue for the company.
(29:33):
So the company has a financial incentive to give a
platform for stuff that gets people riled up, which in
turn contributes to things like political extremism, which I'll talk
more about in our next episode. It's a pretty ugly situation,
and Zuckerberg so far seems to be intent on absolving
himself of any responsibility for creating a platform that can
(29:55):
be gamed in this way, and the platform itself benefits
from this. I can't stress that enough. Facebook makes money
by having these sorts of posts on it because it
generates a lot of activity, and that activity translates into
more screen time, which translates into more money for Facebook,
(30:17):
so they have a financial incentive to keep things going
the way they are. Towards the end of twenty nineteen,
the Federal Trade Commission in the United States began to
take a closer look at Facebook's proposed plan to integrating
its various properties together, uh those being Facebook, Messenger, WhatsApp,
and Instagram. So while Facebook is trying to do this,
it is also under investigation by the US government in
(30:40):
an antitrust case. A tighter integration between the different platforms
would make it more difficult to separate down the line,
and it's possible that the US government will demand Facebook
to break up its various properties and spin them off
as independent companies. So there's a chance that by the
time you hear this, the FTC will have filed an
injunction against Facebook from integrating these services further. And the
(31:02):
hits just keep on coming. Between when I started making
notes for this episode and when I actually sat down
in the studio to record it right now, you had
another story about Facebook broke in mid December Facebook sent
a letter to the United States Senate. The letter revealed
that the company could locate users even if they had
opted out of being tracked with location data. Now, I
(31:26):
would argue that this isn't as big a news story
as it was made out to be because Facebook stated
that they could use meta data, such as tagged photos
that indicated a location and time, as well as who
was in the tagged photo. But that seems pretty intuitive
to me. If I go to a party and I
take a photo of you, you're at the party two,
(31:47):
and then I post from the party and I tagged
the location of the party and I tag you, then
Facebook has data on where I am, where you are,
what time we were there, and all of that that.
It's all there in Facebook's data even if we don't
have location information turned on regularly. Other ways Facebook could
(32:08):
make guesses as to where people are depend less on
direct user input and more and stuff like I P addresses,
which aren't as exact. They can give you a general idea,
but they're not full proof. Now, Facebook defended its policies
by stating that it could detect suspicious logins using this approach,
such as if a person in one part of the
(32:29):
country were to suddenly appear as though they were trying
to log into Facebook, but from an IP address located
on the other side of the world. That would indicate
that maybe somebody else had gotten hold of some log
in information and they were trying to steal someone's Facebook account.
Of course, stuff like VPNs could also create this scenario.
(32:50):
You could be using a VPN to log into Facebook
from the other side of the world for various reasons,
and that could raise a false flag. But I do
see what Facebook was trying to say. Now, one last
Facebook story before I take another break. In mid November,
a thief stole several hard drives from the car of
a Facebook employee, and those hard drives included unencrypted payroll
(33:13):
data for thousands of Facebook employees. The data covered about
twenty nine thousand people who are working for Facebook, so
some of those folks presumably no longer work for the company. Now,
in this case, we're talking about physical hardware taken from
a car, so this was not a data breach in
the traditional sense. Now I'm surprised the data was unencrypted.
(33:36):
I would imagine that in most cases you would want
to encrypt that information, even on just a physical hard drive,
but presumably it wasn't because no one ever assumed the
hard drives would leave the possession of Facebook. Still, yikes,
we got a few more bummers to go, but before
we do, let's take another quick break. So a big
(34:03):
story to play out over the course of twenty nineteen
was the world's response to the Chinese telecom company Huawei,
which I've also covered in a previous episode of tech Stuff.
The company isn't that old, but it already stands to
be one of the major players in rolling out the
technology that will enable five G wireless connectivity around the world.
(34:23):
In fact, with the outstanding orders the company already has
in Europe, it leads the pack in terms of five
G equipment sales. This is despite some hefty restrictions placed
upon Huawei, mostly from the United States. In mid December
twenty nineteen, it was revealed that Chinese officials had leveraged
tremendous pressure on European countries to sign contracts to purchase
(34:46):
five G equipment from Huawei or face consequences such as
canceled trade agreements. You know, wider trade agreements throughout China.
Now at the heart of the dispute is a concern
that Huawei has close ties with the Chinese government and
that as a provider of telecommunications equipment, it's possible the
(35:07):
company could potentially build in back doors and other features
that would allow China to access vital communications channels across
the globe. In fact, such back doors had previously been found,
although they could have been vulnerabilities not intentionally placed there,
but still it raises some eyebrows. Huawei argues that it's
(35:28):
actually a private company and it doesn't have any direction
from the Chinese government, and that such fears are unfounded.
But it hasn't stopped countries like the United States from
eyeing Huawei with suspicion, And to be fair, China is
putting some pressure on various countries that are you know,
conflicted about using Huawei, and that seems to send a
(35:51):
message that China's kind of deeply integrated with the company's
you know, day to day operations. Although Huawei says, no, no, no,
this is just a government looking out for a company
that exists within its borders. That's it. It's not a
sign that it's a Chinese government operation. So it's a
(36:13):
complicated thing, and it all depends upon whose perspective you believe.
The truth is probably somewhere in the middle. Speaking of China,
the country's conflicts with Hong Kong have spilled over into
the tech space in various ways. A large number of
Hong Kong citizens mobilized against the Chinese government, initially protesting
a policy that would allow for extradition of Hong Kong
(36:35):
citizens accused of certain crimes and they would be extradited
to mainland China. Now, given China's reputation when it comes
to justice, the too long didn't read version of that is,
it's a very bad reputation. Many Hong Kong citizens protested
against this policy. They stated that it was undermining the
(36:56):
independence of Hong Kong, which was something China had previously
promised it wouldn't mess around with. While China would ultimately
withdraw the extradition bill, this was really the push that
got the ball rolling, and protests continue to this day
because they extend beyond that. You could think of that
as the straw that broke the camel's back. Now the
(37:17):
tech angle of all of this, there's the video game
company Blizzard that I recently covered on tech stuff. While
they make a digital card battle game called Hearthstone, and
during a Hearthstone tournament in Taiwan, a Hong Kong player
named why Chung or blitz Chung that's his gamer handle,
showed support for Hong Kong protesters on camera during an
(37:41):
interview Blizzard band blitz Chung from the tournament. The Blizzard
also banned the UH the people who were conducting the interview,
even though they were doing their best to try and
avoid appearing like they were enabling this UH and that
band of blitz Chung would prevent him from playing in
any grand Master tournament for a year, and he would
(38:02):
have to forfeit the prize money he had accumulated up
to that point in the tournament. When pressed to explain
why they leveled such a harsh ban, Blizzards stated that
blitz Chung had violated a policy that prohibited players from
doing anything that would tarnish the company's image or within
the public. Now, that raised a pretty strong counter objection
(38:24):
among the gaming community at large. Many people hypothesized that
blizzards response was largely motivated by the fact that ten Cent,
a Chinese company, owns a stake of ownership in Activision.
Blizzard they don't own the company outright, they just own
a percentage. There was also speculation that Blizzard didn't want
(38:46):
to endanger operations within the Chinese market. The Chinese market
represents billions of dollars of potential revenue, so they didn't
want to put that at risk. Critics also pointed out
that Blizzards punishments toward other gamers around the world in
response to vulgarity, you know, clear cut cases where someone
has violated that policy. They were rarely as severe as
(39:08):
what blitz Chung experienced. Blizzards subsequently walked back the punishment
a little bit. They returned the prize winnings to blitz Chung,
but they kept a ban in place for half a
year rather than a full year. Interestingly, Chinese companies, namely Tencent,
have partial ownership in other video game companies, not just Blizzard,
(39:29):
and some of these companies also produce games that have
a tournament circuit, and in some of those cases, there
seems to be no restriction on what players can say
about the situation in Hong Kong. So that raises questions
about whether Blizzard was being proactively responsive for fear of
upsetting the Apple cart or if possibly other companies have
seen the backlash that Blizzard faced and they're setting themselves
(39:53):
apart by taking a different approach. Oh and I should
also backtrack just a little bit. So remember how I
mentioned Whahwei is a leading company when it comes to
five G technologies. Well, that reminds me I should quickly
address that a T and T and the company's attempt
to leverage the concept of five G and how that
got a lot of scorn in the tech community. Okay,
(40:14):
so part of this story hinges on the fact that
five G isn't just a single technology or anything like that.
You can't just say five G relates to this specific implementation.
It's really more of a family of technologies and implementations
that enable wireless data throughput at really impressive levels. And
(40:34):
we typically describe it as speed, but the data is
not actually moving faster than it was before. It's just
that more data can travel all at once through a channel.
So instead of thinking of it as like a one
lane road where you can just somehow defy the laws
of physics and drive faster than the speed of light,
it's more like you have an ultra wide highway where
(40:57):
all the cars can travel at the speed of light
simul taneously, so you get more cars, more data, but
they're not traveling faster than they were before. There's just
more of them. The rollout of five G is taking
time because it requires new infrastructure. You can't just send
an update out to existing antenna's out there. You actually
have to go install new ones and make them in
(41:19):
a different density than older generations of wireless technology. You
also need to have phones and other devices that can
actually receive five G signals to take advantage of it.
They can't just do that with their standard stuff, so
it requires a whole lot of hardware upgrades across the board. Now,
A T and T decided to kind of, you know,
(41:40):
leap frog all of that. The company made a change
and they pushed out an update that would replace the
LTE indicator on certain A T and T smartphones with
a symbol saying five G E, and the E stands
for evolution, so is a five G evolution network device. Now.
(42:01):
Critics said that A T and T was purposefully confusing
the market, that it was positioning these phones as if
they were already taking advantage of true five G networks,
and we're operating on actual five G technology, when in
fact they were actually relying on the older lt E
four G technology. Making matters more confusing was that A
(42:24):
T and T was actually rolling out legit five G infrastructure,
but it was only available in limited areas, and sometimes
that would just be a small area within an actual city.
For example, according to analytics company open Signal, the A
T and T five G E service did not outperform
either T Mobile or Verizons LTE service, and so the
(42:45):
general conclusion was that A T and T was trying
to take advantage of an emerging technology to make it
seem like their product, which according to tests wasn't superior
to the competition, was somehow more capable. It was dirty
pool wool, as go maz Adams would say. Now I
should also add that while it looks to me like
(43:05):
A T and T deliberately tried to fool folks with
this whole five G evolution network approach, the situation does
actually get pretty complicated because the generations of wireless connectivity
are kind of lucy goosey. You can't point to say
three G and give a set of firm specifications on
how much data could be sent over a network per
(43:28):
unit of time. The technologies within a generation evolve over
the course of that generation, and if a company can
upgrade hardware to take advantage of those evolutions, it can
see improved data rate. So, in other words, not all
four G networks or devices are equal. Some are capable
of much better data transfer rates than others. It's even
(43:49):
possible to have a really good network and a device
on an earlier generation outperform a later generation. Example, so
it's possible for you to have a really good four
G network and device outperform a five G device on
a five G network. Possibly it's that the Venn diagram
(44:10):
is narrow, but it can happen, so it's not as
simple as saying five G is faster than four G.
It's definitely true that the potential of five G far
outpaces that of four G. In other words, the best
implementation of five G is always going to be better
than the best implementation of four G as far as
data throughput is concerned. But potential and reality are two
(44:32):
different things, so it all depends on how it's implemented
in the area that you are in. And yes, I
find this all to be incredibly frustrating because as a consumer.
I just want my stuff to work really well and
for it to be really fast, and it's not always
an easy thing to determine. I'll wrap up with a
couple of short stories. One is the saga of these
(44:55):
seven thirty seven Macs, which I covered in a recent
tech Stuff episode. After two strop it crashes, governments around
the world ordered that Boeing's seven thirty seven Max aircraft
be grounded, pending a full investigation into what went wrong
and any adjustments that need to be made. Boeing subsequently
made changes to the aircraft's systems. The particular system at
fault was meant to be a safety feature, a system
(45:17):
that would kick in to counter this seven thirty seven
Max's tendency to tilt its nose upward. The problem was
that the safety feature could override pilot commands, and if
you had a single sensor failure sending incorrect information to
the safety system, that's what could cause tragedy. Now, as
(45:37):
of this recording, the fleet of aircraft is still grounded
and Boeing has suspended manufacturing any more of them for
the time being. The last story I wanted to mention
quickly is a follow up on a company that I've
covered in a past episode of Tech Stuff. That company is,
or rather was, movie Pass. So movie Pass aimed to
create a subscription based service in which stomers could purchase
(46:01):
a monthly pass to see first run movies in various
movie theaters. But movie theater chains weren't super keen on
this idea. Movie Pass had many notable ups and downs,
most of which I covered in my episode on the company,
but somehow managed to hang on longer than anyone really
thought was possible. This was despite the company having to
(46:23):
walk back it's unlimited movie Pass for a much more
modest offering, which I imagine must have led to a
pretty large number of customers canceling their subscriptions when suddenly
their unlimited movie Pass became no, you can see three
movies or you can get discounts on tickets. And thus
movie Pass had to secure loans from various sources just
(46:44):
to stay in business. Now, eventually the credits had to
roll on this company, and in September twenty nine, team
that's what happened. Movie Pass CEO Mitch Lowe released a
statement that the company would cease operations immediately, and uh it,
did you know? Movie Pass had failed to turn a
profit and the opposition it faced was considerable. While the
(47:07):
company tried lots of different approaches to right itself, those
choices ultimately either didn't work or actively worked against the company,
alienating the users and inviting various lawsuits to come in.
And it was pretty ugly stuff, all right. That wraps
up this episode, but in our next episode, I'll continue
(47:27):
to look back on technology in twenty nineteen. There's still
a lot of bummers left on that list, including some
they go beyond bummer too outright disastrous. But there are
a few cool things in there too, so we'll get
to those as well. So if you guys have suggestions
for future episodes of tech Stuff, reach out to me.
(47:48):
The best place to do so's on social media over
on Twitter and on Facebook. You can find us at
text stuff, H s W and I'll talk to you
again really soon. Text Stuff is a production of I
Heart Radio's How Stuff Works. For more podcasts from I
(48:08):
heart Radio, visit the i heart Radio app, Apple Podcasts,
or wherever you listen to your favorite shows.
TechStuff News
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Karah Preiss
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