Digital Digest – 14 May

In this week’s Digital Digest, we look closer to home as the Government bans unhealthy food and drink advertising pre-watershed and ITV launches a campaign to showcase its drama and reality programming.

We then shine a light on big tech, as Starbucks threatens to leave Facebook, TikTok is taken to court over the use of children’s data, and Germany bans Facebook from accessing WhatsApp data.

Finally, we look to North America, and the battle between Canada and the USA to attract top tech talent.

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CLOSER TO HOME

‘Dismay’ at Govt Go-Ahead for HFSS Ad Restrictions for TV and Online

Advertisers and industry heads have reacted with “dismay” to the UK government’s announcement that it plans to press ahead with an advertising ban for food and drink high in fat, sugar and salt (HFSS) completely online and before the 9pm watershed on TV.

The Department for Health and Social Care ran a rapid consultation for six weeks to try and understand the impact of introducing a total ban on online HFSS advertising.

Experts have warned of the financial impact of HFSS restrictions on media owners. In ITV’s latest annual report, it predicted a 4% decline in ad sales from 2023 – equivalent to about £65m a year – should a ban on HFSS come into force.

ITV’s drama and reality stars go head-to-head in new brand campaign

ITV has kicked off a new brand campaign to showcase its smorgasbord of drama and reality shows. The campaign was created with Uncommon Creative Studio and shot by Oscar-winning director Tom Hooper (The King’s Speech, Les Misérables), whose credits also include classic ITV crime drama Prime Suspect.

Nils Leonard, co-founder at Uncommon, said: “ITV are unique – they are the only place to bring together epic British drama and ferocious reality in one place on the ITV Hub.

The campaign is set to follow with another battle between ITV drama and reality TV stars launching next week.

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BIG TECH

Starbucks considers leaving Facebook over hate and intolerance, report says

Coffee giant Starbucks is said to be considering leaving Facebook over the “negative/insensitive, hate speech-related comments” it receives on its posts about social justice issues.

The report is based on internal discussions seen by the outlet that were written by Facebook employees who manage the platform’s relationship with the world’s largest coffee company.

Starbucks spokesperson Sanja Gould would not confirm if the company was considering removing its Facebook page, but told Buzzfeed in a statement that the coffee corporation stands “against hate speech”.

TikTok sued over use of children’s data

A former children’s commissioner for England has launched a “landmark case” against the video-sharing app TikTok, alleging that it illegally collects the personal information of its child users. Despite a minimum age requirement of 13, Ofcom found last year that 42% of UK eight to 12-year-olds used TikTok.

As with other social media companies such as Facebook, there have long been concerns about data collection and the UK’s Information Commissioner’s Office is investigating TikTok’s handling of children’s personal information.

Tom Southwell, a partner at Scott + Scott, which is acting for Longfield, said: “TikTok and ByteDance’s advertising revenue is built on the personal information of its users, including children.”

Germany bans Facebook from handling WhatsApp data over privacy concerns

Germany’s leading data protection regulator has banned Facebook from using data generated by WhatsApp users. The ruling follows a controversy over the messaging app’s latest privacy terms, which the regulator believes are illegal.

The move follows emergency discussions in Hamburg after WhatsApp asked users to consent to the new terms or stop using it.

WhatsApp, which is owned by Facebook, accused the Hamburg data protection authority of misunderstanding the purpose of the update and said there was no legitimate basis for the ban.

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NORTH AMERICA

North America battles for top tech talent

It seems Donald Trump’s tough stance on immigration may have turned Canada into a technology powerhouse, after the country opened their doors the best and the brightest while the U.S. tightened restrictions on high skilled workers.

Canada’s 900,000 “tech talent workers” now account for 5.6% of its workforce, compared with 3.7% in it’s southern neighbour. Companies are growing so fast, they’re struggling to meet demand.

But Justin Treaudu’s dream of a Silicon Valley in the snow may be dashed following the election of Joe Biden who has promised to issue more high-skilled visas. Will overseas talent go back to the U.S. to live and work? Or can Canada maintain their competitive edge?

What’s clear is that the battle for tech talent is heating up (well, as much as it can in Canada)!

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ALSO IN THE NEWS

1. It’s been a bad week for big tech, with tech-focused growth companies suffering the most from a global stock sell-off, mounted by inflation fears that central banks will tighten monetary policy.

2. To add to their woes, new internet laws announced in the Queen’s Speech could see Ofcom fine companies up to £18m or 10% of their annual global turnover (whichever is higher) if they fail to take down harmful content.

3. Meanwhile, Refuge has warned that technology is playing a growing role in domestic abuse cases with perpetrators using multiple accounts and devices to abuse, control and monitor their partners using a range of tech as well as sophisticated malicious software.

4. Elsewhere, Elon Musk, Tesla CEO and ‘Technoking’ has caused a storm by suspending the purchase of its electric vehicles with Bitcoin, despite the company investing $1.5 billion in Bitcoin this quarter and publicly vouching for the crypto currency’s longevity.

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WORTH A READ

1. Noahpinion: How Clubhouse might still win

2. Financial Times: An uphill race for Peloton as gyms reopen

3. WIRED: Social media companies say they want to be transparent. So why aren’t they?

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Under The Radar – 14 May

This week, we discuss:

1. MDMA being used to treat PTSD

2. Warnings from the media over the Online Safety Bill

3. Facebook downgrading its digital currency project…again

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MDMA used to treat PTSD

What happened?

Results from a new trial in America suggest that MDMA, commonly known as a party drug, could be more effective than therapy alone at treating PTSD. The results suggest two-thirds of people no longer qualified for a PTSD diagnosis afterwards.

What does it mean?

Undertaken by US charity Maps with the approval of the FDA, the study found 88% of people had a “meaningful reduction in symptoms”, while 67% no longer qualified for a PTSD diagnosis at all after 18 weeks and three sessions of MDMA-assisted therapy.

Although the results are based on just 91 people, they are nonetheless significant. Most psychedelic studies are exploratory, remaining unlikely to receive approval for prescription usage. However, Maps’ study is a stage three trial, meaning the findings can be used to apply for prescribing approval.

In recent years the US has rapidly embraced a liberal approach to psychedelics in numerous states, resulting in changing attitudes that have paved the way for progressive trials. Maps’ chief scientific officer has now said that MDMA could be available for prescription by 2023 in the US, with approval being sought in the UK this summer.

Experts in the UK have urged caution due to the small sample size but have accepted the study adds further weight to the growing conviction that psychedelic drugs have real treatment potential. 

It remains to be seen whether the UK will embrace the potential of psychedelics or continue living in the past.

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Alarm bells rung over Online Safety Bill 

What happened?

Campaigners have warned that the government’s Online Safety Bill risks “stifling the free press”. The proposed bill includes safeguards for social media users’ ability to access journalism, including features to protect content deemed “democratically important”. Nevertheless, some have warned journalism is now in the scope of state regulation and under threat.

What does it mean?

Oliver Dowden, the culture secretary, is certainly correct in calling the legislation “groundbreaking” – with its unprecedented curbs to stop the spread of illegal and harmful content.

But in the government’s war on social media, has the free press been caught in the crossfire? Ministers are adamant it has not, pointing to the protections for “democratically important” content and a fast-track appeals process should journalists’ content be removed. But Fleet Street is not so sure.

Commentator, former journalist, and General Secretary of the Free Speech Union, Toby Young, has argued that while the democratic protections are a welcomed exemption, “an important line has been crossed” and “the state has no business regulating the work of journalists, whether it’s in a newspaper or on Facebook”.

Equally, Daily Mail editor emeritus Peter Wright told the House of Lords that the appeals process is completely unworkable for the media, “the shelf life of news is incredibly short. If a big story breaks, and 20 to 30 different news outlets are covering it and the platforms decide to block three of them, the story may have moved on within an hour or two. There is no appeals process you could put in place that would repair the damage that had been done.”

Social media has undoubtedly had a detrimental effect on the quality of journalism. So despite the reactionary outrage, perhaps a slower and more considered news cycle would be a good thing.

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Facebook’s digital currency fails to impress

What happened?

Facebook-backed digital currency project Diem has announced it has withdrawn its application for a Swiss payment license and will instead shift its operations to the United States and partner with a domestic bank to issue a US-dollar backed stablecoin.

What does it mean?

Facebook’s digital currency has hit road bump after road bump. It is now a shadow of the former grandiose vision that was supposedly going to change the way we pay for goods and services entirely.

Announced in 2019, it was anticipated that Facebook would revolutionise the world of commerce by creating the Libra Association and the eponymous digital currency. But after Mark Zuckerberg and his Nick Clegg brain-trust failed to win over policymakers and regulators, Facebook scaled back the plan to Libra 2.0, which shared more resemblance to PayPal than a challenger currency.

The subsequent rebrand to Diem hasn’t been enough to shake the reputational damage that dogged Libra, with successor Diem downgrading the project even further. It has given up its global vision, abandoning its application to the Swiss Financial Market Supervisory Authority and relocating its HQ from Switzerland to the U.S.

Diem will now launch a stablecoin, which is tied to the U.S. dollar, while California based Silvergate Bank will issue and manage the reserves.

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This Week’s Must Reads

1. ‘How India’s Covid-19 crisis diminished Narendra Modi’ by

2. Amy Kazmin, Benjamin Parkin and Jyotsna Singh for the Financial Times

3. ‘Could the rising Gaza death toll spell the end of Israel’s new friendship with Gulf states?’ by Yossi Mekelberg for The Telegraph

4. ‘No visitors but teeming with life: what’s going on inside the Natural History Museum?’ by Phoebe Weston for The Guardian

5. ‘Without total change Labour will die’ by Tony Blair for the New Statesman

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Under The Radar – 07 May

This week, we discuss

1. Achieving commercial viability for lab-grown chicken

2. Fake news legislation in Hong Kong

3. Uber’s $600m hit following the landmark Supreme Court ruling

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Lab-grown chicken – an eggciting prospect?

What happened?

Israeli start-up Future Meat has slashed production costs by almost half in just a few months, marking a huge leap towards achieving commercial viability for its lab-grown chicken. The company expects the cost of a 110-gram chicken breast to fall below $2 in the next 12-18 months.

What does it mean?

The food industry is rapidly changing. Alternative milk brands like Oatly are undergoing IPOs and meatless alternatives including Heck and Linda McCartney are continuing to enjoy impressive growth. But alongside these market developments – all of which are underpinned by changing consumer trends – lies the outlier that is lab-grown meat.

Generally referred to in food circles as alternative protein companies, it is here where the most consequential and impactful changes for society will be germinated. The goal is simple: to mimic the taste and texture of conventional meat, compete in price and find a viable business model whilst doing so.

Lab-grown meat companies have had the potential to generate exponential growth for a while – even attracting investors like Richard Branson – yet they have remained an outlier because of their failure to bring products to market at anywhere near an affordable price.

However, as a result of their remarkable progress in slashing production costs, Future Meat will be launching a product in the US within the next 18 months, potentially providing the company first-mover advantage in what could be a multi-billion industry.

Whilst the path to commercial success is not a given one for Future Meat, on this trajectory one would assume their lab-grown meats will be on our plates sooner rather than later.

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Bleak prospects for Hong Kong’s press

What happened?

In a press conference on Tuesday, Hong Kong leader Carrie Lam confirmed that her government is working to introduce fake news legislation in an attempt to curb “misinformation, hatred and lies”.

What does it mean?

Lam’s threat to impose a fake news law during the same week as World Press Freedom Day is another stark reminder of Hong Kong’s freefall since the handover: Reporters Without Borders ranked Hong Kong 80th out of 180 countries in its latest index – a far cry from its 18th place position in 2002.

This crackdown is just the latest development in Hong Kong’s slide to authoritarianism. Indeed, a bogus fake news law is a natural progression of the Chinese-backed national security law, passed last year, which gave the government power to stifle any form of dissent.

The depressing and alarming reality of Hong Kong’s authoritarian turn will likely be on full view next month – the 32nd anniversary of the Tiananmen Square Massacre.

Hong Kong traditionally hosts an annual candlelight vigil in Victoria Park to commemorate the event, making it the only Chinese city where people are able to openly honour the victims and call on Beijing to apologise for its historic crimes.

But this year marks the first Tiananmen Square anniversary under the national security law. The vigil attendees face their biggest challenge yet with the almost certain threat of arrest and suppression. Capturing the stakes of this historic moment, Richard Tsoi, one of the vigil’s organisers, said: “If we cannot do it well now, we will have no future at all”.

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Mixed-results for Uber

What happened?

Uber reported on Wednesday its highest-ever quarter of gross bookings, up 24% year on year to $19.5bn. However, total revenue fell by 11% to $2.9 billion after the company set aside $600 million to resolve historical claims with UK drivers following the landmark Supreme Court decision in March.

What does it mean?

Working in the gig economy has become unattractive for many during the health crisis – in the UK, those on insecure contracts were twice as likely to die from COVID-19.

This may have contributed to the Supreme Court’s ruling that Uber was wrong to class its drivers as independent contractors, meaning the company has now gained 70,000 workers, all entitled to the minimum wage and holiday pay.

And it’s not an isolated case. In Milan, Deliveroo, UberEats and JustEat were ordered to employ 60,000 delivery riders and pay €733 million in fines. Meanwhile, in the U.S. Joe Biden has begun fulfilling his campaign promise to protect gig economy workers, with Labor Secretary Marty Walsh blocking an incoming Trump era regulation that would have made it harder for gig workers to be classified as employees. Share prices have been falling since, with low-cost flexible labour crucial to Uber’s business.

The gig economy needs a new business model that isn’t dependent on predatorily undercutting workers’ rights.

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This Week’s Must Reads

1. Diplomacy has changed more than most professions during the pandemic’ for The Economist

2. ‘Can London reinvent itself after the pandemic?’ by 

3. William Wallis for the Financial Times

4. ‘The woodfired brick wall’ by Robert Hutton for The Critic

5. ‘British Political Veteran Steers Facebook’s Trump Decision’ by Adam Satariano and Cecilia Kang for The New York Times

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