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Ahead of third antitrust ruling, Google announces fresh tweaks to Android in Europe

Posted by | Android, antitrust, Apple, Apps, chrome os, competition commission, DuckDuckGo, Europe, european commission, european union, France, G Suite, Google, Image search, joaquin almunia, Jolla, Kent Walker, Margrethe Vestager, Mobile, operating systems, play store, Policy, Qwant, search app, search engine, search engines, smartphone, Spotify, travel search | No Comments

Google is widely expected to be handed a third antitrust fine in Europe this week, with reports suggesting the European Commission’s decision in its long-running investigation of AdSense could land later today.

Right on cue the search giant has PRed another Android product tweak — which it bills as “supporting choice and competition in Europe”.

In the coming months Google says it will start prompting users of existing and new Android devices in Europe to ask which browser and search apps they would like to use.

This follows licensing changes for Android in Europe which Google announced last fall, following the Commission’s $5BN antitrust fine for anti-competitive behavior related to how it operates the dominant smartphone OS.

tl;dr competition regulation can shift policy and product.

Albeit, the devil will be in the detail of Google’s self-imposed ‘remedy’ for Android browser and search apps.

Which means how exactly the user is prompted will be key — given tech giants are well-versed in the manipulative arts of dark pattern design, enabling them to create ‘consent’ flows that deliver their desired outcome.

A ‘choice’ designed in such a way — based on wording, button/text size and color, timing of prompt and so on — to promote Google’s preferred browser and search app choice by subtly encouraging Android users to stick with its default apps may not actually end up being much of a ‘choice’.

According to Reuters the prompt will surface to Android users via the Play Store. (Though the version of Google’s blog post we read did not include that detail.)

Using the Play Store for the prompt would require an Android device to have Google’s app store pre-loaded — and licensing tweaks made to the OS in Europe last year were supposedly intended to enable OEMs to choose to unbundle Google apps from Android forks. Ergo making only the Play Store the route for enabling choice would be rather contradictory. (As well as spotlighting Google’s continued grip on Android.)

Add to that Google has the advantage of massive brand dominance here, thanks to its kingpin position in search, browsers and smartphone platforms.

So again the consumer decision is weighted in its favor. Or, to put it another way: ‘This is Google; it can afford to offer a ‘choice’.’

In its blog post getting out ahead of the Commission’s looming AdSense ruling, Google’s SVP of global affairs, Kent Walker, writes that the company has been “listening carefully to the feedback we’re getting” vis-a-vis competition.

Though the search giant is actually appealing both antitrust decisions. (The other being a $2.7BN fine it got slapped with two years ago for promoting its own shopping comparison service and demoting rivals’.)

“After the Commission’s July 2018 decision, we changed the licensing model for the Google apps we build for use on Android phones, creating new, separate licenses for Google Play, the Google Chrome browser, and for Google Search,” Walker continues. “In doing so, we maintained the freedom for phone makers to install any alternative app alongside a Google app.”

Other opinions are available on those changes too.

Such as French pro-privacy Google search rival Qwant, which last year told us how those licensing changes still make it essentially impossible for smartphone makers to profit off of devices that don’t bake in Google apps by default. (More recently Qwant’s founder condensed the situation to “it’s a joke“.)

Qwant and another European startup Jolla, which leads development of an Android alternative smartphone platform called Sailfish — and is also a competition complainant against Google in Europe — want regulators to step in and do more.

The Commission has said it is closely monitoring changes made by Google to determine whether or not the company has complied with its orders to stop anti-competitive behavior.

So the jury is still out on whether any of its tweaks sum to compliance. (Google says so but that’s as you’d expect — and certainly doesn’t mean the Commission will agree.)

In its Android decision last summer the Commission judged that Google’s practices harmed competition and “further innovation” in the wider mobile space, i.e. beyond Internet search — because it prevented other mobile browsers from competing effectively with its pre-installed Chrome browser.

So browser choice is a key component here. And ‘effective competition’ is the bar Google’s homebrew ‘remedies’ will have to meet.

Still, the company will be hoping its latest Android tweaks steer off further Commission antitrust action. Or at least generate more fuzz and fuel for its long-game legal appeal.

Current EU competition commissioner, Margrethe Vestager, has flagged for years that the division is also fielding complaints about other Google products, including travel search, image search and maps. Which suggests Google could face fresh antitrust investigations in future, even as the last of the first batch is about to wrap up.

The FT reports that Android users in the European economic area last week started seeing links to rival websites appearing above Google’s answer box for searches for products, jobs or businesses — with the rival links appearing above paid results links to Google’s own services.

The newspaper points out that tweak is similar to a change promoted by Google in 2013, when it was trying to resolve EU antitrust concerns under the prior commissioner, Joaquín Almunia.

However rivals at the time complained the tweak was insufficient. The Commission subsequently agreed — and under Vestager’s tenure went on to hit Google with antitrust fines.

Walker doesn’t mention these any of additional antitrust complaints swirling around Google’s business in Europe, choosing to focus on highlighting changes it’s made in response to the two extant Commission antitrust rulings.

“After the Commission’s July 2018 decision, we changed the licensing model for the Google apps we build for use on Android phones, creating new, separate licenses for Google Play, the Google Chrome browser, and for Google Search. In doing so, we maintained the freedom for phone makers to install any alternative app alongside a Google app,” he writes.

Nor does he make mention of a recent change Google quietly made to the lists of default search engine choices in its Chrome browser — which expanded the “choice” he claims the company offers by surfacing more rivals. (The biggest beneficiary of that tweak is privacy search rival DuckDuckGo, which suddenly got added to the Chrome search engine lists in around 60 markets. Qwant also got added as a default choice in France.)

Talking about Android specifically Walker instead takes a subtle indirect swipe at iOS maker Apple — which now finds itself the target of competition complaints in Europe, via music streaming rival Spotify, and is potentially facing a Commission probe of its own (albeit, iOS’ marketshare in Europe is tiny vs Android). So top deflecting Google.

“On Android phones, you’ve always been able to install any search engine or browser you want, irrespective of what came pre-installed on the phone when you bought it. In fact, a typical Android phone user will usually install around 50 additional apps on their phone,” Walker writes, drawing attention to the fact that Apple does not offer iOS users as much of a literal choice as Google does.

“Now we’ll also do more to ensure that Android phone owners know about the wide choice of browsers and search engines available to download to their phones,” he adds, saying: “This will involve asking users of existing and new Android devices in Europe which browser and search apps they would like to use.”

We’ve reached out to Commission for comment, and to Google with questions about the design of its incoming browser and search app prompts for Android users in Europe and will update this report with any response.

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Tor pulls in record donations as it lessens reliance on US government grants

Posted by | Android, brave, Brendan Eich, carnegie mellon, censorship, censorshit, DuckDuckGo, Edward Snowden, Federal Bureau of Investigation, Firefox, Mozilla, TC, tor, U.S. government, United States | No Comments

Tor, the open-source initiative that provides a more secure way to access the internet, is continuing to diversify its funding away from its long-standing reliance on U.S. government grants.

The Tor Foundation — the organization behind the service which stands for “The Onion Router” — announced this week that it brought in a record $460,000 from individual donors in 2018. In addition, recently released financial information shows it raised a record $4.13 million from all sources in 2017 thanks to a growth in non-U.S. government donors.

The individual donation push represents an increase on the $400,000 it raised in 2017. A large part of that is down to Tor ally Mozilla, which once again pledged to match donations in the closing months of the year, while an anonymous individual matched all new backers who pledged up to $20,000.

Overall, the foundation said that it attracted donations from 115 countries worldwide in 2018, which reflects its importance outside of the U.S.

The record donation haul comes weeks after the Tor Foundation quietly revealed its latest financials — for 2017 — which show it has lessened its dependence on U.S. government sources. That’s been a key goal for some time, particularly after allegations that the FBI paid Carnegie Mellon researchers to help crack Tor, which served as a major motivation for the introduction of fundraising drives in 2015.

Back in 2015, U.S. government sources accounted for 80-90 percent of its financial backing, but that fell to just over 50 percent in 2017. The addition of a Swedish government agency, which provided $600,000, helped on that front, as well as corporate donations from Mozilla ($520,000) and DuckDuckGo ($25,000), more than $400,000 from a range of private foundations, and, of course, those donations from individuals.

Tor is best known for being used by NSA whistleblower Edward Snowden but, with governments across the world cracking down on the internet, it is a resource that’s increasingly necessary if we are to guard the world’s right to a free internet.

Tor has certainly been busy making its technology more accessible over the last year.

It launched its first official mobile browser for Android in September, and the same month it released TorBrowser 8.0, its most usable browser yet, which is based on Firefox’s 2017 Quantum structure. It has also worked closely with Mozilla to bring Tor into Firefox itself as it has already done with Brave, a browser firm led by former Mozilla CEO Brendan Eich.

Beyond the browser and the Tor network itself, which is designed to minimize the potential for network surveillance, the organization also develops a range of other projects. More than two million people are estimated to use Tor, according to data from the organization.

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Apple’s increasingly tricky international trade-offs

Posted by | Advertising Tech, Android, Apple, apple inc, Asia, Baidu, Bing, China, DuckDuckGo, Europe, France, Google, iOS, iPhone, Mobile, privacy, Qwant, safari, search engine, search engines, siri, smartphone, smartphones, TC, Tim Cook, United States, Yahoo | No Comments

Far from Apple’s troubles in emerging markets and China, the company is attracting the ire of what should really be a core supporter demographic naturally aligned with the pro-privacy stance CEO Tim Cook has made into his public soapbox in recent years — but which is instead crying foul over perceived hypocrisy.

The problem for this subset of otherwise loyal European iPhone users is that Apple isn’t offering enough privacy.

These users want more choice over key elements such as the search engine that can be set as the default in Safari on iOS (Apple currently offers four choices: Google, Yahoo, Bing and DuckDuckGo, all U.S. search engines; and with ad tech giant Google set as the default).

It is also being called out over other default settings that undermine its claims to follow a privacy by design philosophy. Such as the iOS location services setting which, once enabled, non-transparently flip an associated sub-menu of settings — including location-based Apple ads. Yet bundled consent is never the same as informed consent…

6/ and @Apple also defaults to ON, approx 13 location settings the moment a user enables location settings 🤔 that includes using YOUR location to support APPLE’s advertising business interests & $$$. By ‘enabling location based services’ you give your consent to this 🤔@tim_cook pic.twitter.com/scYSg94QgY

— Privacy Matters (@PrivacyMatters) October 19, 2018

As the saying goes you can’t please all of the people all of the time. But the new normal of a saturated smartphone market is imposing new pressures that will require a reconfiguration of approach.

Certainly the challenges of revenue growth and user retention are only going to step up from here on in. So keeping an otherwise loyal base of users happy and — crucially — feeling listened to and well served is going to be more and more important for the tech giant as the back and forth business of services becomes, well, essential to its fortunes going forward.

(At least barring some miracle new piece of Apple hardware — yet to be unboxed but which somehow rekindles smartphone-level demand afresh. That’s highly unlikely in any medium term timeframe given how versatile and capable the smartphone remains; ergo Apple’s greatest success is now Apple’s biggest challenge.)

With smartphone hardware replacement cycles slowing, the pressure on Cook to accelerate services revenue naturally steps up — which could in turn increase pressure on the core principles Cupertino likes to flash around.

Yet without principles there can be no brand premium for Apple to command. So that way ruin absolutely lies.

Control shift

It’s true that controlling the iOS experience by applying certain limits to deliver mainstream consumer friendly hardware served Apple well for years. But it’s also true iOS has grown in complexity over time having dropped some of its control freakery.

Elements that were previously locked down have been opened up — like the keyboard, for instance, allowing for third party keyboard apps to be installed by users that wish to rethink how they type.

This shift means the imposed limit on which search engines users can choose to set as an iOS default looks increasingly hard for Apple to justify from a user experience point of view.

Though of course from a business PoV Apple benefits by being able to charge Google a large sum of money to remain in the plum search default spot. (Reportedly a very large sum, though claims that the 2018 figure was $9BN have not been confirmed. Unsurprisingly neither party wants to talk about the terms of the transaction.)

The problem for Apple is that indirectly benefiting from Google eroding the user privacy it claims to champion — by letting the ad tech giant pay it to suck up iOS users’ search queries by default — is hardly consistent messaging.

Not when privacy is increasingly central to the premium the Apple brand commands.

Cook has also made a point of strongly and publicly attacking the ‘data industrial complex‘. Yet without mentioning the inconvenient side-note that Apple also engages in trading user data for profit in some instances, albeit indirectly.

In 2017 Apple switched from using Bing to Google for Siri web search results. So even as it has stepped up its rhetoric around user privacy it has deepened its business relationship with one of the Western Internet’s primary data suckers.

All of which makes for a very easy charge of hypocrisy.

Of course Apple offers iOS users a non-tracking search engine choice, DuckDuckGo, as an alternative choice — and has done so since 2014’s iOS 8.

Its support for a growing but still very niche product in what are mainstream consumer devices is an example of Apple being true to its word and actively championing privacy.

The presence of the DDG startup alongside three data-mining tech giants has allowed those ‘in the know’ iOS users to flip the bird at Google for years, meaning Apple has kept privacy conscious consumers buying its products (if not fully on side with all its business choices).

But that sort of compromise position looks increasingly difficult for Apple to defend.

Not if it wants privacy to be the clear blue water that differentiates its brand in an era of increasingly cut-throat and cut-price Android -powered smartphone competition that’s serving up much the same features at a lower up-front price thanks to all the embedded data-suckers.

There is also the not-so-small matter of the inflating $1,000+ price-tags on Apple’s top-of-the-range iPhones. $1,000+ for a smartphone that isn’t selling your data by default might still sound very pricy but at least you’d be getting something more than just shiny glass for all those extra dollars. But the iPhone isn’t actually that phone. Not by default.

Apple may be taking a view that the most privacy sensitive iPhone users are effectively a captive market with little option but to buy iOS hardware, given the Google-flavored Android competition. Which is true but also wouldn’t bode well for the chances of Apple upselling more services to these people to drive replacement revenue in a saturated smartphone market.

Offending those consumers who otherwise could be your very best, most committed and bought in users seems short-sighted and short-termist to say the least.

Although removing Google as the default search provider in markets where it dominates would obviously go massively against the mainstream grain that Apple’s business exists to serve.

This logic says Google is in the default position because, for most Internet users, Google search remains their default.

Indeed, Cook rolled out this exact line late last year when asked to defend the arrangement in an interview with Axios on HBO — saying: “I think their search engine is the best.”

He also flagged various pro-privacy features Apple has baked into its software in recent years, such as private browsing mode and smart tracker prevention, which he said work against the data suckers.

Albeit, that’s a bit like saying you’ve scattered a few garlic cloves around the house after inviting the thirsty vampire inside. And Cook readily admitted the arrangement isn’t “perfect”.

Clearly it’s a trade off. But Apple benefitting financially is what makes this particular trade-off whiff.

It implies Apple does indeed have an eye on quarterly balance sheets, and the increasingly important services line item specifically, in continuing this imperfect but lucrative arrangement — rather than taking a longer term view as the company purports to, per Cook’s letter to shareholders this week; in which he wrote: “We manage Apple for the long term, and Apple has always used periods of adversity to re-examine our approach, to take advantage of our culture of flexibility, adaptability and creativity, and to emerge better as a result.”

If Google’s search product is the best and Apple wants to take the moral high ground over privacy by decrying the surveillance industrial complex it could maintain the default arrangement in service to its mainstream base but donate Google’s billions to consumer and digital rights groups that fight to uphold and strengthen the privacy laws that people-profiling ad tech giants are butting hard against.

Apple’s shareholders might not like that medicine, though.

More palatable for investors would be for Apple to offer a broader choice of alternative search engines, thereby widening the playing field and opening up to more pro-privacy Google alternatives.

It could also design this choice in a way that flags up the trade-off to its millions of users. Such as, during device set-up, proactively asking users whether they want to keep their Internet searches private by default or use Google?

When put like that rather more people than you imagine might choose not to opt for Google to be their search default.

Non-tracking search engine DDG has been growing steadily for years, for example, hitting 30M daily searches last fall — with year-on-year growth of ~50%.

Given the terms of the Apple-Google arrangement sit under an NDA (as indeed all these arrangements do; DDG told us it couldn’t share any details about its own arrangement with Apple, for e.g.) it’s not clear whether one of Google’s conditions requires there be a limit on how many other search engines iOS users can pick from.

But it’s at least a possibility that Google is paying Apple to limit how many rivals sit in the list of competitors iOS users can pick out an alternative default. (It has, after all, recently been spanked in Europe for anti-competitive contractual limits imposed on Android OEMs to limit their ability to use alternatives to Google products, including search. So you could say Google has history where search is concerned.)

Equally, should Google actually relaunch a search product in China — as it’s controversially been toying with doing — it’s likely the company would push Apple to give it the default slot there too.

Though Apple would have more reason to push back, given Google would likely remain a minnow in that market. (Apple currently defaults to local search giant Baidu for iOS users in China.)

So even the current picture around search on iOS is a little more fuzzy than Cook likes to make out.

Local flavor

China is an interesting case, because if you look at Apple’s growth challenges in that market you could come to a very different conclusion vis-a-vis the power of privacy as a brand premium.

In China it’s convenience, via the do-it-all ‘Swiss army knife’ WeChat platform, that’s apparently the driving consumer force — and now also a headwind for Apple’s business there.

At the same time, the idea of users in the market having any kind of privacy online — when Internet surveillance has been imposed and ‘normalized’ by the state — is essentially impossible to imagine.

Yet Apple continues doing business in China, netting it further charges of hypocrisy.

Its revised guidance this week merely spotlights how important China and emerging markets are to its business fortunes. A principled pull-out hardly looks to be on the cards.

All of which underscores growing emerging market pressures on Apple that might push harder against its stated principles. What price privacy indeed?

It’s clear that carving out growth in a saturated smartphone market is going to be an increasingly tricky business for all players, with the risk of fresh trade-offs and pitfalls looming especially for Apple.

Negotiating this terrain certainly demands a fresh approach, as Cook implies is on his mind, per the shareholder letter.

Arguably the new normal may also call for an increasingly localized approach as a way to differentiate in a saturated and samey smartphone market.

The old Apple ‘one-sized fits all’ philosophy is already very outdated for some users and risks being caught flat-footed on a growing number of fronts — be that if your measure is software ‘innovation’ or a principled position on privacy.

An arbitrary limit on the choice of search engine your users can pick seems a telling example. Why not offer iOS users a free choice?

Or are Google’s billions really standing in the way of that?

It’s certainly an odd situation that iPhone owners in France, say, can pick from a wide range of keyboard apps — from mainstream names to superficial bling-focused glitter and/or neon LED keyboard skins or indeed emoji and GIF-obsessed keyboards — but if they want to use locally developed pro-privacy search engine Qwant on their phone’s native browser they have to tediously surf to the company’s webpage every time they want to look something up.

Google search might be the best for a median average ‘global’ (excluding China) iOS user but in an age of increasingly self-focused and self-centred technology, with ever more demanding consumers, there’s really no argument against letting people who want to choose for themselves.

In Europe there’s also the updated data protection framework, GDPR, to consider. Which may yet rework some mainstream ad tech business models.

On this front Qwant questions how even non-tracking rival DDG can protect users’ searches from government surveillance given its use of AWS cloud hosting and the U.S. Cloud Act. (Though, responding to a discussion thread about the issue on Github two years ago, DDG’s founder noted it has servers around the world, writing: “If you are in Europe you will be connected to our European servers.” He also reiterated that DDG does not collect any personal data from users — thereby limiting what could be extracted from AWS via the Act.)

Asked what reception it’s had when asking about getting its search engine on the Safari iOS list, Qwant told us the line that’s been (indirectly) fed back to it is “we are too European according to Apple”. (Apple declined to comment on the search choices it offers iOS users.)

“I have to work a lot to be more American,” Qwant co-founder and CEO Eric Leandri told us, summing up the smoke signals coming out of Cupertino.

“I understand that Apple wants to give the same kind of experience to their customers… but I would say that if I was Apple now, based on the politics that I want to follow — about protecting the privacy of customers — I think it would be great to start thinking about Europe as a market where people have a different point of view on their data,” he continued.

“Apple has done a lot of work to, for example, not let applications give data to each by a very strict [anti-tracking policy]; Apple has done a lot of work to guarantee that cookies and tracking is super difficult on iOS; and now the last problem of Apple is Google search.”

“So I hope that Apple will look at our proposal in a different way — not just one-fits-all. Because we don’t think that one-fits-all today,” he added.

Qwant too, then, is hoping for a better Apple to emerge as a result of a little market adversity.

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