Wiser! #72: Elon Musk dominates headlines yet again over Twitter. He's only gone and became the largest independant shareholder, joined the board and broken the SEC's rules in the process. Plus: Facebook's algorithms go astray and they didn't know why. The UK wants to be a crypto hub.
w/Issue #72 - 8th April 2022
This week I'm making sense of the news about Elon buying into Twitter, Facebook's algorithms out of control, and the UK's plans to be a global crypto hub. Plus lots of other stuff.
Meanwhile, at Wiser! HQ, there's a lot going on.
First, the podcast is coming! This week my podcast buddy and I made a pilot show. He's an experienced Podcaster and I'm not. It was a trial run, and, let's just say, I'm itching to start. BTW, if you have any ideas on a name, let me have them, we're still deciding.
Second, the "Wiser! on Linkedin" version of the newsletter is now up and running. It took LinkedIn's engineers a year (I kid you not) to figure out why the system wasn't giving me the option (kinda related to the Facebook story that you're about to read). Anyhow, the key is that it's up and running and subscriber numbers are over 6,000 already.
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Musk Becomes Largest Individual Shareholder In Twitter
Back Story: The only thing that you can be certain of is that this is going to be a crazy ride!
Elon Musk is considered to be the world's richest man, thanks to his enormous, and arguably overinflated shareholdings in Tesla, SpaceX and The Boring Company.
This week, he added another $1 billion to his paper wealth after it was made public that he'd spent around $2.4 billion on a big stake in Twitter. Musk now owns around 9% of the company.
As the news broke, Twitter's share price popped and Elon profited (again), thanks to Twitter. Remember, Elon has a history of tweeting to influence the market. Something that has gotten him into hot water with the SEC before, and is likely to do so again.
$13 billion of Twitter stock exchanged hands on Monday. The highest daily volume ever for the underperforming social media platform.
Is this about free speech? Probably.
Is he in trouble with the SEC? Yes, almost certainly.
What is Elon likely to do with Twitter? Quite a bit.
Is Musk the kick-start that Twitter needs? That's the $2.4 billion question. It's going to be fun finding out!
I've written an 8-minute Wiser! Insights article about it here. Now that I've taken down the paywalls, this is free to read and not just for Premium Members. Remember to post your comments at the bottom of the page.
Facebook Knew It Was Promoting Fake News, But Couldn't Stop It
Back Story: Facebook has revealed that they spotted a fault in their algorithms last October. The AI that decides what posts go into a user's News Feed was doing the opposite of what was intended. The feature, called down-ranking, was meant to suppress the posts of known misinformed.
Instead, according to Facebook engineers, it was boosting them by up to 30%!
Worse, it took the Facebook engineers 6 months to work out why the artificial intelligence was going wrong before they could fix it.
So What?: Here's why this story is important. Facebook's algorithms control everything you see. But you don't know how those algorithms make those decisions, do you?
Talk to most Facebook users and they'll say things like, "Facebook doesn't influence me", or "I can spot fake news a mile off", or "I only look at posts from genuine people". Or any variation of the theme.
The point is that they're mistaken.
According to the latest data from Ofcom, "1 in 3 Internet users fail to question misinformation."
Tests reveal that both adults and children "overestimate their ability" to spot fake news.
Although around 7 in 10 adults believe they can't be fooled by fake news, when put to the test, only 2 in 10 were able to spot the tell-tale signs of misinformation.
Similarly, around a quarter of all users who said they could not be fooled were unable to identify fake profiles when presented with them.
Here's the thing: Putting to one side a user's (in)ability to smell a fake post from 30 paces, most users think that they are deciding what to read and what to ignore. But they can only do that based on what is put before them. Users don't decide what goes into their News Feed, Facebook's AI does.
And it's the Facebook algorithms that decide what is put before them.
This is why this story about Facebook taking 6 months to work out how to stop its own algorithms from doing what they were not supposed to be doing, is important.
The long version of this story can be found here...👇👇
Do You Know What Are The Top Performing Posts on Facebook?
Back Story: There's a Twitter account that publishes a daily list of the top 10 performing posts on Facebook in the US.
It highlights that strong political bias, on both sides of the political fence, dominates the top 10 posts appearing in News Feeds.
Take Ben Shapiro, a right-wing commentator with some pretty distasteful points of view (IMHO). You'll see Ben Shapiro appears regularly in the top 10.
Here's the thing about Ben. He runs a small team that takes credible news stories and just rewrites the headline. He reposts the story, with full attribution to the original article but, with an enraging, and mostly biased headline.
Neutral stories are converted to fit a right-wing narrative simply by changing the headline (which is what everyone remembers from the News Feed, even if they don't read the article).
As a result, Shapiro's posts draw far more attention and advertising money to Shapiro's page than to the original source of the story.
Ben Shapiro is one of the most widely shared "news sources" on Facebook. Meanwhile, the original journalists and newspapers that wrote the original story get a fraction of the traction or ad revenues. Even though it's exactly the same story.
UK Wants To Be A Global Crypto Hub
Back Story: The UK Gov has announced plans to "become a global hub for digital assets". The government is now looking at “regulating a broader set of crypto activities including the trading of tokens like bitcoin."
The plans include;
- updated laws on payments to include stablecoins,
- Royal Mint to create an NFT as an “emblem of the forward-looking approach the UK is determined to take” (whatever that means),
- using crypto technology to issue UK government debt.
Following the lead from the USA and the European Union, the UK has joined the party when it comes to "thinking" about crypto regulations. It's a necessary next step for a market that now has over 300 million crypto owners and a market cap of around $2 trillion (which is the size of the Italian or Brazilian economies).
So What? It's about time.
This is reminiscent of the early days of the internet when there was a lot of promise of a better future, a small but growing user base and no rules of engagement. This applies as much to crypto now as it did to the internet in the early years.
In the 1990s the Internet was primarily about e-commerce. The likes of Amazon, LastMinute.com and eBay started trading online. This created new legal and regulatory issues that nobody fully understood.
It was also a time when there were lots of naysayers. It’s hard to imagine now, but there were many who said it would never take off. Or should be stopped altogether (mainly because they feared the competitive threat that came from Internet-based services).
I don't see it as much different today. Like deja vue all over again when it comes to crypto and digital currencies.
Bruce R. Burningham wrote in a letter to the editor published in the January 14, 1996 issue of The New York Times.
Meta Facebook Try Again At A Digital Currency
Back Story: The Financial Times reports that MetaFacebook is looking (again) at a digital currency.
Unlike the now cancelled Diem project, the currency is rumoured to be a centralised token, more akin to the in-app tokens used on platforms like Roblox.
Meanwhile, Meta's plans for NFTs on Facebook and Instagram are moving forward, according to the scoop in the FT. Facebook is expected to start testing ads and fees for NFTs from next month as they introduce features to let users create, showcase and sell NFTs
So What? The Zuck has always wanted a money system for the Facebook economy. He sees the enormous potential of enabling users to buy and sell inside the network.
Remember Facebook Credits (probably not, that was in 2009). Well, that's how long Zuckerberg has been trying to get a virtual money system going in Facebook!
The point is that "owning money" is key to Facebook's future ability to "make money".
With the prospect of declining ad revenues (thanks Apple), declining user numbers (thanks TikTok) and increasing regulatory headwinds (it's about time), the Zuck is pushing hard on the pivot to the Metaverse.
Which is where a digital money system comes into play. Having an in-house digital currency is critical to the Meta strategy to build a virtual ecosystem that combines social, commerce and entertainment.
Third-Party Apps Are More Popular Than Apple's Own Apps
A new report, financially supported by Apple, reports that users are turning to non-Apple apps on their Apple devices. For example, the researchers found that Spotify is used 50% more than Apple Music with iPhone users. Cynically, it looks like an attempt by Apple to show the anti-trust regulators that they are facing competition. It's not likely to cut it. Source: The Information
Russians are using their phones very differently than they did before the war
With 504 news sites, 140 financial sites, and three social media sites blocked by the Russian government since the invasion of Ukraine began, Russians are resorting to virtual private networks (VPNs) to disguise their location and connect to the public internet. Source: Morning Brew
Bitcoin to be accepted by McDonald’s and Walmart
This is because of a thing called the Lightning Network. It's is a layer two solution for the Bitcoin blockchain that uses smart contracts to settle payments instantly with near-zero fees. In other words, it enables people to use Bitcoin as a digital currency, not just as digital gold. In theory, the Lightning Network lets Bitcoin scale and compete with every other currency on the planet. Source: CryptoSlate
Uber Wants To Turn Itself Into A SuperApp
Uber plans to emulate China's "superapps". Uber already has the pieces in play. They have a global brand, a ubiquitous app and, most importantly, a payments engine. This is the key, payments. The unlocking of WeChat from a messaging app to a superapp came when China deregulated financial services and let the equivalent of Facebook and Amazon have banking licences. Expect to see Uber add train, bus and plane tickets, car rentals and hotels to the Uber app. Source: CNBC
Spain to Invest in Chipmaking
As part of a strategic overhaul of the Spanish economy (into a digital one), President Sanchez has announced an ambitious €11 billion investment to develop a national microchip and semi-conductor capability. Source: Bloomberg
Almost Half of All Crypto Owners Bought for the 1st Time in 2021
A survey by Crypto exchange Gemini reported that Brazil and Indonesia lead the world in global crypto adoption. 41% of people surveyed in those countries reported owning crypto, compared with 20% in the United States and 18% in the United Kingdom. They also found that 79% of people who owned crypto chose to purchase the digital assets for their long-term investment potential. Source: Reuters
Did You Know? Microsoft and its browser archrival Netscape share the same birthday? Microsoft was formed on April 4, 1975, while Netscape was founded April 4, 1994.
Create AI Art For Fun
Here's a bit of fun to waste some time. Create your own digital art using AI. Tell the AI what you want, pick the style of artwork and hit go. Within seconds, an AI algorithm will have generated a unique piece of "art". To be frank, every pic it did for me was rubbish, but it was amusing until the novelty wore off. Source: Wombo
Global Market Size for AR/VR/Mixed Reality
7 billion voice messages are sent every day on WhatsApp
That's 1 voicemail a day for 7 out of every 8 people on the planet. Source: WhatsApp
A third of parents of 5-7-year-olds said they have a social media profile
For 8-11-year-olds this is as high as 60%. Interesting when I remind you that the minimum age requirement for most social media sites is 13! Source: Ofcom
Apple now has 1.8 billion active devices
And Google has over 3 billion active devices on Android. Source: The Verge
Amazon is the biggest clothing retailer in the US
Having overtaken Walmart in 2020, Amazon’s sales represent 11-12% of the total US market and around 35% of all online sales. Well Fargo estimate that Amazon’s sales will grow another $4 billion this year to top $45 billion. Source: Retail Week
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