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VOCHI raises additional $2.4 million for its computer vision-powered video editing app

July 22, 2021 No Comments

VOCHI, a Belarus-based startup behind a clever computer vision-based video editing app used by online creators, has raised an additional $ 2.4 million in a “late-seed” round that follows the company’s initial $ 1.5 million round led by Ukraine-based Genesis Investments last year. The new funds follow a period of significant growth for the mobile tool, which is now used by over 500,000 people per month and has achieved a $ 4 million-plus annual run rate in a year’s time.

Investors in the most recent round include TA Ventures, Angelsdeck, A.Partners, Startup Wise Guys, Kolos VC, and angels from other Belarus-based companies like Verv and Bolt. Along with the fundraise, VOCHI is elevating the company’s first employee, Anna Bulgakova, who began as head of marketing, to the position of co-founder and Chief Product Officer.

According to VOCHI co-founder and CEO lya Lesun, the company’s idea was to provide an easy way for people to create professional edits that could help them produce unique and trendy content for social media that could help them stand out and become more popular. To do so, VOCHI leverages a proprietary computer-vision-based video segmentation algorithm that applies various effects to specific moving objects in a video or to images in static photos.

“To get this result, there are two trained [convolutional neural networks] to perform semi-supervised Video Object Segmentation and Instance Segmentation,” explains Lesun, of VOCHI’s technology. “Our team also developed a custom rendering engine for video effects that enables instant application in 4K on mobile devices. And it works perfectly without quality loss,” he adds. It works pretty fast, too — effects are applied in just seconds.

The company used the initial seed funding to invest in marketing and product development, growing its catalog to over 80 unique effects and more than 30 filters.

Image Credits: VOCHI

Today, the app offers a number of tools that let you give a video a particular aesthetic (like a dreamy vibe, artistic feel, or 8-bit look, for example). It can also highlight the moving content with glowing lines, add blurs or motion, apply different filters, insert 3D objects into the video, add glitter or sparkles, and much more.

In addition to editing their content directly, users can swipe through a vertical home feed in the app where they can view the video edits others have applied to their own content for inspiration. When they see something they like, they can then tap a button to use the same effect on their own video. The finished results can then be shared out to other platforms, like Instagram, Snapchat and TikTok.

Though based in Belarus, most of VOCHI’s users are young adults from the U.S. Others hail from Russia, Saudi Arabia, Brazil and parts of Europe, Lesun says.

Unlike some of its video editor rivals, VOCHI offers a robust free experience where around 60% of the effects and filters are available without having to pay, along with other basic editing tools and content. More advanced features, like effect settings, unique presents and various special effects require a subscription. This subscription, however, isn’t cheap — it’s either $ 7.99 per week or $ 39.99 for 12 weeks. This seemingly aims the subscription more at professional content creators rather than a casual user just looking to have fun with their videos from time to time. (A one-time purchase of $ 150 is also available, if you prefer.)

To date, around 20,000 of VOCHI’s 500,000 monthly active users have committed to a paid subscription, and that number is growing at a rate of 20% month-over-month, the company says.

Image Credits: VOCHI

The numbers VOCHI has delivered, however, aren’t as important as what the startup has been through to get there.

The company has been growing its business at a time when a dictatorial regime has been cracking down on opposition, leading to arrests and violence in the country. Last year, employees from U.S.-headquartered enterprise startup PandaDoc were arrested in Minsk by the Belarus police, in an act of state-led retaliation for their protests against President Alexander Lukashenko. In April, Imaguru, the country’s main startup hub, event and co-working space in Minsk — and birthplace of a number of startups, including MSQRD, which was acquired by Facebook — was also shut down by the Lukashenko regime.

Meanwhile, VOCHI was being featured as App of the Day in the App Store across 126 countries worldwide, and growing revenues to around $ 300,000 per month.

“Personal videos take an increasingly important place in our lives and for many has become a method of self-expression. VOCHI helps to follow the path of inspiration, education and provides tools for creativity through video,” said Andrei Avsievich, General Partner at Bulba Ventures, where VOCHI was incubated. “I am happy that users and investors love VOCHI, which is reflected both in the revenue and the oversubscribed round.”

The additional funds will put VOCHI on the path to a Series A as it continues to work to attract more creators, improve user engagement, and add more tools to the app, says Lesun.


Social – TechCrunch


Cowboy Ventures’ Ted Wang: CEO coaching is ‘about having a second set of eyes’

July 22, 2021 No Comments

Earlier this month, Cowboy Ventures’ Ted Wang joined us at TechCrunch Early Stage: Marketing and Fundraising, where he spoke about executive coaching and why he encourages founders in his portfolio to have a CEO coach. Wang, who has an executive coach himself, sees coaching as a key way to drive sustained personal growth, a factor that he believes separates the middling CEOs from the best ones.

Why CEOs need coaching

Just like professional athletes at the top of their game still need coaching, executives can need external validation and comment on where they are and aren’t delivering, Wang says. These insights can be tough for executives to catch on their own and might require a level of honesty that can be challenging for a CEO to expect from anyone involved with their company.

Roger Federer — the famous tennis player who has won 20 Grand Slam events — he has a coach, but he doesn’t just have a coach, he has a coach for tennis. I’m pretty sure Roger knows the rules of the game and all the different strokes he needs to hit, so why would he have a coach? The answer is really that it’s about having a second set of eyes; when you’re in the moment … it’s hard to be able to see yourself and assess yourself. (Timestamp: 4:52)

Coaches can help entrepreneurs reflect and reframe the things being communicated with them.

A good example — you might be at a board meeting and one of your board members is being critical of your VP of marketing, and one way to think of that is “Oh, OK, here are some things we need to solve for this person,” but another point of view that a coach might open your eyes to, is actually maybe this person thinks you’re not hiring the right people. (Timestamp: 8:59)

While advisers can help startups navigate tactical situations, therapists may be more focused on helping clients navigate emotional states and improve themselves. Coaching exists in a very nebulous gray area between startup advisers and licensed therapists, Wang says, but coaching is more focused on improving yourself as a business leader rather than solving a particularly vexing startup issue.

When you’re in the moment … it’s hard to be able to see yourself and assess yourself.


Startups – TechCrunch


How To Combine The Best Amazon PPC & SEO Strategies

July 22, 2021 No Comments

SEO and PPC are the two blocks each website marketing mode should have. If you are dreaming to increase eCommerce sales, combining them is the best technique.

Read more at PPCHero.com
PPC Hero


Samsung will announce new foldables on August 11

July 21, 2021 No Comments

Samsung just sent out invites for its next Unpacked event. There are those companies that like to sneak hints into their invites — and then there’s Samsung. The note leads with the big, bold words “Get ready to unfold” and features a pair of flat-colored objects that can reasonably be said to resemble the form factors of the Galaxy Z Fold and Flip, respectively.

In keeping with…the general state of the world over the past year-and-a-half, the event will be held virtually on Wednesday, August 11. Interestingly, the company is also opening up preorders on its “next flagship,” sights and specs unseen. Perks for early preorders include “12 free months of Samsung Care+, up to an extra $ 200 trade-in credit and a special pre-order offer.”

But honestly, it’s generally best to wait until you actually see the thing and maybe even read a review or two.

There’s a lot to unpack (so to speak) ahead of the event. First, I’m probably not alone in expecting that the company would focus its next big event on the upcoming Galaxy Watch. The big event at MWC was a bit of a dud (not unlike MWC itself), offering up more information on the upcoming wearable partnership with Google, in lieu of announcing any hardware.

As the company noted at the time, “The upcoming One UI Watch will debut at an upcoming Unpacked event later this summer, sporting the new UI, as well as the forthcoming joint Samsung/Google platform.”

It seems reasonably likely that this will be the event where that will occur, even if the new watch doesn’t get top billing. For one thing we’re running out of summer. For another, rumors have the new Galaxy Watch set for a late-August (the 27th) release.

All told, this could well be a pretty huge summer event for the company, bucking last year’s trend of meting out devices one by one at virtual invents. Word on the street is we could be seeing a Galaxy Watch 4, Galaxy Z Fold 3, Galaxy Z Flip 3, Galaxy S21 FE (“Fan Edition” — basically the latest version of the company’s budget flagship) and even the Galaxy Buds Pro, which will more directly take on the AirPods Pro (which are getting a bit long in the tooth).

What’s missing in all of this? No points if you said the Note. Samsung’s well-loved phablet is reportedly not coming this year, as chip shortages continue to plague the industry. That would be a big hit to Samsung’s six-month cycle, though we’ll see how that all plays out soon enough.

The August 11th event kicks off at 10AM ET / 7AM PT.

Mobile – TechCrunch


Pillar VC closes $192M for two funds targeting SaaS, crypto, biotech, manufacturing

July 20, 2021 No Comments

As its name suggests, venture firm Pillar VC is focused on building “pillar” companies in Boston and across the Northeast.

The Boston-based seed-stage firm closed a raise of $ 192 million of capital that was split into two funds, $ 169 million for Pillar III and $ 23 million for Pillar Select. More than 25 investors are backing the new fund, including portfolio founders.

Jamie Goldstein, Sarah Hodges and Russ Wilcox are Pillar VC’s three partners, and all three lead investments for Pillar. The trio all have backgrounds as entrepreneurs: Goldstein, who has spent the past two decades in VC, co-founded speech recognition company PureSpeech, which was acquired by Voice Control Systems; Hodges was at online learning company Pluralsight; and Wilcox was CEO of electronic paper company E Ink, which he sold in 2009.

Pillar typically invests in a range of enterprise and consumer startups and aims to target Pillar III at startups focused on biology, enterprise SaaS, AI/ML, crypto, fintech, hardware, manufacturing and logistics. The firm will make pre-seed investments of $ 50,000 to $ 500,000 and seed-round investments of $ 2 million to $ 6 million.

One of the unique aspects of the firm is that it will buy common stock so that it will be aligned with founders and take on the same risks, Goldstein told TechCrunch.

The firm, founded in 2016, already has 50 portfolio companies from its first two funds — Pillar I, which raised $ 57 million, and Pillar $ 100 million. These include cryptocurrency company Circle, which announced a SPAC earlier this month, 3D printing company Desktop Metal that went public, also via SPAC, last year, and PillPack, which was bought by Amazon in 2018.

“Pillar is an experiment, answering the question of ‘what would happen if unicorn CEOs came in and helped bootstrap the next generation’,” Wilcox said. “The experience is working, and Pillar does what VCs ought to do, which is back first-of-its-kind ideas.”

In addition to leading investments, Hodges leads the Pillar VC platform for the firm’s portfolio companies. Many of the portfolio companies are spinouts from universities, and need help turning that technology into a company. Pillar provides guidance to recruit a CEO or partner on the business side, leadership development, recruit talent and makes introductions to potential customers.

Pillar also intends to invest a third of the new fund into that biology category, specifically looking at the convergence of life science and technology, Wilcox said.

In its second fund, the firm started Petri, a pre-seed bio accelerator focused on biotech, and brought in founders using computation and engineering to develop technologies around the areas of agriculture, genetics, cell and gene therapies, medical data and drug discovery. The third fund will continue to support the accelerator through both pre-seed and seed investments.

The first investments from Pillar III are being finalized, but Hodges expects to infuse capital into another 50 companies.

“We are super bullish on Boston,” she added. “So many companies here are growing to be household names, and an exciting energy is coming out.”

 


Enterprise – TechCrunch


Testing the Power of the YouTube Lead Form Extension

July 20, 2021 No Comments

YouTube remains a strong platform and the lead form extensions make it all the more accessible. These are the exciting results of my recent lead form test.

Read more at PPCHero.com
PPC Hero


Nothing founder Carl Pei on Ear (1) and building a hardware startup from scratch

July 19, 2021 No Comments

On July 27, hardware maker Nothing will debut its first product, wireless earbuds dubbed Ear (1). Despite releasing almost no tangible information about the product, the company has managed to generate substantial buzz around the launch — especially for an entry into the already-crowded wireless earbud market.

The hype, however, is real — and somewhat understandable. Nothing founder Carl Pei has a good track record in the industry — he was just 24 when he co-founded OnePlus in 2013. The company has done a canny job capitalizing on heightened expectations, meting out information about the product like pieces in a puzzle.

We spoke to Pei ahead of the upcoming launch to get some insight into Ear (1) and the story behind Nothing.

TC: I know there was a timing delay with the launch. Was that related to COVID-19 and supply chain issues?

CP: Actually, it was due to our design. Maybe you’ve seen the concept image of this transparent design. It turns out there’s a reason why there aren’t many transparent consumer tech products out there. It’s really, really hard to make it high quality. You need to ensure that everything inside looks just as good as the outside. So that’s where the team has been iterating, [but] you probably wouldn’t notice the differences between each iteration.

It could be getting the right magnets — as magnets are usually designed to go inside of a product and not be seen by the consumer — to figuring out the best type of gluing. You never have to solve that problem if you have a non-transparent product, but what kind of glue will keep the industrial design intact? I think the main issue has been getting the design ready. And we’re super, super close. Hopefully, it will be a product that people are really excited about when we launch.

So, there were no major supply chain issues?

Not for this product category. With true wireless earbuds, I think we’re pretty fine. No major issues. I mean, we had the issue that we started from zero — so no team and no partners. But step by step, we finally got here.

That seems to imply that you’re at least thinking ahead toward the other products. Have you already started developing them?

We have a lot of products in the pipeline. Earlier this year, we did a community crowdfunding round where we allocated $ 1.5 million to our community. That got bought up really quickly. But as part of that funding round, we had a deck with some of the products in development. Our products are code-named as Pokémon, so there are a lot of Pokémon on that slide [Ed note: The Ear (1) was “Aipom.”]. We have multiple categories that we’re looking at, but we haven’t really announced what those are.

Why were earbuds the right first step?

I think this market is really screaming for differentiation. If you look at true wireless today, I think after Apple came out with the AirPods, the entire market kind of followed. Everybody wears different clothes. This is something we wear for a large part of the day. Why wouldn’t people want different designs?

We’re working with Teenage Engineering — they’re super, super strong designers. I think true wireless is a place where we can really leverage that strength. Also, from a more rational business perspective, wireless earbuds is a super-fast-growing product category. I think we’re going to reach 300 million units shipped worldwide this year for this category. And your first product category should be one with good business potential.

“Screaming for differentiation” is an interesting way to put it. When you look at AirPods and the rest of the industry, are aesthetics what the market primarily lacks? Is it features or is it purely stylistic?

If we take a take a step back and think about it from a consumer perspective, we feel like, as a whole, consumer tech is quite, quite boring. Kids used to want to become engineers and astronauts and all that. But if you look at what kids want to become today, they want to be TikTokers or YouTubers. Maybe it’s because technology isn’t as inspiring as before. We talked to consumers, and they don’t care as much as a couple of years ago either. If you look at what what brands are doing in their communication, it’s all about features and specs.

Gadgets – TechCrunch


Ireland must ‘swiftly’ investigate legality of Facebook-WhatsApp data sharing, says EDPB

July 17, 2021 No Comments

Facebook’s lead regulator in the European Union must “swiftly” investigate the legality of data sharing related to a controversial WhatsApp policy update, following an order by the European Data Protection Board (EDPB).

We’ve reached out to the Irish Data Protection Commission (DPC) for a response. (Update: See below for their statement.)

Updated terms had been set to be imposed upon users of the Facebook-owned messaging app early this year — but in January Facebook delayed the WhatsApp terms update until May after a major privacy backlash and ongoing confusion over the details of its user data processing.

Despite WhatsApp going ahead with the policy update, the ToS has continued to face scrutiny from regulators and rights organizations around the world.

The Indian government, for example, has repeatedly ordered Facebook to withdraw the new terms. While, in Europe, privacy regulators and consumer protection organizations have raised objections about how opaque terms are being pushed on users — and in May a German data protection authority issued a temporary (national) blocking order.

Today’s development follows that and is significant as it’s the first urgent binding decision adopted by the EDPB under the bloc’s General Data Protection Regulation (GDPR).

Although the Board has not agreed to order the adoption of final measures against Facebook-WhatsApp as the requesting data supervisor, the Hamburg DPA, had asked — saying that “conditions to demonstrate the existence of an infringement and an urgency are not met”.

The Board’s intervention in the confusing mess around the WhatsApp policy update follows the use of GDPR Article 66 powers by Hamburg’s data protection authority.

In May the latter ordered Facebook not to apply the new terms to users in Germany — saying its analysis found the policy granted “far-reaching powers” to WhatsApp to share data with Facebook, without it being clear what legal basis the tech giant was relying upon to be able to process users’ data.

Hamburg also accused the Irish DPC of failing to investigate the Facebook-WhatsApp data sharing when it raised concerns — hence seeking to take matters into its own hands by making an Article 66 intervention.

As part of the process it asked the EDPB to take a binding decision — asking it to take definitive steps to block data-sharing between WhatsApp and Facebook — in a bid to circumvent the Irish regulator’s glacial procedures by getting the Board to order enforcement measures that could be applied stat across the whole bloc.

However, the Board’s assessment found that Hamburg had not met the bar for demonstrating the Irish DPC “failed to provide information in the context of a formal request for mutual assistance under Article 61 GDPR”, as it puts it.

It also decided that the adoption of updated terms by WhatsApp — which it nonetheless says “contain similar problematic elements as the previous version” — cannot “on its own” justify the urgency for the EDPB to order the lead supervisor to adopt final measures under Article 66(2) GDPR.

The upshot — as the Hamburg DPA puts it — is that data exchange between WhatsApp and Facebook remains “unregulated at the European level”.

Article 66 powers

The importance of Article 66 of the GDPR is that it allows EU data protection authorities to derogate from the regulation’s one-stop-shop mechanism — which otherwise funnels cross border complaints (such as those against Big Tech) via a lead data supervisor (oftentimes the Irish DPC), and is thus widely seen as a bottleneck to effective enforcement of data protection (especially against tech giants).

An Article 66 urgency proceeding allows any data supervisor across the EU to immediately adopt provisional measures — provided a situation meets the criteria for this kind of emergency intervention. Which is one way to get around a bottleneck, even if only for a time-limited period.

A number of EU data protection authorities have used (or threatened to use) Article 66 powers in recent years, since GDPR came into application in 2018, and the power is increasingly proving its worth in reconfiguring certain Big Tech practices — with, for example, Italy’s DPA using it recently to force TikTok to remove hundreds of thousands of suspected underage accounts.

Just the threat of Article 66’s use back in 2019 (also by Hamburg) was enough to encourage Google to suspend manual reviews of audio reviews of recordings captured by its voice AI, Google Assistant. (And later led to a number of major policy changes by several tech giants who had similarly been manually reviewing users’ interactions with their voice AIs.)

At the same time, Article 66 provisional measures can only last three months — and only apply nationally, not across the whole EU. So it’s a bounded power. (Perhaps especially in this WhatsApp-Facebook case, where the target is a ToS update, and Facebook could just wait out the three months and apply the policy anyway in Germany after the suspension order lapses.)

This is why Hamburg wanted the EDPB to make a binding decision. And it’s certainly a blow to privacy watchers eager for GDPR enforcement to fall on tech giants like Facebook that the Board has declined to do so in this case.

Unregulated data sharing

Responding to the Board’s decision not to impose definitive measures to prevent data sharing between WhatsApp and Facebook, the Hamburg authority expressed disappointment — see below for its full statement — and also lamented that the EDPB has not set a deadline for the Irish DPC to conduct the investigation into the legal basis of the data sharing.

Ireland’s data protection authority has only issued one final GDPR decision against a tech giant to date (Twitter) — so there is plenty of cause to be concerned that without a concrete deadline the ordered probe could be kicked down the road for years.

Nonetheless, the EDPB’s order to the Irish DPC to “swiftly” investigate the finer-grained detail of the Facebook-WhatsApp data sharing does look like a significant intervention by a pan-EU body — as it very publicly pokes a regulator with a now infamous reputation for reluctance to actually do the job of rigorously investigating privacy concerns. 

Demonstrably it has failed to do so in this WhatsApp case. Despite major concerns being raised about the policy update — within Europe and globally — Facebook’s lead EU data supervisor did not open a formal investigation and has not raised any public objections to the update.

Back in January when we asked about concerns over the update, the DPC told TechCrunch it had obtained a “confirmation” from Facebook-owned WhatsApp that there was no change to data-sharing practices that would affect EU users — reiterating Facebook’s line that the update didn’t change anything, ergo “nothing to see here”. 

“The updates made by WhatsApp last week are about providing clearer, more detailed information to users on how and why they use data. WhatsApp have confirmed to us that there is no change to data-sharing practices either in the European Region or the rest of the world arising from these updates,” the DPC told us then, although it also noted that it had received “numerous queries” from stakeholders who it described as “confused and concerned about these updates”, mirroring Facebook’s own characterization of complaints.

“We engaged with WhatsApp on the matter and they confirmed to us that they will delay the date by which people will be asked to review and accept the terms from February 8th to May 15th,” the DPC went on, referring to a pause in the ToS application deadline which Facebook enacted after a public backlash that saw scores of users signing up to alternative messaging apps, before adding: “In the meantime, WhatsApp will launch information campaigns to provide further clarity about how privacy and security works on the platform. We will continue to engage with WhatsApp on these updates.”

The EDPB’s assessment of the knotty WhatsApp-Facebook data-sharing terms looks rather different — with the Board calling out WhatsApp’s user communications as confusing and simultaneously raising concerns about the legal basis for the data exchange.

In a press release, the EDPB writes that there’s a “high likelihood of infringements” — highlighting purposes contained in the updated ToS in the areas of “safety, security and integrity of WhatsApp IE [Ireland] and the other Facebook Companies, as well as for the purpose of improvement of the products of the Facebook Companies” as being of particular concern.

From the Board’s PR [emphasis its]:

Considering the high likelihood of infringements in particular for the purpose of safety, security and integrity of WhatsApp IE [Ireland] and the other Facebook Companies, as well as for the purpose of improvement of the products of the Facebook Companies, the EDPB considered that this matter requires swift further investigations. In particular to verify if, in practice, Facebook Companies are carrying out processing operations which imply the combination or comparison of WhatsApp IE’s [Ireland] user data with other data sets processed by other Facebook Companies in the context of other apps or services offered by the Facebook Companies, facilitated inter alia by the use of unique identifiers. For this reason, the EDPB requests the IE SA [Irish supervisory authority] to carry out, as a matter of priority, a statutory investigation to determine whether such processing activities are taking place or not, and if this is the case, whether they have a proper legal basis under Article 5(1)(a) and Article 6(1) GDPR.

NB: It’s worth recalling that WhatsApp users were initially told they must accept the updated policy or else the app would stop working. (Although Facebook later changed its approach — after the public backlash.) While WhatsApp users who still haven’t accepted the terms continue to be nagged to do so via regular pop-ups, although the tech giant does not appear to be taking steps to degrade the user experience further as yet (i.e. beyond annoying, recurring pop-ups).

The EDPB’s concerns over the WhatsApp-Facebook data sharing extend to what it says is “a lack of information around how data is processed for marketing purposes, cooperation with the other Facebook Companies and in relation to WhatsApp Business API” — hence its order to Ireland to fully investigate.

The Board also essentially confirms the view that WhatsApp users themselves have no hope of understanding what Facebook is doing with their data by reading the comms material it has provided them with — with the Board writing [emphasis ours]:

Based on the evidence provided, the EDPB concluded that there is a high likelihood that Facebook IE [Ireland] already processes WhatsApp IE [Ireland] user data as a (joint) controller for the common purpose of safety, security and integrity of WhatsApp IE [Ireland] and the other Facebook Companies, and for the common purpose of improvement of the products of the Facebook Companies. However, in the face of the various contradictions, ambiguities and uncertainties noted in WhatsApp’s user-facing information, some written commitments adopted by Facebook IE [Ireland] and WhatsApp IE’s [Ireland] written submissions, the EDPB concluded that it is not in a position to determine with certainty which processing operations are actually being carried out and in which capacity.

We contacted Facebook for a response to the EDPB’s order, and the company sent us this statement — attributed to a WhatsApp spokesperson:

We welcome the EDPB’s decision not to extend the Hamburg DPA’s order, which was based on fundamental misunderstandings as to the purpose and effect of the update to our terms of service. We remain fully committed to delivering secure and private communications for everyone and will work with the Irish Data Protection Commission as our lead regulator in the region in order to fully address the questions raised by the EDPB.

Facebook also claimed it has controls in place for “controller to processor data sharing” (i.e. between WhatsApp and Facebook) — which it said prohibit it (Facebook) from using WhatsApp user data for its own purposes.

The tech giant went on to reiterate its line that the update does not expand WhatsApp’s ability to share data with Facebook.

GDPR enforcement stalemate

A further vital component to this saga is the fact the Irish DPC has, for years, been investigating long-standing complaints against WhatsApp’s compliance with GDPR’s transparency requirements — and still hasn’t issued a final decision.

So when the EDPB says it’s highly likely that some of the WhatsApp-Facebook data-processing being objected to is already going on it doesn’t mean Facebook gets a pass for that — because the DPC hasn’t issued a verdict on whether or not WhatsApp has been up front enough with users.

tl;dr: The regulatory oversight process is still ongoing.

The DPC provisionally concluded its WhatsApp transparency investigation last year — saying in January that it sent a draft decision to the other EU data protection authorities for review (and the chance to object) on December 24, 2020; a step that’s required under the GDPR’s co-decision-making process.

In January, when it said it was still waiting to receive comments on the draft decision, it also said: “When the process is completed and a final decision issues, it will make clear the standard of transparency to which WhatsApp is expected to adhere as articulated by EU Data Protection Authorities.”

Over a half a year later and WhatsApp users in the EU are still waiting to find out whether the company’s comms lives up to the required legal standard of transparency or not — with their data continuing to pass between Facebook and WhatsApp in the meanwhile.

The Irish DPC was contacted for comment on the EDPB’s order today and with questions on the current status of the WhatsApp transparency investigation.

It told us it would have a response later today — we’ll update this report when we get it.

Update: The DPC’s deputy commissioner Graham Doyle said [emphasis his]:

This Article 66 procedure was about whether the EDPB on request from Hamburg would take final measures confirming the provisional measures applied by the Hamburg SA against Facebook. The EDPB decision decided not to take measures as insufficient evidence to ground such measures was presented by the Hamburg SA.

Measures, had they been decided by the Board, would not in any case be measures that would be adopted by the Irish DPC. They would be measures adopted by the EDPB. This is a decision of the Board based on a request from Hamburg SA under a provision that is a derogation to the cooperation and consistency mechanism.

The DPC, of course, has already carried out an in-depth inquiry into WhatsApp’s privacy policy user facing material in the context of its transparency inquiry. That inquiry reached the Article 60 (co-decision making) stage in December 2020 and is now progressing through the dispute resolution procedure. The Hamburg SA has been actively involved in the decision-making process since December 2020 and the dispute resolution process (which commenced in June) is an EDPB-led initiative, involving all other supervisory authorities.

The DPC notes the request of the Board and will give consideration to any appropriate regulatory follow-up where it identifies matters canvassed in the EDPB decision have not already been addressed in the Article 60 draft decision transmitted by the DPC (and now currently with the Board under Article 65).

The DPC also has a separate, complaint-based inquiry ongoing that considers the legal basis that WhatsApp relies upon for processing. That inquiry is also at an advanced stage.

Back in November the Irish Times reported that WhatsApp Ireland had set aside €77.5 million for “possible administrative fines arising from regulatory compliance matters presently under investigation”. No fines against Facebook have yet been forthcoming, though.

Indeed, the DPC has yet to issue a single final GDPR decision against Facebook (or a Facebook-owned company) — despite more than three years having passed since the regulation started being applied.

Scores of GDPR complaints against the Facebook’s data-processing empire — such as this May 2018 complaint against Facebook, Instagram and WhatsApp’s use of so-called “forced consent” — continue to languish without regulatory enforcement in the EU because there’s been no decisions from Ireland (and sometimes no investigations either).

The situation is a huge black mark against the EU’s flagship data protection regulation. So the Board’s failure to step in more firmly now — to course-correct — does look like a missed opportunity to tackle a problematic GDPR enforcement bottleneck.

That said, any failure to follow the procedural letter of the law could invite a legal challenge that unpicked any progress. So it’s hard to see any quick wins in the glacial game of GDPR enforcement.

In the meanwhile, the winners of the stalemate are of course the tech giants who get to continue processing people’s data how they choose, with plenty of time to work on reconfiguring their legal, business and system structures to route around any enforcement damage that does eventually come.

Hamburg’s deputy commissioner for data protection, Ulrich Kühn, essentially warns as much in a statement responding to the EDPB’s decision in a statement — in which he writes:

The decision of the European Data Protection Board is disappointing. The body, which was created to ensure the uniform application of the GDPR throughout the European Union, is missing the opportunity to clearly stand up for the protection of the rights and freedoms of millions of data subjects in Europe. It continues to leave this solely to the Irish supervisory authority. Despite our repeated requests over more than two years to investigate and, if necessary, sanction the matter of data exchanges between WhatsApp and Facebook, the IDPC has not taken action in this regard. It is a success of our efforts over many years that IDPC is now being urged to conduct an investigation. Nonetheless, this non-binding measure does not do justice to the importance of the issue. It is hard to imagine a case in which, against the background of the risks for the rights and freedoms of a very large number of data subjects and their de facto powerlessness vis-à-vis monopoly-like providers, the urgent need for concrete action is more obvious. The EDPB is thus depriving itself of a crucial instrument for enforcing the GDPR throughout Europe. This is no good news for data subjects and data protection in Europe as a whole.

In further remarks the Hamburg authority emphasizes that the Board noted “considerable inconsistencies between the information with which WhatsApp users are informed about the extensive use of their data by Facebook on the one hand, and on the other the commitments made by the company to data protection authorities not (yet) to do so”; and also that it “expressed considerable doubts about the legal basis on which Facebook intends to rely when using WhatsApp data for its own or joint processing” — arguing that the Board therefore agrees with the “essential parts” of its arguments against WhatsApp-Facebook data sharing.

Despite carrying that weight of argument, the call for action is once again back in Ireland’s court.

 


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Are Humans the Meanest Species in the Universe?

July 17, 2021 No Comments

Melinda Snodgrass’ novel The High Ground examines human cruelty in an alien first-contact scenario.
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ServiceMax promises accelerating growth as key to $1.4B SPAC deal

July 17, 2021 No Comments

ServiceMax, a company that builds software for the field-service industry, announced yesterday that it will go public via a special purpose acquisition company, or SPAC, in a deal valued at $ 1.4 billion. The transaction comes after ServiceMax was sold to GE for $ 915 million in 2016, before being spun out in late 2018. The company most recently raised $ 80 million from Salesforce Ventures, a key partner.

Broadly, ServiceMax’s business has a history of modest growth and cash consumption.

ServiceMax competes in the growing field-service industry primarily with ServiceNow, and interestingly enough given Salesforce Ventures’ recent investment, Salesforce Service Cloud. Other large enterprise vendors like Microsoft, SAP and Oracle also have similar products. The market looks at helping digitize traditional field service, but also touches on in-house service like IT and HR giving it a broader market in which to play.

GE originally bought the company as part of a growing industrial Internet of Things (IoT) strategy at the time, hoping to have a software service that could work hand in glove with the automated machine maintenance it was looking to implement. When that strategy failed to materialize, the company spun out ServiceMax and until now it remained part of Silver Lake Partners thanks to a deal that was finalized in 2019.

TechCrunch was curious why that was the case, so we dug into the company’s investor presentation for more hints about its financial performance. Broadly, ServiceMax’s business has a history of modest growth and cash consumption. It promises a big change to that storyline, though. Here’s how.

A look at the data

The company’s pitch to investors is that with new capital it can accelerate its growth rate and begin to generate free cash flow. To get there, the company will pursue organic (in-house) and inorganic (acquisition-based) growth. The company’s blank-check combination will provide what the company described as “$ 335 million of gross proceeds,” a hefty sum for the company compared to its most recent funding round.


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