Mubi launches streaming service in India

Mubi, a 12-year-old on-demand movie streaming and rental service, has arrived in India. Like other streaming services giants such as Netflix, Amazon Prime Video, Apple TV+ and Disney’s Hotstar, Mubi is offering its service at a slightly lower price in the key overseas entertainment market.

The London-headquartered firm is offering a three-month subscription in India at Rs 199 ($2.8), after which it would charge $7 a month or $67 a year (this way, the monthly cost works out to about $5.5). This is substantially lower than the £9.99 monthly subscription fee it charges to subscribers in the U.K., and the $10.99 it charges in the U.S.

Perhaps the lesser-known streaming service among all the usual names, Mubi has earned a name for itself by offering a selection of critically acclaimed movies. Unlike other services, Mubi’s catalog is incredibly thin. At any moment, the service offers only 30 recent and vintage movies. One new title arrives every day and another vanishes at the same time. No movie stays longer than 30 days on the platform.

Mubi, founded in 2007, started with the ambition of becoming just like what Netflix is today. But it became apparent to the company that they couldn’t afford to offer thousands of titles to users, founder and chief executive of the company Efe Cakarel told The New York Times in an interview two years ago.

“In the beginning, we wanted to be like Netflix, but the unit economies of an ‘all-you-can-eat’ site is very capital-intensive,” Cakarel told the Times. “The question becomes, how do you create a compelling experience? If you can’t get 10,000 titles, how about a limited selection?”

Mubi has amassed 9 million subscribers, the company said. (Cakarel will be speaking at Disrupt Berlin next month.)

In an interview last month, Cakarel said most streaming platforms are today focused on the biggest TV series. “But Mubi focuses on finding gems, often going back decades, that very few people know of. We are giving distribution to such films. You may not like a film, but it is there for a reason,” he said.

In India, Mubi has additionally launched a dedicated channel (first time it has done so for any market), where local movies are being showcased. (Customers in India have access to the global feed as well.) Additionally, like in other markets, Mubi is offering a rental service to subscribers in India, allowing them to pick any movie from a selection of a few dozen for $3.5.

For its India business, the company has appointed film producer and Academy Award winner Guneet Monga (known for titles such as Gangs of Wasseypur, The Lunchbox and Masaan) as its content advisor. It also maintains a partnership with Times Bridge, the venture arm of Indian internet services and content conglomerate Times Internet.

“Monga has the sensibility for great cinema. The kind of films she produces, the kind of films she champions are the type of films more people should see. I cannot be more fortunate that she sees our vision in India,” Cakarel said in an interview.

In a statement, Monga said, “I’m thrilled we have launched a dedicated channel for Indian cinema as it means that film lovers can now watch amazing films like Salaam Bombay and Andaz Apna Apna, alongside globally renowned gems like Moonlight.”

The company has secured deals with local distributors FilmKaravan, NFDC, PVR Pictures, Shemaroo, and Ultra to populate titles on India section every day. Some of the upcoming titles include Kamal Swaroop’s cult film Om Dar-B-Dar, Kanu Behl’s Binnu Ka Sapna, which premiered at Clermont-Ferrand International Short Film Festival this year, and ghost film Duvidha from Indian art-house master Mani Kaul.

Mubi Go, a service available in the U.K. and Ireland, which allows subscribers in those markets to get a movie ticket each week in a local theatre, is not available to customers in India.

This ride-hailing PR pitch shows platforms and digital campaign ‘dark arts’ want democracy to be pay to play

A UK PR firm pitching to run an account for Ola has proposed running a campaign to politicize ride-hailing as a tactic to shift regulations in its favor.

The approach suggests that, despite the appearance of ride-hailing platforms taking a more conciliatory position with regulators that are now wise to earlier startup tactics in this space, there remains a calculus involving realpolitik, propaganda and high-level lobbying between companies that want to enter or expand in markets, and those who hold the golden tickets to do so.

In 2017 Estonia-based ride-hailing startup Taxify tried to launch in London ahead of regulatory approval, for example, but city authorities clamped down straight away. It was only able to return to the UK capital 21 months later (now known as Bolt).

In Western markets ride-hailing companies are facing old and new regulatory roadblocks that are driving up costs and creating barriers to growth. In some instances unfavorable rule changes have even led companies to pull out of cities or regions all together. Even as there are ongoing questions around the employment classification of the drivers these platforms depend on to deliver a service.

The PR pitch, made by a Tufton Street-based PR firm called Public First, suggests Ola tackle legislative friction in UK regions with a policy influence campaign targeted at local voters.

The SoftBank-backed Indian ride-hailing startup launched in the U.K. in August, 2018 and currently offers services in a handful of regional locations including South Wales, Merseyside and the West Midlands. Most recently it gained a licence to operate in London, and last month launched services in Coventry and Warwick — saying then that passengers in the UK had clocked up more than one million trips since its launch.

Manchester is also on its target list — and features as a focus in the strategy proposal — though an Ola spokesman told us it has no launch date for the city yet. The company met with Manchester’s mayor, Andy Burnham, during a trade mission to India last month.

The Public First proposal suggests a range of strategies for Ola to get local authorities and local politicians on-side, and thus avoid problems in potential and future operations, including the use of engagement campaigns and digital targeting to mobilize select coalitions around politicized, self-serving talking points — such as claims that public transport is less safe and convenient; or that air quality improves if fewer people drive into the city — in order to generate pressure on regulators to change licensing rules.

Another suggestion is to position the company less as a business, and more as an organization representing tens of thousands of time-poor people.

Public First advocates generally for the use of data- and technology-driven campaign methods, such as microtargeted digital advertising, as more effective than direct lobbying of local government officials — suggesting using digital tools to generate a perception that an issue is politicized will encourage elected representatives to do the heavy lifting of pressuring regulators because they’ll be concerned about losing votes.

The firm describes digital campaign elements as “crucial” to this strategy.

“Through a small, targeted online digital advertising campaign in both cities, local councillors’ email inboxes would begin to fill with requests from a number of different people (students, businesses, and other members of [a commuter advocacy group it proposes setting up to act as a lobby vehicle]) for the local authority to change its approach on local taxi licensing — in effect, to make it easier for Ola to launch,” it offers as a proposed strategy for building momentum behind Ola in Manchester and Liverpool.

Public First confirmed it made the pitch to Ola but told us: “This was merely a routine, speculative proposal of the sort we generate all the time as we meet people.”

“Ola Cabs has no relationship whatsoever with Public First,” it added.

A spokesperson for Ola also confirmed that it does not have a business relationship with Public First. “Ola has never had a relationship with Public First, does not currently have one and nor will it in the future,” the spokesman told us.

“Ola’s approach in the UK has been defined by working closely and collaborating with local authorities and we are committed to being fully licensed in every area we operate,” he added, suggesting the strategy it’s applying is the opposite of what’s being proposed.

We understand that prior to Public First pitching their ideas to a person working in Ola’s comms division, Ola’s director of legal, compliance and regulation, Andrew Winterton, met with the firm over coffee — in an introductory capacity. But that no such tactics were discussed.

It appears that, following first contact, Public First took the initiative to draw up the strategy suggesting politicizing ride-hailing in key target regions which it emailed to Winterton but only presented to a more junior Ola employee in a follow-up meeting the legal director did not attend.

Ola has built a major ride-hailing business in its home market of India — by way of $3.8BN in funding and aggressive competition. Since 2018 it has been taking international steps to fuel additional growth. In the U.K. its approach to date has been fairly low key, going to cities and regional centers outside of high-profile London first, as well as aiming to serve areas with big Indian populations to help recruit riders and drivers.

It’s a strategy that’s likely been informed by being able to view the track record of existing ride-hailing players — and avoid Uber-style regulatory blunders.

The tech giant was dealt a major shock by London’s transport regulator in 2017, when TfL denied it a licence renewal — citing concerns over Uber’s approach to passenger safety and corporate governance, including querying its explanation for using proprietary software that could be used to evade regulatory oversight.

The Uber story looks to be the high water mark for blitzscaling startup tactics that relied on ignoring or brute forcing regulators in the ride-hailing category. Laws and local authorities have largely caught up. The name of the game now is finding ways to get regulators on side.

Propaganda as a service

The fact that strategic proposals such as Public First’s to Ola are considered routine enough to put into a speculative pitch is interesting, given how the lack of transparency around the use of online tools for spreading propaganda is an issue that’s now troubling elected representatives in parliaments all over the world. Tools such as those offered by Facebook’s ad platform.

In Facebook’s case the company provides only limited visibility into who is running political and issue-based ads on its platform. The targeting criteria being used to reach individuals is also not comprehensively disclosed.

Some of the company’s own employees recently went public with concerns that its advanced targeting and behavioral-tracking tools make it “hard for people in the electorate to participate in the public scrutiny that we’re saying comes along with political speech”, as they put it.

At the same time, platforms providing a conduit for corporate interests to cheaply and easily manufacture ‘politicized’ speech looks to be another under-scrutinized risk for democratic societies.

Among the services Public First lists on its website are “policy development”, “qualitative and quantitative opinion research”, “issues-based campaigns”, “coalition-building” and “war gaming”. (Here, for example, is a piece of work the firm carried out for Google — where its analysis-for-hire results in a puffy claim that the tech giant’s digital services are worth at least $70BN in annual “economic value” for the UK.)

Public First’s choice of office location, in Tufton Street, London, is also notable as the area is home to an interlinked hub of right-leaning think tanks, such as the free market Center for Policy Studies and pro-Brexit Initiative for Free Trade. These are lobby vehicles dressed up as policy wonks which put out narratives intended to influence public opinion and legislation in a particular direction without it being clear who their financial backers are.

Some of the publicity strategies involved in this kind of work appear to share similarities with tactics used by Big Tobacco to lobby against anti-smoking legislation, or fossil fuel interests’ funding of disinformation and astroturfing operations to create a perception of doubt around consensus climate science.

“A lot of what used to get sold in this space essentially was access [to policymakers],” says one former public relations professional, speaking on background. “What you’re seeing an increasingly amount of now is the ‘technification’ of that process. Everyone’s using those kinds of tools — clearly in terms of trying to understand public sentiment better and that kind of thing… But essentially what they’re saying is we can set up a set of politicized issues so that they can benefit you. And that’s an interesting change. It’s not just straight defence and attack; promote your brand vs another. It’s ‘okay, we’re going to change the politics around an issue… in order to benefit your outcome’. And that’s fairly sophisticated and interesting.”

Mat Hope, editor of investigative journalism outlet DeSmog — which reports on climate-related misinformation campaigns — has done a lot of work focused on Tufton Street specifically, looking at the impact the network’s ‘policy-costumed’ corporate talking points have had on UK democracy.

“There is a set of organisations based out of offices in and around 55 Tufton Street in Westminster, just around the corner from the Houses of Parliament, which in recent years have had an outsized impact on British democracy. Many of the groups were at the forefront of the Leave campaign, and are now pushing for a hard or no-deal Brexit,” he told us, noting that Public First not only has offices nearby but that its founders and employees “have strong ties to other organisations based there”.

“The groups regularly lobby politicians in the interests of specific companies or big industry through the guise of grassroots or for-the-people campaigns,” he added. “One way they do this is through targeting adverts or social media posts, using groups with benign sounding names. This makes it hard to trace the campaign back to any particular company, and gives the issue an impression of grassroots support that is, on the whole, artificial.”

Platform power without responsibility

Ad platforms such as Facebook which profit by profiling people offer cheap yet powerful tools for corporate interests to identify and target highly specific sub-sets of voters. This is possible thanks to the vast amounts of personal data they collect — an activity that’s finally coming under significant regulatory scrutiny — and custom ad tools such as lookalike audiences, all of which enables behavioral microtargeting at the individual user/voter level.

Lookalike audiences is a powerful ad product that allows Facebook advertisers to upload customer data yet also leverage the company’s pervasive people-profiling to access new audiences that they do not hold data on but who have similar characteristics to their target. These so-called lookalike audiences can be tightly geotargeted, as well as zeroed in on granular interests and demographics. It’s not hard to see how such tools can be applied to selectively hit up only the voters most likely to align with a business’ interests.

The upshot is that an online advertiser is able to pay little to tap into the population-scale reach and vast data wealth of platform giants — turning firehose power against individual voters who they deem — via focus group work or other voter data analysis — to be aligned with a corporate agenda. The platform becomes a propaganda machine for manufacturing the appearance of broad public engagement and grassroots advocacy for a self-interested policy change.

The target voter, meanwhile, is most likely none the wiser about why they’re seeing politicized messaging. It’s that lack of transparency that makes the activity inherently anti-democratic.

The UK’s Digital, Culture, Media and Sport committee raised Facebook’s lookalike audiences as a risk to democracy during a recent enquiry into online disinformation and digital campaigning. It went on to recommend an outright ban on political microtargeting to lookalike audiences online. Though the UK government has so far failed to act on that or its fuller suite of recommendations. (Nor has Facebook responded to increasingly loud calls from politicians and civic society to ban political and issue ads altogether.)

Even a code of conduct published by the International Public Relations Association (IPRA) emphasizes transparency — with member organizations committing to “be open and transparent in declaring their name, organisation and the interest they represent”. (Albeit, the IPRA’s member list is not itself public.)

While online targeting of social media users remains a major problem for democracies, on account of the lack of transparency and individual consent to targeting (or, indeed, to data-based profiling), in recent years we’ve also seen more direct efforts by companies to use their own technology tools to generate voter pressure.

Examples such as ride-hailing giant Uber which, under its founding CEO, Travis Kalanick, became well known for a ‘push button’ approach to mobilizing its user base by sending calls to action to lobby against unfavorable regulatory changes.

Airbnb has also sought to use its platform-reach to beat against local authority rule changes that threaten its ‘home sharing’ business model.

However it’s the opaque tech-fuelled targeting enabled by ad platforms like Facebook that’s far more problematic for democracies as it allows vested interests to generate self-interested pressure remotely — including from abroad — while remaining entirely shielded from view.

Fixing this will require regulatory muscle to enforce existing laws around personal data collection (at least where such laws exist) — and doing so in a way that prevents microtargeting from being the cheap advertising default. Democracies should not allow their citizens to be mirrored in the data because it sets them up to be hollowed out; their individuals aggregated, classified and repackaged as all-you-can-eat attention units for whoever is paying.

And likely also legislation to set firm boundaries around the use of political and campaigning/issue ads online. Turning platform power against the individual is inherently asymmetrical. It’s never going to be a fair fight. So fair ground rules for digital political campaigning — and a proper oversight regime to enforce them — are absolutely essential.

Another democratic tonic is transparency. Which means raising awareness about tech-fuelled tactics that are designed to generate and exploit data-based asymmetries in order to hack and manipulate public opinion. Such skewed stuff only really works when the target is oblivious to what’s afoot. In that respect, every little disclosure of these ‘dark arts’ and the platforms that enable them provides a much-needed counter boost for critical thinking and democracy.

Facebook is failing to prevent another human rights tragedy playing out on its platform, report warns

A report by campaign group Avaaz examining how Facebook’s platform is being used to spread hate speech in the Assam region of North East India suggests the company is once again failing to prevent its platform from being turned into a weapon to fuel ethnic violence.

Assam has a long-standing Muslim minority population but ethnic minorities in the state look increasingly vulnerable after India’s Hindu nationalist government pushed forward with a National Register of Citizens (NRC), which has resulted in the exclusion from that list of nearly 1.9 million people — mostly Muslims — putting them at risk of statelessness.

In July the United Nations expressed grave concern over the NRC process, saying there’s a risk of arbitrary expulsion and detention, with those those excluded being referred to Foreigners’ Tribunals where they have to prove they are not “irregular”.

At the same time, the UN warned of the rise of hate speech in Assam being spread via social media — saying this is contributing to increasing instability and uncertainty for millions in the region. “This process may exacerbate the xenophobic climate while fuelling religious intolerance and discrimination in the country,” it wrote.

There’s an awful sense of deja-vu about these warnings. In March 2018 the UN criticized Facebook for failing to prevent its platform being used to fuel ethnic violence against the Rohingya people in the neighboring country of Myanmar — saying the service had played a “determining role” in that crisis.

Facebook’s response to devastating criticism from the UN looks like wafer-thin crisis PR to paper over the ethical cracks in its ad business, given the same sorts of alarm bells are being sounded again, just over a year later. (If we measure the company by the lofty goals it attached to a director of human rights policy job last year — when Facebook wrote that the responsibilities included “conflict prevention” and “peace-building” — it’s surely been an abject failure.)

Avaaz’s report on hate speech in Assam takes direct aim at Facebook’s platform, saying it’s being used as a conduit for whipping up anti-Muslim hatred.

In the report, entitled Megaphone for Hate: Disinformation and Hate Speech on Facebook During Assam’s Citizenship Count, the group says it analysed 800 Facebook posts and comments relating to Assam and the NRC, using keywords from the immigration discourse in Assamese, assessing them against the three tiers of prohibited hate speech set out in Facebook’s Community Standards.

Avaaz found that at least 26.5% of the posts and comments constituted hate speech. These posts had been shared on Facebook more than 99,650 times — adding up to at least 5.4 million views for violent hate speech targeting religious and ethnic minorities, according to its analysis.

Bengali Muslims are a particular target on Facebook in Assam, per the report, which found comments referring to them as “criminals,” “rapists,” “terrorists,” “pigs,” and “dogs”, among other dehumanizing terms.

In further disturbing comments there were calls for people to “poison” daughters, and legalise female foeticide, as well as several posts urging “Indian” women to be protected from “rape-obsessed foreigners”.

Avaaz suggests its findings are just a drop in the ocean of hate speech that it says is drowning Assam via Facebook and other social media. But it accuses Facebook directly of failing to provide adequate human resource to police hate speech spread on its dominant platform.

Commenting in a statement, Alaphia Zoyab, senior campaigner, said: “Facebook is being used as a megaphone for hate, pointed directly at vulnerable minorities in Assam, many of whom could be made stateless within months. Despite the clear and present danger faced by these people, Facebook is refusing to dedicate the resources required to keep them safe. Through its inaction, Facebook is complicit in the persecution of some of the world’s most vulnerable people.”

Its key complaint is that Facebook continues to rely on AI to detect hate speech which has not been reported to it by human users — using its limited pool of (human) content moderator staff to review pre-flagged content, rather than proactively detect it.

Facebook founder Mark Zuckerberg has previously said AI has a very long way to go to reliably detect hate speech. Indeed, he’s suggested it may never be able to do that.

In April 2018 he told US lawmakers it might take five to ten years to develop “AI tools that can get into some of the linguistic nuances of different types of content to be more accurate, to be flagging things to our systems”, while admitting: “Today we’re just not there on that.”

That sums to an admission that in regions such as Assam — where inter-ethnic tensions are being whipped up in a politically charged atmosphere that’s also encouraging violence — Facebook is essentially asleep on the job. The job of enforcing its own ‘Community Standards’ and preventing its platform being weaponized to amplify hate and harass the vulnerable, to be clear.

Avaaz says it flagged 213 of “the clearest examples” of hate speech which it found directly to Facebook — including posts from an elected official and pages of a member of an Assamese rebel group banned by the Indian Government. The company removed 96 of these posts following its report.

It argues there are similarities in the type of hate speech being directed at ethnic minorities in Assam via Facebook and that which targeted at Rohingya people in Myanmar, also on Facebook, while noting that the context is different. But it did also find hateful content on Facebook targeting Rohingya people in India.

It is calling on Facebook to do more to protect vulnerable minorities in Assam, arguing it should not rely solely on automated tools for detecting hate speech — and should instead apply a “human-led ‘zero tolerance’ policy” against hate speech, starting by beefing up moderators’ expertise in local languages.

It also recommends Facebook launch an early warning system within its Strategic Response team, again based on human content moderation — and do so for all regions where the UN has warned of the rise of hate speech on social media.

“This system should act preventatively to avert human rights crises, not just reactively to respond to offline harm that has already occurred,” it writes.

Other recommendations include that Facebook should correct the record on false news and disinformation by notifying and providing corrections from fact-checkers to each and every user who has seen content deemed to have been false or purposefully misleading, including if the disinformation came from a politician; that it should be transparent about all page and post takedowns by publishing its rational on the Facebook Newsroom so the issue of hate speech is given proportionate prominence and publicity to the size of the problem on Facebook; and it should agree to an independent audit of hate speech and human rights on its platform in India.

“Facebook has signed up to comply with the UN Guiding Principles on Business and Human Rights,” Avaaz notes. “Which require it to conduct human rights due diligence such as identifying its impact on vulnerable groups like women, children, linguistic, ethnic and religious minorities and others, particularly when deploying AI tools to identify hate speech, and take steps to subsequently avoid or mitigate such harm.”

We reached out to Facebook with a series of questions about Avaaz’s report and also how it has progressed its approach to policing inter-ethnic hate speech since the Myanmar crisis — including asking for details of the number of people it employs to monitor content in the region.

Facebook did not provide responses to our specific questions. It just said it does have content reviewers who are Assamese and who review content in the language, as well as reviewers who have knowledge of the majority of official languages in India, including Assamese, Hindi, Tamil, Telugu, Kannada, Punjabi, Urdu, Bengali and Marathi.

In 2017 India overtook the US as the country with the largest “potential audience” for Facebook ads, with 241M active users, per figures it reports the advertisers.

Facebook also sent us this statement, attributed to a spokesperson:

We want Facebook to be a safe place for all people to connect and express themselves, and we seek to protect the rights of minorities and marginalized communities around the world, including in India. We have clear rules against hate speech, which we define as attacks against people on the basis of things like caste, nationality, ethnicity and religion, and which reflect input we received from experts in India. We take this extremely seriously and remove content that violates these policies as soon as we become aware of it. To do this we have invested in dedicated content reviewers, who have local language expertise and an understanding of the India’s longstanding historical and social tensions. We’ve also made significant progress in proactively detecting hate speech on our services, which helps us get to potentially harmful content faster.

But these tools aren’t perfect yet, and reports from our community are still extremely important. That’s why we’re so grateful to Avaaz for sharing their findings with us. We have carefully reviewed the content they’ve flagged, and removed everything that violated our policies. We will continue to work to prevent the spread of hate speech on our services, both in India and around the world.

Facebook did not tell us exactly how many people it employs to police content for an Indian state with a population of more than 30 million people.

Globally the company maintains it has around 35,000 people working on trust and safety, less than half of whom (~15,000) are dedicated content reviewers. But with such a tiny content reviewer workforce for a global platform with 2.2BN+ users posting night and day all around the world there’s no plausible no way for it to stay on top of its hate speech problem.

Certainly not in every market it operates in. Which is why Facebook leans so heavily on AI — shrinking the cost to its business but piling content-related risk onto everyone else.

Facebook claims its automated tools for detecting hate speech have got better, saying that in Q1 this year it increased the proactive detection rate for hate speech to 65.4% — up from 58.8% in Q4 2017 and 38% in Q2 2017.

However it also says it only removed 4 million pieces of hate speech globally in Q1. Which sounds incredibly tiny vs the size of Facebook’s platform and the volume of content that will be generated daily by its millions and millions of active users.

Without tools for independent researchers to query the substance and spread of content on Facebook’s platform it’s simply not possible to know how many pieces of hate speech are going undetected. But — to be clear — this unregulated company still gets to mark its own homework. 

In just one example of how Facebook is able to shrink perception of the volume of problematic content it’s fencing, of the 213 pieces of content related to Assam and the NCR that Avaaz judged to be hate speech and reported to Facebook it removed less than half (96).

Yet Facebook also told us it takes down all content that violates its community standards — suggesting it is applying a far more dilute definition of hate speech than Avaaz. Unsurprising for a US company whose nascent crisis PR content review board‘s charter includes the phrase “free expression is paramount”. But for a company that also claims to want to prevent conflict and peace-build it’s rather conflicted, to say the least. 

As things stand, Facebook’s self-reported hate speech performance metrics are meaningless. It’s impossible for anyone outside the company to quantify or benchmark platform data. Because no one except Facebook has the full picture — and it’s not opening its platform for ethnical audit. Even as the impacts of harmful, hateful stuff spread on Facebook continue to bleed out and damage lives around the world. 

Naspers Foundry is open for South African startup pitches, CEO says

Naspers’ 1.4 billion rand (≈$100 million) VC fund to support South African startups — Naspers Foundry — is accepting pitches, after making its first investment in online cleaning services company SweepSouth.

The funding initiative also has a new leader, Phuthi Mahanyele-Dabengwa, who joined Naspers in July as a CEO reporting to Group CEO of Naspers, Bob van Dijk.

“We’ll be investing in businesses here in South Africa that have an impact in South Africa. We look for these opportunities all around the country, to the extent that they have South African founders or have a marketplace in South Africa,” Mahanyele-Dabengwa told TechCrunch.

Founders from other parts of Africa with startup operations in South Africa can be considered for funding, she clarified.

Naspers Foundry will back companies that align with the internet business’s Naspers focuses on — such as food, payments, or classifieds — and any other digital venture that addresses a societal need.

On financing size, the Foundry will make equity investments in various amounts primarily from Series A up to Series B,  according to Mahanyele-Dabengwa.

Pre-series funding won’t be on the table, for now, but could be at some point. “We’ve been talking to our stakeholders…and there really is a need [in the region] for much more earlier stage [investment]. So we are giving thought to that,” she said.

Naspers Foundry is already engaged in outreach screening activity, but does have a rolling application call on its website open to any startup that meets specific criteria.

Heading up review of online investment applications is Minette Havemann, Naspers Foundry’s Strategy Director.

Naspers Minette Havemann

Minette Havemann

On her role in recruiting and determining startup investments, Mahanyele-Dabengwa points to her market experience.

She comes to head Naspers Foundry after several finance capital positions, including founding and running Sigma Capital Group, a Johannesburg based private equity fund.  Prior to that, Mahanyele-Dabengwa was CEO of Shanduka Group, an investment holding company formed by South Africa’s current president, Cyril Ramaposa.

She has experience in the U.S. and U.K., having obtained academic degrees in both countries.

There’s also some precedent in her new role, as Mahanyele-Dabengwa is the first female and first black chief executive in Naspers’ 104 year history.

For its VC allocation, Naspers Foundry will make investments over a three year period. The Foundry is part of a 1.4 billion rand (≈$314 million) overall commitment by Naspers to support South Africa’s tech sector.

As a firm, Naspers is on the top 100 largest global companies list — 85th by its $108 billion market cap, just after Nike—and is one the world’s largest tech investors.

Aside from operating notable internet, video, and entertainment platforms, Naspers has made significant investments in Europe, India, Asia, and South America.

Naspers was also an early investor in Chinese tech group Tencent, selling $10 billion in shares this year after a $32 million investment in 2001.

The company recently carved out a new holding company, called Prosus NV, to relist a portion of its assets on Amsterdam’s Euronext stock exchange.

Though Naspers Foundry will not back startups outside South Africa, Mahanyele-Dabengwa noted that its parent — Naspers — can finance ventures anywhere on the continent, if it sees the right opportunity.

The South African media group has invested less in (and been less successful) in Africa, in contrast to its robust global activities.

One of Naspers’ early Africa investments, Nigerian e-commerce startup Konga, was sold in a distressed acquisition in 2018.

The company recently added around $70 million to its commitment to South African e-commerce site Takealot and made one of the largest acquisitions in Africa this September, buying South Africa’s Webuycars for $94 million.

The $100 million fund Phuthi Mahanyele-Dabengwa leads could help South Africa surge in Africa’s increasingly competitive tech landscape.

The country was previously an unquestioned leader and outlier on the continent for its tech scene and VC investment. But over the last decade South Africa has been rivaled on venture capital and startup formation by Kenya and Nigeria.

In Africa’s tech ecosystem — that only recently surpassed $1 billion annually in VC funding — Naspers Foundry’s $100 million could shift the startup financing lead back toward South Africa.

 

 

India moves closer to regulating internet services as it fears ‘unimaginable disruption to democracy’

India said on Monday that it is moving ahead with its plan to revise existing rules to regulate intermediaries — social media apps and others that rely on users to create their content — as they are causing “unimaginable disruption” to democracy.

In a legal document filed with the country’s apex Supreme Court, the Ministry of Electronics and Information Technology said it would formulate the rules to regulate intermediaries by January 15, 2020.

In the legal filing, the government department said the internet had “emerged as a potent tool to cause unimaginable disruption to the democratic polity.” Oversight of intermediaries, the ministry said, would help in addressing the “ever growing threats to individual rights and nation’s integrity, sovereignty and security.”

The Indian government published a draft of guidelines for consultation late last year. The proposed rules, which revise the 2011 laws, identified any service — social media or otherwise — that have more than 5 million users as intermediaries.

Government officials said at the time that modern rules were needed, otherwise circulation of false information and other misuse of internet platforms would continue to flourish.

The Monday filing comes as a response to an ongoing case in India filed by Facebook to prevent the government from forcing WhatsApp to introduce a system that would enable revealing the source of messages exchanged on the popular instant messaging platform, which counts India as its biggest market with more than 400 million users.

Some have suggested that social media platforms should require their users in India to link their accounts with Aadhaar — a government-issued, 12-digit biometric ID. More than 1.2 billion people in India have been enrolled in the system.

Facebook executives have argued that meeting such demands would require breaking the end-to-end encryption that WhatsApp users enjoy globally. The company executives have said that taking away the encryption would compromise the safety and privacy of its users. The Supreme Court will hear Facebook’s case on Tuesday.

India’s online population has ballooned in recent years. More than 600 million users in India are online today, according to industry estimates. The proliferation of low-cost Android handsets and access to low-cost mobile data in the nation have seen “more and more people in India become part of the internet and social media platforms.”

“On the one hand, technology has led to economic growth and societal development, on the other hand there has been an exponential rise in hate speech, fake news, public order, anti-national activities, defamatory postings, and other unlawful activities using Internet/social media platforms,” a lower court told the apex court earlier.

China Roundup: Tencent’s NBA test, TikTok parent deepens education push

Welcome to TechCrunch’s China roundup, a digest of events that happened at major Chinese tech companies and what they mean to tech founders and executives around the world.

The talk about U.S.-China relationships over the past two weeks has centered heavily on the NBA controversy, which has put the interest of some of China’s largest tech firms at stake. Last week, Houston Rockets general manager Daryl Morey voiced support for Hong Kong protests in his since-deleted tweet, angering China’s NBA fans and prompting a raft of local tech companies to sever ties with the league. But some businesses seem to be back on track.

Tencent, which is famous for a slew of internet products, including WeChat and its Netflix-like video service, has been NBA’s exclusive streaming partner since 2009 and recently renewed the deal through the 2024-25 season. As many as 490 million fans in China watched NBA programming through Tencent in just one season this year, the pair claims.

The basketball games are clearly a driver of ad revenue and subscribers for Tencent amid fierce competition in China’s video streaming market, but following Morey’s statement, the company swiftly announced (in Chinese) it would suspend portions of its broadcast arrangements with the NBA. Popular smartphone brand Vivo and Starbucks’s local challenger Luckin also promised to pause collaboration with the NBA.

It was a tough call for businesses having to choose between economic interest and patriotism, and Tencent was tactful in its response, pledging only to “temporarily” halt the streaming of NBA “preseason games (China).” As public anger subsided over the week, Tencent resumed airing NBA preseason games on Monday. After all, the content partnership reportedly cost Tencent a heavy sum of $1.5 billion.

Entertainment giant turns to education

tiktok edutok

TikTok is probably the Chinese Internet service being most closely watched by the world at the moment. Its parent firm ByteDance, last reportedly valued at $75 billion, has ambitions beyond short videos.

This week, more details emerged on the upstart’s education endeavors through a WeChat post by Musical.ly founder Lulu Yang, whose short-video startup was acquired by ByteDance and subsequently merged with TikTok. Yang confirmed he was helping ByteDance to develop an education device in collaboration with phone maker Smartisan’s former hardware team, which ByteDance has absorbed. The product, which leverages ByteDance’s artificial intelligence capabilities, will be a “robotic learning companion” for K-12 students to use at home.

The news arrived in the same week that ByteDance’s flagship video app TikTok announced producing educational content for India, where it’s used by 200 million people every month. The move is designed to assuage local officials who have vehemently slammed TikTok for hosting illicit content, as my colleague Manish Singh pointed out.

Diving into education appears to be a sensible move for ByteDance to build relationships with local authorities, which can at times find its entertainment-focused content problematic. The multi-billion-dollar online education industry is also highly lucrative. ByteDance, with 1.5 billion daily users across TikTok, Douyin (TikTok for China), Toutiao news aggregator and other new media apps, is in a good position to monetize the enormous base by touting new services, whether they are educational content or mobile games.

Also worth your time

  • A total of 53 major video streaming services in China have introduced a “safe mode” for teenagers as of this week, state media reported (in Chinese). During the controls mode, underage users won’t be able to search for content, send real-time comments or private messages, upload or share videos, or reward live streaming hosts with virtual gifts. It’s part of China’s national effort to protect young people from consuming harmful digital content and internet addiction, which has also spawned age checks processes in Tencent games. 
  • Xiaohongshu, a fast-growing social commerce app in China, is back in Android app stores nearly three months after it was banned by the government for undisclosed reasons. Rumors had it that the service, which was reportedly valued at more than $2.5 billion last year, was used to spread pornography and fake reviews. It’s hardly the first tech company hit by media regulation, and it can probably learn a thing or two from ByteDance, which has aggressively ramped up its content moderation force following a sequence of crackdowns by the government.
  • Meituan will partner with 1,000 vocational schools in the country to train as many as 100 million workers from the service industry over the next ten years, the Hong Kong-listed company announced (in Chinese) this week. Food delivery makes up the bulk of the on-demand services giant’s business but its footprint spans a wide range. The classes it provides to prepare workers for a digital era will also touch upon skincare, hair styling, manicure, plastic surgery, hospitality and parenting, a program highlighting the extensive reach of technology into Chinese people’s every life.
  • Chinese workers turn out to be big advocates for the application of AI. According to a survey by Oracle and research firm Future Workplace, workers in India (60 percent) and China (56 percent) are the most excited about AI. Japan, where the labor force is shrinking, ranks surprisingly low (25 percent), and the U.S. has an equally mild reaction (22 percent) toward the technology.

MyGate raises $56M to bring its security management service to more gated communities in India

MyGate, a Bangalore-based startup that offers security management and convenience service for guard-gated premises, said today it has bagged more than $50 million in a new financing round as it looks to expand its footprint in the nation.

Chinese internet giant Tencent, Tiger Global, JS Capital and existing investor Prime Venture Partners funded the three-year-old startup’s $56 million Series B financing round. The new round pushes MyGate’s total fundraise to $67.5 million.

MyGate offers an eponymous mobile app that allows home residents to approve entries and exits, communicate with their neighbors, log attendance and pay society maintenance bills and daily help workers.

The startup says it is operational in 11 cities in India and has amassed over 1.2 million home customers. Its customer base is increasing by 20% each month, it claimed. The service is handling 60,000 requests each minute and clocking over 45 million check-in requests each month.

The idea of MyGate came after its co-founder and CEO, Vijay Arisetty, left the Indian armed force. In an interview with TechCrunch, he said his family was appalled to learn about the poor state of security across societies in India.

“This was also when e-commerce companies and food delivery firms were beginning to gain strong foothold in the nation. This meant that many people were entering a gated community each day,” he said.

MyGate has inked partnerships with many e-commerce players to create a system to offer a silent and secure delivery experience for its users. The startup also trains guards to understand the system.

According to industry estimates, more than 4.5 million people in India today live in gated communities, and that figure is growing by 13% each year. The private security industry in the country is a $15 billion market.

Arisetty says he believes the startup could significantly accelerate its growth as its solution understands the price-sensitive market. Using MyGate costs an apartment about Rs 20 (28 cents) per month. Even at that price, the startup says it is making a profit. “Today, we are seeing more demand than we can handle,” he said.

That’s where the new funding would come into play for the startup, which today employs about 700 people.

The startup plans to use the fresh capital to expand its technology infrastructure, its marketing and operations teams and build new features. The startup aims to reach 15 million homes in 40 Indian cities in the next 18 months.

In a statement, Sanjay Swamy, managing partner at Prime Venture Partners, said, “It’s been great to see a fledgling startup execute consistently and holistically, and grow into a category-creating market-leader.”

India’s Reliance Jio unveils video call assistant to help businesses automate customer support

Before Google moves to bring its human-sounding robot calling service Duplex to help users automate their interactions with businesses to international markets, an Indian giant is deploying its own solution to get a jumpstart on the local market.

Reliance Jio today unveiled AI-powered Video Call Assistant service that will allow businesses to automate their customer support and other communications. The service, built in collaboration with Radisys, a U.S.-based subsidiary of Reliance Industries, can be accessed via a 4G phone call and does not require installation of any additional app, Jio said.

Executives of Reliance Jio demonstrated the technology on Monday at the third installment of Indian Mobile Congress, similar to but not affiliated with the trade show Mobile World Congress. They said they have already courted a number of customers for this service, including HDFC Bank.

In the demo, a user dials a regular phone number and sees a video chat option. Once tapped, the user is greeted by a pre-recorded video message from a human. To demonstrate the AI’s capabilities, an executive of Reliance Jio asked the bot what was the interest rate on personal loans. The human-looking bot was able to answer the question without any delay.

The company, which became the largest telecom operator in India in three years, is also offering audio and text bot options to brands, executives said. “It may be a large business or small, our bot service is built for all,” one of the two executives said.

reliance jio video bot

Image: Manish Singh / TechCrunch

The company said its developer toolkit — called Jio Bot Maker — will allow brands to build and deploy the AI assistant in “just five minutes.”

The company is hoping to address the “current customer pain points like endless call-hold music or seemingly never-ending IVR wait-times,” it said, as it looks to court more businesses in the country.

Earlier this year, Reliance Jio inked a deal with Microsoft to bring Office 365 and other services from the Redmond-headquartered giant to small businesses in India for subsidized cost.

The company has also developed a point-of-sale machine that its agents are increasingly trying to sell to neighborhood stores in the nation. Popularly known as kirana stores, these millions of mom and pop shops dot the entire country.

Reliance Industries, parent firm of Reliance Jio and the largest industrial house in the nation, also operates the largest retail chain in the country, called Reliance Retail. Despite billions of dollars spent on India’s e-commerce market, online sales still amount for just 3% of the overall sales in the nation, according to industry estimates.

The person who appears on the video chat could be replaced by anyone from the CEO of a company to a brand ambassador, Reliance Jio said. “We aim to democratize AI by enabling small businesses to create their own AI-based Bot with no coding and with minimal effort,” it added.

The company plans to introduce support for multiple languages to its bot service and serve “millions of businesses” across various industries in India.

Jio did not reveal when it plans to launch the developer kit to the public, but a spokesperson told TechCrunch that it will be made available “in the near future.”

Jio has made no secret that it wants to develop AI assistants to help businesses. Last year, it acquired Haptik, a Mumbai-based startup that develops “conversational” platforms and virtual assistants. The size of the deal was $100 million.

Aakrit Vaish, co-founder and CEO of Haptik, told TechCrunch in an interview earlier that the startup was developing voice bots.

Club Factory raises $100M to expand its lifestyle e-commerce platform in India

Club Factory, a Chinese e-commerce platform that sells fashion and beauty items and electronics accessories, has raised $100 million in a new financing round as it looks to expand its footprint in India.

The new financing round — Series D — was led by Qiming Venture Partners, Bertelsmann, IDG Capital “and  other Fortune 500 companies from the U.S. and Asia,” the five-year-old Hangzhou-headquartered startup said. Club Factory, which raised $100 million in its previous financing round early last year, has raised about $220 million to date.

Club Factory has amassed more than 70 million users on its platform, of which about 40 million live in India. The startup cited figures from app analytics firm App Annie to claim that Club Factory is now the third-largest e-commerce platform in India, surpassing once a market-leader Snapdeal.

Club Factory does not charge local sellers any commission fee, incentivizing them to cut down the cost of their items and expand offerings. The number of sellers on its platform in India has grown by 10X in the last six months, the startup claimed. Club Factory, which has about 5,000 sellers in India, plans to double that figure by year-end, it said.

club factory india

A screenshot of Club Factory’s homepage

“At the same time, we have also pioneered to strengthen the ‘store-within-platform’ concept in India’s e-commerce industry, allowing direct contact between buyers and sellers through our application,” said Vincent Lou, co-founder and chief executive of Club Factory, in a statement.

He added, “We have changed the status of the Indian e-commerce industry that monopolized information of buyers and sellers, allowing SMEs to own their customers and run their business better. All this, combined with our strategy to reduce the transaction costs of buyers and sellers and allow more local players to enter the ecosystem, has worked very well for us in India.”

The startup said in the coming months it will also bulk up more items on its platform and introduce new product categories.

Africa Roundup: CcHub’s iHub acquisition, Andela’s $50M run-rate and layoffs, Transsion’s IPO

Two of Africa’s powerhouse tech incubators joined forces in September. Nigerian innovation center and seed-fund CcHub acquired Nairobi based iHub.

The purchase amount was undisclosed, but CcHub will finance the deal out of its real-estate project to build a new 10-story HQ in Lagos, CcHub CEO Bosun Tijani told TechCrunch.

Details are emerging on how the two entities will operate together, but Tijani noted some degree of autonomy. The names — CcHub and iHub — will remain the same. Tijani is now co-CEO of both organizations.

Nekesa Were continues as iHub managing director. And iHub’s existing programs will remain, with CcHub extending to Kenya some of its existing activities in education, healthcare and governance.

CcHub will also use the iHub addition to expand the investment scope of its Growth Capital Fund.

The acquisition brings together two of Africa’s most powerful tech hubs by membership networks, volume of programs, startups incubated, and global visibility. CcHub and iHub visitors and partnerships span Zuckerberg, Mayer, Facebook, Google, and several African governments.

There’ll be a lot to cover on how this merger shapes up. At a high level, for now, the CcHub-iHub union creates a direct innovation link between two of Africa’s most active markets for VC and startup formation — Nigeria and Kenya .

Africa-focused tech talent accelerator Andela  announced cuts of 400 junior engineers across Kenya,  Uganda and Nigeria just as the startup released first-time earnings figures indicating it will surpass $50 million in revenues for 2019.

On the disjointed news, Andela CEO told TechCrunch the layoffs were due to a shift in market demand for the startup’s more senior developers.

Andela’s client base is comprised of more than 200 companies around the world that pay for the African developers Andela selects and trains to work on projects.

The Series D tech-venture is one of Africa’s most visible (by press volume) and best funded ― backed by $181 million in VC from investors that include the Chan Zuckerberg Initiative.

Johnson said the layoffs were not due to a lack of demand or financial woes. That’s probably why Andela released first-time figures of a $50 million run-rate for 2019, something of a rarity for a startup to reach in less than five years. That’s even more rare for ventures in Africa. Only one VC-backed digital company has revealed annual revenues between $50 and $100 million. That’s Jumia, the e-commerce startup that listed in an NYSE IPO earlier this year.

The departing Andela software engineers gained severance packages and are receiving placement assistance from partners including incubators CcHub and iHub.

Chinese mobile phone and device maker Transsion listed in an IPO on Shanghai’s new NASDAQ-like STAR Market, a Transsion spokesperson confirmed to TechCrunch.

Headquartered in Shenzhen, Transsion is a top seller of smartphones in Africa under its Tecno brand. The company has also started to support venture funding of African startups.

Transsion issued 80 million A shares at an opening price of 35.15 yuan (≈ $5.00) to raise 2.8 billion yuan (or ≈ $394 million).

Transsion plans to spend 1.6 billion yuan (or $227 million) of its STAR Market raise on building more phone assembly hubs, and around 430 million yuan ($62 million) on research and development, including a mobile phone R&D center in Shanghai.

Transsion has a manufacturing facility in Ethiopia and announced plans to build an R&D facility in India.

There are a couple things to watch with Transsion’s IPO. First, the public listing, and accompanying capital could mean more venture funding for African startups.

Transsion-funded Future Hub already teamed up with Kenya’s Wapi Capital in August to source and fund early-stage African fintech startups.

Transsion’s IPO and growing presence in Africa also accompanies TechCrunch coverage over the last year that signals China’s growing digital influence in Africa (see Extra Crunch analysis).

More Africa-related stories @TechCrunch

African tech around the ‘net