Free VPNs are bad for your privacy

VPNs are in high demand as Americans scramble to keep access to TikTok and WeChat amid a looming government ban. There are dozens of free VPNs out there that promise to protect your privacy by keeping you anonymous on the internet and hiding your browsing history.

Don’t believe it. Free VPNs are bad for you.

The internet is a hostile place for the privacy-minded. Internet providers can sell your browsing history, governments can spy on you and tech titans collect huge amounts of data to track you across the web. Many have turned to VPNs, or virtual private networks, thinking that they can protect you from snoopers and spies.

But where VPNs try to solve a problem, they can also expose you to far greater privacy risks.

TechCrunch’s Romain Dillet has an explainer on what a VPN is. In short, VPNs were first designed for employees to virtually connect to their office network from home or while on a business trip. These days, VPNs are more widely used for hiding your online internet traffic, and tricking streaming services into thinking you’re another country when you’re not. That same technique also helps activists and dissidents bypass censorship systems in their own countries.

VPNs work by funneling all of your internet traffic through an encrypted pipe to the VPN server, making it more difficult for anyone on the internet to see which sites you are visiting or which apps you are using.

But VPNs don’t inherently protect your privacy or give you anonymity. VPNs simply divert all of your internet traffic from going to your internet provider’s systems into the VPN provider’s systems instead.

That begs the question: Why should you trust a VPN that promises to protect your privacy more than your internet provider? The answer is that you can’t, and you shouldn’t.

By far, some of the worst offenders are the free VPNs.

As the old adage goes, if it’s free then you are the product. What that means is that they make money off you — specifically, your data. Like any service that costs nothing, VPNs are often supported by ads. That means taking your internet traffic and selling it to the highest bidder to serve you targeted ads while you’re connected to the VPN. Other free VPNs have been accused of injecting ads into the websites that you visit.

While there are paid and premium VPNs that are generally more mindful about your privacy, they aren’t anonymous, as they can be linked to your billing address. Paid VPNs also don’t solve the problem of funneling all of your internet traffic to a potentially untrustworthy company.

Some VPN providers also claim to protect your privacy by not storing any logs or track which websites you visit or when. While that may be true in some cases, there’s no way you can be completely sure.

In fact, some VPN providers have claimed they don’t store any logs — but were proven completely false.

Take UFO VPN, which at the time had about 20 million users. It claimed to have a zero-logging policy. But security researchers found the company’s logging database exposed to the internet, no password needed. The database was packed with logs of user activity, including which websites users were visiting.

Former NYPD director of cyber intelligence and investigations Nick Selby, now the chief security officer at fintech startup Paxos, said he only uses VPN providers that he knows do not store any logs. During his time as a police officer he would serve search warrants and know which providers were “the best at giving me nothing,” he told TechCrunch.

It’s not to say that all VPNs are unscrupulous or invading your privacy. Much of the problem with VPNs is that you can’t look under the hood and see what’s going on with your data. Standalone VPNs, like Algo and WireGuard, let you create and control your own VPN server through a cloud service, like Amazon Web Services, Microsoft Azure, Google Cloud or Digital Ocean. But remember: your encrypted data is stored on another company’s cloud, making it potentially susceptible to being grabbed by the authorities.

VPNs can be useful, but it’s important to know their limitations. Just don’t rely on them to protect your privacy or your anonymity.

As it delists, Rocket Internet’s ill-fated experiment with public markets is over

It was all supposed to be so different. When Rocket Internet IPO’d in 2014 it was the largest tech company floatation in Europe for seven years. A year later it had lost $46 million and its valuation had dropped by 30%. Since then the German startup factory behind internet companies such as Delivery Hero, Zalando and Jumia has languished, in part because the reason for its existence — to provide growth capital for “rocket-fueled” startups — has ebbed away, as the tech market was flooded with capital in recent years. Today the company said it was delisting its shares from the Frankfurt and Luxembourg Stock Exchanges for just that reason.

Rocket’s market value has fallen from its high of 6.7 billion euros ($8 billion) on the day of its IPO on the Frankfurt Stock Exchange to just 2.6 billion euros and is now offering investors 18.57 euros ($22.23) for each of their shares, lower than Monday’s closing price of 18.95 euros.

The company said it was “better positioned as a company not listed on a stock exchange” as this would allow it to focus on long-term bets.

In a statement, the company said: “The use of public capital markets as a financing source as essential [sic] parameter for maintaining a stock exchange listing is no longer required and adequate access to capital is secured outside the stock exchange. Outside a capital markets environment, the Company will be able to focus on a long-term development irrespective of temporary circumstances capital markets tend to put emphasis on.”

Delisting, it said, will also reduce operational complexity when setting up new companies, “freeing up administrative and management capacity and reducing costs.”

Its investment division, Global Founders Capital, and CEO Oliver Samwer, will retain their stakes of 45.11% and 4.53% respectively, meaning the virtual shareholder meeting on Sept. 24 to ask for shareholder approval to delist will largely be a formality. It has also launched a separate buyback program to secure 8.84% of its shares from the stock market. Although the decision to delist makes sense, smaller shareholders will be burned, especially as Rocket is using its own cash for the buyback.

The bets Rocket took, however, have of course paid off. For some. According to Forbes, Samwer and his brothers and co-founders Alexander and Marc are worth at least $1.2 billion each.

The Berlin -based firm became quickly known as a “clone factory” after Samwer famously conceded during his Ph.D. that Silicon Valley had got innovation wrong by coming up with new ideas, and the “innovation” would simply be to make existing models more efficient. The fact those existing models were usually dreamt up by other people never seemed to phase him.

Almost like clockwork Rocket produced clones of Amazon, Uber, Uber Eats and Airbnb. Its defense for this rapacious strategy was that it was simply adapting proven models for other markets.

Rocket would say it was merely adapting proven models for untapped local markets. Of course, the kicker was usually that the company would either scale faster globally than the original U.S.-based startup, thus forcing some kind of acquisition, or that it would have its clones IPO faster. It did however produce some big, global, companies, even if they were not particularly original, including e-commerce firm Zalando, food delivery service Delivery Hero and meal-kit provider HelloFresh .

There have been successes. Jumia, the African e-commerce company, listed in April last year and when Rocket sold its stake earlier this year, it contributed to Rocket’s net cash position of €1.9 billion at the end of April.

But it has not benefitted from the recent stock market rally for tech companies, as it is overly exposed to e-commerce rather than pandemic-proof companies like Zoom .

For nostalgia’s sake, here’s that interview I did with Oliver Samwer in 2015, just one more time.

LA gets a big SAAS exit as Fastly nabs the Culver City-based Signal Sciences for $775M

Los Angeles was always more than a one industry town, even when it comes to technology startups, but media and entertainment (and social networking) were always the big draws in tinseltown.

Now the city’s enterprise tech scene can claim a really big winner with Signal Sciences, the security monitoring and management company that is getting bought by Fastly, a provider of content delivery networking services, for $775 million.

“Our team couldn’t be more excited about the opportunity to join Fastly to continue to drive forward security protections that empower developers. But we also believe this is a great moment to showcase the diversity of the LA technology scene,” wrote Signal Sciences chief executive, Andrew Peterson, in a direct message. “Being the largest enterprise tech outcome ever here, we’re just one of so many great deep technology companies who are paving the way for the next generation of SoCal based start ups. We’re thrilled to help lead the way for the broader tech community in Los Angeles.”

Content delivery and security go hand-in-hand and some of the biggest companies online use businesses like Fastly and its competitor, Cloudflare, to ensure that their online presence doesn’t go offline — and that browsers can quickly download and deliver websites.

Fastly said that the acquisition of Signal Sciences’ business will boost its ability to provide better security for applications and APIs — the connective fabric between different services that knit different technologies together behind the scenes.

With the acquisition, Fastly is planting a flag as a new competitor in the cybersecurity market, even as companies like Amazon, Microsoft, and Google offer a wider array of services under their Internet as a service business lines.

Application security is a higher value piece of the services stack and it takes advantage of the natural position that a company like Fastly has as a content distribution network.

“Fastly was founded to meet developers’ need for greater visibility and control. Now, as the digital transformation movement continues to accelerate, DevOps teams are struggling with inadequate and inflexible security tools,” said Joshua Bixby, Chief Executive Officer of Fastly, in a statement. “Together with Signal Sciences, we will give developers modern security tools designed for the way they work.”

Under the terms of the agreement Fastly is buying Signal Sciences for $200 million in cash and approximately $575 million worth of stock, subject to customary adjustments for transactions, according to a statement.

Fastly is also setting up a $50 million retention pool of restricted stock units to give out to Signal Sciences employees.

Signal Sciences employees aren’t the only winners in the deal. The company raised $63 million in venture financing from investors including CRV, Harrison Metal, Index Ventures, Oreilly Alphatech Ventures, Lead Edge Capital, and individual investors including former Facebook security officer Alex Stamos, and Etsy chief executive Chad Dickerson.

The company’s last round was a $35 million investment raised about two years ago, and one investor with knowledge of the company’s cap table called it a “pretty efficient exit” for its backers.

Morgan Stanley & Co. and Union Square Advisors are acting as financial advisors to Fastly, and Cooley LLP is acting as its legal advisor with regard to the transaction, according to a statement. Qatalyst Partners is acting as financial advisor to Signal Sciences, while Goodwin Procter was the company’s lawyer.

The coronavirus pandemic is expanding California’s digital divide

If every California student without an adequate internet connection got together and formed a state, it would contain more residents than Idaho or Hawaii.

A total of 1,529,000 K-12 students in California don’t have the connectivity required for adequate distance learning.

Analysis from Common Sense Media also revealed that students lacking adequate connection commonly lack an adequate device as well. The homework gap that separates those with strong connections from those on the wrong side of the digital divide will become a homework chasm without drastic and immediate intervention.

To raise awareness of the enormity and immediacy of the digital divide, I started No One Left Offline (NOLO) in San Francisco. It’s an all-volunteer nonprofit that’s creating a coalition of Bay Area organizations focused on giving students, seniors and individuals with disabilities access to high-speed, affordable Internet.

During the week of July 27, the NOLO coalition will launch the Bridge the Divide campaign to raise $50,000 in funds that will be used to directly cover broadband bills for families on the edge of the digital divide.

At this point in our response to COVID-19, emergency measures have only stopped the homework gap from growing rather than actually shrinking it. That’s precisely why we need a new form of addressing students’ lack of adequate internet and devices. The digital “haves” should embrace directly covering the broadband bills and upgrades required by the “have nots.” This form of direct giving is both the most effective and efficient means of giving every student high-speed internet and a device to make the most of that connection.

But too few people are aware of just how dire life can be on the wrong side of the digital divide. That’s why I’m hoping you — as a fellow member of the digital “haves” — will join me in taking a day off(line) on July 17. I’m convinced that it will take a day (if not more) in the digital dark for more Americans to recognize just how difficult it is to thrive, let alone survive, without stable internet, a device and a sufficient level of digital literacy.

The increased attention to the digital divide generated by this day off(line) will spur a more collective and significant response to stopping the formation of a homework chasm.

Current efforts to close the homework gap have at once been laudable and limited. For example, internet service providers (ISPs) deserve praise for taking a voluntary pledge to limit fees, forgive fines and remove data caps. But that pledge expired at the end of June, months before school starts and in the middle of an expanding economic calamity.

It’s true that many ISPs are still going to extraordinary lengths to help those in need — look no further than Verizon donating phones to Miracle Messages to help individuals experiencing homelessness connect with loved ones. However, even these extraordinary measures will not fully make up for the fact that hundreds of thousands of Californians are experiencing greater financial insecurity than ever before. They want and require a long-term solution to their digital needs — not just voluntary pledges that end in the middle of a pandemic.

In the same way, many school districts in the Bay Area have rapidly loaned hotspots and devices to students and families in need. In fact, even before COVID-19, the Oakland Unified School District and the 1Million Project were providing hotspots to students in need. These sorts of interventions, though, do not afford students on the wrong side of the homework gap the same opportunity to fully develop their digital literacy as those that have devices to call their own and internet connections sufficient to do more than just homework.

Every student deserves a device to call their own and a connection that allows them to become experts in safely and smoothly navigating the internet.

Direct giving is the solution. Financially secure individuals across the Bay Area can and should “sponsor” internet plans and devices for families in need. By sponsoring a family’s high-speed internet plan for a year or more, donors will provide students and parents alike with the security they need to focus on all of the other challenges associated with life in a pandemic. What’s more, sponsored devices would come without strings attached or “used” labels.

Students would have a fully equipped laptop to call their own as well as one that didn’t lack key functionalities, which is common among donated devices.

Because access to the internet is a human right, the government should be solving the homework gap. So far, it hasn’t been up to the task. So, in the interim, we’ll need a private sector solution. The good news is that we collectively seem up for the task. According to Fidelity, most charitable donors plan to maintain or increase their giving this year.

Consider that even 46% of millennials plan to increase their philanthropy. Unfortunately, one inhibitor to giving is the fact that “many donors don’t feel that they have the information they need to effectively support efforts” to address the ramifications of COVID-19.

That’s where NOLO and other digital inclusion coalitions step in. We’re sounding the bell: The public sector isn’t closing the homework gap; it’s on us to make sure kids have the connections and devices they need to thrive. NOLO is also providing the means to act on this information — during its Bridge the Divide campaign, donors will have a chance to sponsor broadband bills for community members served by organizations across the Bay Area including the SF Tech Council, BMAGIC and the Mission Merchants Association.

Our collective assignment is making the homework gap a priority. Our due date is nearing. The first task is taking a day off(line) on July 17. The next is donating to the Bridge the Divide campaign during the week of the 27th.

Let’s get to work.

Astranis reaches key milestone with MicroGEO communication satellite, aims for service to begin next summer

Satellite telecommunications startup Astranis has achieved a key technical milestone with its MicroGEO product, a small geosynchronous communications satellite that it will use to launch its first commercial service starting next summer for customers in Alaska. This is a big milestone for Astranis because the MicroGEO satellite test article that passed this round of thermal-vacuum qualification testing will serve as the basis for a whole planned line of first products, designed to affordably provide low-cost broadband to specific geographic markets using individual spacecraft, region-by-region.

Having already successfully met its technical requirements in terms of radiation, which is particularly powerful in the target orbital band where the Astranis MicroGEO will operate in a fixed position above the Earth, this means that the startup’s tech has passed the last major technical milestone on its path to launch and operation. I spoke to Astranis CEO and founder John Gedmark about the achievement, and he said that while the MicroGEO qualification test article will still undergo a range of remaining tests ahead of its launch on a SpaceX rocket next year ahead of its planned Summer 2021 operational date, this is a big achievement that represents years of work from the team.

“It was a huge amount of work for the team, and I’m sure as you can imagine, these things do not do not come easy,” Gedmark said. “People maybe don’t understand just how extreme the temperatures are that a satellite has to operate within: We were doing testing all the way from 150 degrees Fahrenheit to -180 degree Fahrenheit. Just imagine that temperature swing on a big box of electronics.”

That is incredibly impressive, given that while they’ve improved significantly over the years, even modern consumer electronics can have challenges with much less extreme temperature swings. And qualification testing for equipment designed to work in space is actually done to a standard of both 20 degrees Fahrenheit hotter and colder than expected orbital temperatures, just to provide the equipment with a safe operational buffer. Temperatures can vary so wildly because the orbital environment lacks the insulating layer of the atmosphere, meaning it gets very cold when the sun is on the far side of the Earth, and extremely hot when the sun is shining directly on the spacecraft.

The Astranis MicroGEO satellites will operate in geostationary orbit (LEO), which means they’ll sit in a high orbit (higher than what’s known as ‘low Earth orbit’ or LEO, which you may have heard of because that’s where SpaceX’s Starlink satellites work). The GEO band is where existing satellite-based communication infrastructure operates today – but these consist of very large, mostly aging and expensive satellites that provide the backbone of networks including those used for in-flight wifi and on cruise ships.

Astranis is outfitting its GEO satellites with much more modern telecommunications equipment, and making its spacecraft significantly smaller, too. The company is betting that it can deploy smaller GEO satellites much more affordably, in order to serve very specific geographies. Its first satellite will serve Alaska, as mentioned, through a partnership with existing satellite TV and internet provider Pacific Dataport. This is expected to triple the available bandwidth to the state, while keeping costs to customers affordable. After that, the goal is to continue to build and launch similar satellites to serve individual small-to-medim sized countries, states and other regions.

This model differs significantly from what SpaceX and others working on LEO communications constellations are doing. Gedmark outlined the costs and benefits of both, and why he believes what Astranis is doing is likely the better fit in terms of business model and efficiencies for a small, young company to pursue.

“We’re huge fans of what some of these other companies are trying to do with LEO constellations – it’s just very different approach,” he said “We have the ability to put up one satellite at a time and focus bandwidth right where it’s needed, and do that quickly. The smaller constellations, they are very much an all-or-nothing proposition – the entire constellation has to be in place to begin service. And then they have some other challenges ahead of them as well, like ground antennas, unique tracking.”

Gedmark notes that you need to deploy many gateway dishes all around the world in order for LEO constellations to be effective, which caries its own costs and risks. Astranis, however, is compatible with existing infrastructure already used in satellite-based internet and communications, making it much easier to get serving customers. Plus, since it can launch satellites individually to serve specific regions, it can add revenue in stages over time, whereas LEO networks will need an immense up-front capital investment before any money actually starts coming in from commercial customers.

“They certainly can be successful,” he said. “I just think I think it’s gonna take them some time and we’re optimized for speed. Whether it be a U.S. state like Alaska, or a small- or medium-sized country we can offer them some extra bandwidth they can use as soon as possible and, and get it to them at the right price.”

Cloudflare partners with JD to expand its network in China

Cloudflare today announced a new partnership with JD Cloud & AI that will see the company expand its network in Chinato an additional 150 data centers. Currently, Cloudflare is available in 17 data centers in mainland China, thanks to a long-standing partnership with Baidu, but this new deal is obviously significantly larger.

CloudFlare’s original partnership with Baidu launched in 2015. The idea then, as now, was to give Cloudflare a foothold in one of the fastest-growing internet markets by providing Chinese companies better reach customers inside and outside of the country, but also — and maybe more importantly — to allow foreign companies to better reach the vast Chinese market.

“I think there are very few Western technology companies that have figured out how to operate in China,” Matthew Prince, the CEO and co-founder Cloudflare told me. “And I think we’re really proud of the fact that we’ve done that. What I’ve learned about China — certainly in the last six years that we’ve been directly working with partners there, […] has been that while it’s an enormous market and an enormous opportunity […], it’s still a very tight-knot technology community there — and one with a very long memory.”

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SAN FRANCISCO, CA – SEPTEMBER 22: (L-R) Matthew Prince and Michelle Zatlyn of CloudFlare speak onstage during day two of TechCrunch Disrupt SF 2015 at Pier 70 on September 22, 2015 in San Francisco, California. (Photo by Steve Jennings/Getty Images for TechCrunch)

He attributes the fact that Cloudflare was a good partner to Baidu for so many years to JD’s interest in working with the company as well. That partnership with Baidu will continue (Prince called them a “terrific partner”). This new deal with JD, however, will now also give Cloudflare the ability to reach another set of Chinese enterprises, too, that are currently betting on that company’s cloud.

“As we got to know them, JD really stood out,” Prince said. “I think they’re first of all really one of the up and coming cloud providers in China. And I think that then means that marrying Cloudflare’s services with JD’s services makes their overall cloud platform much more robust for Chinese customers.” He also noted that JD has relationships with many large Chinese businesses that are increasingly looking to go global.

To put this deal into perspective, today, Cloudflare operates in about 200 cities. Adding another 150 to this — even if it’s through a partner — marks a major expansion for the company.

As for the deal itself, Prince said that its structure is similar to the deal it made with Baidu. “We contribute the technology and the know-how to build a network out across China. They introduce capital in order to build that network out and also have some financial guarantees to us and then we share in the upside of what happens as we’re both able to sell the China network or as JD is able to sell Cloudflare’s services outside of China.”

When the company first went to China through Baidu, it was criticized for going into a market where there some obvious issues around free speech. Prince, who has been pretty outspoken about free speech issues, seems to be taking a rather pragmatic approach here.

“[Free speech] is certainly something we thought about a lot when we first made the decision to go into China in 2014,” he said. “And I think we’ve learned a lot about it. Around the world, whether it’s China or Turkey or Egypt or the United Kingdom or Brazil or increasingly even the United States, there are rules about what content can be accessed there. Regardless of what my personal feelings might be — and I grew up as a son of a journalist and in the United States and have seen the power of having a very free press and really, really, really strong freedom of expression protection. But I also think that every country doesn’t have the same tradition and the same laws as the United States. And I think that what we have tried to do everywhere that we operate, is comply with whatever the regional laws are. And it’s hard to do anything else.”

Cloudflare expects that it will take three years before all of the data centers will go online.

“I’m thrilled to establish this strategic collaboration with Cloudflare,” said Dr. Bowen Zhou, President of JD Cloud & AI. “Cloudflare’s mission of ‘helping to build a better Internet,’ closely aligns with JD Cloud & AI’s commitment to provide the best service possible to global partners. Leveraging JD.com’s rich experience across vast business scenarios, as well as its logistics and technological capabilities, we believe that this collaboration will provide valuable services that will transform how business is done for users inside and outside of China.”

Players Ntwrk launches celebrity gaming channel backed by WME, Daylight and Stratton Sclavos

Emerging from the smoldering wreckage of Echo Fox and Vision Venture Partners, the investor Stratton Sclavos is rising again to launch a new esports-related venture — a gaming-focused digital network also backed by the WME talent agency and Daylight Holdings.

Tapping Daylight and WME’s roster of talent, Sclavos has created Players Ntwrk, a new gaming-focused production company that will look to compete with other upstarts angling to tap into esports and competitive gaming’s newly dominant place in the entertainment firmament.

Players Ntwrk will feature original programming, unscripted series, celebrity gameplay and live events tapping talent from music, traditional pro-sports and the esports gaming world.

Sclavos and the multifaceted talent manager and president of Daylight Holdings, Ben Curtis, dreamed up Players Ntwrk as a way to tie together disparate groups of athletes and entertainers around their shared love of gaming and entertainment. The network will initially leverage relationships with WME and Klutch Sports Group, the agency founded by LeBron James’ longtime manager, Rich Paul, to find talent for programming.

The network will launch on Tuesday at 5:00 pm Pacific for two hours of gameplay featuring the New Orleans Pelicans Guard/Forward Josh Hart and Sacramento Kings point guard De’Aaron Fox on the Players Ntwrk Twitch channel. Additional live streams will be broadcast Friday and Saturday, the company said.

Over the next 12 weeks the network will add live programming featuring all of its “First Squad” talent and experimenting with different gaming and unscripted formats. Ultimately, the network will produce between 12 and 15 hours of original programming per week by the end of the second quarter and will ramp up to 20 to 24 hours of programming per-week by the end of the year.

Initial programming is going to be devoted to charity fundraising, with proceeds going to designated charities based on direct audience donations, the company said.

Players Ntwrk’s First Squad talent roster includes:

  • Professional athletes: De’Aaron Fox (Sacramento Kings), Josh Hart (New Orleans Pelicans), Jarvis Landry (Cleveland Browns) and Alvin Kamara (New Orleans Saints)
  • Music and Entertainment: PARTYNEXTDOOR, Murda Beatz, producer Boi-1da, actor/former athlete Donovan Carter (Ballers)
  • Creators/Streamers: KatGunn, Sodapoppin, Cash, Jesser, Jericho, Octane, Sigils, Sonii and DenkOps

Players Ntwrk joins companies like Venn, which are angling to gain a slice of the roughly 37.5 million monthly viewers that are expected to watch live streams on Twitch by the end of 2020, according to research done by eMarketer.

“The number of viewers and subscribers consuming gaming entertainment across YouTube and Twitch tops other entertainment services such as Netflix, HBO, Spotify and ESPN combined,” said Sclavos, in a statement. “Entertainment spectacle is trumping hardcore gaming competition. That kind of engagement makes it clear; gaming entertainment is the next pop culture phenomena. PLAYERS NTWRK is the only platform embracing and executing this new reality by creating original content with the most influential people who also happen to be fans themselves.”

Netflix is reducing its traffic on ISPs by 25% in India

Netflix said on Tuesday that it is lowering its traffic on network providers by 25% in India for a period of 30 days, following a similar move in Europe in a bid to reduce the congestion on internet pipelines.

The American giant said that despite lowering the strain it puts on internet service providers, it will “maintain the quality” of its service. Amazon Prime Video said it has also started to lower the data consumption that streaming takes up on its platform, while local services Disney’s Hotstar, Times Internet’s MX Player and Zee5 say they are working to enforce similar measures.

Vijay Venkataramanan, Director of Post-Production at Netflix India, offers clarity on how reducing the traffic would impact the quality of video streams.

“Given the crisis, we’ve developed a way to reduce Netflix’s traffic on telecommunications networks by 25% while also maintaining the quality of our service. So consumers should continue to get the quality that comes with their plan – whether it’s Ultra-High, High or Standard Definition. We believe that this will provide significant relief to congested networks and will be deploying it in India for the next 30 days,” Ken Florance, VP Content Delivery of Netflix, said in a statement to TechCrunch.

TechCrunch understands that Netflix, which maintains several different streams for a single title, is removing the highest bandwidth streams as part of this move. This won’t affect most Netflix subscribers in India.

The mobile-only plan that Netflix introduced in India last year is its most popular tier in the country, a person familiar with the matter said. Both mobile-only plan and the basic plan, the immediate advanced tier above it, offer limit streaming in standard definition.

Netflix’s announcement follows a local telecom group’s (Cellular Operators Association of India) appeal to on-demand video streaming services to put less burden on internet pipelines that are facing surge in usage as more people stay and work from home in the wake of coronavirus outbreak.

A report by Bank of America, obtained by TechCrunch, said this week that internet service providers in India were witnessing a 10% surge in the volume of daily traffic and data consumption. The firm analyzed traffic at internet exchanges and spoke with internet service providers to reach that conclusion, it said in the report.

Google and Facebook turn their backs on undersea cable to China

Google and Facebook seem to have resigned themselves to losing part of the longest and highest profile internet cable they have invested in to date. In a filing with the Federal Communications Commission last week, the two companies requested permission to activate the Pacific Light Cable Network (PLCN) between the US and the Philippines and Taiwan, leaving its controversial Hong Kong and Chinese sections dormant.

Globally, around 380 submarine cables carry over 99.5 percent of all transoceanic data traffic. Every time you visit a foreign website or send an email abroad, you are using a fiber-optic cable on the seabed. Satellites, even large planned networks like SpaceX’s Starlink system, cannot move data as quickly and cheaply as underwater cables.

When it was announced in 2017, the 13,000-kilometer PLCN was touted as the first subsea cable directly connecting Hong Kong and the United States, allowing Google and Facebook to connect speedily and securely with data centers in Asia and unlock new markets. The 120 terabit-per-second cable was due to begin commercial operation in the summer of 2018. 

“PLCN will help connect US businesses and internet users with a strong and growing internet community in Asia,” they wrote. “PLCN will interconnect … with many of the existing and planned regional and international cables, thus providing additional transmission options in the event of disruptions to other systems, whether natural or manmade.”

Instead, it has been PLCN itself that has been disrupted, by an ongoing regulatory battle in the US that has become politicized by trade and technology spats with China.

Team Telecom, a shadowy US national security unit comprised of representatives from the departments of Defense, Homeland Security, and Justice (including the FBI), is tasked with protecting America’s telecommunications systems, including international fiber optic cables. Its regulatory processes can be tortuously slow. Team Telecom took nearly seven years to decide whether to allow China Mobile, a state-owned company, access to the US telecoms market, before coming down against it in 2018 on the grounds of “substantial and serious national security and law enforcement risks.”

Although subsidiaries of Google and Facebook have been the public face of PLCN in filings to the FCC, four of the six fiber-optic pairs in the cable actually belong to a company called Pacific Light Data Communication (PLDC). When the project was first planned, PLDC was controlled by Wei Junkang, a Hong Kong businessman who had made his fortune in steel and real estate.

“It is just one of those moments where it is more difficult to land a cable, no matter who the Chinese partner is, because of the political situation.” – NYU professor Nicole Starosielski

In December 2017, Wei sold most of his stake in PLDC to Dr Peng Telecom & Media Group, a private broadband provider based in Beijing. That sent alarm bells ringing in Washington, according to a report in the Wall Street Journal last year. While Dr Peng is not itself state-owned or controlled, it works closely with Huawei, a telecoms company the Trump administration has accused of espionage and trade secret theft. Dr Peng has also worked on Chinese government projects, including a surveillance network for the Beijing police.  

PLCN has been legal limbo ever since, with Google complaining bitterly to the FCC about the expense of the ongoing uncertainty. In 2018, it wrote, “[any further holdup] would impose significant economic costs. Depending on the length of the delay, the financial viability of the project could be at risk.”

Google and Facebook finally secured special permission to lay the cable in US waters last year, and to construct, connect and temporarily test a cable landing station in Los Angeles. But while the network itself is now essentially complete, Team Telecom has yet to make a decision on whether data can start to flow through it. 

In the past, Team Telecom has permitted submarine cables, even from China, to land in the US, as long as the companies operating them signed what are called network security agreements. These agreements typically require network operations to be based in the US, using an approved list of equipment and staffed by security-screened personnel. Operators are obliged to block security threats from foreign powers, while complying with lawful surveillance requests from the US government.

In 2017, for example, Team Telecom gave the green light to the New Cross Pacific (NCP) cable directly connecting China and the US, despite it being part-owned by China Mobile, the state-owned company it later denied US access to on national security grounds.

“Normally there wouldn’t be so much fuss over a cable to China,” says Nicole Starosielski, a professor at New York University and author of The Undersea Network. “We’ve had cables to China for a long time and all of these networks interconnect, so even if they don’t land directly in China, they’re only a hop away. It is just one of those moments where it is more difficult to land a cable, no matter who the Chinese partner is, because of the political situation.”

In September, Senator Rick Scott (R-FL), who sits on Senate committees for technology, communications and homeland security, sent a letter to FCC Chairman Ajit Pai urging him to block PLCN. “[PLCN] threatens the freedom of Hong Kong and our national security,” wrote Scott. “This project is backed by a Chinese partner, Dr Peng Telecom & Media Group Co., and would ultimately provide a direct link from China into Hong Kong … China has repeatedly shown it cannot be trusted … We cannot allow China expanded access to critical American information, even if funded by US companies.”

Google and Facebook saw the writing on the wall. On January 29 last week, representatives from the two companies – but not PLDC – met with FCC officials to propose a new approach. A filing, made the same day, requests permission to operate just the two PLCN fiber pairs owned by the American companies: Google’s link to Taiwan, and Facebook’s to the Philippines. 

“[Google] and [Facebook] are not aware of any national security issues associated with operation of US-Taiwan and US-Philippine segments,” reads the application. “For clarity, the [request] would not authorize any commercial traffic on the PLCN system to or from Hong Kong, nor any operation of the PLCN system by PLDC.”

The filling goes on to describe how each fiber pair has its own terminating equipment, with Google’s and Facebook’s connections arriving at Los Angeles in cages that are inaccessible to the other companies. “PLDC is contractually prohibited from using its participation interest in the system to interfere with the ownership or rights of use of the other parties,” it notes.

Neither company would comment directly on the new filing. A Google spokesperson told TechCrunch, “We have been working through established channels in order to obtain cable landing licenses for various undersea cables, and we will continue to abide by the decisions made by designated agencies in the locations where we operate.” 

A Facebook spokesperson said, “We are continuing to navigate through all the appropriate channels on licensing and permitting for a jointly-owned subsea cable between the US and Asia to provide fast and secure internet access to more people on both continents.”

“I think stripping out the controversial [Hong Kong] link will work,” says Starosielski. “But whenever one of these projects either gets thwarted, it sends a very strong message. If even Google and Facebook can’t get a cable through, there aren’t going to be a ton of other companies advancing new cable systems between the US and China now.”

Ironically, that means that US data to and from China will continue to flow over the NCP cable controlled by China Mobile – the only company that Team Telecom and the FCC have ever turned down on national security grounds.

Cloudflare is giving away its security tools to US political campaigns

Network security giant Cloudflare said it will provide its free security tools and services to U.S. political campaigns, as part of its efforts to secure upcoming elections against cyberattacks and election interference.

The company said its new Cloudflare for Campaigns offering will include distributed denial-of-service attack mitigation, load balancing for campaign websites, a website firewall, and anti-bot protections.

It’s an expansion of the company’s security offering for journalists, civil rights activists and humanitarian groups under its Project Galileo, which aims to protect against disruptive cyberattacks. The project later expanded to smaller state and local government sites in 2018, with an aim of protecting servers containing voter registration data and other election infrastructure from attacks.

Now the company is offering its security services to 11 of the 17 presidential campaigns, it said, but wants to ensure that its offering is “available to the largest campaigns are also available to smaller campaigns as well.”

Cloudflare’s co-founder and chief executive Matthew Prince said there was a “clear need” to help campaigns secure not only their public facing websites but also their internal data security.

The company said it’s working with the non-partisan, non-profit organization Defending Digital Campaigns to provide its services to campaigns. Last year the Federal Elections Commission changed the rules to allow political campaigns to receive discounted cybersecurity assistance, which was previously a campaign finance violation.