Apple is (temporarily) waiving its App Store fee for Facebook’s online events

Last month, Facebook introduced support for paid online events — and since many of the businesses offering those events have struggled during the coronavirus pandemic, the company also said it would not collect fees for the next year. At the same time, it complained that Apple had “dismissed” its requests to waive the App Store’s customary 30% fee on in-app purchases.

Today, Facebook is announcing a reversal on Apple’s part: Online event fees will be processed through Facebook Pay, without Apple collecting its 30% cut, meaning businesses will receive all of the earnings from their online events, minus taxes. This arrangement will last until December 31 and will not apply to gaming creators.

The news comes after Facebook publicly pressured Apple to change its stance. It even submitted an iOS app update stating that “Apple takes 30% of this purchase” in the events payments flow. (Facebook said Apple rejected the update for including information that’s “irrelevant” to users.)

And while the two companies appear to have come to an agreement, today’s statements from Facebook are still a bit barbed.

“This is a difficult time for small businesses and creators, which is why we are not collecting any fees from paid online events while communities remain closed for the pandemic,” said Facebook spokesperson Joe Osborne. “Apple has agreed to provide a brief, three-month respite after which struggling businesses will have to, yet again, pay Apple the full 30% App Store tax.”

Similarly, in discussing the exception for gaming creators, Facebook Gaming Vice President Vivek Sharma said, “We unfortunately had to make this concession to get the temporary reprieve for other businesses.”

When asked about the change, Apple provided the following statement: “The App Store provides a great business opportunity for all developers, who use it to reach half a billion visitors visitors each week across 175 countries. To ensure every developer can create and grow a successful business, Apple maintains a clear, consistent set of guidelines that apply equally to everyone.”

More specifically, Apple said it’s giving Facebook until the end of the year to implement in-app payments for these events and bring them into compliance with App Store rules.

This also comes as Fortnite-maker Epic Games is waging a legal battle and publicity campaign against Apple’s App Store fees, with Fortnite removed Fortnite from the iOS App Store. Epic is also part of a just-announced group of publishers called the Coalition for App Fairness, which is pushing for app store changes or regulation.

Apple is (temporarily) waiving its App Store fee for Facebook’s online events

Last month, Facebook introduced support for paid online events — and since many of the businesses offering those events have struggled during the coronavirus pandemic, the company also said it would not collect fees for the next year. At the same time, it complained that Apple had “dismissed” its requests to waive the App Store’s customary 30% fee on in-app purchases.

Today, Facebook is announcing a reversal on Apple’s part: Online event fees will be processed through Facebook Pay, without Apple collecting its 30% cut, meaning businesses will receive all of the earnings from their online events, minus taxes. This arrangement will last until December 31 and will not apply to gaming creators.

The news comes after Facebook publicly pressured Apple to change its stance. It even submitted an iOS app update stating that “Apple takes 30% of this purchase” in the events payments flow. (Facebook said Apple rejected the update for including information that’s “irrelevant” to users.)

And while the two companies appear to have come to an agreement, today’s statements from Facebook are still a bit barbed.

“This is a difficult time for small businesses and creators, which is why we are not collecting any fees from paid online events while communities remain closed for the pandemic,” said Facebook spokesperson Joe Osborne. “Apple has agreed to provide a brief, three-month respite after which struggling businesses will have to, yet again, pay Apple the full 30% App Store tax.”

Similarly, in discussing the exception for gaming creators, Facebook Gaming Vice President Vivek Sharma said, “We unfortunately had to make this concession to get the temporary reprieve for other businesses.”

When asked about the change, Apple provided the following statement: “The App Store provides a great business opportunity for all developers, who use it to reach half a billion visitors visitors each week across 175 countries. To ensure every developer can create and grow a successful business, Apple maintains a clear, consistent set of guidelines that apply equally to everyone.”

More specifically, Apple said it’s giving Facebook until the end of the year to implement in-app payments for these events and bring them into compliance with App Store rules.

This also comes as Fortnite-maker Epic Games is waging a legal battle and publicity campaign against Apple’s App Store fees, with Fortnite removed Fortnite from the iOS App Store. Epic is also part of a just-announced group of publishers called the Coalition for App Fairness, which is pushing for app store changes or regulation.

India’s ShareChat raises $40 million, says its short-video platform Moj now reaches 80 million users

ShareChat, an Indian social network that focuses entirely on serving users in non-English languages, said on Thursday it has raised $40 million from a clutch of investors after the Indian startup added tens of millions of new users in recent months.

The five-year-old Bangalore-based startup said Dr. Pawan Munjal, chief executive and chairman of giant two-wheeler manufacturer Hero MotoCorp, Ajay Shridhar Shriram, chairman of chemical manufacturing company DCM Shriram, and existing investors Twitter, SAIF Partners, Lightspeed Ventures, and India Quotient financed the new round of capital.

Ankush Sachdeva, co-founder and chief executive of ShareChat, told TechCrunch in an interview that the startup’s new fundraise is part of its pre-Series E financing round. TechCrunch understands the startup is engaging with several major VC funds and corporate giants to raise more than $100 million in the next few months.

The new capital will help ShareChat better support creators on its platform, Sachdeva said. ShareChat launched the short-video app Moj in early July, days after New Delhi banned TikTok, which at the time had about 200 million users in India.

In the weeks following TikTok’s ban in India, scores of startups have launched short-video apps in the country. DailyHunt has launched Josh, and Times Internet’s MX Player has launched TakaTak. But Moj has clearly established dominance1 among short-form video apps.

ShareChat said Moj has amassed over 80 million monthly active users, who are spending about 34 minutes on the platform each day.

ShareChat’s marquee and eponymous app, which caters users in 15 Indian languages, itself has grown significantly. The app has amassed 160 million monthly active users 2, up from 60 million during the same period last year. A user on an average spends about 31 minutes on the app each day, the startup said.

The growth of ShareChat in the social media category is a rare success story for the Indian startup ecosystem.

“India could never have dreamt of having a homegrown social media platform, had ShareChat not embarked on the impossible in 2015. ShareChat’s success has given immense hope to India’s startup fraternity, and motivated entrepreneurs to take audacious bets in India’s internet ecosystem,” said Madhukar Sinha, Partner at India Quotient, one of the earliest backers of ShareChat.

In yet another move that is not very common among Indian startups, ShareChat announced earlier this week that it was adding $14 million to its employee stock ownership plan (ESOP) pool, taking the total to $35 million.

Sachdeva told TechCrunch that for a startup of ShareChat’s scale, it is crucial that its employees feel valued, because there are enough other giants in the market looking for their talent.

The new capital will also help the startup build new products and establish deeper partnerships with music labels, Sachdeva said. TechCrunch reported earlier this year that ShareChat had quietly launched a fantasy sports app called Jeet11.

Sachdeva said Jeet11 is gaining good traction and the startup’s foray into fantasy sports and short-video app categories demonstrates how fast it moves.

ShareChat has also been working with advertisers as it solidifies its monetization avenues, he said.

More to follow…


1 Instagram reaches about 150 million monthly active users in India, but it’s unclear if more than half of the app’s userbase has embraced Reels yet.

2  Many players in the industry rely on mobile insight firm AppAnnie and Sensor Tower to track the performance of their apps, their portfolio startups’ apps, and those of their competitors. We often cite AppAnnie and Sensor Tower data, too.

According to AppAnnie, ShareChat had fewer than 20 million monthly active users in India last month. Startup founders and other tech executives who TechCrunch has spoken to say that AppAnnie’s data is usually very reliable, and I can tell you that most of the figures companies claim publicly match with what you see on AppAnnie’s dashboard.

But another thing I have heard from many startup founders is that AppAnnie’s data often misses the mark for apps that have a significant portion of their user base in smaller cities and towns — as is the case with ShareChat.

I asked Sachdeva about it, and he said that ShareChat and many other apps that are popular in smaller Indian cities have not integrated AppAnnie’s SDK into their apps. AppAnnie relies on developers integrating its SDK into their apps to be able to assess the performance of that app and others installed on the handset.

This would explain why AppAnnie estimates that WhatsApp, which claims to have over 400 million users in India and is also popular among users in smaller Indian cities and towns and villages, has about 330 million users.

The contrast between the numbers ShareChat has officially shared and what one of the most reliable and widely used third-party firms offers was too significant, and I thought I should mention this. AppAnnie did not share ShareChat’s figure with TechCrunch — an industry executive did.

Facebook denies it will pull service in Europe over data transfer ban

Facebook’s head of global policy has denied the tech giant could close its service to Europeans if local regulators order it to suspend data transfers to the US following a landmark Court of Justice ruling in July that has cemented the schism between US surveillance laws and EU privacy rights.

Press reports emerged this week of a Dublin court filing by Facebook, which is seeking a stay to a preliminary suspension order on its EU-US data transfers, that suggested the tech giant could pull out of the region if regulators enforce a ban against its use of a data transfer mechanism known as Standard Contractual Clauses.

The court filing is attached to Facebook’s application for a judicial review of a preliminary suspension order from Ireland’s Data Protection Commission earlier this month, as Facebook’s lead EU data supervisor responded to the implications of the CJEU ruling.

“We of course won’t [shut down in Europe] — and the reason we won’t of course is precisely because we want to continue to serve customer and small and medium sized businesses in Europe,” said Facebook VP Nick Clegg during a livestreamed EU policy debate yesterday.

However he also warned of “profound effects” on scores of digital businesses if a way is not found by lawmakers on both sides of the pond to resolve the legal uncertainty around US data transfers — making a pitch to politicians to come up with a new legal ‘sticking plaster’ for EU-US data transfers now that a flagship arrangement, called Privacy Shield, is dead.

“We have a major issue — which is that for various complex, legal, political and other reasons question marks are being raised about the current legal basis under which data transfers occur. If those legal means of data transfer are removed — not by us, but by regulators — then of course that will have a profound effect on how, not just our services, but countless other companies operate. We’re trying to avoid that.”

The Facebook VP was speaking during an EBS panel debate on rebooting the regional economy “towards a green, digital and resilient union” — which included the EU’s commissioner for the economy, Paolo Gentiloni, and others.

Discussing the Dublin legal filing, Clegg suggested that an overenthusiastic reporter “slightly overwrote” in their interpretation of the document. “We’ve taken legal action in the Dublin courts to — in a sense — to try to send a signal that this is a really big issue for the whole European economy, for all small and large companies that rely on data transfers,” he said.

Clegg went on to claim that while Facebook being forced to suspend data transfers from the EU to the US “would of course be very bad for Facebook” the impact of such an order “would be absolutely disastrous for the economy as a whole”.

“What is at stake here is quite a big issue that in the end can only be resolved politically between a continued negotiation between the US and the EU that clearly is not going to happen until there’s a new US administration in place after the transition period in the early part of next year,” he said, indicating Facebook is using Ireland’s courts to try to buy time for a political fix.

“We need the time and the space for the political process between the EU and the US to work out so that companies can have confidence going fwd that they’re able to transfer data going forward,” he added.

Clegg also sought to present Facebook’s platform as a vital component of any regional economy recovery — talking up its utility to European SMEs for reaching customers.

Some 25M European companies use its apps and tools, he said — impressing that the “vast majority” do so for free and further claiming activity on Facebook’s ad platform could be linked to sales of 208BN, and 3M+ jobs, per independent estimates.

“In terms of the economic recovery, our most important role is to continue to provide that extraordinary capacity for small businesses to do something which in the past only big businesses could do,” he said. “In the past only big businesses had the fancy marketing budgets and could take out bill boards and television and radio ads. The transformational effect of social media and Facebook in part economically speaking is that it’s levelled the playing field.”

Clegg went further on this point — linking the mass exploitation of Internet users’ personal data to the economic value generated by regional businesses via what he badged “personalized advertising” — aka “Facebook’s business model”.

“The personalized advertising model allows us to do that — allows us to level the playing field,” he claimed.

The tech giant’s processing of Europeans’ personal data remains under investigation on multiple fronts by EU regulators — meaning that as well as the clear threat to its US transfers Facebook’s core business model risks being unpicked by regulatory action if it faces enforcement action over data protection violations in future.

“I’m acutely aware that it is a business model that has plenty of criticism aimed at it and there’s a totally legitimate debate which rages in Brussels and elsewhere about how Facebook gathers, stores and monetizes data — and that is a totally legitimate and ongoing debate — but I hope people will not overlook that that business model has one ingenious benefit, amongst others, which is that it allows small businesses to operate on the same basis as big businesses in reaching their customers,” he said.

Never one to waste a lobbying opportunity, Clegg argued the pandemic has made this capacity “even more important” with EU populations under lockdown and fewer opportunities for businesses to engage in face to face selling.

Taxing times

The knotty issue of digital tax reform also came up during the debate.

Gentiloni reiterated the Commission position that it wants to see global agreement on reforming tax rules to take account of the shift to online business but he said the bloc is willing to go ahead with a European digital tax if that effort fails.

“We can’t remain with the model of the previous century,” he said, before going on to flesh out the challenges facing global accord on the issue. “We don’t want to be the one breaking this OECD process. To be honest, there was a lot of progress in this thing that we call ‘inclusive framework’ — more than dozens of countries working together and reaching something like an agreement on a new form of digital tax but then one single country — but a very important one — is not agreeing with this solution, is proposing a different one. But this different solution, the so called ‘Safe Harbor’, appears a little bit like an optional solution and it’s a bit difficult to conceive of an optional solution because of course you don’t pay ‘optional taxes’, I don’t think so. But we are still committed towards the end of this year to try to find this solution.

“My absolute preferred solution would be a global one. For many reasons — for avoiding tensions among different countries, and for facilitating for business the payment of taxes — but I want to say very clearly that we have a second best solution which is a European digital taxation because the alternative to this would be to have, as we already have in legislation, a French one, an Italian one, a Spanish one and I don’t think this is a good solution for Facebook or other companies. So we’re working for global but if global is not possible we will go European.”

Facebook’s Clegg said the company “will pay the taxes that are due under the rules that operate”, adding that if there is a European digital tax it will “of course” abide by it. But he too said Facebook’s preference is for a global arrangement.

TikTok says it removed 104M videos in H1 2020, proposes harmful content coalition with other social apps

As the future of ByteDance’s TikTok ownership continues to get hammered out between tech leviathans, investors and government officials in meeting rooms, the video app today published its latest transparency report. In all, over 104.5 million videos were taken down; it had nearly 1,800 legal requests; and received 10,600 copyright takedown notices for the first half of this year.

Alongside that, and possibly to offset the high numbers of illicit videos and to also coincide with an appearance today in front of a parliamentary committee in the UK over harmful content, TikTok also announced a new initiative — potentially in partnership with other social apps — against harmful content.

The figures in the transparency report underscore an important aspect around the impact of the popular app. The government may want to shut down TikTok over national security concerns (unless ByteDance finds a new non-Chinese controlling structure that satisfies lawmakers).

But in reality, just like other social media apps, TikTok has another not-insignificant fire to fight: it is grappling with a lot of illegal and harmful content published and shared on its platform, and as it continues to grow in popularity (it now has more than 700 million users globally), that problem will also continue to grow.

That’s something TikTok sees will be an ongoing issue for the company, regardless of how its ownership unfolds outside of China. While one of the big issues around TikTok’s ownership has been related to its algorithms and whether these can or will be part of any deal, the company has tried to make other efforts to appear more open with regards to how it works. Earlier this year it opened a transparency center in the US that it said would help experts observe and vet how it moderates content.

TikTok said that the 104,543,719 total videos that TikTok removed globally for violating either community guidelines or its terms of service made up less than 1% of all videos uploaded on TikTok, which gives you some idea of the sheer scale of the service. 

The volume of videos that are getting taken down have more than doubled over the previous six months, a reflection of how the total volume of videos has also doubled.

In the second half of 2019, the company took down more than 49 million videos, according to the last transparency report published by the company (I don’t know why exactly, but it took a lot longer to publish that previous transparency report, which came out in July 2020.) The proportion of total videos taken down was roughly the same as in the previous six months (“less than 1%”).

TikTok said that 96.4% of the total number were removed before they were reported, with 90.3% removed before they received any views. It doesn’t specify if these were found via automated systems or by human moderators, or a mix of both, but it sounds like it made a switch to algorithm-based moderation at least in some markets:

“As a result of the coronavirus pandemic, we relied more heavily on technology to detect and automatically remove violating content in markets such as India, Brazil, and Pakistan,” it noted.

The company notes that the biggest category of removed videos was around adult nudity and sexual activities, at 30.9%, with minor safety at 22.3% and illegal activities at 19.6%. Other categories included suicide and self harm, violent content, hate speech and dangerous individuals. (And videos could count in more than one category, it noted.)

The biggest origination market for removed videos is the one in which TikTok has been banned (perhaps unsurprisingly): India took the lion’s share of videos at 37,682,924. The US, on the other hand, accounted for 9,822,996 (9.4%) of videos removed, making it the second-largest market.

Currently, it seems that misinformation and disinformation are not the main ways that TikTok is getting abused, but they are still significant numbers: some 41,820 videos (less than 0.5% of those removed in the US) violated TikTok’s misinformation and disinformation policies, the company said.

Some 321,786 videos (around 3.3% of US content removals) violated its hate speech policies.

Legal requests, it said, are on the rise, with 1,768 requests for user information from 42 countries/markets in the first six months of the year, with 290 (16.4%) coming from US law enforcement agencies, including 126 subpoenas, 90 search warrants and 6 court orders. In all, it had 135 requests from government agencies to restrict or remove content from 15 countries/markets.

TikTok said that the harmful content coalition is based on a proposal that Vanessa Pappas, the acting head of TikTok in the US, sent out to nine executives at other social media platforms. It doesn’t specify which, nor what the response was. We are asking and will update as we learn more.

Social media coalition proposal

Meanwhile, the letter, published in full by TikTok and reprinted below, underscores a response to current thinking around how proactive and successful social media platforms have been in trying to curtail some of the abuse of their platforms. It’s not the first effort of this kind — there have been several other attempts like this one where multiple companies, erstwhile competitors for consumer engagement, come together with a united front to tackle things like misinformation.

This one specifically is identifying non-political content and coming up with a “collaborative approach to early identification and notification amongst industry participants of extremely violent, graphic content, including suicide.” The MOU proposed by Pappas suggested that social media platforms communicate to keep each other notified of the content — a smart move, considering how much gets shared across multiple platforms, from other platforms.

The company’s efforts on the harmful content coalition is one more example of how social media companies are trying to take their own initiative and show that they are trying to be responsible, a key way of lobbying governments to stay out of regulating them. With Facebook, Twitter, YouTube and others continue to be in hot water over the content that is shared over their platforms — despite their attempts to curb abuse and manipulation — it’s unlikely that this will be the final word on any of this.

Full memo below:

Recently, social and content platforms have once again been challenged by the posting and cross-posting of explicit suicide content that has affected all of us – as well as our teams, users, and broader communities.

Like each of you, we worked diligently to mitigate its proliferation by removing the original content and its many variants, and curtailing it from being viewed or shared by others. However, we believe each of our individual efforts to safeguard our own users and the collective community would be boosted significantly through a formal, collaborative approach to early identification and notification amongst industry participants of extremely violent, graphic content, including suicide.

To this end, we would like to propose the cooperative development of a Memorandum of Understanding (MOU) that will allow us to quickly notify one another of such content.

Separately, we are conducting a thorough analysis of the events as they relate to the recent sharing of suicide content, but it’s clear that early identification allows platforms to more rapidly respond to suppress highly objectionable, violent material.

We are mindful of the need for any such negotiated arrangement to be clearly defined with respect to the types of content it could capture, and nimble enough to allow us each to move quickly to notify one another of what would be captured by the MOU. We also appreciate there may be regulatory constraints across regions that warrant further engagement and consideration.

To this end, we would like to convene a meeting of our respective Trust and Safety teams to further discuss such a mechanism, which we believe will help us all improve safety for our users.

We look forward to your positive response and working together to help protect our users and the wider community.

Sincerely,

Vanessa Pappas
Head of TikTok

More to come.

Daily Crunch: This TikTok deal is pretty confusing

Companies send out conflicting messages about the TikTok deal, Microsoft acquires a gaming giant and the WeChat ban is temporarily blocked. This is your Daily Crunch for September 21, 2020.

The big story: This TikTok deal is pretty confusing

This keeps getting more confusing. Apparently TikTok’s parent company ByteDance has reached a deal with Walmart and Oracle that will allow the Chinese social media app to continue operating in the United States, and the deal has been approved by Donald Trump. But it’s hard to tell exactly what this agreement entails.

ByteDance said it would retain 80% control of TikTok, while selling 20% of the company to Walmart and Oracle as “commercial partner” and “trusted technology partner,” respectively. However, Oracle released a seemingly conflicting statement, claiming that Americans will have majority ownership and “ByteDance will have no ownership in TikTok Global.”

So what’s going on here? We’re trying to figure it out.

The tech giants

Microsoft set to acquire Bethesda parent ZeniMax for $7.5B — ZeniMax owns some of the biggest publishers in gaming, including Bethesda Game Studios, id Software, ZeniMax Online Studios, Arkane, MachineGames, Tango Gameworks, Alpha Dog and Roundhouse Studios.

Trump administration’s WeChat ban is blocked by US district court — More news about the Trump administration’s efforts to ban some high-profile Chinese apps: A district court judge in San Francisco has temporarily stayed the nationwide ban on WeChat.

Nikola’s chairman steps down, stock crashes following allegations of fraud — This comes in the wake of a report from a noted short-seller accusing the electric truck company of fraud.

Startups, funding and venture capital

With $100M in funding, Playco is already a mobile gaming unicorn — Playco is a new mobile gaming startup created by Game Closure co-founder Michael Carter and Zynga co-founder Justin Waldron.

Indian mobile gaming platform Mobile Premier League raises $90 million — Mobile Premier League operates a pure-play gaming platform that hosts a range of tournaments.

A meeting room of one’s own: Three VCs discuss breaking out of big firms to start their own gigs — We talked to Construct Capital’s Dayna Grayson, Renegade Partners’ Renata Quintini and Plexo Capital’s Lo Toney.

Advice and analysis from Extra Crunch

Edtech investors are panning for gold — At Disrupt, investors told us how they separate the gold from the dust.

Despite slowdowns, pandemic accelerates shifts in hardware manufacturing — China continues to be the dominant global force, but the price of labor and political uncertainty has led many companies to begin looking elsewhere.

The Peloton effect — Alex Wilhelm examines the latest VC activity in connected fitness.

(Reminder: Extra Crunch is our subscription membership program, which aims to democratize information about startups. You can sign up here.)

Everything else

Ireland’s data watchdog slammed for letting adtech carry on ‘biggest breach of all time’ — The Irish Council for Civil Liberties is putting more pressure on the country’s data watchdog to take enforcement action.

Pandemic accelerated cord cutting, making 2020 the worst-ever year for pay TV — According to new research from eMarketer, the cable, satellite and telecom TV industry is on track to lose the most subscribers ever.

Original Content podcast: ‘Wireless’ shows off Quibi’s Turnstyle technology — I interviewed the director of the new Quibi series.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

Instagram CEO, ACLU slam TikTok and WeChat app bans for putting US freedoms into the balance

As people begin to process the announcement from the U.S. Department of Commerce detailing how it plans, on grounds of national security, to shut down TikTok and WeChat — starting with app downloads and updates for both, plus all of WeChat’s services, on September 20, with TikTok following with a shut down of servers and services on November 12 — the CEO of Instagram and the ACLU are among those speaking out against the move.

The CEO of Instagram, Adam Mosseri, wasted little time in taking to Twitter to criticize the announcement. His particular beef is the implication the move will have for U.S. companies — like his — that also have built their businesses around operating across national boundaries.

In essence, if the U.S. starts to ban international companies from operating in the U.S., then it opens the door for other countries to take the same approach with U.S. companies.

Meanwhile, the ACLU has been outspoken in criticizing the announcement on the grounds of free speech.

“This order violates the First Amendment rights of people in the United States by restricting their ability to communicate and conduct important transactions on the two social media platforms,” said Hina Shamsi, director of the American Civil Liberties Union’s National Security Project, in a statement today.

Shamsi added that ironically, while the U.S. government might be crying foul over national security, blocking app updates poses a security threat in itself.

“The order also harms the privacy and security of millions of existing TikTok and WeChat users in the United States by blocking software updates, which can fix vulnerabilities and make the apps more secure. In implementing President Trump’s abuse of emergency powers, Secretary Ross is undermining our rights and our security. To truly address privacy concerns raised by social media platforms, Congress should enact comprehensive surveillance reform and strong consumer data privacy legislation.”

Vanessa Pappas, who is the acting CEO of TikTok, also stepped in to endorse Mosseri’s words and publicly asked Facebook to join TikTok’s litigation against the U.S. over its moves.

We agree that this type of ban would be bad for the industry. We invite Facebook and Instagram to publicly join our challenge and support our litigation,” she said in her own tweet responding to Mosseri, while also retweeting the ACLU. (Interesting how Twitter becomes Switzerland in these stories, huh?) “This is a moment to put aside our competition and focus on core principles like freedom of expression and due process of law.”

The move to shutter these apps has been wrapped in an increasingly complex set of issues, and these two dissenting voices highlight not just some of the conflict between those issues, but the potential consequences and detriment of acting based on one issue over another.

The Trump administration has stated that the main reason it has pinpointed the apps has been to “safeguard the national security of the United States” in the face of nefarious activity out of China, where the owners of WeChat and TikTok, respectively Tencent and ByteDance, are based:

“The Chinese Communist Party (CCP) has demonstrated the means and motives to use these apps to threaten the national security, foreign policy, and the economy of the U.S.,” today’s statement from the U.S. Department of Commerce noted. “Today’s announced prohibitions, when combined, protect users in the U.S. by eliminating access to these applications and significantly reducing their functionality.”

In reality, it’s hard to know where the truth actually lies.

In the case of the ACLU and Mosseri’s comments, they are highlighting issues of principles but not necessarily precedent.

It’s not as if the U.S. would be the first country to take a nationalist approach to how it permits the operation of apps. Facebook and its stable of apps, as of right now, are unable to operate in China without a VPN (and even with a VPN, things can get tricky). And free speech is regularly ignored in a range of countries today.

But the U.S. has always positioned itself as a standard-bearer in both of these areas, and so apart from the self-interest that Instagram might have in advocating for more free-market policies, it points to wider market and business position that’s being eroded.

The issue, of course, is a little like an onion (a stinking onion, I’d say), with well more than just a couple of layers around it, and with the ramifications bigger than TikTok (with 100 million users in the U.S. and huge in pop culture beyond even that) or WeChat (much smaller in the U.S. but huge elsewhere and valued by those who do use it).

The Trump administration has been carefully selecting issues to tackle to give voters reassurance of Trump’s commitment to “Make America Great Again,” building examples of how it’s helping to promote U.S. interests and demote those that stand in its way. China has been a huge part of that image building, positioned as an adversary in industrial, defence and other arenas. Pinpointing specific apps and how they might pose a security threat by sucking up our data fits neatly into that strategy.

But are they really security threats, or are they just doing the same kind of nefarious data ingesting that every social app does in order to work? Will the U.S. banning them really mean that other countries, up to now more in favor of a free market, will fall in line and take a similar approach? Will people really stop being able to express themselves?

Those are the questions that Trump has forced into the balance with his actions, and even if they were not issues before, they have very much become so now.

Daily Crunch: Twitter tightens security ahead of election

Twitter takes preemptive steps to avoid election-related hacks, we check out the new Apple Watches and Facebook launches new business tools. This is your Daily Crunch for September 17, 2020.

The big story: Twitter tightens security ahead of election

Twitter said today that “high-profile, election-related” accounts in the United States will be receiving notifications telling them they’re required to adopt strong passwords. The company will also be enabling password reset protections for those accounts, and encouraging them to adopt two-factor authentication.

And on top of the steps that it’s requiring candidates to take, Twitter also said it’s adopting additional “proactive internal security safeguards,” such as more sophisticated alerts.

This comes after Twitter was hacked in July, resulting in many high-profile accounts tweeting out a cryptocurrency scam. The company probably wants to avoid an election-related repeat.

The tech giants

A closer look at the new Apple Watches — This isn’t our full review, but rather Brian Heater’s first impressions of the Series 6 and SE.

Facebook launches Facebook Business Suite, an app for managing business accounts across Facebook, Instagram and Messenger — The app offers combined access to a business’s key updates and priorities across Facebook and Instagram.

Amazon makes Alexa Routines shareable — In the U.S., Alexa users will be able to visit the Routines section in the Alexa app, then click on the routine they want to share and grab a shareable URL.

Startups, funding and venture capital

Connected fitness startup Tonal raises another $110 million — It’s a pretty massive round for the strength training company, especially as the space has become increasingly crowded in recent years.

Amazon’s first five climate fund investments include Tesla co-founder JB Straubel’s startup Redwood Materials — Redwood Materials is a recycling startup aiming to create a circular supply chain.

With Goat Capital, Justin Kan and Robin Chan want to keep founding alongside the right teams — Goat Capital is a hybrid incubator, as opposed to a pure seed investment firm.

Advice and analysis from Extra Crunch

Superhuman’s Rahul Vohra asks 6 VCs how to raise funding when the sky is falling — Deal velocity has gone up!

Startup founders must overcome information overload — Entrepreneurs share their tips for weighing advice and data.

Does early-stage health tech need more ‘patient’ capital? — Steve O’Hear interviews Dr. Fiona Pathiraja of early-stage health tech fund Crista Galli Ventures.

(Reminder: Extra Crunch is our subscription membership program, which aims to democratize information about startups. You can sign up here.)

Everything else

Jennifer Doudna sees CRISPR gene-editing tech as a Swiss Army knife for COVID-19 and beyond — Doudna is one of the pioneers of the gene-editing technique known as CRISPR, and she discussed its potential at Disrupt.

Hulu tests its co-viewing feature ‘Watch Party’ with ad-supported viewers — Hulu Watch Party was initially only available for subscribers on the service’s ad-free tier.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

Twitter tightens account security for political candidates ahead of US election

Twitter is taking steps to tighten account security for a range of users ahead of the US presidential election, including by requiring the use of strong passwords.

“We’re taking the additional step of proactively implementing account security measures for a designated group of high-profile, election-related Twitter accounts in the US. Starting today, these accounts will be informed via an in-app notification from Twitter of some of the initial account security measures we will be requiring or strongly recommending going forward,” it said in a blog post announcing the pre-emptive step.

Image credit: Twitter

Last month Twitter said it would be dialling up efforts to combat misinformation and election interference, as well as pledging to help get out the vote — going on to out an election hub to help voters navigate the 2020 poll earlier this week.

Its latest election-focused security move follows an embarrassing account hack incident in July which saw scores of verified users’ accounts accessed and used to tweet out a cryptocurrency scam.

Clearly, Twitter won’t want a politically-flavored repeat of that.

Twitter said accounts that will be required to take steps to tighten their security are:

  • US Executive Branch and Congress

  • US Governors and Secretaries of State

  • Presidential campaigns, political parties and candidates with Twitter Election Labels running for US House, US Senate, or Governor

  • Major US news outlets and political journalists

As well as requiring users in these categories to have a strong password — prompting those without one to update it next time they log in — Twitter said it will also enable Password reset protection for the accounts by default.

“This is a setting that helps prevent unauthorized password changes by requiring an account to confirm its email address or phone number to initiate a password reset,” it noted.

It will also encourage the target types of users to enable Two-factor authentication (2FA) as a further measure to bolster against unauthorized logins. Although it will not be requiring 2FA be switched on.

The platform also said it would be implementing extra layers of what it called “proactive internal security safeguards” for the aforementioned accounts, including:

  • More sophisticated detections and alerts to help us, and account holders, respond rapidly to suspicious activity

  • Increased login defenses to prevent malicious account takeover attempts

  • Expedited account recovery support to ensure account security issues are resolved quickly

Facebook addresses political controversy in India, monetization opportunities, startup investments

At the beginning of the previous decade, Facebook had a tiny presence in India. It had just started to slowly expand its team in the country and was inking deals with telecom operators to make access to its service free to users and even offer incentives such as free voice credit.

India’s internet population, now the second largest with more than 500 million connected users, itself was very small. In early 2011, the country had fewer than 100 million internet users.

But Facebook ended up playing a crucial role in the last decade. So much so that by the end of it, the social juggernaut was reaching nearly every internet user in the country. WhatsApp alone reaches more than 400 million internet users in India, more than any other app in the country, according to mobile insight firm App Annie.

This reach of Facebook in India didn’t go unnoticed. Politicians in the country today heavily rely on Facebook services, including WhatsApp, to get their message out. But it has also complicated things.

Rumors have spread on WhatsApp that cost lives, and politicians from both the large political parties in India in recent weeks have accused the company of showing favoritism to the other side.

To address these issues, and the role Facebook wishes to play in India, Ajit Mohan, the head of the company’s business in the country, joined us at Disrupt 2020. Following are some of the highlights.

On controversy

A recent report in WSJ claimed that Ankhi Das, one of Facebook’s top executives in India, decided against taking down a post from a politician from the ruling party. She did so, the report claimed, because she feared it could hurt the company’s business prospects in India.

In Mohan’s first interview since the controversy broke, he refuted the claims that any executive in the country holds power to influence how Facebook enforces its content policy.

“We believe that it’s important for us to be open and neutral and non-partisan,” he said. “We have deep belief and conviction that our enabling role is as a neutral party that allows speech of all kinds, that allows expression of all kinds, including political expression, and a lot of the guidelines that we have developed are to make sure that we really enable our diversity of expression and opinion so long as we’re able to make sure that the safety and security of people are protected.”

Mohan said the internal processes and systems inside Facebook are designed to ensure that any opinion and preference of an employee or a group of employees is “quite separate from the company and the company’s objective enforcement of its own policies.”

He said individuals can offer input on decisions, but nobody — including Ankhi Das — can unilaterally influence the decision Facebook takes on content enforcement.

“We do allow free expression inside the company as well. We don’t have any constraints on people expressing their point of view, but we see that separate from the enforcement of our content policy. […] The content policy itself, in the context of India, is a team that stands separate from the public policy team that is led by Ankhi,” he added.

This photo illustration shows an Indian newspaper vendor reading a newspaper with a full back page advertisement from WhatsApp intended to counter fake information, in New Delhi on July 10, 2018. (Photo by Prakash SINGH / AFP)

On India and monetization

Even as Facebook has amassed hundreds of millions of users in India, the world’s second largest market contributes little to its bottom line. So why does Facebook care so much about the country?

“India is in the middle of a very exciting economic and social transformation where digital has a massive role to play. In just the last four years, more than 500 million users have come online. The pace of this transformation probably has no parallel in either human history or even in the digital transformation happening in countries around the world,” he said.

“For a company like ours, if you look at the family of apps across WhatsApp and Instagram, we believe we have a useful role to play in fueling this transformation,” he said.

Even as Facebook does not generate a lot of revenue from India, Mohan said the company has established itself as one of the most trusted platforms for marketers. “They look to us as a material partner in their marketing agenda,” he said.

He said the company is hopeful that advertising as a GDP will go up in India. “Therefore ad-revenue will become substantial over time,” he said.

For Facebook, India is also crucial because it allows the company to build some unique products that solve issues for India but could be replicated in other markets. The company is currently testing an integration of WhatsApp, which currently does not have a business model despite having over 2 billion users, with new Indian e-commerce JioMart, to allow users to easily track their orders.

“We think there is opportunity to build India-first models, experiment at scale, and in a world where we succeed, we see huge opportunity in taking some of these models global,” he said.

Facebook as a VC

Facebook does not usually invest in startups. But in India, the company has invested in social-commerce firm Meesho, online learning platform Unacademy — it even participated in its follow-up round — and it wrote a $5.7 billion check to Jio Platforms earlier this year. So why is Facebook taking this investment route in India?

“We wanted to create a program for taking minority investments in early-stage startups to figure out how we could be helpful to startup founders and the ecosystem as a whole. The starting point was backing teams that were building models that in some ways were unique to India and could go global. Since we made an investment in Meesho, they have made a strong thrust in Indonesia. These are the kind of companies where we feel we can add value as well as we can learn from these startups,” he said.

The partnership with Jio Platforms follows a different rationale. “The transformation we talked about in India in the last few years, Jio triggered it,” he said. Other than that, Facebook is exploring ways to work with Jio, such as with its partnership with Jio’s venture JioMart. “It can really fuel the small and medium business that is good for the Indian economy,” he said.

Mohan said the company continues to explore more opportunities in Indian startups, especially with those where the teams think Facebook can add value, but he said there is no mandate of any kind that Facebook has to invest in, say dozens of startups in three to four years. “It’s not a volume play,” he said.

During the Q&A part of the interview, Mohan was asked if Reliance Industries, which operates Jio Platforms and Reliance Retail, will receive any special access on Facebook’s services. What if Amazon, BigBasket, Grofers, or Flipkart want to integrate with WhatsApp, too? Mohan said Facebook platform is open for every firm and everyone will receive the same level of access and opportunities.

In the interview, Mohan, who ran the Disney-run Hotstar on-demand streaming service in India, also talked about the growing usage of video in India, the state of WhatsApp Pay’s rollout in the country, what Facebook thinks of India’s ban on Chinese apps, and much more. You can watch the full interview below.