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Facebook’s parent company Meta has agreed a $725 million settlement to resolve a class-action lawsuit related to the Cambridge Analytica data harvesting scandal.

First reported by Reuters earlier today, the deal follows nearly four months after news first emerged that Meta had proposed a settlement in the Northern District of California where the suit was first filed some four years ago. In the intervening years, Meta has pushed back against the lawsuit, which consolidated complaints from multiple Facebook users, arguing that those who voluntarily signed up to the social network should have no real expectations of privacy — an assertion that the judge overseeing the case in 2019 called “so wrong.”

The scandal in question — one of many to hit the world of Facebook through the years — relates to the now-defunct U.K. political consulting firm Cambridge Analytica that funnelled data from tens of millions of Facebook users through a survey app called MyDigitalLife, with a view toward influencing voters’ behavior using targeted ads. The privacy brouhaha that followed led to various fines and settlements, with Meta (then called Facebook) paying $5 billion as part of a deal with the Federal Trade Commission (FTC), $100 million to the Securities and Exchange Commission (SEC) for misleading investors, and a modest £500,000 ($600,000) to the U.K. Information Commissioner’s Office.

It’s also worth noting that while the genesis of this class-action lawsuit was Cambridge Analytica, it expanded to include other third-parties that may have improperly used Facebook user data.

Facing the music

While Meta cofounder and CEO Mark Zuckerberg had previously testified before Congress about the scandal, his responses proved somewhat evasive and aside from a carefully controlled testimony in front of the EU Parliament shortly after, the upper echelon at Meta have not had to face any more direct questioning on the matter. However, with this impending lawsuit, Zuckerberg, former COO Sheryl Sandberg, and new COO Javier Olivan were all set to testify again at an upcoming hearing. This is something that Meta clearly didn’t want, and it’s something that clearly won’t happen now that a provisional settlement has been reached.

In the filing notifying the court of the proposed settlement, the lawyers conclude that the deal agreed between the plaintiffs and Meta was an “extraordinary outcome,” resulting in the “largest recovery ever achieved in a data privacy class-action and the most Facebook has ever paid” to end a private class-action lawsuit.

They wrote:

The amount of the recovery is particularly striking given that Facebook argued that its users consented to the practices at issue, and that the class suffered no actual damages. Plaintiffs dispute these characterizations, but acknowledge that they faced tremendous risks in this novel and complex case. In addition to the monetary relief obtained by Plaintiffs, Facebook has meaningfully changed the practices that gave rise to Plaintiffs’ allegations, as set forth in the declarations of two Facebook employees with knowledge of those facts.

However, the $725 million settlement will see Meta once again admit no wrongdoing, saying in a statement issued to Reuters that the settlement was “in the best interest of our community and shareholders.” Moreover, the settlement applies to every Facebook user in the U.S. who, if they wish to apply, will only receive a few dollars each from the pot.

The settlement has yet to be rubberstamped, though, though this is expected at a follow-on hearing on March 2, 2023.

Meta hasn’t heard the last of Cambridge Analytica though, with Washington, D.C. suing Zuckerberg personally, alleging that he was personally responsible for the failures leading to the scandal.

Facebook parent Meta to settle Cambridge Analytica class-action lawsuit for $725M by Paul Sawers originally published on TechCrunch

Google said on Friday it has appealed against the Indian antitrust body’s order against the firm over alleged anti-competitive practices surrounding Android mobile devices in the key overseas market.

The company has approached the National Company Law Appellate Tribunal (NCLAT), the nation’s appellate tribunal, to appeal against the Competition Commission of India’s October order, in which the watchdog fined Google $162 million.

“We have decided to appeal the CCI’s decision on Android as we believe it presents a major setback for our Indian users and businesses who trust Android’s security features, and potentially raising the cost of mobile devices,” a Google spokesperson said in a statement.

“We look forward to making our case in NCLAT and remain committed to users and partners.”

In October, the CCI, which began investigating Google three and a half years ago, said that it finds Google requiring device manufacturers to pre-install its entire Google Mobile Suite and mandating prominent placement of those apps “imposition of unfair condition on the device manufacturers” and thus was in “contravention of the provisions of Section 4(2)(a)(i) of the Act.”

Days later, the CCI hit Google with another $113 million fine for allegedly abusing the dominant position of its Google Play Store and ordered the firm to allow app developers to use third-party payments processing services for in-app purchases or for purchasing apps.

India is a key overseas market for Google, which has amassed over 500 million users in the South Asian market. The company, which has poured billions in its India business over the past decade, has pledged to invest another $10 billion in the country over the next couple of years.

Google appeals against India’s fine over ‘unfair’ business practices on Android by Manish Singh originally published on TechCrunch

After taking over Twitter, Elon Musk had long promised that the company is working toward making the platform more appealing to video creators. Today, Twitter updated the Twitter Blue page declaring that subscribers can now upload 60-minute-long videos from the web at 1080p resolution and 2GB in file size.

Prior to the change, Twitter Blue subscribers were able to upload 10-minute-long videos on the platform at 1080p resolution with a file size limit of 512MB. Sadly, if you’re uploading from iOS or Android, this limit is still applicable.

Twitter said that it will consider modifying the quality of the video for distribution.

“We strive to maintain the highest possible video quality for all videos uploaded to our platform. However, we may modify or adapt your original video for distribution, syndication, publication, or broadcast by us and our partners and/or make changes in order to adapt it to different media, including modifying the resolution and bitrate of the original video while streaming based on the speed and stability of the viewer’s internet connection,” the company said on a support page.

By allowing longer video uploads, Twitter will also face a challenge to tackle piracy. Users might post movies or whole episodes of TV shows and the social network’s moderators and automated systems will have to be alert about removing them quickly. Last month, when Twitter’s copyright systems stopped working briefly, users uploaded whole movies in smaller chunks. The new 60-minute video limit makes it easier for culprits to post someone else’s work.

There are also questions about monetization from these videos. YouTube shows multiple ads in longer videos, but it’s not clear at the moment if Twitter is planning to do something similar.

Along with increasing the video upload limit, subscribers will also get priority in replies. The company said that users will “see a slight preference for replies from Blue verified accounts over other replies.” This means you will see replies by paid accounts before other replies. Twitter didn’t really detail how it might handle folks who pay to troll or spam other users by getting a preference in replies.

Musk-led Twitter relaunched Twitter Blue earlier this month after a disastrous first launch in November. Now, the company is charging $11 per month to iOS users to offset App Store fees and $8 per month to folks who subscribe using the web. Earlier this week, Twitter also rolled out the Blue for Business program, which allows companies to identify their affiliated brands and workers through an extra square badge.

Notably, longer video uploads and priority in replies are the first features to be available for paid users apart from the Blue verification badge.

Twitter Blue users can now upload 60-minute long videos by Ivan Mehta originally published on TechCrunch

More than a week after being banned from Twitter, Jack Sweeney, the University of Central Florida sophomore who has been a pain in the side of Elon Musk for at least the past year, has a new account on the platform. Called @ElonJetNexDay, the hours-old account tracks the private jet of Elon Musk, but with a 24-hour delay.

Whether it’s the last chapter in an ongoing story remains to be seen, but you have to give it to Sweeney; he’s persistent.

Two years ago, the 20-year-old launched a Twitter account that used public data to automatically map the flights of Musk’s private jet, @ElonJet. Musk asked Sweeney back in January through a direct message on the platform to take it down in exchange for $5,000. “It’s a security risk,” Musk reportedly wrote Sweeney. “I don’t love the idea of being shot by a nutcase.” When Sweeney only half-kiddingly asked instead for a Model 3 or $50,000, Musk apparently ghosted Sweeney, but he did not forget him, plainly.

Instead, Sweeney wound up a headline story one very busy day last week after Musk, now the owner of Twitter, banned the account, costing Sweeney 530,000 followers. The impetus, Musk suggested on Twitter, was a car carrying his son X Æ A-12 that had been “followed by [a] crazy stalker” in Los Angeles.” Though there was no obvious tie between the account and the incident, Twitter soon after alerted Sweeney that “after careful review,” it had been “determined your account broke the Twitter rules,” without saying at the time which rules were violated.

Then Twitter kept shutting down more accounts, including Sweeney’s personal account (for violating Twitter’s rules against “platform manipulation and spam”); other accounts operated by Sweeney that tracked the air travel of other prominent individuals, including Musk nemesis Mark Zuckerberg; and a day later, numerous journalists who reported on the Sweeney story, including Ryan Mac of the New York Times and Drew Harwell of the Washington Post. (`Some remain locked out.)

Separately, Musk ratcheted up his focus on Sweeney, tweeting: “Legal action is being taken against Sweeney & organizations who supported harm to my family.”

Sweeney has continued all the while to operate his social media accounts elsewhere. Last week, he opened an account on the newer social media platform Mastadon that tracks Musk’s private jet in real time and has already amassed 67,000 followers; Sweeney also has pages on Facebook and Instagram that track the comings and goings of private jets, including that of Musk, and which enjoy substantial followings.

And now he’s back at it on Twitter, too, for now at least. According to its new rules, “sharing publicly available location information after a reasonable time has elapsed, so that the individual is no longer at risk for physical harm” is not a violation. With a 24-hour delay in reporting on where Musk’s private jet has traveled, @ElonJetNexDay would seem to fall within the confines of Twitter’s recently set safety parameters.

Still, it’s easy to interpret the account as Sweeney thumbing his nose at Musk, who has wielded his power as Twitter’s newfound owner erratically nearly from the day he hauled a sink into the company’s San Francisco headquarters in late October to make a joke about his takeover. (“Let that sink in.”)

Even Musk’s devoted followers on the platform appear exhausted by all the drama. When Musk asked them in a survey on Sunday if he should step down as the leader of the social media site, the vast majority of respondents answered that he should. Musk has since said he will step down as CEO once he finds “someone foolish enough to take the job!”

Persistent Jack Sweeney brings back @ElonJet (but delayed) to Twitter by Connie Loizos originally published on TechCrunch

Indian e-commerce giant Flipkart no longer owns a stake in payments firm PhonePe. The two said on Friday that they have completed a full ownership separation of PhonePe and shareholders in the Singapore entities of both firms have purchased shares directly in PhonePe’s India entity.

The move comes as PhonePe, which was acquired by Flipkart in 2016, moves its entire base to India. The payments startup is in talks to raise as much as $1.5 billion at a pre-money valuation of $12 billion and use some of the proceedings to buy back some shares, according to a source familiar with the matter.

Walmart continues to be the majority shareholder of both the firms.

“The Flipkart Group has developed many successful entrepreneurs and seen impactful businesses started by former employees. We are proud to see PhonePe grow and thrive as a successful organization in its own right,” said Kalyan Krishnamurthy, chief executive of Flipkart Group, in a statement.

“We are confident PhonePe will continue to scale and achieve its vision of providing financial inclusion to millions of Indians. Flipkart stays committed to its purpose to empower every Indian’s dream by delivering value through innovation in technology and commerce while helping small businesses connect to pan-India markets.”

Flipkart doesn’t plan to re-enter the consumer payments market, according to another source familiar with the matter. PhonePe announced its intention to become a separate entity in late 2020.

The separation will have some impact on Flipkart’s valuation. PhonePe, which leads the mobile payments market in India, was valued at $5.5 billion in a funding round it unveiled in late 2020. In July, Flipkart Group raised $3.6 billion at a valuation of $37.6 billion.

“Flipkart and PhonePe are proud, homegrown Indian brands with a user base upwards of 400 million each. We are looking forward to the next phase of our growth as we invest in new businesses – like insurance, wealth management and lending, while also enabling the next wave of growth for UPI payments in India. This will help propel our vision to provide billions of Indians with financial inclusion,” said Sameer Nigam (pictured above), founder and chief executive of PhonePe, in a statement.

PhonePe is the top payments app on the nation’s homegrown UPI app, commanding over 40% of the market share. India announced earlier this month that it won’t enforce a check on the market share for players operating on the homegrown payments network until December 31, 2024 in a surprising extension to the deadline that analysts said is a major a win for the market leaders PhonePe and Google Pay.

Flipkart and PhonePe complete separation by Manish Singh originally published on TechCrunch

A brand-new law (awaiting only the president’s signature) will let the Federal Communications Commission directly regulate rates in the notoriously predatory prison calling industry. Under the threat of having to provide a solid product for a reasonable price, companies may opt to call it a day and open up the market to a more compassionate and forward-thinking generation of providers.

Prison calling systems depend on the state and the prison system, and generally have run the gamut from good enough to shockingly bad. With a literally captive customer base, companies had no real reason to innovate, and financial models involving kickbacks to the prisons and states incentivized income at all costs.

Inmates are routinely charged extortionate rates for simple services like phone calls and video calls (an upsell), and have even had visitation rights rescinded, leaving paid calls the only option. Needless to say, this particular financial burden falls disproportionately on people of color and those with low incomes, and it’s a billion-dollar industry.

It’s been this way for a long time, and former FCC commissioner Mignon Clyburn spent years trying to change it. When I talked with her in 2017, before she left the agency, she called inmate calling “the clearest, most glaring type of market failure I’ve ever seen as a regulator.” It was an issue she spent years working on, but she gave a lot of credit to Martha Wright-Reed, a grandmother who had organized and represented the fight to bring reform to the system right up until she died.

And it is after Martha Wright-Reed that the bill today is named. It’s a simple bill, imbuing the FCC with the power “to ensure just and reasonable charges for telephone and advanced communications services in correctional and detention facilities.” It does this with some minor but significant changes to the Communications Act of 1934, which (among other things) established the FCC and is regularly updated for this purpose. (The bill passed the House and Senate and will almost certainly be signed by President Biden soon, when the festivities relating to the spending bill, Volodymyr Zelenskyy’s visit, and the holiday address pass.)

“The FCC has for years moved aggressively to address this terrible problem, but we have been limited in the extent to which we can address rates for calls made within a state’s borders,” said FCC chairwoman Jessica Rosenworcel in a statement. “Today, thanks to the leadership of Senators Duckworth, Portman and their bipartisan coalition, the FCC will be granted the authority to close this glaring, painful, and detrimental loophole in our phones rate rules for incarcerated people.” (She also thanked Wright-Reed, as well as Clyburn.)

Free Press has collected a number of other comments from interested parties, all lauding the legislation for curbing “carceral profiteering” and generally benefiting inmates rather than continuing to treat them like a source of labor or easy cash.

While it’s great that costs will go down as soon as the FCC can put together and pass a rule on the matter, the effect will probably be greater than just savings.

Most companies in place today will all but certainly face vastly reduced revenues along with increased scrutiny as the FCC requires reports and takes any other measures it decides are necessary to enforce the new rules. It would not be surprising at all if plenty of these companies just get out while the gettin’s good.

The introduction of regulation into a space like this, dominated for years by legacy providers, may well cause a changing of the guard — something we’ve seen advance notice of with some states embracing new models like Ameelio’s. The startup began as a way to mail postcards to inmates for free, but soon they had built a modern digital video calling infrastructure that’s far cheaper and easier to operate than the legacy ones.

Now operating in three states, Ameelio’s service can also serve as the basis for activities like education and legal advocacy in prison facilities, since the cost is so much lower and access is easier. (As indeed the founders discovered, and went on to found Emerge Career.)

A bunch of shady companies in a hurry to leave means a market opportunity as states scramble to find providers — no doubt Ameelio will be looking to fill some of those gaps, but the next few years will probably see other companies stepping in to take part as well.

The prison system we have is in dire need of reformation in general, but that will happen piece by piece, as we see happening here.

The FCC can finally hammer predatory prison phone call companies, thanks to just-passed bill by Devin Coldewey originally published on TechCrunch

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Well, the weather outside is…entirely dependent on where you are, we suppose. For the purposes of this newsletter, let’s imagine sunshine, some pristine beaches, a lovely gentle cooling breeze, and some piña coladas, because if we’re going to make up some fictional weather, we may as well make it lovely, right? — Christine and Haje

The TechCrunch Top 3

Surprised, but also not surprised: FTX co-founder Gary Wang and Alameda’s Caroline Ellison plead guilty to criminal charges, Darrell writes.
$eeing i$ believing: Twitter is now sourcing stock and cryptocurrency prices from TradingView and automatically displaying them in search results. Ivan shows you how to get them to appear in your next tweet.
Another Okta breach: Okta confirmed that it’s responding to another major security incident after a hacker accessed its source code following a breach of its GitHub repositories, Carly reports.

Startups and VC

Text-to-image AI exploded this year as technical advances greatly enhanced the fidelity of art that AI systems could create. As controversial as systems like Stable Diffusion and OpenAI’s DALL-E 2 are, platforms such as DeviantArt and Canva have adopted them to power creative tools, personalize branding and even ideate new products, writes Kyleas he takes you on a tour through a brief history of diffusion, the tech at the heart of modern image-generating AI.

Speaking of AI, Amanda reports that Unstable Diffusion, a group trying to monetize AI porn generation, raised more than $56,000 on Kickstarter from 867 backers. Then, as Kickstarter changed its thinking about what kind of AI-based projects it will allow, the crowdfunding platform shut down Unstable Diffusion’s campaign.

And in only partially AI news:

Putting Austin under the loupe: Mary Ann reports how a fatal police shooting of a startup founder puts Austin’s diversity problem in the spotlight.
Scooping up a slice of Exyn: Reliance buys a 23% stake in U.S.-based AI firm Exyn, Manish reports.
Curbing your enthusiasm: Rebecca writes that Automotus raises $9 million to scale automated curb management tech.
Pumping the brakes: The other day we reported that self-driving truck company TuSimple was contemplating layoffs. Today, Rebecca is back with the sad news that it’s happening: TuSimple is laying off 25% of its workforce.

Avoid 3 common sales mistakes startups make during a downturn

Analysts estimate that IT spending will increase in 2023, but tell that to SaaS sales teams who are trying to close contracts with customers who’ve been instructed to slash spending.

“What every company needs now is efficient sales,” says Anand Shah, CEO and co-founder of Databook.

In a TC+ guest post, he explains why reactive moves like increasing sales quotas or raising prices are wrongheaded moves that won’t move the needle.

“Make real changes to meet your buyers’ needs. Use the macroeconomic backdrop to make the necessary sales productivity improvements.”

Three more from the TC+ team:

Really milking it: The future of milk is … milk? by Christine.
The weather outside is frightful: Holiday shipping is easier this year, but the tech is still lagging, by Ryan Petersen.
Still blasting off: Investor interest in SpaceX appears immune to Musk’s meddling, by Becca.

TechCrunch+ is our membership program that helps founders and startup teams get ahead of the pack. You can sign up here. Use code “DC” for a 15% discount on an annual subscription!

Big Tech Inc.

Having that ad blocker box pop up when you try to open a new website is annoying, but Zack says we should find the good in it — heck, even the FBI says you should use an ad blocker, he writes. Why? Apparently, “cybercriminals are buying ads to impersonate legitimate brands, like cryptocurrency exchanges” and they are so good that it’s hard to tell it’s not the real thing. Stay safe, everyone!

What do we want? News! When do we want it? Now!:

Now, isn’t that sporting: Aisha has a pair of streaming stories in case you need any last-minute gift ideas for the sports lovers in your life. The first is that YouTube secured NFL Sunday Ticket and the second is that Netflix is branching out into fitness content.
More from that bird company: Amanda catches us up on the latest with Twitter. Unfortunately, there were more layoffs, this time in public policy and engineering. And now the company brings us a new feature we didn’t know we wanted. That probably rarely checked views analytics is now front and center so you can see how many people view your tweets.
Inside the action studio: Warning, this story has spoilers. Lauren reports on VFX studio Perception and its technology that made the visual effects for “Black Panther: Wakanda Forever.”
It’s all about the ride: Vianova uses APIs to gather data from shared mobility companies and cities to help make these services better. Romain has more.
Adventure is out there!: Aria details seven predictions for the space industry in 2023.

Daily Crunch: 2 former SBF associates plead guilty to fraud and are cooperating with US federal prosecutors by Christine Hall originally published on TechCrunch

Password manager giant LastPass has confirmed that cybercriminals stole its customers’ encrypted password vaults, which store its customers’ passwords and other secrets, in a data breach earlier this year.

In an updated blog post on its disclosure, LastPass CEO Karim Toubba said the intruders took a copy of a backup of customer vault data by using cloud storage keys stolen from a LastPass employee. The cache of customer password vaults is stored in a “proprietary binary format” that contains both unencrypted and encrypted vault data, but technical and security details of this proprietary format weren’t specified. The unencrypted data includes vault-stored web addresses, but LastPass does not say more or in what context. It’s not clear how recent the stolen backups are.

LastPass said customers’ password vaults are encrypted and can only be unlocked with the customers’ master password, which is only known to the customer. But the company warned that the cybercriminals behind the intrusion “may attempt to use brute force to guess your master password and decrypt the copies of vault data they took.”

Toubba said that the cybercriminals also took vast reams of customer data, including names, email addresses, phone numbers and some billing information.

Password managers are overwhelmingly a good thing to use for storing your passwords, which should all be long, complex and unique to each site or service. But security incidents like this are a reminder that not all password managers are created equal and can be attacked, or compromised, in different ways. Given that everyone’s threat model is different, no one person will have the same requirements as the other.

In a rare shituation (not a typo) like this — which we spelled out in our parsing of LastPass’s data breach notice — if a bad actor has access to customers’ encrypted password vaults, “all they would need is a victim’s master password.” An exposed or compromised password vault is only as strong as the encryption — and the password — used to scramble it.

The best thing you can do as a LastPass customer is to change your current LastPass master password to a new and unique password (or passphrase) that is written down and kept in a safe place. This means that your current LastPass vault is secured.

If you think that your LastPass password vault could be compromised — such as if your master password is weak or you’ve used it elsewhere — you should begin changing the passwords stored in your LastPass vault. Start with the most critical accounts, such as your email accounts, your cell phone plan account, your bank accounts and your social media accounts, and work your way down the priority list.

The good news is that any account protected with two-factor authentication will make it far more difficult for an attacker to access your accounts without that second factor, such as a phone pop-up or a texted or emailed code. That’s why it’s important to secure those second-factor accounts first, like your email accounts and cell phone plan accounts.

LastPass says hackers stole customers’ password vaults by Zack Whittaker originally published on TechCrunch

Tesla started out the month of December by offering Model 3 and Model Y buyers in the U.S. a $3,750 credit if they have their vehicle delivered in December 2022. Now with a week left in the month, the electric vehicle maker has upped that discount to $7,500, according to the company’s website.

After the news of the discount and other offers designed to increase sales in the fourth quarter, Tesla’s stock dropped another 9% and is trading at $125.12 at market close on Wednesday.

It seems Tesla is getting a little too thirsty for end-of-year sales and it’s giving investors the ick.

Tesla’s stock has already taken massive hits this week as investors wring their hands over CEO Elon Musk’s political rhetoric on and micromanaging of Twitter, his selling of Tesla stock to fund Twitter initiatives and concerns over vehicle sales in China — Tesla’s biggest market — taking a dip as the country abandons COVID-19 restrictions.

Along with the discount, Tesla has also tacked on offers of 10,000 Supercharging miles free and a “Holiday Software Release” that includes “wireless multiplayer gaming and access to tens of thousands of titles in the Steam game library,” a programmable light show that syncs with other Teslas and “Dog Mode,” which helps people keep an eye on dogs they’ve left in the vehicle.

The automaker is also offering credits in Canada and Mexico, and in October cut the price of cars in China.

The doubling of an already out-of-character discount is likely in response to the U.S. Treasury Department this week delaying EV tax credit rules around sourcing of critical materials to March 2023. Per the Inflation Reduction Act, by January 1, automakers would only have been eligible for the full $7,500 credit if they build their vehicles in North America and source critical materials from North America or free trade agreement countries — so not China, where most of those materials come from today. The delay means that many automakers, Tesla included, will now qualify for the full credit at the start of the year, which may cause buyers to put off purchases until 2023.

Tesla is running up against its own guidance this year, which projected a 50% growth in production and deliveries for 2022. That would mean 1,404,333 deliveries for the year, so Tesla has to hit 495,760 deliveries in Q4 to achieve that. In the third quarter, Tesla sold 343,830 units.

Investors are taking the discounts on Tesla’s already most popular and lower-priced vehicles as a sign that there’s less demand for the vehicles.

After the bell Wednesday, investment banking firm Canaccord Genuity cut its price target for Tesla from $304 to $275, citing “cosmically bad” public sentiment and a “distraught” shareholder base. The firm still says Tesla is a buy, though.

Tesla’s $7,500 discount feels desperate, and it’s giving investors the ick by Rebecca Bellan originally published on TechCrunch