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Another rough week ahead for Facebook – POLITICO – Politico


With help from Steven Overly, Sam Sabin and Emily Birnbaum

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— Brace yourselves: A fresh batch of stories based on Facebook’s internal company documents is expected to drop this morning.

— Across the pond: Facebook whistleblower Frances Haugen is speaking before the U.K. Parliament today as lawmakers consider a bill that could undermine encrypted platforms, but her comments on encryption this weekend have disturbed some cybersecurity advocates.

— Republican dissent: GOP lawmakers, who haven’t been a fan of how the Biden administration has approached global tax talks, slammed last week’s announcement on a delayed end to digital services taxes.

IT’S MONDAY, OCT. 25. WELCOME BACK TO MORNING TECH. I’m your host, Benjamin Din. If you were participating in Model Congress and could choose which lawmaker you were, who would you be and why?

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OPEN THE FLOODGATES — Facebook’s public relations nightmare is about to get a whole lot worse, now that The Wall Street Journal isn’t the only media outlet with access to a trove of leaked company documents anymore. Since Morning Tech first published today, POLITICO has published a package of stories on the Facebook Papers, documents from a former employee that provide revelations from internal company message boards, research, strategy plans and more. Read our coverage here.

Starting Friday, a number of news organizations unveiled they were a part of a consortium that had gained access to the documents taken from Facebook by Haugen. The project, dubbed “The Facebook Papers,” follows the Journal’s “Facebook Files” series (to which new stories are still being added) and the resultant intense congressional scrutiny. It’s been a hellacious news cycle for the social media company, and the pain shows no signs of ebbing any time soon.

(Speaking of: If you have any tips, feel free to drop me a line, or reach out via these secure methods.)

— Weekend highlights: The Journal has published several stories about the company in the last few days, starting on Friday with an article about the “ad hoc” approach Facebook took to suppressing political movements on its platform that it deemed dangerous — such as those related to the Jan. 6 insurrectionists. The Journal followed that up the next day with a story on how Facebook’s products were being used to spread religious hatred in India, as well as another on Sunday that said the company “regularly places political considerations at the center of its decision making.” Several consortium members also published stories over the weekend based on the documents that the Journal cited in its reporting.

— Facebook’s response: Nick Clegg, Facebook’s vice president of global affairs, warned his employees Saturday “to steel ourselves for more bad headlines in the coming days.”

“In the past, public discourse was largely curated by established gatekeepers in the media who decided what people could read, see and digest. Social media has enabled people to decide for themselves,” he wrote in an internal post. “This is both empowering for individuals — and disruptive to those who hanker after the top-down controls of the past.”

The company has criticized the reporting on the documents as mischaracterizations of Facebook’s own research, which it says was conducted in order to help Facebook better understand the effects its platforms can have on users. Taking that internal research out of context could cause companies to think twice about studying their platforms, Facebook CEO Mark Zuckerberg warned in a public post earlier this month.

— Who will come forward next? That’s the question on everyone’s mind. On Friday, another Facebook whistleblower filed an affidavit with the Securities and Exchange Commission, saying the company prioritized profit over the public interest. The Washington Post, which reported the news, did not name the person but described them as “a former member of Facebook’s Integrity team,” which works to combat harmful content on the platform.

“We know of others. We hope to hear from others,” Sen. Richard Blumenthal (D-Conn.), who chairs the Senate Commerce consumer protection panel that Haugen testified before a few weeks ago, told CNN’s “Reliable Sources” on Sunday. Blumenthal has also called on Zuckerberg to appear before Congress, and will lead a separate hearing Tuesday on protecting children online with policy executives from Snap, TikTok and YouTube.

HAUGEN KICKS OFF EUROPEAN TOUR AMID ENCRYPTION BACKLASH — Adding to Facebook’s headaches: Haugen is meeting with U.K. lawmakers today, her first meeting with European policymakers in the coming weeks. She’s set to testify on the so-called Online Safety Bill, Parliament’s attempt to combat harmful digital content.

But some of Haugen’s positions on encryption drew concerns from anti-government surveillance advocates, who say her comments opposing Facebook’s use of end-to-end encryption are doing more harm than good.

— What she said: Haugen told the Telegraph in an interview published Sunday that Facebook won’t be able to detect government espionage operations that abuse its Messenger service or Instagram’s direct messages if it moves forward with its plans to make end-to-end encryption of messages the default on both platforms. The U.K. government is pressuring Facebook to ditch its encryption plans.

However, her stance is more nuanced than that (as the Telegraph figured out when it updated its headline after publication). While Haugen says she’s generally pro-encryption, she’s still concerned that Facebook’s plans allow the company to “sidestep” harmful content and “go ‘look we can’t see it, not our problem.’’”

But even with that caveat, Haugen’s views on the company’s plans still received flak. “She is arguing that if Facebook willingly surrenders its ability to spy on user content — including on behalf of, say, the Chinese Government — then it cannot protect those users *FROM* the Chinese Government,” said former Facebook engineer Alec Muffett on Twitter.

Not the only one: Alex Stamos, former Facebook chief security officer and current director of the Stanford Internet Observatory, said that “on her specific concern, stopping targeted surveillance, I think her balance of priorities is still wrong.” And Dia Kayyali, associate director for advocacy at Mnemonic, said Haugen was “harming the painstaking labor of years of advocacy on encryption.”

— In her corner: Haugen’s comments were defended by fellow Facebook whistleblower Sophie Zhang, who said she strongly opposed a potential ban on encrypted platforms but agreed with Haugen that adding end-to-end encryption on Facebook Messenger was a “bad idea” without some design changes. (Zhang testified before the same U.K. committee last week but said she didn’t get to address the issue during her testimony.)

— Coming up: Haugen has been invited by EU lawmakers to testify on Nov. 8. She’s later expected to testify before the French parliament on Nov. 10, our colleagues Elisa Braun and Laura Kayali report. “Our interest is to better understand in what way there would be a risk on the ‘safety’ of users, especially the youngest ones,” a French official told them. (French policymakers are examining a bill to protect whistleblowers.)

SECURITY ALERT — The quantum, semiconductor and artificial intelligence sectors are among those most at risk of Chinese and Russian interference, the National Counterintelligence and Security Center warned in a report Friday. As such, the center plans to focus its private-sector outreach around these emerging industries, as well as the bioeconomy and autonomous systems sectors, to help them thwart attempts to steal intellectual property and cybersecurity protocols.

REPUBLICANS SLAM BIDEN’S DIGITAL TAX AGREEMENT — Republicans on the Senate Finance and House Ways and Means committees are rebuking the Biden administration’s decision to terminate tariffs on European trading partners before those countries have eliminated their own digital services taxes.

Sen. Mike Crapo (R-Idaho) and Rep. Kevin Brady (R-Texas) criticized the White House for “surrendering once again to our foreign competitors” after reaching an agreement that rescinded retaliatory tariffs on Austria, France, Italy, Spain and the U.K.

In return for that tariff reprieve, those five countries committed to end their own unilateral taxes on U.S. tech giants, once a global tax reform proposal now in the works has been adopted. That process is expected to take at least a couple of years, and taxes collected in the meantime will be applied to companies’ future tax bills.

— Not good enough: The Republican lawmakers have opposed Biden’s approach to global tax negotiations at the Organization for Economic Cooperation and Development. But they noted Friday that even the Office of the U.S. Trade Representative — part of Biden’s own administration — has determined that digital services taxes harm American companies.

“Instead of taking action, however, the Biden Administration retreated by failing to demand immediate repeal of discriminatory taxes, which will continue for years, if not indefinitely,” the pair wrote in a joint statement. “The administration simply settled for an empty promise — if we reform our tax laws to these countries’ satisfaction, then they will grant U.S. businesses tax credits against future taxes.”

Karen Zacharia, SVP and chief privacy officer at Verizon, will retire next year, after stepping into the privacy role in 2011. As a part of the transition over the coming months, Donna Epps will be SVP for public policy and strategic alliances, and Sue Vinci will be VP and chief privacy officer.

USTelecom announced a slate of leadership changes: Kathy Grillo, Verizon’s SVP for public policy and government affairs, is now chair of the board, and Jason Williams is vice chair. Takami Abe and Julie Kearney are joining the board. Jeff England was elected chair of the leadership committee, serving alongside Jennifer Prather as vice chair and Becky Scott as secretary.

The Next Generation 911 Institute announced new members of its board: USTelecom’s Patrick Halley, Rave Mobile’s Todd Piett and RedSky Technologies’ Jerry Eisner. Susan Ornstein, Liz Graeber and Peter Beckwith were reelected.

Walk the walk: “Silicon Valley Giants Built an Open Culture. Now Workers Are Holding Them to It.” More from WSJ.

Pinging HR: Issues with Amazon’s system for paid and unpaid leaves has been “devastating” for its workers, NYT reports.

ICYMI: Lawmakers are frustrated that a legislative package meant to boost competition against China has stalled in the House, POLITICO’s Andrew Desiderio and Gavin Bade report.

Moscow moves: “Russia Strengthens Its Internet Censorship Powers,” via NYT.

Not a fan: The antitrust bill that would ban tech giants from prioritizing their own products would be harmful to consumers and is discriminatory, the Information Technology and Innovation Foundation argues.

Tips, comments, suggestions? Send them along via email to our team: Bob King ([email protected]), Heidi Vogt ([email protected]), John Hendel ([email protected]), Alexandra S. Levine ([email protected]), Leah Nylen ([email protected]), Emily Birnbaum ([email protected]), and Benjamin Din ([email protected]). Got an event for our calendar? Send details to [email protected]. And don’t forget: Add @MorningTech and @PoliticoPro on Twitter.

SEE YOU TOMORROW!





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