Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every
Speaker 1: day we bring you insight and analysis into the most
Speaker 1: important legal news of the day. You can find more
Speaker 1: episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud,
Speaker 1: and on Bloomberg dot com slash podcast. The Justice Department
Speaker 1: is ratcheting up the ongoing federal investigations of Facebook's data
Speaker 1: sharing practices with a criminal subpoena. A federal grand jury
Speaker 1: in New York subpoena records from at least two other
Speaker 1: tech companies that had data sharing agreements with Facebook. That's
Speaker 1: according to The New York Times. Joining us as Garrett
Speaker 1: de Vinc Bloomberg News technology reporter to talk about all
Speaker 1: things Facebook. First of all, Garrett, what do you know
Speaker 1: about the Justice Department's investigation. It's out of the Eastern District.
Speaker 1: What they're looking at is, you know, there's been all
Speaker 1: these stories written the past year or two about Facebook
Speaker 1: and how it was using our data, right, and so
Speaker 1: there has been some reporting that Facebook struck deals with
Speaker 1: other companies, so these would be handset manufacturers in some case,
Speaker 1: um certain banks. They had to deal with Spotify as well,
Speaker 1: So that if you were using, you know, one of
Speaker 1: these companies products, you could sort of integrate it with
Speaker 1: Facebook Messenger and chat with your friends. Now, the question
Speaker 1: that is being investigated is whether those things violated some
Speaker 1: promises that Facebook had made to the U S Government
Speaker 1: about how it would share user data, and also whether
Speaker 1: they were telling users that there may be sometimes private messages,
Speaker 1: private information would be seen by other companies that they
Speaker 1: didn't know. We're going to be looking at that. Every
Speaker 1: time this comes up, flashing through my mind is well,
Speaker 1: there's aleven consent degree that Facebook has and it's based
Speaker 1: on privacy. Are there other organizations that are investigating Facebook
Speaker 1: in the US? Yeah, I mean, so that's the the
Speaker 1: FTC consent degree, which is sort of what I what
Speaker 1: I was referencing about that promise that they made about
Speaker 1: how they were gonna use and share data. I think
Speaker 1: a lot of people in the US, at the regular
Speaker 1: a level, at the political level, are interested in going
Speaker 1: after Facebook. It's a big news story. It's something that
Speaker 1: is gaining some traction with consumers. Even at the end
Speaker 1: of the day, most people still really you know, like
Speaker 1: the products are at least use them. Maybe maybe we're
Speaker 1: addicted to them. Some of us. But I think that
Speaker 1: at the end of the day, you know this as
Speaker 1: a political story, and it's something for regulators and politicians
Speaker 1: who want to take a stand on something. It is
Speaker 1: something that they will keep beating the drum on. And
Speaker 1: it seems that every day they have something new to
Speaker 1: beat the drum on. And Facebook again being criticized for
Speaker 1: live streaming of that shooting in New Zealand. Tell us
Speaker 1: about that. Yeah, so, I mean Facebook has allowed live
Speaker 1: streaming for a couple of years now. Obviously they're not
Speaker 1: the only platform. You can do it on Twitter, you
Speaker 1: can do it on YouTube, you can do it on
Speaker 1: on a host of different apps for it. And it's
Speaker 1: a really tricky problem, right because Facebook and the other
Speaker 1: technology companies they want to do live streaming for them.
Speaker 1: It gets people more engaged. People are more likely to
Speaker 1: comment on live videos than they are on static ones.
Speaker 1: But at the same time, you will have incidence like
Speaker 1: this where someone live streams a crime, where someone live
Speaker 1: streams content that otherwise would not be allowed on the platform,
Speaker 1: and because it's live, there's no way to monitor it
Speaker 1: using the technology that is usually monitored to sort of
Speaker 1: take down or block videos that otherwise would break the rules.
Speaker 1: Let's talk a little bit about Mark Zuckerberg's recent thoughts,
Speaker 1: very very long thoughts, about lengthy thoughts about pivoting to privacy.
Speaker 1: Do you see anything substantial coming out of that. Yeah,
Speaker 1: I think anything that Mark Zuckerberg says you have to
Speaker 1: take substantially. I mean it's sort of, you know, interesting
Speaker 1: to kind of watch all his comments and see what
Speaker 1: they actually mean and then look back a year later
Speaker 1: and see whether things have changed or not. I'm pretty
Speaker 1: skeptical of that word pivot, which I think has been
Speaker 1: thrown around a lot when it comes to his recent announcement.
Speaker 1: Facebook is not going to get rid of its public platforms.
Speaker 1: It's not going to get rid of the core apps
Speaker 1: where you know, I post a photo of my children
Speaker 1: or whatnot and can share it publicly or share it
Speaker 1: with my friends. But they do realize that, you know,
Speaker 1: a huge part of communication and social networking is becoming
Speaker 1: private and is becoming encrypted, and with their What's App application,
Speaker 1: which is, if not the most popular messaging tool in
Speaker 1: the world, definitely one of the top couple is um
Speaker 1: you know, already encrypted, and so they're really leaning into
Speaker 1: that side of the business as an area future growth.
Speaker 1: They've lost one of their top executives. Yeah, so Chris
Speaker 1: Cox resigned, And the way that Facebook was talking about
Speaker 1: it is that, you know, he was someone who kind
Speaker 1: of a couple of years ago, was already looking at
Speaker 1: other alternatives. He'd been at Facebook pretty much since the
Speaker 1: very beginning, and then because of all these these complications
Speaker 1: they've had with privacy, with regulation and having to deal
Speaker 1: with that, he stayed on. You know, you can kind
Speaker 1: of probably take that with a grain of salt. Some
Speaker 1: people could say that he's leaving because of the last
Speaker 1: couple of years of complications, And at the end of
Speaker 1: the day, I think that's probably why the stock is down,
Speaker 1: you know, cynically, it's probably not because of the live
Speaker 1: streaming and because of the New Zealand shooting. It's probably
Speaker 1: because someone who is very close within Mark Zuckerberg's inner circle.
Speaker 1: I think, after Zuckerberg and Charles Soundberg, he would be
Speaker 1: one of the top people has now left the company.
Speaker 1: You cover tech. So is there any real fear on
Speaker 1: the part of Facebook, Google, or Apple about Elizabeth Warren's
Speaker 1: calls to break them up if she becomes president, and frankly,
Speaker 1: the calls of other people who see them as just
Speaker 1: too big. It's a really interesting story that that we've
Speaker 1: been tracking very closely. We will continue to track. I
Speaker 1: have no idea where this is going to go. How
Speaker 1: serious in the United States, These calls for very very
Speaker 1: strict antitrust regulations, just changes in how we think about
Speaker 1: anti trust in the United States are actually gonna happen.
Speaker 1: But this is a movement I would say that has
Speaker 1: been brewing for a couple of years, and it started,
Speaker 1: you know, with some progressive policy think tank kind of
Speaker 1: people saying, you know, we really need to rethink how
Speaker 1: this is going, and it has filtered into the political mainstream,
Speaker 1: you know, most strikingly now with Elizabeth Warren very clearly
Speaker 1: stating I will break up the company's I will do
Speaker 1: it this way. I will separate Instagram from Facebook. And
Speaker 1: she's sort of stating this in a way that you know,
Speaker 1: although other politicians have talked about the need for stricter
Speaker 1: antitrust rules, they haven't gone as far as to say
Speaker 1: explicitly what they want to do. And so, you know,
Speaker 1: she is a long way off from the presidency. She
Speaker 1: has a grueling primary to get through, and then of
Speaker 1: course to you know, whoever does win that that democratic
Speaker 1: promimly has to defeat Donald Trump. But I'm sure it
Speaker 1: will be a topic of debate during Democratic primary pleasure. Garrett,
Speaker 1: that's so nice to have you. That's Garrett Davinky is
Speaker 1: the Bloomberg News technology reporter. Thanks for listening to the
Speaker 1: Bloomberg Law Podcast. You can subscribe and listen to the
Speaker 1: show on Apple Podcasts, SoundCloud, and on bloomberg dot com
Speaker 1: slash podcast. I'm June Brasso. This is Bloomberg