Hillicon Valley: Facebook shareholders reject proposals to limit Zuckerberg’s power | Google cracks down on video game ‘loot boxes’ | California moves closer to protecting gig economy workers
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ZUCK LIVES TO FIGHT AGAIN: Facebook shareholders on Thursday voted down a series of proposals that would have limited CEO Mark Zuckerberg’s power, following a contentious meeting marked by pointed criticism of the company’s top brass.
The proposals were largely expected to fail after Facebook’s board of directors recommended shareholders vote against them. Zuckerberg, as CEO and chairman, controls 58 percent of Facebook’s voting power, meaning proposals aimed at reducing his authority or ousting him from the board are unlikely to succeed.
A total of eight shareholder proposals failed to pass on Thursday, including one that would have required Facebook to look into potentially breaking up the company.{mosads}
Activists are awaiting the final vote tallies to see how much support the proposals garnered. The final results will be filed with the Securities and Exchange Commission later this week.
Shareholders at the meeting raised a litany of complaints about Facebook’s management and conduct, many of which Zuckerberg and Chief Financial Officer Sheryl Sandberg declined to answer directly.
Inside the room: Zuckerberg reiterated his calls for more government regulation, sidestepping a question about his power over the company.
“I don’t think that people overall would want companies to have so much unilateral authority to make decisions over speech and elections and privacy,” Zuckerberg said. “I think the big question that we need to answer is: What is the right framework, whether it’s regulation or industry bodies, that will enable us to solve the specific issues we’re grappling with?”
Eli Kasargod-Staub, the executive director of Majority Action, a corporate accountability group, told The Hill that shareholders in the meeting were “incredulous” over statements from Facebook executives indicating they support the company’s current structure.
“Shareholders in the room, I really believe, were pretty incredulous at the idea that the existing team and governance structure that got everybody into this mess … is going to be able to get us out,” Kasargod-Staub said.
Activists have rallied around proposals to curtail Zuckerberg’s power amid the barrage of privacy and civil rights scandals that have plagued the company in recent years. Regulators and lawmakers around the world have been cracking down on Facebook, accusing the tech giant of enabling genocide in Myanmar, allowing hate speech to fester and spread unabated, invading users’ privacy and doing too little to stave off disinformation campaigns from foreign actors.
Facebook has said they are investing resources to address those issues.
Shareholders voted to reelect Zuckerberg to the board, alongside some of his closest allies.
Digital civil rights group Color of Change and Majority Action had been urging Facebook shareholders to withhold their support for nominating Zuckerberg to the head of the board.
Another failed proposal would have asked Facebook to compile a report on the company’s gender pay gap.
GETTING THEIR MESSAGE ACROSS: When Facebook shareholders arrived to their hotel in Palo Alto, Calif., on Wednesday night, they were met with an angry message aimed at founder and CEO Mark Zuckerberg.
Activist group Fight for the Future projected the words “Fire Zuckerberg” on the side of the building where the social media giant’s annual shareholder’s meeting would be held.
“Facebook has violated billions of people’s basic rights, harvested and abused our data in nauseating ways, and shown reckless disregard for the human impact of its products,” Fight for the Future wrote in a blog post. The group has been calling for Zuckerberg to be fired.
“Zuckerberg has been the sole leader of Facebook for its entire 15 years of existence,” the group wrote. “In that time, there has been no attempt to move away from a business model reliant on violating user privacy. Facebook’s current business practices are fundamentally at odds with democracy and human rights.”
NO ‘LOOT’ERING: Google this week updated its rules on so-called loot boxes, a game feature that has been accused of encouraging gambling and addiction among children and could face regulations under a new bill on Capitol Hill.
“Loot boxes” are a popular game feature that allows players to receive rewards at random for a fee. Countries around the world have been eyeing crackdowns on loot boxes, and Belgium last year declared them illegal under the country’s gambling laws.
Google appears to be heeding the warnings, and this week added language requiring Play Store app developers to disclose the likelihood that players will receive rewards from loot boxes.
“Apps offering mechanisms to receive randomized virtual items from a purchase (i.e. ‘loot boxes’) must clearly disclose the odds of receiving those items in advance of purchase,” Google’s payments rules read as of Thursday, according to tech blog Android Police.
The Apple App Store instituted a similar policy in 2017.
Sen. Josh Hawley (R-Mo.), a fierce tech critic who recently introduced legislation that would prohibit games geared toward children from implementing loot boxes entirely, applauded Google’s move.
“This is a step in the right direction, but Google should force video game companies to keep slot machines out of the hands of children altogether,” Hawley said in a tweet.
Hawley introduced the bill last week alongside Sens. Richard Blumenthal (D-Conn.) and Ed Markey (D-Mass.), both of whom are vocal on children’s privacy issues.
Read more on the fight against loot boxes here.
NY HALTS SCHOOL’S PLANS TO USE FACIAL RECOGNITION TECH: The New York State Education Department on Thursday instructed a school district to delay its plans to implement the use of facial recognition technology.
“We have made it clear, the Department has not approved the testing of the system planned for next week and we told the District not to commence the testing of the technology until we receive information that assures us that student information will be properly protected,” a spokesperson for the department told The Hill.
The New York Education Department spokesperson said the agency is in the process of reviewing the school district’s facial recognition system and has not found sufficient protections for students’ privacy or data.
First in the nation: Lockport City School District would have been the first school district in the country to use the new technology. It had planned to being testing its Aegis system on Monday, with plans to have it broadly operational by Sept. 1. It intended to use the technology to identify if guns or flagged persons, such as sex offenders, entered school grounds.
Critics are pushing back: The program’s implementation drew backlash from critics who point to studies of inaccuracies in facial recognition technology, especially for women and people of color.
The New York Civil Liberties Union (NYCLU) last year sent a letter to the New York State Department of Education that asked officials to halt the project. NYCLU has asked the state legislature to do the same, according to the Journal.
State Assembly Member Monica Wallace (D) has introduced a bill that would effectively force Lockport to stop using the system.
CALIFORNIA TAKES ON GIG ECONOMY: California is one step closer to protecting “gig economy” workers’ rights, moving forward a bill that tightens regulations on company’s like Uber and Amazon that classify some workers as independent contractors.
The state Assembly on Thursday passed a proposal by a 59-15 vote that would restrict corporations’ ability to bypass labor laws.
The bill now heads to the state Senate.
The new law would benefit workers across a variety of fields, but the problem has seemingly grown with the rise of service apps.
“This kind of started with Uber and Lyft, but now we’ve seen a proliferation of this business model that is essentially built around this classifying of workers as independent contractors and cheating those workers out of basic protections in the law,” said Steve Smith, spokesman for the California Labor Federation.
The labor federation sponsored the bill.
“It’s becoming a bigger and bigger problem, especially here in California and all around the country,” Smith said.
If passed, the bill known as AB5 would codify into law the decision in the California Supreme Court Dynamex case. Last month’s court decision ruled that businesses should follow the “ABC” test to decide if a worker is an employee.
Based on the Dynamex ruling, to deem a worker an independent contractor, a company must prove three points: the worker is free from the company’s control, the worker is doing work that isn’t central to the company’s business, and the worker has an independent business in that industry.
UK ‘UNDECIDED’ ON HUAWEI: National security adviser John Bolton said Thursday that British officials may still be undecided on whether to move forward with giving Chinese telecom giant Huawei access to parts of the country’s 5G network.
Bolton told reporters in London that talks are still ongoing about Britain’s future use of the technology, which the U.S. has warned presents security threats, Reuters reported.
“I’m not sure that this decision has reached the prime ministerial level in final form. I mean we are still talking,” Bolton said, according to Reuters. “People are talking back and forth.”
“Everybody is catching up to the dangers posed, especially in fifth-generation telecommunications systems, by equipment from Huawei and potentially others that can allow foreign governments a back door into telecommunications systems,” he added.
The U.S. has been urging allies to drop Huawei for months. Intelligence officials have repeatedly expressed concerns that the technology giant may be spying on behalf of the Chinese government.
AN OP-ED TO CHEW ON: 3 reasons you should pay attention to the OECD AI principles.
A LIGHTER CLICK: Not far enough.
NOTABLE LINKS FROM AROUND THE WEB:
U.S. universities and retirees are funding the technology behind China’s surveillance state. (Buzzfeed News)
Clock runs down for privacy legislation. (Axios)
An electric scooter caught fire in downtown D.C. (The Washington Post)
Uber loses $1 billion in quarter, hitting forecast, as revenue rises 20%. (Reuters)
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