Starlink mobile plans hit snag as FCC dismisses SpaceX spectrum application

Snow and ice cover part of a Starlink satellite dish.
Enlarge / A Starlink user terminal during winter.
Getty Images | AntaresNS

Starlink’s mobile ambitions were dealt at least a temporary blow yesterday when the Federal Communications Commission dismissed SpaceX’s application to use several spectrum bands for mobile service.

SpaceX is seeking approval to use up to 7,500 second-generation Starlink satellites with spectrum in the 1.6 GHz, 2 GHz, and 2.4 GHz bands. SpaceX could still end up getting what it wants but will have to go through new rulemaking processes in which the FCC will evaluate whether the spectrum bands can handle the system without affecting existing users.

The FCC Space Bureau’s ruling dismissed the SpaceX application yesterday as “unacceptable for filing.” The application was filed over a year ago.

The FCC said the SpaceX requests “do not substantially comply with Commission requirements established in rulemaking proceedings which determined that the 1.6/2.4 GHz and 2 GHz bands are not available for additional MSS [mobile-satellite service] applications.”

But the FCC yesterday also issued two public notices seeking comment on SpaceX petitions to revise the commission’s spectrum-sharing rules for the bands. Dish Network and Globalstar oppose the SpaceX requests, and SpaceX will have to prove to the FCC that its plan won’t cause harmful interference to other systems.

T-Mobile deal still on, but SpaceX wants more capacity

The FCC order won’t stop SpaceX’s partnership with T-Mobile, which uses T-Mobile’s licensed spectrum in the 1.9 GHz band. In January, Starlink demonstrated the first text messages sent between T-Mobile phones via one of Starlink’s low-Earth orbit satellites. Texting service for T-Mobile users is expected sometime during 2024 with voice and data service beginning later.

But SpaceX wants to use more spectrum bands to increase capacity in the US and elsewhere. Space has Starlink partnerships with several carriers outside the US.

SpaceX filed its application in February 2023. “Granting this application will enable SpaceX to augment its MSS capabilities and leverage its next-generation satellite constellation to provide increased capacity, reduced latency, and broader service coverage for mobile users across the United States and the world, including those users underserved or unserved by existing networks,” the application said.

Dish Network owner EchoStar is angry that the FCC is still entertaining SpaceX’s request for the 2 GHz band. “The FCC should immediately dismiss SpaceX’s petition for rulemaking without seeking comment, because the mere action of seeking comment would provide it with undeserved credibility and threaten the certainty that has allowed EchoStar to innovate in this band leading to significant public interest benefits,” the company told the FCC yesterday.

https://arstechnica.com/?p=2012994




Facebook secretly spied on Snapchat usage to confuse advertisers, court docs say

Facebook secretly spied on Snapchat usage to confuse advertisers, court docs say

Unsealed court documents have revealed more details about a secret Facebook project initially called “Ghostbusters,” designed to sneakily access encrypted Snapchat usage data to give Facebook a leg up on its rival, just when Snapchat was experiencing rapid growth in 2016.

The documents were filed in a class-action lawsuit from consumers and advertisers, accusing Meta of anticompetitive behavior that blocks rivals from competing in the social media ads market.

“Whenever someone asks a question about Snapchat, the answer is usually that because their traffic is encrypted, we have no analytics about them,” Facebook CEO Mark Zuckerberg (who has since rebranded his company as Meta) wrote in a 2016 email to Javier Olivan.

“Given how quickly they’re growing, it seems important to figure out a new way to get reliable analytics about them,” Zuckerberg continued. “Perhaps we need to do panels or write custom software. You should figure out how to do this.”

At the time, Olivan was Facebook’s head of growth, but now he’s Meta’s chief operating officer. He responded to Zuckerberg’s email saying that he would have the team from Onavo—a controversial traffic-analysis app acquired by Facebook in 2013—look into it.

Olivan told the Onavo team that he needed “out of the box thinking” to satisfy Zuckerberg’s request. He “suggested potentially paying users to ‘let us install a really heavy piece of software'” to intercept users’ Snapchat data, a court document shows.

What the Onavo team eventually came up with was a project internally known as “Ghostbusters,” an obvious reference to Snapchat’s logo featuring a white ghost. Later, as the project grew to include other Facebook rivals, including YouTube and Amazon, the project was called the “In-App Action Panel” (IAAP).

The IAAP program’s purpose was to gather granular insights into users’ engagement with rival apps to help Facebook develop products as needed to stay ahead of competitors. For example, two months after Zuckerberg’s 2016 email, Meta launched Stories, a Snapchat copycat feature, on Instagram, which the Motley Fool noted rapidly became a key ad revenue source for Meta.

In an email to Olivan, the Onavo team described the “technical solution” devised to help Zuckerberg figure out how to get reliable analytics about Snapchat users. It worked by “develop[ing] ‘kits’ that can be installed on iOS and Android that intercept traffic for specific sub-domains, allowing us to read what would otherwise be encrypted traffic so we can measure in-app usage,” the Onavo team said.

Olivan was told that these so-called “kits” used a “man-in-the-middle” attack typically employed by hackers to secretly intercept data passed between two parties. Users were recruited by third parties who distributed the kits “under their own branding” so that they wouldn’t connect the kits to Onavo unless they used a specialized tool like Wireshark to analyze the kits. TechCrunch reported in 2019 that sometimes teens were paid to install these kits. After that report, Facebook promptly shut down the project.

This “man-in-the-middle” tactic, consumers and advertisers suing Meta have alleged, “was not merely anticompetitive, but criminal,” seemingly violating the Wiretap Act. It was used to snoop on Snapchat starting in 2016, on YouTube from 2017 to 2018, and on Amazon in 2018, relying on creating “fake digital certificates to impersonate trusted Snapchat, YouTube, and Amazon analytics servers to redirect and decrypt secure traffic from those apps for Facebook’s strategic analysis.”

Ars could not reach Snapchat, Google, or Amazon for comment.

Facebook allegedly sought to confuse advertisers

Not everyone at Facebook supported the IAAP program. “The company’s highest-level engineering executives thought the IAAP Program was a legal, technical, and security nightmare,” another court document said.

Pedro Canahuati, then-head of security engineering, warned that incentivizing users to install the kits did not necessarily mean that users understood what they were consenting to.

“I can’t think of a good argument for why this is okay,” Canahuati said. “No security person is ever comfortable with this, no matter what consent we get from the general public. The general public just doesn’t know how this stuff works.”

Mike Schroepfer, then-chief technology officer, argued that Facebook wouldn’t want rivals to employ a similar program analyzing their encrypted user data.

“If we ever found out that someone had figured out a way to break encryption on [WhatsApp] we would be really upset,” Schroepfer said.

While the unsealed emails detailing the project have recently raised eyebrows, Meta’s spokesperson told Ars that “there is nothing new here—this issue was reported on years ago. The plaintiffs’ claims are baseless and completely irrelevant to the case.”

According to Business Insider, advertisers suing said that Meta never disclosed its use of Onavo “kits” to “intercept rivals’ analytics traffic.” This is seemingly relevant to their case alleging anticompetitive behavior in the social media ads market, because Facebook’s conduct, allegedly breaking wiretapping laws, afforded Facebook an opportunity to raise its ad rates “beyond what it could have charged in a competitive market.”

Since the documents were unsealed, Meta has responded with a court filing that said: “Snapchat’s own witness on advertising confirmed that Snap cannot ‘identify a single ad sale that [it] lost from Meta’s use of user research products,’ does not know whether other competitors collected similar information, and does not know whether any of Meta’s research provided Meta with a competitive advantage.”

This conflicts with testimony from a Snapchat executive, who alleged that the project “hamper[ed] Snap’s ability to sell ads” by causing “advertisers to not have a clear narrative differentiating Snapchat from Facebook and Instagram.” Both internally and externally, “the intelligence Meta gleaned from this project was described” as “devastating to Snapchat’s ads business,” a court filing said.

https://arstechnica.com/?p=2012980




SCOTUS mifepristone case: Justices focus on anti-abortion groups’ legal standing

<img src="https://rassegna.lbit-solution.it/wp-content/uploads/2024/03/scotus-mifepristone-case-justices-focus-on-anti-abortion-groups-legal-standing.jpg" alt="Demonstrators participate in an abortion-rights rally outside the Supreme Court as the justices of the court hear oral arguments in the case of the US Food and Drug Administration v. Alliance for Hippocratic Medicine on March 26, 2024 in Washington, DC.”>
Enlarge / Demonstrators participate in an abortion-rights rally outside the Supreme Court as the justices of the court hear oral arguments in the case of the US Food and Drug Administration v. Alliance for Hippocratic Medicine on March 26, 2024 in Washington, DC.

The US Supreme Court on Tuesday heard arguments in a case seeking to limit access to the abortion and miscarriage drug mifepristone, with a majority of justices expressing skepticism that the anti-abortion groups that brought the case have the legal standing to do so.

The case threatens to dramatically alter access to a drug that has been safely used for decades and, according to the Guttmacher Institute, was used in 63 percent of abortions documented in the health care system in 2023. But, it also has sweeping implications for the Food and Drug Administration’s authority over drugs, marking the first time that courts have second-guessed the agency’s expert scientific analysis and moved to restrict access to an FDA-approved drug.

As such, the case has rattled health experts, reproductive health care advocates, the FDA, and the pharmaceutical industry alike. But, based on the line of questioning in today’s oral arguments, they have reason to breathe a sigh of relief.

Standing

The case was initially filed in 2022 by a group of anti-abortion organizations led by the Alliance for Hippocratic Medicine. They collectively claimed that the FDA’s approval of mifepristone in 2000 was unlawful, as were FDA actions in 2016 and 2021 that eased access to the drug, allowing for it to be prescribed via telemedicine and dispensed through the mail. The anti-abortion groups justified bringing the lawsuit by claiming that the doctors in their ranks are harmed by the FDA’s actions because they are forced to treat girls and women seeking emergency medical care after taking mifepristone and experiencing complications.

The FDA and numerous medical organizations have emphatically noted that mifepristone is extremely safe and the complications the lawsuit references are exceedingly rare. Serious side effects occur in less than 1 percent of patients, and major adverse events, including infection, blood loss, or hospitalization, occur in less than 0.3 percent, according to the American College of Obstetricians and Gynecologists. Deaths are almost non-existent.

Still, a conservative federal judge in Texas sided with the anti-abortion groups last year, revoking the FDA’s 2000 approval. A conservative panel of judges for the Court of Appeals for the 5th Circuit in New Orleans then partially overturned the ruling, undoing the lower court’s ruling on the 2000 approval, allowing the FDA’s approval to stand, but still finding the FDA’s 2016 and 2021 actions unlawful. The ruling was frozen until the Supreme Court weighed in.

Today, many of the Supreme Court Justices went back to the very beginning: the claimed scenario that the plaintiff doctors have been or will imminently be harmed by the FDA’s actions. At the outset of the hearings, Solicitor General Elizabeth Prelogar argued that the plaintiffs had not been harmed, and, even if they were, they already had federal protections and recourse. Any doctor who consciously objects to caring for a patient who has had an abortion already has federal protections that prevent them from being forced to provide that care, Prelogar argued. As such, hospitals have legal obligations and have set up contingency and staffing plans to prevent violating those doctors’ federal conscious objection protections.

https://arstechnica.com/?p=2012710




Missouri AG sues Media Matters over its X research, demands donor names

A photo of Elon Musk next to the logo for X, the social network formerly known as Twitter,.
Getty Images | NurPhoto

Missouri Attorney General Andrew Bailey yesterday sued Media Matters in an attempt to protect Elon Musk and X from the nonprofit watchdog group’s investigations into hate speech on the social network. Bailey’s lawsuit claims that “Media Matters has used fraud to solicit donations from Missourians in order to trick advertisers into removing their advertisements from X, formerly Twitter, one of the last platforms dedicated to free speech in America.”

Bailey didn’t provide much detail on the alleged fraud but claimed that Media Matters is guilty of “fraudulent manipulation of data on X.com.” That’s apparently a reference to Media Matters reporting that X placed ads for major brands next to posts touting Hitler and Nazis. X has accused Media Matters of manipulating the site’s algorithm by endlessly scrolling and refreshing.

Bailey yesterday issued an investigative demand seeking names and addresses of all Media Matters donors who live in Missouri and a range of internal communications and documents regarding the group’s research on Musk and X. Bailey anticipates that Media Matters won’t provide the requested materials, so he filed the lawsuit asking Cole County Circuit Court for an order to enforce the investigative demand.

“Because Media Matters has refused such efforts in other states and made clear that it will refuse any such efforts, the Attorney General seeks an order… compelling Media Matters to comply with the CID [Civil Investigative Demand] within 20 days,” the lawsuit said.

Media Matters slams Musk and Missouri AG

Media Matters, which is separately fighting similar demands made by Texas, responded to Missouri’s legal action in a statement provided to Ars today.

“Far from the free speech advocate he claims to be, Elon Musk has actually intensified his efforts to undermine free speech by enlisting Republican attorneys general across the country to initiate meritless, expensive, and harassing investigations against Media Matters in an attempt to punish critics,” Media Matters President Angelo Carusone said. “This Missouri investigation is the latest in a transparent endeavor to squelch the First Amendment rights of researchers and reporters; it will have a chilling effect on news reporters.”

Musk thanked Bailey for filing the lawsuit in a post that said, “Media Matters is doing everything it can to undermine the First Amendment. Truly an evil organization.”

Bailey is seeking the names and addresses of all Media Matters donors from Missouri since January 1, 2023, and the amounts of each donation. He wants all promotional or marketing material sent to potential donors and documents showing how the donations were used.

Ads next to pro-Nazi content

Several of Bailey’s demands relate to the Media Matters article titled, “As Musk endorses antisemitic conspiracy theory, X has been placing ads for Apple, Bravo, IBM, Oracle, and Xfinity next to pro-Nazi content.” Bailey wants all “documents related to the article, or to the events described in the article.”

The Media Matters article displayed images of advertisements next to pro-Nazi posts. Musk previously sued Media Matters over the article, claiming the group “manipulated the algorithms governing the user experience on X to bypass safeguards and create images of X’s largest advertisers’ paid posts adjacent to racist, incendiary content.”

X said Media Matters did this by “endlessly scrolling and refreshing its unrepresentative, hand-selected feed, generating between 13 and 15 times more advertisements per hour than viewed by the average X user repeating this inauthentic activity until it finally received pages containing the result it wanted: controversial content next to X’s largest advertisers’ paid posts.”

X also sued the Center for Countering Digital Hate, but the lawsuit was thrown out by a federal judge yesterday.

https://arstechnica.com/?p=2012671




Florida braces for lawsuits over law banning kids from social media

Florida braces for lawsuits over law banning kids from social media

On Monday, Florida became the first state to ban kids under 14 from social media without parental permission. It appears likely that the law—considered one of the most restrictive in the US—will face significant legal challenges, however, before taking effect on January 1.

Under HB 3, apps like Instagram, Snapchat, or TikTok would need to verify the ages of users, then delete any accounts for users under 14 when parental consent is not granted. Companies that “knowingly or recklessly” fail to block underage users risk fines of up to $10,000 in damages to anyone suing on behalf of child users. They could also be liable for up to $50,000 per violation in civil penalties.

In a statement, Florida governor Ron DeSantis said the “landmark law” gives “parents a greater ability to protect their children” from a variety of social media harm. Florida House Speaker Paul Renner, who spearheaded the law, explained some of that harm, saying that passing HB 3 was critical because “the Internet has become a dark alley for our children where predators target them and dangerous social media leads to higher rates of depression, self-harm, and even suicide.”

But tech groups critical of the law have suggested that they are already considering suing to block it from taking effect.

In a statement provided to Ars, a nonprofit opposing the law, the Computer & Communications Industry Association (CCIA) said that while CCIA “supports enhanced privacy protections for younger users online,” it is concerned that “any commercially available age verification method that may be used by a covered platform carries serious privacy and security concerns for users while also infringing upon their First Amendment protections to speak anonymously.”

“This law could create substantial obstacles for young people seeking access to online information, a right afforded to all Americans regardless of age,” Khara Boender, CCIA’s state policy director, warned. “It’s foreseeable that this legislation may face legal opposition similar to challenges seen in other states.”

Carl Szabo, vice president and general counsel for Netchoice—a trade association with members including Meta, TikTok, and Snap—went even further, warning that Florida’s “unconstitutional law will protect exactly zero Floridians.”

Szabo suggested that there are “better ways to keep Floridians, their families, and their data safe and secure online without violating their freedoms.” Democratic state house representative Anna Eskamani opposed the bill, arguing that “instead of banning social media access, it would be better to ensure improved parental oversight tools, improved access to data to stop bad actors, alongside major investments in Florida’s mental health systems and programs.”

Netchoice expressed “disappointment” that DeSantis agreed to sign a law requiring an “ID for the Internet” after “his staunch opposition to this idea both on the campaign trail” and when vetoing a prior version of the bill.

“HB 3 in effect will impose an ‘ID for the Internet’ on any Floridian who wants to use an online service—no matter their age,” Szabo said, warning of invasive data collection needed to verify that a user is under 14 or a parent or guardian of a child under 14.

“This level of data collection will put Floridians’ privacy and security at risk, and it violates their constitutional rights,” Szabo said, noting that in court rulings in Arkansas, California, and Ohio over similar laws, “each of the judges noted the similar laws’ constitutional and privacy problems.”

https://arstechnica.com/?p=2012595




Justice Department indicts 7 accused in 14-year hack campaign by Chinese gov

Justice Department indicts 7 accused in 14-year hack campaign by Chinese gov
peterschreiber.media | Getty Images

The US Justice Department on Monday unsealed an indictment charging seven men with hacking or attempting to hack dozens of US companies in a 14-year campaign furthering an economic espionage and foreign intelligence gathering by the Chinese government.

All seven defendants, federal prosecutors alleged, were associated with Wuhan Xiaoruizhi Science & Technology Co., Ltd. a front company created by the Hubei State Security Department, an outpost of the Ministry of State Security located in Wuhan province. The MSS, in turn, has funded an advanced persistent threat group tracked under names including APT31, Zirconium Violet Typhoon, Judgment Panda, and Altaire.

Relentless 14-year campaign

“Since at least 2010, the defendants … engaged in computer network intrusion activity on behalf of the HSSD targeting numerous US government officials, various US economic and defense industries and a variety of private industry officials, foreign democracy activists, academics and parliamentarians in response to geopolitical events affecting the PRC,” federal prosecutors alleged. “These computer network intrusion activities resulted in the confirmed and potential compromise of work and personal email accounts, cloud storage accounts and telephone call records belonging to millions of Americans, including at least some information that could be released in support of malign influence targeting democratic processes and institutions, and economic plans, intellectual property, and trade secrets belonging to American businesses, and contributed to the estimated billions of dollars lost every year as a result of the PRC’s state-sponsored apparatus to transfer US technology to the PRC.”

The relentless, 14-year campaign targeted thousands of individuals and dozens of companies through the use of zero-day attacks, website vulnerability exploitation, and the targeting of home routers and personal devices of high-ranking US government officials and politicians and election campaign staff from both major US political parties.

“The targeted US government officials included individuals working in the White House, at the Departments of Justice, Commerce, Treasury and State, and US Senators and Representatives of both political parties,” Justice Department officials said. “The defendants and others in the APT31 Group targeted these individuals at both professional and personal email addresses. Additionally in some cases, the defendants also targeted victims’ spouses, including the spouses of a high-ranking Department of Justice official, high-ranking White House officials and multiple United States Senators. Targets also included election campaign staff from both major US political parties in advance of the 2020 election.”

One technique the defendants allegedly used was the sending of emails to journalists, political officials, and companies. The messages, which were made to appear as originating from news outlets or journalists, contained hidden tracking links, which, when activated, gave APT31 members information about the locations, IP addresses, network schematics, and specific devices of the targets for use in follow-on attacks. Some of the targets of these emails included foreign government officials who were part of the Inter-Parliamentary Alliance on China, a group formed after the 1989 Tiananmen Square massacre that’s critical of the Chinese government; every European Union member of that’s a member of that group; and 43 UK parliamentary accounts part of the group or critical of the People’s Republic of China.

APT31 used a variety of methods to infect networks of interest with custom malware such as RAWDOOR, Trochilus, EvilOSX, DropDoor/DropCa, and later the widely available Cobalt Strike Beacon security testing tool. In late 2016, the hacking group exploited what was then a zero-day vulnerability in unnamed software to gain access to an unidentified defense contractor. In their indictment, prosecutors wrote:

Using the zero-day privilege escalation exploit, the Conspirators first obtained administrator access to a subsidiary’s network before ultimately pivoting into the Defense Contractor’s core corporate network,” prosecutors wrote in the indictment. “The Conspirators used a SQL injection, in which they entered malicious code into a web form input box to gain access to information that was not intended to be displayed, to create an account on the subsidiary’s network with the username “testdew23.” The Conspirators used malicious software to grant administrator privileges to the “testdew23” user account. Next, the Conspirators uploaded a web shell, or a script that enables remote administration of the computer, named “Welcome to Chrome,” onto the subsidiary’s web server. Thereafter, the Conspirators used the web shell to upload and execute at least two malicious files on the web server, which were configured to open a connection between the victim’s network and computers outside that network that were controlled by the Conspirators. Through this method, the Conspirators successfully gained unauthorized access to the Defense Contractor’s network.

Other APT31 targets include military contractors and companies in the aerospace, IT services, software, telecommunications, manufacturing, and financial services industries. APT31 has long been known to target not only individuals and entities with information of primary interest but also companies or services that the primary targets rely on. Primary targets were dissidents and critics of the PRC and Western companies in possession of technical information of value to the PRC.

Prosecutors said targets successfully hacked by APT31 include:

  • a cleared defense contractor based in Oklahoma that designed and manufactured military flight simulators for the US military
  • a cleared aerospace and defense contractor based in Tennessee
  • an Alabama-based research corporation in the aerospace and defense industries
  • a Maryland-based professional support services company that serviced the Department of Defense and other government agencies
  • a leading American manufacturer of software and computer services based in California
  • a leading global provider of wireless technology based in Illinois; a technology company based in New York
  • a software company servicing the industrial controls industry based in California
  • an IT consulting company based in California; an IT services and spatial processing company based in Colorado
  • a multifactor authentication company; an American trade association
  • multiple information technology training and support companies
  • a leading provider of 5G network equipment in the United States
  • an IT solutions and 5G integration service company based in Idaho
  • a telecommunications company based in Illinois
  • a voice technology company headquartered in California;
  • a prominent trade organization with offices in New York and elsewhere
  • a manufacturing association based in Washington, DC
  • a steel company
  • an apparel company based in New York
  • an engineering company based in California
  • an energy company based in Texas
  • a finance company headquartered in New York
  • A US multi-national management consulting company with offices in Washington, DC, and elsewhere
  • a financial ratings company based in New York
  • an advertising agency based in New York
  • a consulting company based in Virginia;
  • multiple global law firms based in New York and throughout the United States
  • a law firm software provider
  • a machine learning laboratory based in Virginia
  • a university based in California
  • multiple research hospitals and institutes located in New York and Massachusetts
  • an international non-profit organization headquartered in Washington, DC.

The defendants are:

  • Ni Gaobin (倪高彬), age 38
  • Weng Ming (翁明), 37
  • Cheng Feng (程锋), 34
  • Peng Yaowen (彭耀文), 38
  • Sun Xiaohui (孙小辉), 38
  • Xiong Wang (熊旺), 35
  • Zhao Guangzong (赵光宗), 38

The men were charged with conspiracy to commit computer intrusions and conspiracy to commit wire fraud. While none of the men are in US custody or likely to face prosecution, the US Department of Treasury on Monday sanctioned Wuhan Xiaoruizhi Science and Technology Company, Limited. The department also designated Zhao Guangzong and Ni Gaobin for their roles in hacks targeting US critical infrastructure.

“As a result of today’s action, all property and interests in property of the designated persons and entity described above that are in the United States or in the possession or control of US persons are blocked and must be reported to OFAC,” Treasury officials wrote. “In addition, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked. Unless authorized by a general or specific license issued by OFAC, or exempt, OFAC’s regulations generally prohibit all transactions by US persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons.”

The US State Department is offering $10 million for information leading to the identification or location of any of the defendants or others associated with the campaign.

https://arstechnica.com/?p=2012482




Reddit faces new reality after cashing in on its IPO

Steve Huffman
Enlarge / Steve Huffman, u/spez on Reddit, sold 500,000 of his shares in Reddit’s IPO on Thursday
AFP via Getty Images

In an interview on the New York Stock Exchange trading floor ahead of Reddit’s market debut on Thursday, chief executive Steve Huffman acknowledged that the mischievous retail investors that congregate on the social media platform might deliberately drive down its share price.

“It’s a free market!” he said.

For Reddit, as for Huffman, the bet on a public offering for a site he described as a “fun and special, but sometimes crazy place” has appeared to pay off.

Shares of the social media company soared on its Big Board debut under the ticker RDDT, closing at $50.44, or 48 percent above its IPO price. This brought its fully diluted market capitalization to $9.5 billion, close to where the company was last valued privately at $10 billion in 2021.

Reddit’s journey to public markets marks a turning point for a fringe, free speech-oriented platform dominated by esoteric memes, sardonic humor, and gamers, as it transforms itself into a more mainstream discussion hub that enforces stricter moderation rules in order to attract advertising dollars.

The picture for its earlier investors was mixed. One big winner was the Newhouse family, who through Advance Magazine Publishers Inc own Condé Nast, which bought Reddit in 2006 for $10 million before spinning it out in 2011. Its shares are now worth about $2.1 billion, a handsome windfall to their publishing empire, which also includes Vanity Fair, the New Yorker, and Vogue. Entities affiliated with OpenAI chief executive Sam Altman now hold a stake worth $613 million.

But investors who put money in at the last financing round in 2021 at $61.79 a share, such as Fidelity, were looking at slightly less on that particular investment.

Founded in 2005, the self-proclaimed “front page of the internet” has battled through management upheaval and moderation scandals to grow to 73 million daily users across its 100,000 communities, or “subreddits,” per Reddit parlance. It is a social media minnow, however, relative to Meta or X, which have more than 2.1 billion and 245 million daily active users, respectively.

Still, its IPO attracted institutional interest. Demand was strong, and the top two dozen investors in the deal, who received the majority of its shares, were typically large asset managers who intend on owning the stock for the long term, one person familiar with the matter said.

Reddit’s surge on its first day of trading, a day after AI infrastructure group Astera Labs jumped 72 percent in its Nasdaq debut, also signals a validation of public investor demand for listings—even a company that is unprofitable, such as Reddit.

“Overall, this is a very positive development for IPO markets [and] should bode well for many of the pre-IPO companies sitting in the queue,” said Christian Munafo, chief investment officer of Liberty Street Advisors.

But, Munafo said, “while [Reddit] performed well out of the gate, the stock may come under pressure unless they are able to demonstrate better growth and monetization.”

Either way, the deal is a boon for Huffman. The chief executive sold 500,000 of his shares in the IPO, cashing out a plump $17 million, and is due to receive additional equity awards as a result of listing the company above a $5 billion valuation. He also received an estimated $193 million pay package last year, mostly made up of equity awards, according to filings.

Historically, Huffman’s style as a leader has reflected that of Reddit’s unruly user base. The self-confessed “internet troll” initially squirmed at the idea of policing the more extreme communities hosted on the platform, relying on these groups to create their own rules and self-moderate. He has defended and cheered on Reddit’s WallStreetBets trading forum that shot to mainstream fame when members collectively bought so-called meme stocks in a bid to squeeze hedge funds*.

But Huffman has recently been forced to tidy up the darker underbelly of the platform for advertisers, present a more professional front to Wall Street and hunt harder for profitability. As a result, Reddit has shifted its ambitions slightly to pin its fortunes to wider tech trends. When Reddit first filed for an IPO in 2021, AI was mentioned once in its prospectus. In the 2024 version, AI appeared more than 60 times.

Nevertheless, the approach has left Huffman and the company at odds with some Reddit communities, who have been resistant to any changes to the platform. Facing new pressures as it enters public markets, some analysts warn that Reddit’s character could be destroyed and users may seek out alternatives, in a drag to the company.

“Reddit, more so than many social media platforms, has been a very community-based, non-commercial space and people know and love it for [this],” said Samuel Woolley, a propaganda expert and assistant professor at the University of Texas at Austin.

“I think the big question that should be on everyone’s mind for Reddit is to what extent the IPO will change the very nature and fabric of the platform.”

Additional reporting by Nicholas Megaw in New York.

© 2024 The Financial Times Ltd. All rights reserved. Not to be redistributed, copied, or modified in any way.

https://arstechnica.com/?p=2012282




Cable ISP fined $10,000 for lying to FCC about where it offers broadband

Businessman secretly crossing fingers
Enlarge / “Yes, we offer Internet at your address.”

An Internet service provider that admitted lying to the Federal Communications Commission about where it offers broadband will pay a $10,000 fine and implement a compliance plan to prevent future violations.

Jefferson County Cable (JCC), a small ISP in Toronto, Ohio, admitted that it falsely claimed to offer fiber service in an area that it hadn’t expanded to yet. A company executive also admitted that the firm submitted false coverage data to prevent other ISPs from obtaining government grants to serve the area. Ars helped expose the incident in a February 2023 article.

The FCC announced the outcome of its investigation on March 15, saying that Jefferson County Cable violated the Broadband Data Collection program requirements and the Broadband DATA Act, a US law, “in connection with reporting inaccurate information or data with respect to the Company’s ability to provide broadband Internet access service.”

“To settle this matter, Jefferson County Cable agrees to pay a $10,000 civil penalty to the United States Treasury,” the FCC said. “Jefferson County Cable also agrees to implement enhanced compliance measures. This action will help further the Commission’s efforts to bridge the digital divide by having accurate data of locations where broadband service is available.”

We also published reports in February 2023 detailing false broadband claims made by Comcast, which initially insisted that the false data it submitted to the FCC was correct. It’s not clear yet whether Comcast will face any punishment.

Inaccurate claims for 1,500 addresses

Last week’s FCC order said that Jefferson County Cable initially reported serving 8,178 addresses for the commission’s June 30, 2022, data collection. It then reduced that number to 6,605 addresses in the FCC’s next round of data collection for December 31, 2022.

Even the second, lower number was higher than Jefferson County Cable’s actual coverage. After a letter from the FCC Enforcement Bureau in March 2023, “Jefferson County Cable corrected its inaccurate submissions for both data filings by removing these approximately 1,500 locations from each of the relevant data filings on May 19, 2023,” the FCC order said.

“At that time, the Company could not provide broadband service at or connect those locations within 10 business days of a request for service, as required by the Broadband Data Collection Rules,” the FCC said. “Jefferson County Cable acknowledged to the Bureau that it had not taken the necessary time and effort to review and understand the Commission’s guidance on Broadband Data Collection filings before it made these two filings.”

Jefferson County Cable’s false claim came to light thanks to Ryan Grewell, who runs a small wireless Internet service provider called Smart Way Communications. He heard about the false claims from his own customers and used the FCC’s map system to file challenges at specific addresses.

Damning email

One of Grewell’s challenges at an address in Bergholz, Ohio, led to the cable company admitting its false claims. Last week’s FCC order said this address was one of the 1,500 incorrectly claimed locations.

As we reported, Grewell got a response from a Jefferson County Cable executive who mistakenly thought Grewell was a potential customer instead of a competitor. The email said that Jefferson County Cable didn’t serve the area yet, but wanted to prevent potential competitors from getting deployment grants.

“You challenged that we do not have service at your residence and indeed we don’t today,” said the January 2023 email from Jefferson County Cable executive Bob Loveridge. “With our huge investment in upgrading our service to provide xgpon we reported to the BDC [Broadband Data Collection] that we have service at your residence so that they would not allocate addition [sic] broadband expansion money over [the] top of our private investment in our plant.”

https://arstechnica.com/?p=2012235




Users shocked to find Instagram limits political content by default

Users shocked to find Instagram limits political content by default

Instagram users have started complaining on X (formerly Twitter) after discovering that Meta has begun limiting recommended political content by default.

“Did [y’all] know Instagram was actively limiting the reach of political content like this?!” an X user named Olayemi Olurin wrote in an X post with more than 150,000 views as of this writing. “I had no idea ‘til I saw this comment and I checked my settings and sho nuff political content was limited.”

“Instagram quietly introducing a ‘political’ content preference and turning on ‘limit’ by default is insane?” wrote another X user named Matt in a post with nearly 40,000 views.

Instagram apparently did not notify users directly on the platform when this change happened.

Instead, Instagram rolled out the change in February, announcing in a blog that the platform doesn’t “want to proactively recommend political content from accounts you don’t follow.” That post confirmed that Meta “won’t proactively recommend content about politics on recommendation surfaces across Instagram and Threads,” so that those platforms can remain “a great experience for everyone.”

“This change does not impact posts from accounts people choose to follow; it impacts what the system recommends, and people can control if they want more,” Meta’s spokesperson Dani Lever told Ars. “We have been working for years to show people less political content based on what they told us they want, and what posts they told us are political.”

To change the setting, users can navigate to Instagram’s menu for “settings and activity” in their profiles, where they can update their “content preferences.” On this menu, “political content” is the last item under a list of “suggested content” controls that allow users to set preferences for what content is recommended in their feeds.

There are currently two options for controlling what political content users see. Choosing “don’t limit” means “you might see more political or social topics in your suggested content,” the app says. By default, all users are set to “limit,” which means “you might see less political or social topics.”

“This affects suggestions in Explore, Reels, Feed, Recommendations, and Suggested Users,” Instagram’s settings menu explains. “It does not affect content from accounts you follow. This setting also applies to Threads.”

For general Instagram and Threads users, this change primarily limits what content posted can be recommended, but for influencers using professional accounts, the stakes can be higher. The Washington Post reported that news creators were angered by the update, insisting that Meta’s update diminished the value of the platform for reaching users not actively seeking political content.

“The whole value-add for social media, for political people, is that you can reach normal people who might not otherwise hear a message that they need to hear, like, abortion is on the ballot in Florida, or voting is happening today,” Keith Edwards, a Democratic political strategist and content creator, told The Post.

Meta’s blog noted that “professional accounts on Instagram will be able to use Account Status to check their eligibility to be recommended based on whether they recently posted political content. From Account Status, they can edit or remove recent posts, request a review if they disagree with our decision, or stop posting this type of content for a period of time, in order to be eligible to be recommended again.”

Ahead of a major election year, Meta’s change could impact political outreach attempting to inform voters. The change also came amid speculation that Meta was “shadowbanning” users posting pro-Palestine content since the start of the Israel-Hamas war, The Markup reported.

“Our investigation found that Instagram heavily demoted nongraphic images of war, deleted captions and hid comments without notification, suppressed hashtags, and limited users’ ability to appeal moderation decisions,” The Markup reported.

Meta appears to be interested in shifting away from its reputation as a platform where users expect political content—and misinformation—to thrive. Last year, The Wall Street Journal reported that Meta wanted out of politics and planned to “scale back how much political content it showed users,” after criticism over how the platform handled content related to the January 6 Capitol riot.

The decision to limit recommended political content on Instagram and Threads, Meta’s blog said, extends Meta’s “existing approach to how we treat political content.”

“People have told us they want to see less political content, so we have spent the last few years refining our approach on Facebook to reduce the amount of political content—including from politicians’ accounts—you see in Feed, Reels, Watch, Groups You Should Join, and Pages You May Like,” Meta wrote in a February blog update.

“As part of this, we aim to avoid making recommendations that could be about politics or political issues, in line with our approach of not recommending certain types of content to those who don’t wish to see it,” Meta’s blog continued, while at the same time, “preserving your ability to find and interact with political content that’s meaningful to you if that’s what you’re interested in.”

While platforms typically update users directly on the platform when terms of services change, that wasn’t the case for this update, which simply added new controls for users. That’s why many users who prefer to be recommended political content—and apparently missed Meta’s announcement and subsequent media coverage—expressed shock to discover that Meta was limiting what they see.

On X, even Instagram users who don’t love seeing political content are currently rallying to raise awareness and share tips on how to update the setting.

“This is actually kinda wild that Instagram defaults everyone to this,” one user named Laura wrote. “Obviously political content is toxic but during an election season it’s a little weird to just hide it from everyone?”

https://arstechnica.com/?p=2012207




Michael Cohen loses court motion after lawyer cited AI-invented cases

Michael Cohen photographed outside while walking toward a courthouse.
Enlarge / Michael Cohen, former personal lawyer to former US President Donald Trump, arrives at federal court in New York on December 14, 2023.
Getty Images | Bloomberg

A federal judge decided not to sanction Michael Cohen and his lawyer for a court filing that included three fake citations generated by the Google Bard AI tool.

Cohen’s lawyer, David M. Schwartz, late last year filed the court brief that cites three cases that do not exist. It turned out that Cohen passed the fake cases along to Schwartz, who didn’t do a fact-check before submitting them as part of a motion in US District Court for the Southern District of New York.

US District Judge Jesse Furman declined to impose sanctions on either Cohen or Schwartz in a ruling issued today. But there was bad news for Cohen because Furman denied a motion for early termination of his supervised release.

Cohen, Donald Trump’s former attorney, served time in prison after pleading guilty to five counts of evasion of personal income tax, making false statements to a bank, excessive campaign contribution, and causing an unlawful corporate contribution. Cohen was also disbarred five years ago. His supervised release is scheduled to expire in November this year.

The fake citations certainly didn’t help Cohen’s attempt to end his supervised release. The citations were intended to show previous instances in which defendants were allowed to end supervised release early. But two of them involved fictional cocaine distributors and the other involved an invented tax evader.

Cohen thought AI tool was a search engine

Furman previously ordered Schwartz to “show cause in writing why he should not be sanctioned.” No such order was issued to Cohen.

“The Court’s Order to Show Cause was limited to Schwartz and did not alert Cohen to the possibility of sanctions. But even if the Court had put Cohen on notice, sanctions would not be warranted,” Furman wrote today. “Cohen is a party to this case and, as a disbarred attorney, is not an officer of the Court like Schwartz. He was entitled to rely on his counsel and to trust his counsel’s professional judgment—as he did throughout this case.”

Cohen stated that he believed Google Bard to be a “super-charged search engine” rather than a “generative text service,” and the judge found “no basis to question Cohen’s representation that he believed the cases to be real.” Bard was recently renamed Gemini.

As for Schwartz, Furman said the attorney’s “citation to non-existent cases is embarrassing and certainly negligent, perhaps even grossly negligent.”

Schwartz apparently believed, incorrectly, that the citations were reviewed by E. Danya Perry, another lawyer representing Cohen. Perry had not reviewed the citations but did provide comments on an early draft of the filing.

“Perry’s comments on the initial draft that Cohen forwarded to Schwartz provided a good faith basis for Schwartz’s belief that Perry was the source… the Court credits Schwartz’s testimony that he genuinely, but mistakenly, believed that the cases had come from Perry; that he did not independently review the cases based on that belief; that he would have researched the cases had he known that Cohen was the source; and that he did not intend to deceive the Court,” Furman wrote.

The facts may support “a finding of extreme carelessness” but not intentional bad faith, according to Furman. “In sum, as embarrassing as this unfortunate episode was for Schwartz, if not Cohen, the record does not support the imposition of sanctions in this case,” the judge wrote.

Other lawyers were sanctioned in similar incident

A similar incident happened in the same court last year when lawyers admitted using ChatGPT to help write court filings that cited six nonexistent cases invented by the AI chatbot. In that case, a judge imposed a $5,000 fine on two lawyers and their law firm and ordered them to send letters to six real judges who were “falsely identified as the author of the fake” opinions cited in their legal filings.

Cohen’s motion for early termination of supervised release cited his October 2023 testimony in the State of New York v. Donald J. Trump. But Furman agreed with the US government that Cohen’s testimony provides reason to deny his motion rather than grant it.

“Specifically, Cohen repeatedly and unambiguously testified at the state court trial that he was not guilty of tax evasion and that he had lied under oath to Judge Pauley when he pleaded guilty to those crimes,” Furman wrote.

Furman’s ruling said that Cohen either committed perjury when he pleaded guilty in 2018 or committed perjury during his October 2023 testimony. “Either way, it is perverse to cite the testimony, as Schwartz did, as evidence of Cohen’s ‘commitment to upholding the law,'” Furman wrote.

https://arstechnica.com/?p=2011656