Clubhouse: Is the audio app really worth $4bn?

Live-audio app Clubhouse is creating plenty of chatter – about itself.

Elon Musk, Oprah Winfrey, Kanye West, Demi Lovato and Mark Zuckerberg are among the celebrities to have popped up on the service. And you can find chats about everything from Bitcoin and Buddhism to relationships and R&B music on it.

Even so, the idea that this one-year-old app could be worth $4bn (£2.9bn) is startling.

It stems from a Bloomberg report saying the San Francisco-based start-up is seeking fresh funds at this level.

But it was only in January that venture capital fund Andreessen Horowitz bought a stake valuing the firm at a quarter of the sum.

The jump may be justified by a follow-up report that Twitter has discussed buying the app for the higher price – although it declined to confirm this when asked.

Why would Clubhouse be worth so much?
Clubhouse had about 13.4 million users in late March, according to research firm App Annie, having added about a fifth of that number over the previous four weeks alone.

In short, it’s growing quickly – despite being “invite only” and limited to Apple’s iOS – and appears to have found a gap in the market.

“It’s at the intersection of several hot trends – audio, live and social,” said Joseph Evans from Enders Analysis.

“And it’s recreating some of the things we can’t do normally because of the coronavirus pandemic restrictions, such as attending a talk or having a group conversation.”

At present the app doesn’t make any money. But that’s not necessarily important.

As Sarah Frier’s book No Filter recounts, Mark Zuckerberg insisted Instagram take its time before introducing ads after Facebook bought the photo app in 2012 for a then-groundbreaking $1bn.

The reason, he said, was that it was more important to establish “staying power” first.

But Instagram only achieved its value because both Facebook and Twitter wanted to buy the business.

And that’s unlikely to be the case this time round.

“A few years ago Facebook would probably have already put an offer on the table [for Clubhouse], said Mr Evans.

“But it’s not in the market for another social network because of the competition scrutiny that it’s under, so Facebook’s only option is to compete with it.”

Indeed, Facebook has just launched a new web-based app of its own called Hotline, which lets hosts chat to their audience via audio and text.

What other rivals are out there?
Twitter has already launched Spaces, an audio-streaming feature inside the existing Twitter app.

It is being rolled out to select creators first, but the plan is to allow anyone to create a “space” later this month.

Chat app Telegram launched a voice chat feature last year, and revamped the feature in March to work like Clubhouse’s one-to-many dynamic.

And Discord – a sleeping giant in the voice comms space – has just launched Stages, where one speaker “on stage” can speak to many people at once.

Business-focused giants Slack and LinkedIn are known to be working on the idea too.

Many of these apps have much bigger audiences than Clubhouse ever has had – and are available on more platforms, including Android and PCs.

What other challenges does Clubhouse face?
Content moderation is set to be a big issue.

Clubhouse has already attracted controversy with reports of it being used by far-right personalities to discuss claims of women fabricating rape accusations, as well as instances of racism, sexism and anti-Semitism.

And this isn’t a good time to attract this kind of attention.

Politicians in the US are threatening to remove legal protections given to social networks under a law known as Section 230, after accusing them of bias and allowing harmful material to run rampant.

And in the UK, the proposed Online Safety Bill could soon give regulator Ofcom the power to block apps it judges to have failed to protect users.

Policing live audio is a lot harder than using algorithms to detect offensive text-based comments.

And while Clubhouse does retain audio recordings of chats if an incident is reported to it in “real-time”, it does not do so if a user tries to report a past offence, hindering any follow-up investigation.

Another risk is that Clubhouse might not prove “sticky” enough with its users.

One early adopter says she has found herself using it less and less because there are podcasts and other media available that do a better job of competing for her attention.

“Clubhouse makes it really easy for people to create content, but actually the content itself is surprisingly hard to use,” said Sharon O’Dea, an Amsterdam-based digital communications consultant.

“You can’t share it, you can’t record it, you can’t quote it, and it often takes speakers ages to get to their key point.

“It just feels to me like it’s it doesn’t respect my time as a consumer.”

How might Clubhouse become profitable?
The traditional way for social networks to make money is adverts.

But an audio-only format makes that difficult.

Would users stick around if forced to listen to pre-roll promotions? Would the natural flow of conversations be damaged by hosts having to pause for regular breaks, or worse ads simply playing over parts of discussions, in a similar way to how Twitch interrupts video gameplay?

As an alternative, the app’s creators have suggested they could take a cut of payments made by listeners to room hosts in order to thank them or access premium “ticketed” content.

Patreon, another start-up, has already built a business around this model, and was valued at $4bn in its latest funding round.

Clubhouse has just introduced a money transfer tool of its own – but for now has opted to let 100% of payments go to creators rather than taking a commission.

Should firms be more worried about firmware cyber-attacks?

“Firmware attacks are not common on a day-to-day basis, but that’s because people don’t realise they’re being infected by such an attack,” says Mr Boyd.

“It’s like when ransomware first came onto the scene – people didn’t know of anyone who was infected by it, and if big organisations were, they wouldn’t tell anyone about it, as there was an element of shame, not wanting their clients to know they’d been infected.”

Mr Boyd adds that a new generation of “budding hardware enthusiasts” who have been learning their way around firmware by “modding video game consoles over the last decade” could well pose additional threats to enterprise cyber-security going forward – a point Mt Cirlig fervently agrees with, since he hacked the firmware in his own car when he was younger.

“Microsoft is right to raise this as a major issue, because we need to bring firmware designers and operational technologies along the journey of cyber-security, the way we have with software companies,” says Mr Potter.

“As we connect more things to the internet, we’re connecting a lot more devices that haven’t been designed with cyber-security in mind. And if the trend continues, bad guys will go after it.”

Tool checks phone numbers from Facebook data breach

People can now enter their phone numbers into a website to see if they appeared in a recent Facebook data breach.

Details of more than 530 million people were leaked in a database online, largely consisting of mobile numbers.

People can use the Have I Been Pwned online tool to check if their numbers or emails were compromised.

Facebook says the data is from an “old” breach in 2019 but privacy watchdogs are now investigating.

The data
Facebook said it had “found and fixed” the breach more than a year-and-a-half ago.

But the information has now been published for free in a hacking forum, making it widely available.

The database covers 533 million people in 106 countries, according to researchers analysing the data. That includes 11 million Facebook users in the UK, 30 million Americans and 7 million Australians.

Not every piece of data is available for each user but 500 million phone numbers were leaked compared with “only a few million email addresses”, Troy Hunt, a security expert who runs HaveIBeenPwned said in a blog on his website.

‘Not just a tiny slice of people’
Mr Hunt launched the phone number search function after “unprecedented traffic” to the website, following the news of the Facebook data leak.

Previously, users of the platform could only search for email addresses.

Visitors to the website can now enter their mobile number into a search box, and the website will confirm if it has appeared in the leaked database.

“I wanted to ensure Have I Been Pwned could answer that question for everyone, not just a tiny slice of people,” Mr Hunt told the BBC.

It has also been suggested that Facebook’s own chief executive, Mark Zuckerberg, had his mobile number leaked in the database.

“This is the number associated with his account from the recent Facebook leak,” security expert Dave Walker tweeted, along with a screenshot of Zuckerberg’s leaked phone number.

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The screenshot also suggests Mr Zuckerberg was on messaging platform Signal – which uses end-to-end encryption and is not owned by Facebook.

Facebook has requested users input their phone numbers since 2011, citing security reasons.

It allows for “two-factor authentication”, an additional feature that sends a text to a user’s mobile whenever somebody logs into their account.

The tech giant has advised users to check what details they share publicly on the platform by updating the How People Find and Contact You section, as well as completing “regular privacy checkups”.

Facebook added the data was “scraped” using public information available on the system, rather than hacked.

Meanwhile, several investigations have been launched into Facebook by privacy watchdogs around the world.

Ireland’s Data Protection Commission said it was working with the tech firm to establish if “the dataset referred to is indeed the same as that reported in 2019”.

The Philippines’ National Privacy Commission and Hong Kong’s Office of the Privacy Commissioner have also launched probes into the breach.

Amazon v the union: The vote the online giant fears

Amazon workers in Bessemer, Alabama, have voted in a historic poll to decide whether they want to be represented by the Retail, Wholesale and Department Store Union.

The results are not expected until next week – but if they say yes, it will become Amazon’s first US union.

Amazon argues its wages and benefits are industry-beating and has gone into battle to persuade workers to vote no.

Most agree the outcome could have major implications for US labour laws.

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Peter Romer-Friedman, principal of law firm Gupta Wessler PLLC, said: “The key question in America at the moment is are we going to have fair treatment of workers in the businesses that will dominate our future?

“There will be ramifications for the real economy but also for tech firms.

In the US, Amazon has 800 facilities staffed by 950,000 full- and part-time workers – and it should be said many do not feel the need to join a union.

And for those who do, this is not primarily a wages issue – in fact, Amazon pays workers an average of $15 (£11) a hour, plus benefits.

But most agree conditions in its warehouses can be hard – the job is very demanding and lots of workers complain of back pain or other physical niggles as a result of working long hours, often standing in the same position.

Others talk about the mental-health toll of repeated tasks or feeling like they are a cog in a very big machine that does not always listen to their problems.

And there are a lot of things workers feel they do not have control of, such as shift patterns, time off, sick leave and being fired.

One of the most controversial features is time off task (TOT).

When a worker is clocked in, Amazon’s computer system calculates which hours of a shift are on or off task, based on whether or not an item is scanned.

And some say they feel dehumanised by technology watching their every move.

Do workers really have to urinate in bottles?
Amazon issued an extraordinary tweet last week, in response to US congressman Mark Pocan repeating an oft-heard complaint workers sometimes urinated in bottles because they did not feel they had time to visit the toilet.

“Paying workers $15 an hour doesn’t make you a ‘progressive workplace’ when you union-bust and make workers urinate in water bottles,” he wrote.

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Amazon News replied: “You don’t really believe the peeing in bottles thing, do you?

“If that were true, nobody would work for us.”

Amazon’s tweet was shared thousands of times, with most people saying it reflected badly on the company.

The claim can be traced back to James Bloodworth, who worked undercover at a UK warehouse while researching his book on low-paid British workers.

And he responded to the Amazon News tweet by tweeting: “I was the person who found the pee in the bottle.

A series of allegations levelled at Amazon over its attempts to disrupt the union include:

It altered a traffic-light system outside the warehouse, to give union officials less time to leaflet workers
It unsuccessfully tried to appeal against a National Labour Relations Board ruling allowing workers to vote by mail
It bombarded workers with texts, posters and signs encouraging them to vote no
It ran anti-union ads on its streaming platform, Twitch, which were later removed
At the time, RWDSU president Stuart Appelbaum said: “Amazon is leaving no stone unturned, including ads on Twitch – in its efforts to deceive and intimidate their employees into voting against the union.”

In September, the company briefly advertised for two intelligence analysts whose work duties would include keeping an eye on union activity – but after becoming national news, the advert was removed.

What does Amazon say?
Amazon told BBC News: “RWDUS membership has fallen 25% during Stuart Appelbaum’s tenure – but that is no justification for Mr Appelbaum to misrepresent the facts.

“Our employees know the truth – starting wages of $15 or more, health care from day one, and a safe and inclusive workplace.

“We encouraged all of our employees to vote – and their voices will be heard in the days ahead.”

How else has it responded?
In recent days, Amazon has stepped up its public-relations drive – but with fairly mixed results.

One of its security engineers had even thought the Amazon News account had been hacked, as its tweets seemed “unnecessarily antagonistic”, The Intercept reported.

As well as the tweet about urinating in bottles, it also fired back aggressively at Democratic Party politicians, including Elizabeth Warren and Bernie Saunders.

And it has also been accused of using fake Twitter accounts to put a positive spin on working at the company.

Amazon itself admitted one of these accounts was not that of an actual worker, without saying whether the company had created it.

Has Covid played a part?
The company’s net sales in 2020 increased by 38% – and it hired more than 500,000 additional staff.

But behind the scenes there has been huge pressure on warehouse staff to keep supplying the goods so many people in lockdown were ordering.

Chris Smalls, one of a handful of employees to raise questions in the early days of the pandemic about how safe conditions in warehouses were, was sacked, with Amazon saying he had broken social-distancing rules.

And in February, New York state’s attorney general sued Amazon, claiming it failed to adequately protect its warehouse workers from Covid risks.

Union membership in the US is unusually low – just 6.3% of the private-sector workforce, according to the labour department.

In comparison, Amazon workers in Japan, the UK, Germany, Italy , France and Poland are all unionised.

In Germany a recent four-day strike was called over pay and conditions, while in Italy Amazon workers held a 24-hour strike over what they described as exhausting work rates and “management by algorithm”.

Facebook leak: Irish regulator probes ‘old’ data dump

A data leak involving personal details of hundreds of millions of Facebook users is being reviewed by Ireland’s Data Protection Commission (DPC).

The database is believed to contain a mix of Facebook profile names, phone numbers, locations and other facts about more than 530 million people.

Facebook says the data is “old”, from a previously-reported leak in 2019.

But the Irish DPC said it will work with Facebook, to make sure that is the case.

Ireland’s regulator is critical to such investigations, as Facebook’s European headquarters is in Dublin, making it an important regulator for the EU.

The most recent data dump appears to contain the entire compromised database from the previous leak, which Facebook said it found and fixed more than a year and a half ago.

But the dataset has now been published for free in a hacking forum, making it much more widely available.

It covers 533 million people in 106 countries, according to researchers who have viewed the data. That includes 11 million Facebook users in the UK and more than 30 million Americans.

Not every piece of data is available for every user, but the large scale of the leak has prompted concern from cyber-security experts.

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The DPC’s deputy commissioner Graham Doyle said the recent data dump “appears to be” from the previous leak – and that the data-scraping behind it had happened before the EU’s GDPR privacy legislation was in effect.

“However, following this weekend’s media reporting we are examining the matter to establish whether the dataset referred to is indeed the same as that reported in 2019,” he added.

Phone issues
Despite the claims of the data being “old”, some security researchers remain concerned due to the unchanging nature of the data involved.

Phone numbers, for example, are unlikely to have changed for many people in the past two to three years, and other information – such as a date of birth or hometown – never change.

Alon Gal, a well-known personality in cyber-security circles who tweets as @UnderTheBreach, wrote that the phone number database first appeared in January, where hackers could look up the phone database for a small fee.

But the widespread leak of the database “means that if you have a Facebook account, it is extremely likely the phone number used for the account was leaked,” he tweeted.

“I have yet to see Facebook acknowledging this absolute negligence of your data,” he added.

This is a cautionary tale on a colossal scale.

It’s actually terrifyingly common for companies to store customer data in large, unsecured databases.

Often they are discovered by well-meaning security researchers and are either deleted or made safe swiftly before the bad guys stumble upon the treasure trove.

However, sometimes it’s too late.

This case highlights that a company’s defence “we’ve fixed it now” is not good enough.

The horse had bolted long before the stable doors were closed. And clearly, the horse has been having a field day for years since.

The database has likely changed criminal hands many times before now being offered for free.

Facebook may claim this is “an old story”, but clearly it’s one that keeps coming back to bite it – and, more importantly, its users.

Presentational grey line
Troy Hunt, a security expert who runs HaveIBeenPwned – an online service for users to check if their information has been involved in a data breach – said queries were six times higher than normal since news of the database’s release broke.

He also suggested that the leaked dataset could be very useful “for a targeted attack where you know someone’s name and country” – though it would be much harder to use for a blanket mass cyber-attack.

“But for spam based on using phone number alone, it’s gold,” he added.

“Not just SMS, there are heaps of services that just require a phone number these days and now there’s hundreds of millions of them conveniently categorised by country with nice mail merge fields like name and gender.”

Google rejigs remote working as it reopens offices

Google is changing its work-from-home policy as it looks to get more people back into its US offices.

The tech firm will only allow employees to work from home for more than 14 days a year if they apply for it.

Google will continue its current work-from-home arrangements until 1 September but will allow people to return voluntarily from next month.

The tech giant was one of the first companies to offer working from home when the pandemic struck last year.

“It’s now been a year since many of us have been working from home, and the thought of returning to the office might inspire different emotions,” Fiona Cicconi, Google’s head of people operations, wrote in a company email on Wednesday.

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Google is currently preparing for a broad reopening in September, when employees will be expected to be in the office for at least three days a week.

Until then, the initial return period will be voluntary as offices slowly reopen with limited capacity, based on vaccine availability and a downward trend in Covid-19 cases.

When staff are required to officially return to Google’s offices in September, they “won’t look exactly the way you remember them” but “will include meals, snacks and amenities where possible,” Ms Cicconi said.

“We will even be welcoming our Dooglers back,” she added, referring to Google’s bring-your-dog-to-work group. There is now a dog park at its Mountain View campus called The Doogleplex.

The company is advising workers to get vaccinated against Covid-19, but is not making it mandatory for returning to the workplace.

Google says more long-term work-from-home arrangements are available. Staff can apply for up to 12 months in “the most exceptional circumstances.

Different approach
Google is taking a different approach from its tech rivals who have allowed most staff can continue remote work indefinitely. Twitter has said it will allow most of its employees to work from home permanently.

A number of big companies have plan to test so-called hybrid work arrangements, where employees split their time between home and office.

“None of us have this all figured out,” said Carolyn Everson, vice president of Facebook’s global business group, when talking about current work-from-home arrangements.

“We are making this up on the fly. The reality is we are all trying to figure it out together,” the senior Facebook executive told a panel hosted by Bloomberg.

Facebook will start to reopen its Silicon Valley offices at the beginning in May, after more than a year of working from home during the global pandemic.

Its largest offices won’t reach 50% capacity until early September, it said.

VW rebrand turns out to be April Fool’s joke

German carmaker Volkswagen will not change its name to “Voltswagen” in the US despite earlier saying it would in a press release.

The name change was in fact an April Fool’s joke that was leaked to the media several days early by mistake.

It was initially said to mark VW’s shift to electric vehicles, and was backed by US boss Scott Keogh.

The carmaker will put out an official press release clearing up the matter on Wednesday.

On Tuesday, the carmaker went as far as changing its name on its US website and even launched a new Voltswagen Twitter handle.

It denied speculation it was just a prank, leading to numerous media outlets picking up the story, including BBC News.

‘Changing a K for a T’
In the press release, Mr Keogh said: “We might be changing out our K for a T, but what we aren’t changing is this brand’s commitment to making best-in-class vehicles for drivers and people everywhere.

“This name change signifies a nod to our past as the peoples’ car and our firm belief that our future is in being the peoples’ electric car.”

Some had remained unconvinced, though.

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The Volkswagen Group has long supported the goals of the Paris Climate Agreement and aims to become carbon neutral by 2050.

VW has also committed to sell one million electric vehicles worldwide by 2025.

But its environmental record was damaged by the diesel emissions scandal of 2015. The firm admitted to installing software that was capable of cheating emissions tests in 11 million diesel vehicles worldwide.

As a result it has faced huge fines and compensation claims in Europe and the US, and two VW employees have received jail terms in America.

Child tweets gibberish from US nuclear-agency account

A young child inadvertently sparked confusion over the weekend by posting an unintelligible tweet to the official account of US Strategic Command.

The agency is responsible for safeguarding America’s nuclear weapons.

Some social-media users feared the account may have been hacked.

But it has since been revealed a young member of the account’s social-media manager’s family was responsible for posting the tweet, “;l;;gmlxzssaw”, which was then deleted within minutes.

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News website The Daily Dot revealed the accident, after a Freedom of Information request to the agency.

“The command’s Twitter manager… momentarily left the command’s Twitter account open and unattended,” the response said, adding he had been working from home.

“His very young child took advantage of the situation and started playing with the keys and unfortunately, and unknowingly, posted the tweet,” it said.

A spokesman also confirmed suggestions the account had been hacked were false.

“Absolutely nothing nefarious occurred,” the statement added.

Union creates hotline for disgruntled Amazon staff

The trade union Unite is setting up a hotline for Amazon staff to complain about their treatment at work.

Organiser Sharon Graham told the BBC it was time the internet retail giant shared its “bonanza profits with the workers who help make them”.

Amazon had its most lucrative year ever in 2020, helped by a surge in online shopping during the pandemic.

The company said it offered its staff “excellent” pay, benefits and career opportunities, plus “safe” conditions.

It added that it was “proud” to have created 10,000 jobs in the UK last year.

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Ahead of the hotline’s launch on Monday, Unite said it wanted to agree a “social contract” with Amazon and for the company to recognise trade unions.

These changes, Ms Graham argued, would help secure higher wages and end “relentless” work targets.

She said staff needed to speak about “the exploitation they suffer day after day as a consequence of Amazon’s merciless drive for profit”.

Ms Graham – who is planning to run in the contest to replace current Unite general secretary Len McCluskey when he steps down next year – told the BBC the hotline was “not a stunt” and the union was “in this for the long haul”.

It wants to hear from staff who have had “had timed toilet breaks”, done “back-breaking piece work with never-ending targets”, had “compulsory” overtime imposed and needed to talk about “the horrendous record of injuries on the job”, she said.

‘Critical role’
But Amazon rejected Unite’s criticisms, with a spokesman saying: “The fact is we already offer our employees excellent pay, excellent benefits and excellent opportunities for career growth, all while working in a safe, modern work environment.”

He added that the company’s “competitive wages” started at £9.70 or £10.80 per hour, depending on location, and he would “encourage anyone to compare this to the wages and benefits offered by other retailers”.

“We’re proud to have created 10,000 new permanent roles across the UK in 2020, taking our total permanent UK workforce to more than 40,000,” the spokesman said.

“Our people have played a critical role in serving customers in these unprecedented times and the new roles help us continue to meet customer demand and support small and medium-sized businesses selling on Amazon.”

Facebook removes accounts of ‘China-based hackers’ targeting Uighurs

Facebook has removed a group of China-based hackers it says targeted members of the Uighur community living abroad.

It said hackers used malicious websites and apps to infect devices and allow for remote surveillance, with journalists and activists targeted.

A majority of the cyber attacks didn’t happen directly on Facebook but used the social media platform to share links to infected sites.

This is not the first time hackers have been accused of such activity.

The Uighurs are originally from the north-western region of Xinjiang in China and those targeted are currently living in places including Turkey, the United States, Australia and Canada.

“This activity had the hallmarks of a well-resourced and persistent operation, while obfuscating who’s behind it,” Facebook’s Mike Dvilyanski, head of cyber espionage investigations, and Nathaniel Gleicher, head of security policy, said in a blog post.

Facebook said it removed accounts – which totalled fewer than 100 – it found to have been created by the hackers, a group known as Earth Empusa or Evil Eye.

It believes fewer than 500 accounts were targeted.

Facebook says some of the ways the group infected devices included:

creating fake Uighur-themed apps for the Android app store, including a prayer app and a dictionary app
posing on Facebook as journalists, students, human rights advocates or members of the Uighur community, building trust and tricking them into clicking on malicious links
creating look-alike websites for popular Uighur and Turkish news websites
The Chinese Embassy in Washington has yet to comment.

China is facing mounting criticism from around the world over its treatment of the mostly Muslim Uighur population in Xinjiang.

Rights groups believe China has detained more than a million Uighurs over the past few years.

China denies allegations of abuse, saying camps in the region are “re-education” facilities used to combat terrorism.