It’s a love story
Siri just say yes
Good Monday Morning! It’s Feb 15th — which means yesterday was an incredibly special day: my Mom’s birthday! There may have been something else going on?
Anyway, here’s the SWIRL!
📱Tech: Siri, Taylor, and Spotify: It’s a love story, Siri just say yes
📈Business: Can you clear me now?
🏛Politics: The call is coming from inside the House
If this is your first SWIRL, keep reading this part. If you’ve been here before, carry on to the content. Welcome, new swirlers! Here’s a brief reader guide for you: the three teasers above will unfurl below to briefly cover a buzzy development in their respective areas. You’ll read a little about each one. At the end of the SWIRL, we’ll pull on a common thread among all three and explore what it might mean for us. If you missed last week’s SWIRL, tuck in here.
📱Tech: Siri, Taylor, and Spotify: It’s a love story, Siri just say yes
“Hey Siri, play Love Story (Taylor’s version) on Spotify”
If SWIRL had a music section there’d be much to include. Nestled at the top would be last week’s release of Taylor Swift’s first re-recorded1 single, “Love Story (Taylor’s Version).” Though I’m tempted to devote an entire newsletter to the incredibly fascinating business, pop culture, and technology angles to this story, I’ll just direct you here for now. So what is the tech story today? It’s related. If you own an iPhone and prefer music services other than Apple Music, then playing Taylor’s new releases might get a little easier with the next iOS update 🔃.
iPhone users who are testing the upcoming software updates have uncovered a new feature: the option to choose a default music player that is not Apple Music. For Spotify loyalists (🙋🏻♂️), this is welcome news. No more having to include ‘on Spotify’ in our voice commands to Siri. Allowing users to ditch Apple Music may sound like a minor shift, but it’s sort of a major deal for Apple, a company long-noted for pushing its own products to the front of the line. Because of that behavior, the tech titan has been under fire for not playing nice with others. A couple years ago, Spotify sued Apple ⚖️ specifically over Apple Music, stating Apple gives itself an “unfair advantage.” Last fall, when Apple released its most recent product bundle called “Apple One”, Spotify execs took another swipe at Apple’s “unfair practices.”
So while many iPhone users will likely rejoice in the much-requested update, the new feature may also serve as something of an olive branch to companies like Spotify who criticize Apple for locking them out 🔒 of competition. I’ll be keeping my ears to the ground for this release — and for how Spotify and other streamers respond.
📈Business: Can you clear me now?
Back in September, Verizon announced its plan to acquire TracFone, the nation’s leading “no-contract” wireless seller. Currently, thirteen million TracFone customers leverage Verizon’s network through a longtime partnership 🤝 between the companies. Think of it this way: Verizon owns the roads, but other wireless companies can pay a toll for their customers to access Verizon’s LTE & 5G highways.
The planned acquisition would bring TracFone’s 21 million customers fully onto Verizon’s network and into its direct customer base. The deal, which is set to close later this year, is worth about $6.9B 💰in cash, Verizon stock, and incentives. Analysts have been largely optimistic about the purchase, citing the opportunities for Verizon to increase its share of the more affordable (but less profitable) pre-paid market.
While all of this sounds generally positive, there have been some concerns. Earlier this month, sixteen states + the District of Columbia officially raised their red flags 🚩 by asking the Federal Communications Commission (FCC) to thoroughly investigate this proposed acquisition and to impose specific conditions if it is allowed to proceed.
Why?
An FCC program called Lifeline provides 1.7 million qualifying low-income Americans in 43 states with affordable phone & broadband service at lower than market rate. Many of TracFone’s customers participate in this program. In fact, last year TracFone got in trouble for signing up too many participants, some of which appeared to be fraudulent ⚠️. This led to a $6M fine from the FCC. The primary finding was that Lifeline program dollars were spent to subsidize wireless plans for customers who did not need assistance at the expense of those who did.
The states that filed the investigation request this month want a review of how Verizon will support its potential new TracFone customers who participate in the Lifeline program. To date, Verizon only provides Lifeline plans in four states. If the acquisition goes through, Verizon would to need expand its support for the program in order to keep wireless service 📶flowing to Lifeline participants. Some officials worry about whether Verizon will do that:
“We urge the FCC to put the interest of the American consumer before that of big business and request additional information before allowing this acquisition to happen,” - 🏛 Michigan Attorney General Dana Nessel, Feb ‘21
So far, its seems Verizon has only made the following public commitments:
“The portfolio of Tracfone brands creates a platform for growth and innovation in Verizon’s support of the value and low income segments. Verizon will continue to offer Lifeline service through Tracfone and further develop its core brands, products and distribution channels, including StraightTalk, the vast majority of whose customers operate on the Verizon network today. - 📱 Verizon Press Release, Sep ‘20
We might hear more from Verizon and the FCC over the next few weeks as they both formalize responses to this request. Whether or not the FCC will clear the deal, or if they will intervene is uncertain, but they have made recent moves to promote the expansion of broadband coverage to more Americans. So they could be amenable to the group of states’ request to investigate. With a nearly $7B deal on the line, I imagine Verizon’s main message 📢 will be: Can you clear me now?
🏛Politics: The call is coming from inside the House
Over the last couple of weeks, the news coverage of GameStop has plummeted, like its stock price 📉. (nailed it.) However, next week will likely usher along an uptick in news about the video game retailer. The House Financial Services Committee will hold a hearing about the company’s stock trading frenzy. The hearing, titled: “Game Stopped? Who Wins and Loses When Short Sellers, Social Media, and Retail Investors Collide?” is scheduled to livestream 📺 at 12PM ET on Thursday. The CEOs of Robinhood, Reddit, and financial firms Citadel and Melvin Capital are expected to testify in front of the House panel.
Lawmakers on both sides of the aisle are eager to start uncovering exactly what happened with GameStop — and if anything illegal occurred. Many citizens are likely to join members of Congress in their interest in the trading activity. 28% of Americans bought GameStop or other ‘viral’ stocks. However, this past Thursday, a former chairman of the Securities and Exchange Commission (SEC) called the upcoming hearing ‘premature.’ To paraphrase, he believes it is too soon to seek answers because ‘we’ aren’t sure of what questions ‘we’ should be asking. Some of those questions may get solidified through ongoing investigations 🔎 into the GameStop saga by The Department of Justice and the SEC.
That said, I imagine some folks over in Congress know exactly what questions they want to ask. We’ll just have to wait until Thursday to hear them.
The SWIRL
So, how do these three stories swirl together? They each represent an increasing focus on the role of government regulation in tech.
❇️ Spotify isn’t the only green blip on Apple’s radar. The US government is aiming anti-trust investigations at the company’s App Store. Apple isn’t as big of a target as are Facebook and Amazon, and this new approach to better integrating with other tech companies, like Spotify, could help inoculate Apple against strong federal antitrust actions which are likely in the works.
👩🏻⚖️ The FCC’s pending decision to wade into Verizon’s acquisition of TracFone might shed light on how it will interpret its broader role in achieving a Biden administration priority: leaning on companies to expand broadband in the US. If the FCC decides to jump into and shape the Verizon deal, it could signal a willingness to wield their power in bold ways by forcing Verizon to adopt specific conditions in order to proceed with the purchase.
🌐 Technologies like Reddit and Robinhood are a part of the broader ‘Big Tech’ ecosystem, and their CEOs will now join other tech chiefs, like Zuckerberg, Bezos, and Pichai in testifying to the House to explain their companies’ complicated roles in society, the economy, and now, the GameStop moment.
World governments are starting to slowly catch up with “Big Tech.” Questions of consumer protection, data privacy, anti-competitive behavior, and a whole cloud of other issues formed from the digital exhaust of big tech’s machinery, are now getting real attention. We’re likely to see companies like Apple, Verizon, and Robinhood argue that they create much more value to society than risk.
The question governments — and us — should ask: What is the nature of the risk that these companies create, and how much of it should we accept?
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If you didn’t know that Taylor Swift has been re-recording her first six albums, now you do! To summarize a very long saga: Taylor’s record company, Big Machine, owned all of her music. Pretty standard and if you’re asking me, unfortunate. Big Machine then sold their rights to the music to a guy name Scooter. It’s at this point that you have all you need to know to guess how this ends. Taylor wanted to own the rights to her music. Scooter said no. So, she’s essentially re-doing every recording. It’s a baller move tbh.