How Will MindGeek Get Paid? Umm, Encrypted and Anonymous Digital Currencies Maybe
December 11, 2020
I have followed the strong MasterCard and Visa response to revelations about MindGeek’s less-than-pristine content offerings. The Gray Lady wrote about MindGeek and then other “real” news sites picked up the story. A good example is “Visa, MasterCard Dump Pornhub Over Abuse Video Claims.” The write ups appear to have sidestepped one question which seems obvious to me:
How will MindGeek collect money?
There are some online ad outfits which have been able to place ads on Dark Web sites and on some other sites offering specialized content, not very different from MindGeek’s glittering content array. Amped up advertising seems one play.
But what about MindGeek’s paying customers?
Perhaps MindGeek, nestled in the Euro-centric confines of Montréal, will come up with the idea to use a digital currency. Invoices can be disseminated in secret messaging systems like those favored by the Russian based Edward Snowden. The payments can flow via encrypted digital currencies. Now many transactions can be tracked by government authorities in a number of countries. Nevertheless, making this type of shift is likely to increase the burden on investigators.
Just as killing off Backpage created additional work for some law enforcement professionals. The MasterCard and Visa termination may have a similar effect. Yes, the backlog can be resolved. But that is likely to add friction to some enforcement activities. A failure by regulatory agencies to get a handle of payments systems (encrypted and unencrypted) is now evident to some.
Stephen E Arnold, December 11, 2020
Cryptocurrency Competition at the Tallest of Ivory Towers
December 7, 2020
Ah, what better use of the finest in education than financial manipulation? We learn from cryptocurrency and Web 3.0 news source Decrypt, “Oxford, Cambridge Students Compete to Make Money on Crypto Markets.” The competition was put to math and computer science students at the two prestigious UK universities by crypto algorithmic trading firm APEX:E3. The firm also brought Coinbase, FTX, SIX Digital Exchange, LMAX Digital, and ConsenSys in on the project. Reporter Robert Stevens writes:
“Since November 16, the students have been competing to make the most money from crypto exchanges Coinbase Pro and FTX, according to a press release APEX:E3 pushed out this morning. APEX:E3 said that students have already spent their days conjuring up algorithms that incorporate technologies and concepts as diverse as machine-learning, neural networks, and whale order trading. In return for their toils, APEX:E3 is providing Oxford and Cambridge students from math and computer science departments access to its APIs, technical support, mentorship, and an undisclosed amount of ‘seed funding.’ … When the competition concludes at some point next month, the clocks will stop and a panel of ‘industry leading judges’ will rate the teams on their algorithms.”
The winning team gets to keep that mysterious amount of seed funding plus their returns. Cambridge is billing the project as a “fun and risk-free way” for these handpicked students to learn about the cryptocurrency industry. It also looks like a cheap and salary-free way for the industry to pick some of the brightest young minds for profitable ideas. A win-win, I suppose.
Soon Facebook’s carpe diem will arrive and more excitement shall ensue.
Cynthia Murrell, December 7, 2020
Palantir Technologies Sparks a Controversial Metaphor
December 4, 2020
In an interview with a policeware/intelware vendor, I learned about a financial company’s view of Palantir Technologies. This is the 13 year old start up which recently went public. The company had an astounding 130 customers, about $600 million in revenue, and a modest $500 million in losses in 12 months.
Here’s the comment which I chased down in its original tweeter output glossiness:
The operative phrase is:
A full casino.
If I were a Palantirian unpacking boxes in Denver, Colorado, I would hit the Yellow Pages or the Seeing Stone. An attorney might have some thoughts about a malicious metaphor disseminated via the marvelous firm managed part time by a bearded CEO.
Palantir. A full casino. Whatever does that mean?
Stephen E Arnold, December 4, 2020
Some US Big Tech Outfits Say Laisse Tomber
December 2, 2020
The trusted “real news” outfit Thomson Reuters published “Amazon, Apple Stay Away from New French Initiative to Set Principles for Big Tech.” Quelle surprise! The “principle” is the silly notion of getting big US technology companies to pay their taxes, fair taxes. Incroyable? Companies not getting with the program allegedly include Apple, Facebook, Google, and Microsoft. These four firms are likely to perceive the suggestion of fairness as a demonstration of flawed logic. It is possible that the initiative may become a cause célèbre because money. France is a mere country anyway.
Stephen E Arnold, December 2, 2020
Innovation Shift: Not Just in China and Singapore
November 23, 2020
How much innovation will $700 million buy? I think I will find out in the next six to 12 months. “COVID Hit Startups Badly – but Something Surprising Is Happening” contains an interesting factoid, if the datum is accurate. Here’s the passage I noted:
Research from MAGNiTT, a startup data platform, revealed that $704m was invested across 564 different startups across the region in 2019. “To put it into perspective, 2009 saw $15m of funding in five venture deals,” the company noted.
The article emphasizes Covid. My thought is that other factors are contributing to this old-school Silicon Valley type surge. Regardless of the reason, some of these “deals” were ones which just a few years ago would have involved lots of Philz Coffee conversations. Not now it seems.
Stephen E Arnold, November 23, 2020
Cost of Auditing the US Department of Defense
November 18, 2020
And you thought that your accountant charged too much for doing your taxes. “Pentagon Fails Audit Yet Again, Could Pass around 2027, Comptroller Says” pegs the fees for the Pentagon audit in 2019-2020 at $203 million this year.
How did the audit team conduct its work?
Around 1,400 auditors tested the systems and record-keeping processes on weapons systems, military personnel and property around the world in 100 site visits, 530 virtual visits and samples. The process resulted in 24 standalone audits, comprising the overall audit.
Interesting. Not H&R Block I presume.
Stephen E Arnold, November 18, 2020
Financial Crime: Who Is Winning? Banks, Bad Actors, or Enforcement Authorities
November 17, 2020
I read “Only 1% of Laundered Cash in EU Is Detected — ABN AMRO Wants to Improve That.” The article reports:
Detecting money laundering is like mixing the perfect cocktail.
And how many outstanding mixologists in addition to a high profile outfit like a certain bank in Hong Kong or a top dog in Manhattan are there in the financial crime enforcement units around the world? If the data in the write up are accurate, not too many.
The article points out:
Globally, estimates suggest between $800 billion and $2 trillion in laundered money flows through the financial system every year, and an overwhelming majority of it goes undetected. The Netherlands alone sees $16 billion in criminal money flowing through its financial system.
Then this item of information is provided:
…the European Commission found just 1% of an estimated $190 billion in laundered funds were successfully confiscated between 2010 and 2014.
What are the principal conduits for money transfers? Let’s see. Maybe banks? What is ABN AMRO? According to Wikipedia, the entity is — wait for it — a bank. Why does ABN AMRO, the number three bank in the Netherlands want to do better in this sphere of activity? Just a “good” bank I assume.
Stephen E Arnold, November 17, 2020
YouTube Factoid
November 10, 2020
Investor Place published “YouTube Is Now Google’s Biggest Growth Engine and Could Be Worth $200 Billion on Its Own.” The write up contains an interesting factoid which may be semi-true.
YouTube is now nearly 20% of Google’s business, and it’s growing three times faster than the rest of the company.
After decades of effort, Google has another revenue stream, based on advertising and subscriptions.
So what?
There’s the $200 billion and the “could”.
Stephen E Arnold, November 10, 2020
Researchers Find Narrow Path to Increased Profits with AI Tech
November 6, 2020
Uh oh—AI and machine learning may not deliver value to most enterprises that adopt the technology. Researchers at MIT Sloan Management Review have found more than half the companies they studied are deploying AI solutions, but fewer than 10% of those are reaping significant financial benefits. If yours is one of those companies, or is considering AI tools, you will want to check out the researchers’ report, “Expanding AI’s Impact with Organizational Learning.” It turns out even with organizations that correctly address the basics, “like having the right data, technology, and talent, organized around a corporate strategy,” only 20% are seeing increased financial gains.
What is the difference? The team found companies that approach learning as a two-way street do the best with AI resources. And that is not a simple task. The report explains:
“Our research shows that these companies intentionally change processes, broadly and deeply, to facilitate organizational learning with AI. Better organizational learning enables them to act precisely when sensing opportunity and to adapt quickly when conditions change. Their strategic focus is organizational learning, not just machine learning. Organizational learning with AI is demanding. It requires humans and machines to not only work together but also learn from each other — over time, in the right way, and in the appropriate contexts. This cycle of mutual learning makes humans and machines smarter, more relevant, and more effective. Mutual learning between human and machine is essential to success with AI. But it’s difficult to achieve at scale. Our research — based on a global survey of more than 3,000 managers, as well as interviews with executives and scholars — confirms that a majority of companies are developing AI capabilities but have yet to gain significant financial benefits from their efforts. … Our key finding: Only when organizations add the ability to learn with AI do significant benefits become likely. With organizational learning, the odds of an organization reporting significant financial benefits increase to 73%.”
Interested readers should navigate to the report, kindly supplied in full for free. Section 1 is the executive summary and section 2 describes an example firm that met with success. One might skip section 3, which covers the disappointed, and focus on sections 4-8. That is where the researchers lay out, in great detail, the approach that could mean the difference between a wasted investment and a nearly 75% chance of significantly increased income. We suggest those who wish to be in the latter category study it carefully.
Cynthia Murrell, November 6, 2020
Technical Debt with Cats: Lots of Cats
October 29, 2020
Cats are fine. Lots of cats can trigger a different reaction. I liked “Technical Debt: Why It’ll Ruin Your Software.” I ignored the cats and focused on the information payload of the article. The author does a good job of explaining what a number of people [a] ignore, [b] do not understand, and [c] miss the connection with cost and time over-runs.,
I circled three items in the write up:
First, I circled this passage:
The moment John chose the faster and easiest solution for him was the moment that the Technical Debt was inserted in the code.
The idea is that in order to “get ‘er done,” the Corona virus of cost, complexity, and chaos was let loose. The “faster and easiest” method is everywhere. Like a person with an addiction the individual will not admit, there is no single step toward remediation. The remediators will use the same method.
Second, I noted this diagram:
The chart makes clear what people under pressure often ignore. Costs are rising, and they may not be controllable. How much change has the core of Google search undergone in the last 20 years. Who wants to dig into the guts and deal with some of the interesting problems which exist? Answer: No one who wants a promotion and a chance to start a VC firm.
Third, the future is smart software:
In a realistic and respectable world, machines should take care of these situations, and not us.
Yep, and software will be just wonderful.
Stephen E Arnold, October 29, 2020
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