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The document defending Facebook regulation got leaked, it’s not impressive

(BUSINESS NEWS) Facebook is trying to avoid a fight with the government over Whatsapp and Instagram, but their leaked defense isn’t that solid.

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Laptop on lap open to Facebook with busy coffee table behind.

A leaked document acquired by the Wall Street Journal has revealed the defense Facebook has in case of a government-mandated breakup of its assets—including Whatsapp and Instagram.

The 14-page file reveals that the social media conglomerate would contest both acquisitions of Whatsapp and Instagram by the company passed FTC scrutiny and Facebook has since invested large sums of money into both platforms.

While reports have stated that the FTC is looking to launch an antitrust lawsuit against Facebook by the end of the year, nothing official has been announced as of yet. The House of Representatives Antitrust Subcommittees have been focused on the Menlo-Park based firm as well as Amazon, Apple, and Google, holding hearings in July with the CEOs of each company. The committees are expected to release their investigation findings into the businesses at the end of the month.

The document says that as Facebook poured money into boosting the growth of both Whatsapp and Instagram, they became integrated with Facebook’s core systems. If the government were to force divestiture of both platforms from Facebook, the company argues it would have to spend billions of dollars unwinding each system and in the process would weaken the security of each application. The file goes on to say that achieving true system independence at this point would be nearly impossible, with the paper concluding that “A ‘breakup’ of Facebook is thus a complete nonstarter.”

How well that argument would hold up is still in question. According to Tim Wu, a Columbia University law professor and tech policy expert, the idea that past government decisions regarding Facebook’s acquisitions should limit current action is “surprisingly weak.” As Wu points out, at the time the FTC wasn’t considering the purchases of Whatsapp and Instagram by Facebook to be based on limiting its competition, leaving the door open to examine those practices now. There is also no guarantee that the difficulty of breaking up the systems would factor into a court’s decision either.

Between the House investigations and the looming possibility of an FTC lawsuit, it’s unlikely that Facebook will come out of 2020 without some type of fight against the government. Although the company has declined to comment on the leaked document as of this writing, one can expect them to be preparing for the inevitable fight(s) ahead behind closed doors.

Patrick Auger is a management consultant and entrepreneur who resides in Austin, Texas. He has a Bachelor of Arts in Business Management from Western Illinois University, and is the Founder and Principal Consultant at Auger Consulting Group, LLC. When he's not writing for The American Genius, he's writing about the business of Mixed Martial Arts for The Body Lock or learning how to cook, one burnt recipe at a time.

Business News

Bay Area co-living startup strands hundreds of renters at dire time

(BUSINESS NEWS) They’re blaming COVID for failing as a co-living space, but it looks like trouble was well established even before now.

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Person packed a bag and walking away from co-living space.

Over the last few years, “co-living” startups have become increasingly common in tech-rich cities like San Francisco. These companies lease large houses, then rent individual bedrooms for as much as $2,000 per month in hopes of attracting the young professionals who make up the tech industry. Many offer food, cleaning services, group activities, and hotel-quality accommodations to do so.

But the true value in co-living companies lies in their role as a third party: Smoothing over relations, providing hassle free income to homeowners and improved accountability to tenants… in theory, anyway. The reality has proved the opposite can just as easily be true.

In a September company email, Bay Area co-living startup HubHaus released a statement that claimed they were “unable to pay October rent” on their leased properties. Hubhaus also claimed to have “no funds available to pay any amounts that may be owed landlords, tenants, trade creditors, or contractors.”

This left hundreds of SF Bay Area renters scrambling to arrange shelter with little notice, with the start of a second major COVID-19 outbreak on the horizon.

HubHaus exhibited plenty of red flags leading up to this revelation. Employees complained of insufficient or late payment. The company stopped paying utilities during the spring, and they quietly discontinued cleaning services while tenants continued to pay for them.

Businesses like HubHaus charge prices that could rent a private home in most of the rest of the country, in exchange for a room in a house of 10 or more people. PodShare is a similar example: Another Bay Area-based co-living startup, whose offerings include “$1,200 bunk beds” in a shared, hostel-like environment.

As a former Bay Area resident, it’s hard not to be angry about these stories. But they have been the unfortunate reality since long before the pandemic. Many urbanites across the country cannot afford to opt out of a shared living situation, and these business models only exacerbate the race to the bottom of city living standards.

HubHaus capitalized on this situation and took advantage of their tenants, who were simply looking for an affordable place to live in a market where that’s increasingly hard to find.

They’ve tried to place the blame for their failure on COVID-19 — but all signs seem to indicate that they had it coming.

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Business News

Las Vegas’ largest dispensary gets massive Infinity Wall expansion

(BUSINESS NEWS) Las Vegas’s largest dispensary is getting a big, expensive makeover, thriving while other brick-and-mortar shops are struggling.

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Planet 13, Las Vegas's largest dispensary, set to get a huge expansion.

Have you ever heard of an Infinity Wall? If I were you, I’d check it out right now because it’s utterly mesmerizing.

An 80-foot version of this wall is just one of the new features that Planet 13 (or The Company) announced it will be implementing in Las Vegas’ largest dispensary, The SuperStore, this past Monday. In addition to the futuristic entertainment feature (I honestly can’t get over that thing), they will be doubling the sales floor and expanding the dispensary to ~23,000 sq. ft. For reference, the entire Planet 13 SuperStore complex is 112,000 sq.ft.

Why expand an already massive dispensary during a pandemic, when most brick and mortar stores are suffering? Well, according to Larry Scheffler, Co-CEO of Planet 13, The Superstore is actually thriving beyond belief.

“We are achieving record sales even with Las Vegas at ~50% tourist occupancy. As Las Vegas returns to normal and this industry continues to grow, we anticipate that this will be first of many expansions we will undertake to keep up with demand.”

The expansion adds 40 points of sale to uphold the outstanding customer service reputation Planet 13 has. If you do have to wait, you have a state-of-the-art entertainment system to enjoy. It’s win-win for any and all visitors.

The CapEx cost of the expansion between is $1.5 – $2.5 million. The project is expected come to completion by the end of Q1 2021.

Las Vegas has become a sort of cannabis mecca. After all, it’s home to MJBizCon, the industry’s largest networking event attended by thousands from around the world. And the popularity and overall acceptance makes it an easy choice for any cannabis aficionados. The SuperStore, like most things in Las Vegas, is huge, glamorous, and caters to tourists.

I have no doubt that when the city bounces back from the pandemic, this new-and-improved dispensary will be a must-visit destination.

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Business News

The future of work from home will be a hybrid, says Google CEO

(BUSINESS NEWS) Google is looking to adapt a more flexible, long-term hybrid work model for their employees, which includes partially working from home and partially being on-site.

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Work from home woman at a laptop.

Google, the world’s largest search engine company (yes I know they do other things), is positing that the corporate office will look completely different post-COVID-19.

In September Google’s CEO, Sundar Pichai said that the organization was making changes to its offices that would better support employees in the future. This includes “reconfiguring” office spaces to accommodate “on-sites”, days when employees who regularly work from home will come into the workplace. The move comes after Google was one of the first major tech companies to announce that employees could possibly work from home through next summer.

“I see the future as definitely being more flexible,” Pichai said during a video interview for Time 100, “We firmly believe that in-person, being together, having that sense of community, is super important for whenever you have to solve hard problems, you have to create something new,” he said. “So we don’t see that changing, so we don’t think the future is just 100% remote or something.”

It was reported that Google’s decision to work remotely into mid-2021 was originally in part to help employees whose children might be learning remotely during the coronavirus pandemic. Pichai said that several factors went into the decision, stating that improving productivity was a major concern.

“Early on as this started, I realized it was going to be a period of tremendous uncertainty, so we wanted to lean in and give certainty where we could,” Pichai said. “The reason we made the decision to do work from home until mid of next year is we realized people were trying hard to plan… and it was affecting productivity.”

Pichai also mentioned that the decision would help the firm embrace the reality that remote working wasn’t going anywhere once things returned to normal. A recent survey at Google found that 62% of employees felt they only need to be in the office on occasion, while 20% felt they didn’t need to be in the office whatsoever. While the work from home trend had already been growing over the past several years, the pandemic accelerated that movement greatly.

With housing costs surging in the San Francisco area, where Google headquarters resides, many employees have been forced to move outside of the city to afford a mortgage. This caused many to commute long hours into the office, something Pichai realized was a problem.

“It’s always made me wonder, when I see people commuting two hours and away from their families and friends, on a Friday, you realize they can’t have plans,” Pichai said. “So I think we can do better.”

It’s too early to tell whether or not Pichai’s vision of a “hybrid model” will be adopted by other companies when the pandemic ends. One thing is for certain though—work will never be what is pre-COVID-19.

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