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What police could find out about your illegal abortion

A woman holding a phone.
Now that Roe has been overturned, you might want to think twice about what you do with your phone. | Getty Images/iStockphoto

The pre-Roe world didn’t have data privacy laws. The post-Roe world needs them.

The Supreme Court decision to overturn Roe v. Wade has made abortion illegal in many parts of the United States, with a possible future where it’s illegal everywhere. The pervasive and barely regulated data collection industry could have a big role to play in investigating and proving cases against people accused of performing or getting abortions.

A lot of data is readily available if law enforcement wants it because there’s very little, legally, restricting its collection. And we know the police use that data all the time, getting it through court order or by simply buying it. Through your phone and your computer, they can find out where you go, who you interact with, what you say, what you search the internet for, which websites you visit, and what apps you download.

This isn’t just true of abortion-related data; police have always had ways to access your private data. But now, a lot of people who weren’t concerned about what the police or data brokers knew about them before may suddenly have a lot to worry about — and there’s very little out there to keep their private lives private in a court of law.

“The dangers of unfettered access to Americans’ personal information have never been more obvious,” Sen. Ron Wyden, a longtime advocate and proponent of online privacy laws, told Recode.

One big concern seems to be whether period tracker apps could be used to find and prosecute people who get abortions. Period apps are problematic for a lot of reasons, but somehow tipping off the police that you got an abortion is pretty far down on the list. Far worse is the pervasive and barely regulated data collection industry that has been allowed to build and share detailed profiles of all of us for years. The fact is, it’s easy enough to delete a period app from your phone. It’s a lot harder to delete the data it collected about you. And it’s just about impossible to conceal the rest of the online trail that could help prove you broke an anti-abortion law.

There’s the possibility that all of this data could be used to go after people who get or perform illegal abortions because it’s already being used to help in the investigation of many crimes. An internet search for abortion-inducing drugs was used as evidence to charge with murder a woman who gave birth to a stillborn baby (those charges were dropped). Google data obtained by police placed a man’s phone near the site of a murder; the man was arrested but was later released without charge. Several cases against alleged January 6 insurrectionists have been built on data obtained from companies like Google and Meta. Immigration and Customs Enforcement (ICE) buys location data to try to find entry points used by undocumented immigrants.

That doesn’t mean there’s nothing you can do. The internet as we know it didn’t exist pre-Roe, when abortion was illegal. It does now. Online privacy laws, on the other hand, largely don’t. But they could.

All the data you give away — and who can get it

For now, as long as they follow the appropriate legal channels, law enforcement agencies can obtain pretty much everything you do on your devices. For almost all of us, that’s a lot of data. You can try to lock down your own device, but if the data is also possessed by a third party like Google, that’s where the police will go to get the information they want.

This can include what’s known as reverse search warrants or keyword searches for devices that were in a certain location — say, a building in which police suspect illegal abortions are being performed — or for devices that searched for certain keywords, like “where can I get an abortion.” There’s a legal gray area here. Some judges have ruled that such searches are unconstitutional, but they’re still happening. In fact, the use of them has increased exponentially in the last several years.

“There’s a lot of opportunity for police to take advantage of the lack of clarity in the law,” Nathan Freed Wessler, deputy director of the ACLU’s speech, privacy, and technology project, said. “Which is why lawmakers can and should step in.”

But there’s no gray area when it comes to evidence law enforcement can get about you specifically if they have reason to believe you’ve committed a crime. To give a recent example: Many cases against alleged January 6 insurrectionists were built on data the FBI got from Google and social media. In some cases, this included the suspect’s movements to and from their homes as well as within the Capitol building. It also included the contents of their emails, web searches, websites visited, and YouTube videos watched. You might think the police having such a large data trail to follow is a good thing when it’s used against people whose actions you disagree with. You might not feel the same way if it’s used against people whose actions you support.

That means that, in places where abortion is illegal, there won’t be much a company like Google can do if police have a warrant for data that could be evidence of a crime. There’s also the possibility that people pretending to be the police could obtain data, too. As Bloomberg recently reported, it has happened before. That’s why privacy and civil rights advocates say the less data those companies are forced to give to law enforcement, the better. Laws that minimize the amount of data collected, that restrict what other parties can do with that data, and that allow consumers to delete their data would go a long way here.

There’s also the data that the police (and any other especially motivated private citizens) can buy. Data brokers, it turns out, make for a nice workaround to the Fourth Amendment. Law enforcement can simply buy data it would otherwise have to get a court order for, which it may then use to help in its investigations.

We have plenty of examples of this to draw from: The IRS, the FBI, the DEA, ICE, and even the military do this. This data can be as granular as the movements of an individual in the real world, and data brokers love to combine it with what that individual does online for an even more comprehensive and revealing profile. During the Trump administration, ICE didn’t just use cellphone location data to find a tunnel underneath an abandoned KFC that was used to smuggle drugs over the border; it also used it to find out where undocumented immigrants were crossing the border. It’s entirely possible that authorities could use this type of movement data to find out where illegal abortions are being performed.

It’s not just the government that can buy this data. Private businesses and people do it all the time. Vice recently purchased aggregated location data for a week’s worth of visits to 600 “family planning centers,” some of which offer abortions, for just $160 from a company called SafeGraph. (The government is one of SafeGraph’s customers, by the way.) After Vice published a story detailing how it sold data about family planning centers, SafeGraph said it would stop, but it’s safe to assume there are other companies out there still doing similar things. We also have cases of advertising companies using geofencing, or targeting ads to devices within a certain location, to send anti-abortion ads to people inside women’s health clinics.

Data brokers will often say that their data is aggregated and anonymized, but we know there’s no guarantee that the data will stay aggregated and anonymous. Last summer, a priest was outed after a Catholic news outlet obtained location data sourced from Grindr. The Wall Street Journal recently reported that Grindr’s data was routinely shared with or sold to Grindr’s ad partners. These are very real, very bad examples of how location data can be obtained, re-identified, and used against someone if it falls into the wrong hands — perhaps those belonging to anti-abortion activists who believe any actions they take are righteous. They also highlight why we need to regulate this industry to prevent it from happening again.

If abortion laws can change, so can privacy laws

There are privacy bills out there that would slow or stop the flow of data that could be used against them. Perhaps the end of Roe v. Wade will be what gets these languishing bills over the finish line.

“There are a number of types of laws that could really make a difference,” Wessler said. “Some of them aimed at what law enforcement can get access to, and some aimed at what companies are allowed to collect and sell about us without our express permission and consent.”

The Fourth Amendment Is Not for Sale Act would close the loophole that allows law enforcement to buy information from data brokers that they’d otherwise have to get with a warrant. Sen. Wyden introduced the bill in April 2021, and it has bipartisan and bicameral support.

“Passing the Fourth Amendment Is Not For Sale Act would make it harder for Republican states to persecute women by buying up big databases of information without warrants and then hunt down anyone seeking an abortion,” Wyden told Recode.

But it doesn’t stop all this data from being out there to be purchased in the first place, and not just by the police. “Far more needs to be done to protect the rights of pregnant people. Every company that collects, stores, or sells personal data should be aware that they could soon be a tool for a radical far-right agenda that is trying to strip women of their fundamental privacy rights,” Wyden explained.

All this assumes that these companies care about who uses their data and how. It also suggests that they’ve implemented measures to minimize and control the flow of it. The fact is, they usually don’t have to do this, and they make more money if they don’t.

Consumer privacy laws would go a long way toward reducing what data is out there and available for anyone to access in the first place. Several bills like this have been introduced in Congress over the years, some with better protections than others. The recently introduced American Data Privacy and Protection Act, which is bipartisan and bicameral, is even making some headway in Congress. Meanwhile, other countries and even some states have advanced stronger consumer privacy laws in recent years.

Privacy laws that require affirmative opt-in consent to collect data — especially sensitive data, like location, health data, and search histories — and give consumers control over if that data is sold or shared would go a long way here. Opt-in consent is the difference between Apple’s App Tracking Transparency feature, which doesn’t give out certain types of data unless you tell it to, and Facebook, which just lets you opt out of being tracked after the fact, as long as you can find the option in your privacy settings.

Many privacy advocates also believe opt-in consent should be required before a company can share or sell that data to third parties. Data minimization rules, they say, would also help because these would only allow what an app needs to function to be collected. Customers should also have the right to delete their data upon request.

In lieu of a federal consumer privacy law, individual states have tried to pass their own. A few have recently passed industry-friendly laws that privacy advocates aren’t fond of. But then there’s California, which has the strongest privacy law in the country, or Illinois, which has a biometric privacy law, or Maine, which bans internet service providers from selling their customer’s data without the customer’s consent. New York state lawmakers have been trying to ban reverse search and keyword warrants for years.

A lack of digital privacy might have been a deal you were willing to make when you thought you knew the laws and assumed you’d never break them. But, as the Roe reversal illustrates, laws can change. Unless privacy laws also change, by the time you realize you do have something to hide, it’ll be too late.

Update, June 24, 12:30 pm ET: This story has been updated to reflect that Roe v. Wade has been overturned.

When you drive for work, $5 gas hurts

A gas station crowded with cars displays prices per gallon over $5.
A man pumps gas at a mini-mart in Pittsburgh, Pennsylvania, on June 15. | Gene J. Puskar/AP

A look at how high gas prices are hurting workers and what to do about it.

Back in February, when US gas prices were around $3.50, most Americans said they’d change their driving habits or lifestyle if gas hit $4. It now costs just under $5 on average.

In the short term, high gas prices have meant that some people have become more conscientious about how often they drive. But for those who have to drive for work, either as a commute or as part of their job — like health care workers, farmers, tradespeople, and Uber and Lyft drivers — there’s less wiggle room. For them, sustained high gas prices have long-reaching repercussions that affect their take-home pay, where they live, and if they’ll be able to perform their jobs at all.

“If they’re required to drive as a condition of their livelihood, they’re stuck,” Mark Cohen, director of retail studies at Columbia Business School, told Recode. For those people, increased gas costs will come out of their discretionary income, the same way clothing and trips do. If they are low-income and had limited extra money to begin with, that can mean much harder choices about food, housing, and debt.

People who live paycheck to paycheck “are definitely seeing this have an enormous effect on what’s left in their wallet,” Cohen said.

In May of this year, the average transaction price at gas stations was up 34 percent from May 2019, according to Earnest Research, a company that analyzes anonymized US credit and debit card data. And those charges are taking up a larger share of people’s spending in the US.

For now, the bad news is that there’s not much the government can do to adjust gas prices since they’re due to large global events outside government control. When the pandemic in 2020 began causing travel of all kinds to grind to a halt and demand for gas plummeted as a result, oil companies closed down refineries that process oil into gas — a move that’s not easy to quickly reverse, even as demand for gas in the US has grown again. Additionally, the war between Ukraine and major oil producer Russia has caused prices for crude oil — which are set on a global basis — to soar. As a result, analysts expect gas prices to grow to $6 a gallon this summer and remain high for some time.

The good news is that the current situation is quite a bit different from the gas crisis of the 1970s, which was marked by gas-guzzling cars and much higher foreign oil reliance. These days, more of the money spent on gas stays within the US economy, and less of people’s paychecks are going to gas than back then. Additionally, in the long run, high gas prices could accelerate existing trends — buying more electric vehicles, living closer to work, or working remotely — that would further decouple us from the volatile swings of gas prices.

In the meantime, there will be a lot of pain — especially for Americans who drive to make a living.

How high gas prices are affecting those who drive for their livelihoods

New research shows that demand for gas is more elastic — meaning demand does change as prices go up — than previously thought. That said, it’s most inelastic among people or small businesses that have no choice but to drive.

“They could get more efficient, they could pass it on to customers, or they can eat it,” said Adie Tomer, a senior fellow at public policy nonprofit Brookings Institution who leads its Metropolitan Infrastructure Initiative.

Tianna Kennedy, owner of The 607 CSA, which delivers produce, meats, dairy, and other goods from farms in upstate New York to subscribers nearby and in New York City, is trying to make changes where she can.

The CSA already cuts down on gas mileage for its 40 member farms by consolidating their deliveries and bringing them to pick-up points where subscribers live. But part of the organization’s mission is to bring fresh food to low-income people in poorer, more far-flung neighborhoods in the Bronx and East New York, rather than just wealthier areas in Manhattan and Brooklyn.

“We’re intentionally inefficient,” Kennedy said. “It’s a lot of driving, so it gets really expensive.”

She doesn’t want to raise the fees to farmers, who already don’t make much on their goods, and she doesn’t want to pass it on to customers, so she hasn’t raised the prices of food shares. Kennedy is in the process of transitioning her business into a nonprofit to try and make things work.

 Jae C. Hong/AP
A pedestrian is silhouetted against a gas station’s sign showing prices close to $8 a gallon in Los Angeles, California, on June 16.

Others are raising prices, but it’s a delicate dance.

Brian Stack, president of Stack Heating Cooling & Electric outside Cleveland, Ohio, says the gas bill for his shop’s 40 trucks is now $20,000 a month — that’s double what it has been in recent years — so he’s had to raise prices.

In addition to other inflation costs — he’s now paying fuel charges from his suppliers and has offered salary increases to workers to help them deal with that inflation — Stack said gas prices are eating into the company’s bottom line. Service calls are often unscheduled and urgent — like when someone’s heat isn’t working in winter — so it’s largely impossible to optimize routes for better gas mileage.

“I need the trucks to generate revenue,” he said. “Without them, we’re out of business.”

Some people who drive for a living, like truck drivers working for large outfits or project managers who do site visits in their own cars, have company gas cards or are paid or reimbursed based on gas spending, but that’s not always the case. Uber and Lyft drivers, for the most part, have to take it on the chin.

That’s bad news for the companies and the people who work for them.

In March, when gas was around $4 a gallon, Lyft and Uber added small surcharges to each trip — 55 cents for Lyft, 45 to 55 cents for Uber — to help drivers offset gas prices, but the companies haven’t raised that fee since. Even then, the fee wasn’t enough for drivers like Hector Castellanos.

“It’s an insult,” said Castellanos, who works in the Bay Area where gas is now nearly $7 a gallon.

His Chevy Malibu gets around 30 miles per gallon, but he says the trips are often long, upward of 20 miles. That means the surcharge only helps with a small portion of the trip. Castellanos works 12-hour days where he earns roughly $300. After spending $120 a day on gas — but before car maintenance, insurance, and cellphone costs — he makes $180. In an area with a very high cost of living, that means he faces hard decisions about what he can afford.

“Now we need to think about what are we going to eat,” said Castellanos, who is currently applying for jobs in food service where he thinks he’ll make more. “Everything is so expensive.”

Other people who drive for work don’t have anything mitigating their fuel costs.

Diondre Clarke, a certified nursing assistant in Charlotte, North Carolina, uses her vehicle to drive to home care facilities and to run errands for a private client. Gas, which is more than $4.50 a gallon in Charlotte, comes out of her own pocket.

“This gas has really taken a lot away from me,” Clarke told Recode. She makes $20 an hour, but says with inflation she’s unable to save or pay down debt. “I’m not able to do the things that I wanted to do.”

High gas prices are also hurting those who simply have to drive to and from work. And it has the most impact on people who can afford it the least. Low-wage workers already had trouble making ends meet on the US’s $7.25 minimum wage — an amount that can be erased with just a commute, especially in rural areas where travel times are long and public transit rare.

What can — or, more likely, can’t — be done

Inflation is very unpopular politically, and the gas pump is one of the most obvious places where consumers notice it. But the government has very few levers to pull to help with gas prices, and some of the things the Biden administration is doing are more symbolic than effective.

The Federal Reserve has already raised interest rates, a painful process that tries to slow down spending by making borrowing more expensive, which is supposed to make costs go down. While that could help with demand, aiding with supply is much harder since that’s tied to refinery capacity and global oil prices (and geopolitical whims).

Biden has already released fuel from the country’s emergency stores, a move that has done little to ameliorate gas prices since it can’t make up for declines at the global level, where oil prices are set.

On Wednesday, Biden announced he’s also asking Congress to suspend federal gas taxes for three months. Some states have already paused their gas taxes as well. But those state and federal taxes only account for 12 percent of the cost of gas.

“The price is already five bucks; 20 cents isn’t going to make a huge difference,” Kyle said, referring to how much federal taxes are per gallon.

 Drew Angerer/Getty Images
President Joe Biden calls on Congress to temporarily suspend the federal gas tax while speaking at the White House on June 22.

Additionally, those taxes would normally help pay for road and highway improvements — stuff that will eventually have to be paid through other taxes.

Lutz Kilian, a senior economic policy adviser at the Federal Reserve Bank of Dallas, said such moves to lower gas prices could in fact have “perverse effects” on prices because making gas less expensive could increase demand, which in turn would cause prices to grow. “It could make things worse,” he said.

In the short term, many American workers will have to grit and bear the high price of gas. In the long term, they could make changes, which aren’t easy and will take time.

“In the short run, they have the car they have and they have the job they have,” Steven Kyle, an associate professor at Cornell University’s Dyson School of Applied Economics and Management. In the longer run, these people could switch jobs and move to different industries.

“We’re going to see those kinds of professions depopulate — people are going to leave if they can’t afford the cost-revenue calculation,” Kyle said. “That will eventually make [employers] have to pay those people more, but all of these things take a while to work out.”

Those who can afford it could buy electric and fuel-efficient vehicles, though bottlenecks for EV supplies are putting a damper on this transition.

High gas prices might also affect where people live, causing those who work in-person to ensure they live close to their jobs. It could also accelerate the demand for remote work. In April, 20 percent of jobs on LinkedIn in the US were for remote work, but they received more than half of all applications, according to the company. Those who are coming into the office two or three times a week might ask their bosses if they could come in once a week or even a few times a month — especially since many office workers aren’t convinced there’s a point to going into the office at all.

Early indicators suggest that high prices could be starting to keep people from fueling up, which in turn could help drive down prices: There were 5 percent fewer gas station transactions in May 2022 than in May 2019, according to Earnest Research, and Energy Information Administration data shows that implied demand for gasoline in the week ending June 10 shrank slightly from a week earlier and from the same week a year before.

Even still, gas prices are expected to rise this summer and not substantially decline till 2023. And the longer gas prices stay high, the more drastic will be the changes workers have to make.

Elon Musk the Twitter celebrity vs. Elon Musk the boss

A photo of Elon Musk in a tuxedo from the waist up with a serious expression.
Elon Musk at the 2022 Met Gala in New York City. | Gotham/Getty Images

Some of the CEO’s biggest recent critics are his own employees.

Elon Musk has millions of critics — and dedicated fans — and nowhere is that clearer than on Twitter. Since Musk, who is the world’s richest person and the CEO of Tesla, SpaceX, the Boring Company, and Neuralink, announced plans in April to buy the social media company, the debate has intensified around whether he’s a genius who’s saving the world or merely a crass billionaire with a big platform. And more people, including his own employees, have begun raising questions about the increasingly blurry line between his Twitter persona and his role as the leader of several major companies.

Last Thursday, SpaceX reportedly fired at least five employees involved in writing a letter to company executives condemning Musk’s recent behavior — particularly on Twitter, where he has been interacting more frequently with right-wing politicians and pundits. In recent months, Musk’s Twitter activity has included posting a meme targeting Twitter executive Vijaya Gadde, making light of an allegation that he had sexually harassed a SpaceX flight attendant, and mocking Bill Gates’s appearance. The letter focused on Musk’s behavior on Twitter, where he has been increasingly vocal about US politics and his criticisms of the Democratic Party, which he says has swerved too far to the left.

“Elon’s behavior in the public sphere is a frequent source of distraction and embarrassment for us, particularly in recent weeks,” the letter reads. “As our CEO and most prominent spokesperson, Elon is seen as the face of SpaceX — every Tweet that Elon sends is a de facto public statement by the company.”

The firings followed a Verge report on Thursday about the letter, which represents the first time such a document from employees to Musk has surfaced, and marks one of the most public concerted actions to date against Musk from employees of one of his companies. Musk already has enormous influence, but now that he is on track to own Twitter, one of the largest social media platforms in the US, his voice will have even greater reach. It also means that his ability to influence what people say about him will likely be greater too. The SpaceX letter, and the subsequent firing of the employees involved with it, shows there’s a growing tension between how Musk presents himself as an individual — albeit a very public individual — and how his employees feel represented, or misrepresented, by their CEO.

One of the action items proposed by employees in the letter is to “publicly address and condemn Elon’s harmful Twitter behavior” and “swiftly and explicitly separate itself from Elon’s personal brand.”

But the SpaceX letter isn’t only concerned with Musk’s abrasive “personal brand” on Twitter. The letter writers contend that this behavior was “emblematic” of a larger culture issue at SpaceX. “SpaceX’s current systems and culture do not live up to its stated values,” the letter said. It called on leaders to better promote a workplace culture valuing diversity, equity, and inclusion.

The companies Musk runs have faced several allegations of fostering an unhealthy, or even abusive, work environment. On Thursday, Tesla investor Solomon Chau filed a lawsuit against Tesla in Texas, where the company is headquartered, for failing to adequately address the claims of workplace abuses. “Tesla has created a toxic workplace culture grounded in racist and sexist abuse and discrimination against its own employees,” Chau said in the suit.

This follows a case from February in which the state of California sued Tesla’s Fremont factory over allegations of racism. The lawsuit represented over 4,000 former and current Black employees who claimed that Black workers had been segregated into separate parts of the factory. According to interviews conducted by the Los Angeles Times, there was a particularly labor-intensive section of the plant that was nicknamed “the plantation” by Tesla workers. One Black worker said that they heard racial slurs as often as 50 to 100 times a day.

Musk’s companies have also faced allegations of sexual harassment issues in the workplace. In 2021, five former SpaceX employees told The Verge they had faced or witnessed sexual harassment at the company. One former SpaceX engineer, Ashley Kosak, published an essay detailing her experience during her time at the company, where she had started as an intern in 2017. “I reported each incident of sexual harassment I experienced to HR, and nothing was done,” she wrote. “Each and every man who harassed me was tolerated despite the company’s so-called no-tolerance and no-asshole policy.”

SpaceX’s “no asshole” policy is well-known. President Gwynne Shotwell has boasted that the company’s zero tolerance for assholes prevents interruptions, which in turn boosts innovation. The open letter drafted by employees last week claimed that, in reality, the company did not live up to this policy.

Musk himself has also been accused of mistreating employees. In May, Business Insider reported an allegation that Musk had sexually harassed a SpaceX flight attendant, exposing himself to her and offering to buy her a horse in exchange for an “erotic massage.” After the report surfaced, Musk joked about it on Twitter.

Now, five SpaceX employees have lost their jobs after criticizing their CEO’s leadership. SpaceX has not yet responded to a question on whether Musk was directly involved in firing the employees, but Musk has a reported history of firing critics; in the book Power Play: Tesla, Elon Musk, and the Bet of the Century, author Tim Higgins reports several instances of Musk firing his employees in moments of anger, including people who disagreed with him. Bloomberg reporter and Musk biographer Ashlee Vance quoted a SpaceX engineer in his book Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future who said that “the treatment of staff was not good for long stretches of this era.” The employee recalled some engineers “being blamed for things they hadn’t done” and fired. “The kiss of death was proving Elon wrong about something,” the engineer told Vance.

The SpaceX employee letter and its fallout further reveal the dissonance between Elon Musk the genius innovator and Elon Musk the manager. For a long time, Musk has commanded respect as a brilliant tech founder who many believe is pushing humanity forward. If his leadership is a little brash — even abusive — many seemed to think that can be forgiven due to the sheer importance of Tesla’s and SpaceX’s missions. Musk has drawn comparisons between his work and philanthropy, and has said that sending humans to Mars is important in order to “extend the light of consciousness.

This larger-than-life vision of Musk and his companies has often drawn people to work for him. But, as some of his SpaceX employees made clear, his recent conduct and the scandals that have followed are detrimental to that mission. As Musk becomes increasingly divisive on Twitter, a communications platform that he intends to own, how can his employees continue to separate the two personas — social media celebrity and CEO — and do their work without PR distractions? That’s the question some of Musk’s employees seem to be grappling with now.

Musk’s employees at Twitter seem to already be wary of their future boss. In a virtual meeting with Twitter employees last Thursday, Musk wouldn’t deny the possibility of layoffs after the acquisition. A video of internal Slack messages of employees reacting critically to Musk during the meeting was also leaked on Twitter, with no names redacted. Musk replied on Twitter to the leak with one word: “Interesting.”

It’s TikTok’s world. Can TV live in it?

Two young women stand in front of a large digital billboard watching it display a Chinese ad for TikTok.
Watching an ad for TikTok in Shanghai, 2018. | VCG via Getty Images

Facebook knows it has a TikTok problem. TV and streamers do, too.

The people who bring you video entertainment could be in for a rough time: A looming recession could hurt their advertising revenue and consumer spending on subscription TV streaming services. But they’re also facing a foe that has nothing to do with the economic cycle: TikTok is coming for their eyeballs.

The free, Chinese-owned video-sharing service sometimes gets described as a social network, but that description masks what it really is: a colossally powerful entertainment app that keeps viewers glued to an endless stream of clips.

And TikTok is getting bigger every day: It now says it has 1 billion monthly users, but even that number likely understates its importance, because TikTok users spend a lot of time on TikTok — a year ago, the company was telling advertisers its users were spending nearly 90 minutes a day on the app. By contrast, US TV and streaming watchers were spending nearly five hours a day watching their shows and movies — but TV skews very old, and TikTok is very young. You can’t ascribe TV’s long-running viewer losses to a new app, but it’s very easy to see how it’s going to make it harder than ever to train young would-be viewers to watch traditional TV or even streaming.

“It is safe to say that TikTok has rapidly grown to be one of — if not the — largest social/communication/video apps in America in terms of time spent,” analyst Michael Nathanson wrote in a report last week.

Traditional media has been dealing with — and losing to — the competitive threat from the internet for years. Remember NBC’s freakout when Saturday Night Live’s “Lazy Sunday” sketch went viral on YouTube way back in 2006? TikTok, though, seems both more dangerous and harder for media execs to spot, like a mostly submerged iceberg.

If you run a media company, you’ve been telling yourself for years that your network or service has stuff people simply can’t find on YouTube or Facebook or Instagram or Reddit. But TikTok eviscerates most of those arguments: It’s a direct competitor for video eyeballs; it’s more compelling than the stuff you’re programming; and, just like a slot machine, it promises viewers that there’s always another dopamine hit just a swipe away.

“Tiktok is so much fun, and it’s so addictive — much more than anything you can see on TV,” says Rich Greenfield, a Wall Street analyst at LightShed.

So what is Big Media doing to counter or respond to TikTok’s threat? Nothing more than hope it’s a fad that goes away, from what I can tell. But I wanted to make sure I wasn’t missing anything, so I called around and heard … crickets. I triple-checked by asking Nathanson, who just dug deep into TikTok’s impact — did he know of any media companies doing anything interesting in response? His one-word, all-caps answer: “NOPE.”

Give the media companies this, though: Unlike YouTube a generation ago, they’re not trying to sue TikTok out of existence. And they have realized that anything with that many eyeballs is a good place to advertise.

Right now, at least, they don’t have to pay to do it: While TikTok is happy to take their money — it charges up to $3 million for an ad at the top of its feed that it says can reach all of its users in the US and Canada — the service’s ad business is just beginning to ramp up. Right now, it really expects media companies to act just like its users — by giving it content it can use to entertain other users.

And lots of them are up for it, says Catherine Halaby, a TikTok executive whose job is to help networks and streamers establish a presence on the service. She says her three-person team works with more than 300 accounts, up from 100 a year ago.

“By the time they come to us, they’re 100 percent bought in on the idea that they need to be on TikTok,” she says. “But there’s lots of confusion about how to do that.”

Halaby says there are a couple of problems for media companies to solve when they put their clips on TikTok: The first is simply understanding that while TikTok users can actively follow and look for creators and videos they like, the great majority of videos are served up using TikTok’s vaunted data set and algorithm. That’s supposed to pick stuff an individual user will like, regardless of whether they knew they wanted it.

The second is the pace: TikTok users flit quickly from trend to trend. Which means a company that wants to capitalize on a new viral dance or audio clip — like the “Jiggle Jiggle” song that has turned documentarian Louis Theroux into an unlikely star — means that a corporate account that wants to do the same has to do it fast. “Moving at that speed is the biggest adjustment,” Halaby says.

She cites Netflix, with its 24 million subscribers to its main account making it the biggest streamer on the service by far, and Paramount Pictures, which maximized its shirtless beach football footage from Top Gun: Maverick, as entertainment companies that have figured out that TikTok is for entertainment.

Still, it’s not clear if the entertainment companies putting free content on TikTok are helping themselves or helping TikTok. Omar Raja, a social media star at ESPN, says he goes out of his way to find stuff to show TikTokers that isn’t traditional sports highlights.

“I’m trying to make content that typical sports viewers wouldn’t typically watch,” he says. That seems like a good strategy for making videos that work on TikTok — but it’s harder to understand how that helps a media property that caters to typical sports viewers.

And a studio executive I granted anonymity to in order to speak candidly says TikTok is “incredibly effective” at driving awareness for a film — just like a TV ad or a billboard — but says TikTok users are very unlikely to see a clip for a film and then go purchase a ticket. “They just don’t leave,” he says.

On the other hand, Sylvia George, who runs performance marketing for AMC Networks, says TikTok has been a good tool to prompt viewers to sign up for the company’s streaming services, like Shudder or AMC+. “It hasn’t proven to be this tangible threat that is taking people away from our platforms,” she says. “In some ways it’s the opposite.”

There is a subset of media companies that doesn’t need a wake-up call about TikTok: Tech companies have been paying attention to TikTok for a long time. Now they’re paying it the ultimate compliment, by copying its format (and using its videos) for their own TikTok clones like Facebook and Instagram’s Reels and YouTube’s Shorts. Facebook is also reportedly set to revamp its main newsfeed to be more TikTok-y.

The tech companies are also telling investors they’re paying attention, and have been increasingly loud about it on earnings calls, per Michael Nathanson:

 MoffettNathanson

Meanwhile, Netflix co-CEO Reed Hastings has been musing about TikTok’s potential as a “substitution threat” to his business for a couple of years. And you can see a little of Netflix’s TikTok envy surface in its “fast laughs” feature, which gives you a never-ending stream of funny/funny-ish clips from Netflix comedies in its phone app.

But just seeing the problem doesn’t mean you can solve it, as countless companies have learned during the digital age. And TikTok’s huge ambitions are growing: At first, you could only place clips that ran for a few seconds on the service; now it’s up to 10 minutes. TikTok has its eyes set on moving beyond the phone, to your connected TVs, where you’re watching an increasing amount of video. If that works, it would compete even more directly with the streamers and networks.

I can think of one possible solution for the established media companies: hope that the US government bails them out.

While the Trump administration’s attempt in 2020 to ban TikTok, or at least force it to sell to a US bidder, was ham-handed and transparently jingoistic, there are plenty of thoughtful people who have concerns about TikTok’s presence in the US and think it shouldn’t be here.

One argument focuses on the potential for abuse of private data, since Chinese-owned tech companies ultimately have to answer to the Chinese government; another focuses on the fact that TikTok could be an enormously powerful propaganda tool, if the Chinese government wanted to use it for that reason.

“Donald Trump was right, and the Biden administration should finish what he started,” my former colleague Ezra Klein wrote in the New York Times last month. A jaw-dropping sentence. But once you understand what TikTok is and could be, jaw-dropping ideas don’t seem so wild.

If aliens are calling, let it go to voicemail

The “Sky Eye” radio telescope in Qiannan Buyei and Miao Autonomous Prefecture, Guizhou Province, China
The “Sky Eye” radio telescope in Qiannan Buyei and Miao Autonomous Prefecture, Guizhou Province, China. | Qu Honglun/China News Service via Getty Images

Receiving signals from extraterrestrial civilizations could pose an existential risk. Really.

Humans have invented a rogue’s gallery of nightmarish fictional aliens over the decades: acid-blooded xenomorphs who want to eat us and lay their eggs in our chest cavities; Twilight Zone Kanamits who want to fatten us up like cows and eat us; those lizard creatures in the 1980s miniseries V who want to harvest us for food. (You may be sensing a theme here.)

But the most frightening vision isn’t an alien being at all — it’s a computer program.

In the 1961 sci-fi drama A for Andromeda, written by the British cosmologist Fred Hoyle, a group of scientists running a radio telescope receive a signal originating from the Andromeda Nebula in outer space. They realize the message contains blueprints for the development of a highly advanced computer that generates a living organism called Andromeda.

Andromeda is quickly co-opted by the military for its technological skills, but the scientists discover that its true purpose — and that of the computer and the original signal from space — is to subjugate humanity and prepare the way for alien colonization.

No one gets eaten in A for Andromeda, but it’s chilling precisely because it outlines a scenario that some scientists believe could represent a real existential threat from outer space, one that takes advantage of the very curiosity that leads us to look to the stars. If highly advanced aliens really wanted to conquer Earth, the most effective way likely wouldn’t be through fleets of warships crossing the stellar vastness. It would be through information that could be sent far faster. Call it “cosmic malware.”

Phoning ET

To discuss the possibility of alien life seriously is to embark upon an uncharted sea of hypotheses. Personally, I fall on the Agent Scully end of the alien believer spectrum. The revelation of intelligent extraterrestrials would be an extraordinary event, and as SETI pioneer Carl Sagan himself once said, “extraordinary claims require extraordinary evidence.”

Intelligent extraterrestrials who also want to hack our planet would be even more extraordinary. But this scenario became a bit easier to envision this week.

On Wednesday, a story published in China’s state-backed Science and Technology Daily reported that the country’s giant Sky Eye radio telescope had picked up unusual signals from space. According to the piece, which cited the head of an extraterrestrial civilization search team that was launched in China in 2020, narrowband electromagnetic signals detected by the telescope differed from previous signals, and were in the process of being investigated.

The story was apparently deleted from the internet for unknown reasons, though not before it was picked up by other outlets. At this point it’s difficult to know what, if anything, to make of the story or its disappearance. It wouldn’t be the first time an extraterrestrial search team found a signal that appeared notable, only to dismiss it after further research. But the news is a reminder that there is little in the way of clear agreement about how the world should handle an authenticated message from an apparent alien civilization, or whether it can even be done safely.

For all the recent interest in UFO sightings — including NASA’s surprising announcement last week that it would launch a study team to investigate what it calls “unidentified aerial phenomena” — the chance that aliens would be physically visiting Earth is vanishingly small. The reason is simple: Space is big. Like, really, really, really big. And the idea that after decades of searching for ET with no success, there could be alien civilizations capable of crossing interstellar distances and showing up on our planetary doorstep beggars belief.

But transmitting gigabytes of data across those vast interstellar distances would be comparatively easy. After all, human beings have been doing a variation of that for decades through what is known as active messaging.

In 1974, the astronomer Frank Drake used the Arecibo Observatory in Puerto Rico to blast 168 seconds of two-tone sound toward the star system M13. It sounded like noise, but any aliens listening might have noticed a clear, repetitive structure indicating its origin was non-natural — precisely the kind of signal that radio telescopes like China’s Sky Eye are listening for here on Earth.

Such active messaging efforts were controversial from the start. Beyond the debate about who exactly should get to decide on behalf of the Earth when we try to say “hello” to aliens and what that message should be, transmitting our existence and location to unknown denizens of the cosmos could be inherently dangerous.

“For all we know,” wrote then-Astronomer Royal Martin Ryle shortly after the Arecibo message, “any creatures out there might be malevolent — and hungry.”

Those concerns haven’t put an end to efforts to actively signal to alien civilizations that are “very likely to be older and more technologically advanced than we are,” as Sigal Samuel wrote in a 2019 story about a crowdsourced contest to update the Arecibo message. But we shouldn’t be so sure that simply listening quietly for messages from space is a safer method of extraterrestrial discovery.

Cosmic malware

In a 2012 paper, the Russian transhumanist Alexey Turchin described what he called “global catastrophic risks of finding an extraterrestrial AI message” during the search for intelligent life. The scenario unfolds similarly to the plot of A for Andromeda. An alien civilization creates a signal beacon in space of clearly non-natural origin that draws our attention. A nearby radio transmitter sends a message containing instructions for how to build an impossibly advanced computer that could create an alien AI.

The result is a phishing attempt on a cosmic scale. Just like a malware attack that takes over a user’s computer, the advanced alien AI could quickly take over the Earth’s infrastructure — and us with it. (Others in the broader existential risk community have raised similar concerns that hostile aliens could target us with malicious information.)

What can we do to protect ourselves? Well, we could simply choose not to build the alien computer. But Turchin assumes that the message would also contain “bait” in the form of promises that the computer could, for example, solve our biggest existential challenges or provide unlimited power to those who control it.

Geopolitics would play a role as well. Just as international competition has led nations in the past to embrace dangerous technologies — like nuclear weapons — out of fear that their adversaries would do so first, the same could happen again in the event of a message from space. How confident would policymakers in Washington be that China would safely handle such a signal if it received one first — or vice versa?

As existential risks go, cosmic malware doesn’t compare to out-of-control climate change or engineered pandemics. Someone or something would have to be out there to send that malicious message, and the more exoplanets we discover that could plausibly support life, the odder it is that we have yet to see any concrete evidence of that life.

One day in 1950, at the Los Alamos National Laboratory, the physicist Enrico Fermi posed a question to his lunch companions. Given the vast size and age of the universe, which should have allowed plenty of room and time for alien life to arise, why haven’t we seen them? In other words: “Where is everybody?”

Scientists have posited dozens of answers to his question, which became known as the “Fermi paradox.” But perhaps the right answer is the simplest one: No one’s home. It would be a lonely answer, but at least it would be a safe one.

A version of this story was initially published in the Future Perfect newsletter. Sign up here to subscribe!

Meta is getting data about you from some surprising places

A Meta logo is shown with a background of white slats.
The Pixel tracking system collects and sends site visitor data to Meta, and Meta can match this to a user’s profile on Facebook or Instagram. | Jason Alden/Bloomberg via Getty Images

There doesn’t seem to be a corner of the internet Meta isn’t tracking.

You can’t see them, but Meta’s trackers are embedded in millions of websites all over the internet, collecting data about where you go and what you do and sending it back to Meta. A recent investigation shows that those trackers are on sites that even the most cynical among us might expect to be off-limits: those belonging to hospitals, including patient portals that are supposed to be protected by health privacy laws.

This week, the Markup, a nonprofit news outlet that covers technology’s harms, has been publishing the latest findings of its investigation into Meta’s Pixels, which are pieces of code developers can embed on websites to track their visitors. So far, those stories reveal how websites owned by the government, pregnancy counseling centers, and hospitals are sending data to Meta through Pixels, much of which would be considered sensitive to the users who unwittingly provided it.

It’s easy and understandable to blame Meta for this, given the company’s much-deserved, less-than-stellar reputation on user privacy. In Pixel and other trackers, Meta has played an instrumental role in building the privacy-free, data-leaking online world we must navigate today. The company supplies a tracking system designed to suck up user data from millions of sites and spin it into advertising gold, and it knows very well that there are many cases where the tool was implemented poorly at best and abused at worst. But this may also be a rare case of a Meta-related privacy scandal that isn’t entirely Meta’s fault, partly because Meta has done its best to place that blame elsewhere.

Or, as security researcher Zach Edwards put it: “Facebook wants to have their data cake and not eat the violations, too.”

Businesses choose to put Meta’s trackers on their websites and apps, and they choose again which data about their visitors to send up to the social media giant. There’s simply no good excuse, in this day and age, for developers that use Meta’s business tools not to understand how they work or what user data is being sent through them. At the very least, developers shouldn’t put them on health appointment scheduling pages or inside patient portals, which users have every reason to expect not to be secretly sending their data to nosy third parties because they’re often explicitly told by those sites that they aren’t. Meta created a monster, but those websites are feeding it.

How Pixel makes tracking too easy

Meta makes Pixel available, free of charge, to businesses to embed in their sites. Pixel collects and sends site visitor data to Meta, and Meta can match this to a user’s profile on Facebook or Instagram, giving it that much more insight into that user. (There are also cases where Meta collects data about people who don’t even have Meta accounts.) Some data, like a visitor’s IP address, is collected by Meta automatically. But developers can also set Pixel up to track what it calls “events”: various actions users take on the site. That may include links they click on or responses in forms they fill out, and it helps businesses better understand users or focus on specific behaviors or actions.

All this data can then be used to target ads at those people, or to create what’s known as “lookalike audiences.” This involves a business asking Meta to send ads to people who Meta believes are similar to its existing customers. The more data Meta gets from businesses through those trackers, the better it should be able to target ads. Meta may also use that data to improve its own products and services. Businesses may use Pixel data for analytics to improve their products and services as well.

Businesses (or the third-party vendors they contract to build out their sites or run advertising campaigns) have a lot of control over what data about their customers Meta gets. The Markup discovered that, on some of the sites in its report, hospital website appointment pages were sending Meta the name of someone making an appointment, the date and time of the appointment, and which doctor the patient is seeing. If that’s happening, that’s because someone on the hospital’s end set Pixel up to do that. Either the hospital didn’t do its due diligence to protect that data or it didn’t consider it to be data worth protecting. Or perhaps it assumed that Meta’s tools would stop the company from collecting or using any sensitive data that was sent to it.

In its most recent hospital investigation, the Markup found that a third of the hospitals it looked at from a list of the top 100 hospitals in the country had a Pixel on appointment scheduling pages, and seven health systems had Pixels in their patient portals. Several of the websites removed Pixel after being contacted by the Markup.

How can a hospital justify any of this? The only hospital that gave the Markup a detailed response, Houston Methodist, claimed that it didn’t believe it was sending protected health information to Meta. The Markup found that the hospital’s site told Meta when someone clicked “schedule appointment,” which doctor they scheduled the appointment for, and even that the doctor was found by searching “home abortion.” But Houston Methodist said scheduling an appointment didn’t mean the appointment was ever confirmed, nor that the person who scheduled the appointment was the person that appointment was actually for. Houston Methodist might think it isn’t violating patient privacy, but its patients may well feel differently. But they’d also have no way of knowing this was happening in the first place without using special tools or having a certain level of technical knowledge. Houston Methodist has since removed the Pixel.

Another health system the Markup looked at, Novant Health, said in a statement that the Pixel was placed by a third-party vendor for a campaign to get more people to sign up for its patient portal system, and was only used to see how many people signed up. But the Markup found far more data than what was being sent to Meta, including medications that users listed and their sexual orientations. That third-party vendor appears to have made some mistakes here, but Novant’s the one that has a duty to its patients to keep their information private on websites that promise to do so. Not the third-party vendor, and not Meta.

This is not to let Meta off the hook. Again, it created the Pixel tracking system, and while it has rules and tools that are supposed to prevent certain types of sensitive information — like health conditions — from being sent to it, the Markup’s reports are evidence that those measures aren’t enough.

Meta told Recode in a statement that “our system is designed to filter out potentially sensitive data it detects.” But the Markup found those filters lacking when it came to data from at least one crisis pregnancy center’s website. Meta didn’t respond to Recode’s questions about what it does if it finds that a business is violating its rules.

Edwards, the security researcher, was even less charitable about how much blame Meta should get here.

“It’s 100 percent Facebook’s fault, in my opinion,” he said.

Meta also didn’t respond to questions from Recode asking what it does to ensure businesses are following its policies, or what it does with the sensitive information businesses aren’t supposed to send it. As it stands, it looks as though Meta is making and distributing a tracking tool that can materially benefit Meta. But if that tool is exploited or used incorrectly, someone else is responsible. The only people who pay the price for that, it seems, are the site visitors whose privacy is unknowingly invaded.

What you can do to avoid Pixel

There are a few things you can do to protect yourself here. Browsers like Safari, Firefox, and Brave offer tracker blockers. Todd Feathers, one of the reporters on the Markup’s hospital story, told Recode they used Chrome browsers with no privacy extensions for their tests. Speaking of privacy extensions, you can get those, too. VPNs and Apple’s paid private relay service can obscure your IP address from the sites you visit.

Finally, Meta has controls that limit tracking and ad targeting off of its platforms. The company claims that turning off “data about your activity from partners” or “off-Facebook activity” will stop it from using data collected by Pixel from being used to target ads to you. This means placing some trust in Meta that its privacy tools do what it claims they do.

And there’s always, of course, asking your lawmaker to push for privacy laws that would make some of these practices explicitly illegal, or forcing companies to inform and get user consent before collecting and sending their data to anyone else. A few new federal privacy bills or draft bills have been introduced as recently as this week. The interest is there among some members of Congress, but not in enough of them to come close to passing anything yet.

Now might be a good time to think about crypto insurance

A mesh trashcan containing bitcoin symbols with a bag of trash beside it.
The crypto meltdown doesn’t show any sign of stopping. | Boris SV/Getty Images

As crypto crashes, the state of cryptocurrency and insurance is nebulous.

The crypto industry is cratering. Bitcoin prices are at their lowest since 2020; one platform has barred users from withdrawing funds, and many of the biggest crypto companies, including Coinbase and BlockFi, have announced layoffs. This disruption reflects the economic turmoil rippling through the broader market, but also serves as a stark warning to everyday people that, generally speaking, crypto can be valuable one day and worthless the next.

Although the companies that people use to buy and store crypto are in some ways similar to banks, these platforms don’t have the deposit insurance that bank or investment accounts have. If the companies that operate these platforms were to fail, there’s no guarantee that people would be able to recover the value of their crypto. This lack of protection reflects the fact that regulators are still catching up to the crypto industry. It also serves as a reminder that while crypto platforms might seem secure — some are publicly traded companies — they’re operating in an industry that has almost no rules and few safety nets. Even UST, a “stablecoin” cryptocurrency that’s supposed to track the value of the United States dollar, crashed last month, eviscerating the equivalent of tens of billions of dollars.

“My sleep was severely disturbed, I lost 4 kilograms of weight in a few days, I was in an extremely depressed state,” Yuri Popovich, a Kyiv-based web designer who transferred his family’s savings into UST amid the war in Ukraine, told Recode. “Unfortunately, in our country there is no legislation covering such types of losses.”

While investing in crypto remains incredibly risky around the world for many reasons, regular US bank accounts enjoy some protection offered by the Federal Deposit Insurance Corporation (FDIC). Founded during the Great Depression to boost trust in the financial system, the FDIC is designed to guarantee that account holders will recover at least some of their money in the event of a bank’s collapse. Banks fund the FDIC, which, in turn, insures bank accounts up to $250,000.

Since crypto platforms aren’t technically banks and don’t pay into the FDIC system, individual crypto accounts don’t have this form of protection. Meanwhile, crypto investment accounts aren’t generally backed by the Securities Investor Protection Corporation, which insures accounts that are managed by brokerage firms, like Fidelity or Vanguard, up to $500,000 if the firm fails.

“Most people are buying cryptocurrency to speculate, right? They think of it as an investable asset,” said Lee Reiners, the executive director of Duke Law School’s Global Financial Market Center. “If you buy Apple stock, there’s really no insurance right there, either. The concept of insurance doesn’t really apply now.”

The risky nature of crypto has become a bigger topic of discussion as several crypto companies show signs of faltering. Coinbase, one of the world’s most popular crypto exchanges, said in an earnings report last month that users could theoretically lose access to their crypto if the company went bankrupt. (Coinbase later tried to walk back the warning in a blog post, and said there’s “never a situation where customer funds could be confused with corporate assets.”)

Things have only gotten worse for the crypto industry lately. In the wake of the UST crash, the Securities and Exchange Commission is reportedly investigating whether the company behind the coin, Terraform Labs, violated securities law. And last week, Celsius Network, a crypto platform that isn’t an actual bank but purports to offer high-yield cryptocurrency lending, suddenly barred its users from withdrawing from the platform; securities regulators in several states are now investigating that decision. Downtime can be extremely costly for crypto investors, since the value of a single coin can swing by hundreds or thousands of dollars within just a few hours. Amid all of the disruption, the price of bitcoin is around $20,000, a sharp decline from its November high of nearly $70,000.

“At the moment, there is no easy way for customers to determine the nature and extent of their exposure to the bankruptcy of a crypto trading platform,” Dan Awrey, a Cornell law professor, told Barron’s last month. “Customers should assume that a platform’s bankruptcy would expose them to significant delays in recovery, at the end of which they may only get back just pennies on the dollar.”

But there are other risks, too. A crypto wallet can be hacked, and once someone has stolen what’s in it, that crypto can be incredibly difficult to recover. Some people try to avoid this risk by protecting their crypto with what’s called “cold storage,” which amounts to storing the keys that people use to access their crypto on a hard drive that’s not connected to the internet. This method comes with the same kind of risks that any other piece of physical property does, and those risks are even more significant for companies that store lots of other peoples’ crypto in cold storage, and for crypto mining operations that produce new cryptocurrency using warehouses full of powerful computers.

“You got earthquake, flood, fire, lightning, wind, hail,” said Ben Davis, a team leader at Superscript, an insurance program that covers crypto and is registered as a broker on Lloyd’s insurance marketplace. “If you have a lot of very expensive equipment all in one place, you’re gonna want it insured.”

While some conventional insurance providers are slowly warming to covering crypto, there’s also an emerging crop of startups that focus specifically on crypto insurance. These include companies like InsurAce, which covers losses that result from crypto hacks, and Coincover, which offers NFT insurance, among several other crypto-focused products that come with insurance.

Some people are already filing claims for crypto losses. One judge in Ohio ruled in 2018 that bitcoin stolen from one man’s online account was legally property — not money — and should therefore be covered by the man’s homeowner’s insurance for its full value, which, at the time, was $16,000. After an explosion at a substation used by a bitcoin miner in upstate New York last month, a company that was affected, along with the crypto-miner, Blockfusion, said they would file a claim for the revenue they lost.

More recently, InsurAce’s Dan Thomson says the company paid out more than $11 million to people who bought “depegging” insurance for their UST, the stablecoin designed by Terraform Labs (depegging occurs when a cryptocurrency’s value no longer matches the fiat currency, or another type of asset, that it’s designed to track). The company also reimbursed some of its customers after hackers attacked a crypto platform called Elephant Money in April.

Although insurance is becoming a slightly bigger part of the crypto industry, coverage is still patchwork. And even when a crypto platform does buy insurance, there’s no guarantee that individual crypto holders who use that company’s platform are fully protected. Coinbase, for instance, says that while certain security events are protected by its insurance, even if the company tries to make people whole, its plan may not cover the entirety of someone’s losses. Overall, most of the activity in the world of crypto remains uninsured.

“It’s really, really, really small,” said Eyhab Aejaz, the co-founder and CEO of Breach Insurance, an insurance company that focuses on crypto. “There is just not enough insurance capacity out in the market to insure even a small fraction of the total exposure that is out there.”

This highlights a major problem when it comes to regulating crypto: There isn’t a strong consensus on what crypto is. Is it internet money, property, a scam, a digital asset, a security, a reasonable investment? And because there’s no agreement on what crypto is, it’s hard to come up with a good approach to insuring its value — or figuring out if it should even be protected in the first place.

Regulators are still studying how to approach crypto. The SEC has argued that at least some crypto products are securities, and earlier this year, President Joe Biden ordered federal agencies to start drafting new rules for the industry. A bipartisan bill from Sens. Kirstin Gillibrand (D-NY) and Cynthia Lummis (R-WY) aims to protect customers’ access to their cryptocurrency in the event the crypto exchange they’re using goes bankrupt, among other proposals for regulating the industry. At least one lawmaker, Rep. Josh Gottheimer, has proposed that the government expand FDIC coverage to certain types of stablecoin cryptocurrencies, as long as they’re provided by institutions that the government qualifies. The FDIC, Federal Reserve, and Office of the Comptroller of the Currency have suggested similar plans. Still, not everyone thinks that’s a great idea or makes sense for every type of crypto.

“If crypto is an entirely speculative investment, then I think it’s unwise to put the deposit insurance and government backing behind those crypto assets,” said Hilary Allen, a law professor at American University. “Investors need to understand that what they’re doing is not putting money in a bank. What they’re doing is gambling.”

The mounting effort to regulate the crypto industry probably won’t be over anytime soon. In the meantime, all the chaos in the crypto market has more people thinking about the fate of their money. That may not be good news for crypto investors, but it’s certainly good news if you’re in the burgeoning crypto insurance business.

Leaked Amazon memo warns the company is running out of people to hire

Warehouse worker Billie Her wraps plastic around a pallet of boxes at Amazon’s fulfillment center in Thornton, Colorado, in March 2019. | Helen H. Richardson/MediaNews Group/The Denver Post via Getty Images

Unions might not be the tech giant’s biggest labor threat.

Amazon is facing a looming crisis: It could run out of people to hire in its US warehouses by 2024, according to leaked Amazon internal research from mid-2021 that Recode reviewed. If that happens, the online retailer’s service quality and growth plans could be at risk, and its e-commerce dominance along with it.

Raising wages and increasing warehouse automation are two of the six “levers” Amazon could pull to delay this labor crisis by a few years, but only a series of sweeping changes to how the company does business and manages its employees will significantly alter the timeline, Amazon staff predicted.

“If we continue business as usual, Amazon will deplete the available labor supply in the US network by 2024,” the research, which hasn’t previously been reported, says.

The report warned that Amazon’s labor crisis was especially imminent in a few locales, with internal models showing that the company was expected to exhaust its entire available labor pool in the Phoenix, Arizona, metro area by the end of 2021, and in the Inland Empire region of California, roughly 60 miles east of Los Angeles, by the end of 2022. Amazon’s internal report calculated the available pool of workers based on characteristics like income levels and a household’s proximity to current or planned Amazon facilities; the pool does not include the entire US adult population.

Amazon spokesperson Rena Lunak didn’t refute the contents of the internal report Recode obtained but declined to comment on it.

The research provides a rare glimpse into the staffing challenges that Amazon is now facing behind its slick veil of one-click online shopping and same-day Prime delivery. And it pointedly reveals how much of Amazon’s business success and its longtime position as a darling of Wall Street investors is dependent on its workforce of more than 1 million people who pick, pack, and ship its customers’ orders nearly 24/7.

The leaked internal findings also serve as a cautionary tale for other employers who seek to emulate the Amazon Way of management, which emphasizes worker productivity over just about everything else and churns through the equivalent of its entire front-line workforce year after year.

 Watchara Phomicinda/MediaNews Group/The Press-Enterprise via Getty Images
Workers sort parcels in the outbound dock at the Amazon fulfillment center in Eastvale, California, in August 2021.

In the past, that churn wasn’t a problem for Amazon — it was even desirable at some points. Amazon founder and former CEO Jeff Bezos saw his warehouse workforce as necessary but replaceable, and feared that workers who remained at the company too long would turn complacent or, worse, disgruntled, according to reporting by the New York Times. But now, as the internal report Recode reviewed shows, some inside Amazon are realizing that strategy won’t work much longer, especially if leaders truly want to transform it into “Earth’s best employer,” as Bezos proclaimed in 2021.

To be sure, part of Amazon’s turnover issue relates to how some employees view working in a warehouse as a brief pit stop on the way to better things. But some workers have long complained of stresses unique to Amazon’s workplace, from the pace and repetition of the labor to the unrelenting computerized surveillance of workers’ every move to comparatively high injury rates. In a company survey of 31,000 workers who left Amazon that was referenced in the report, some former Amazon workers say it’s worse to work at Amazon than some big-name competitors like Walmart or FedEx. In that survey, those who joined another employer soon after leaving the tech giant “rated Amazon significantly worse on work fitting skills or interests, demands of the work, shift length and shift schedule.”

With traditional competitors ramping up their investments in e-commerce warehouses, Amazon is no longer a slam-dunk top choice for those seeking work in these types of facilities and the starting minimum wage that comes along with it. And that dynamic is already playing out in some parts of the country.

Danger zones

In the Inland Empire region of California, for example, Amazon may cycle through every worker who’d be interested in applying for a warehouse job by the end of 2022, the internal report warned. One of the reasons is that Amazon is increasingly finding itself in a bidding war for workers with rivals in the area, which is a key logistics region because it is within a two-hour drive of 20 million potential customers and two of the largest container ports in the US.

“We are hearing a lot of [Amazon] workers say, ‘I can just go across the street to Target or Walmart,’” said Sheheryar Kaoosji, co-executive director of an Inland Empire nonprofit called the Warehouse Worker Resource Center. Kaoosji added that Walmart is offering some workers with past warehouse experience as much as $25 an hour. An Amazon executive told Reuters in late 2021 that the company was bumping the average starting wage for new hires in the US to more than $18 an hour, attributing the decision to intense competition among employers. He also said Amazon had increased hiring bonuses to as much as $3,000 in some geographies.

And internal forecasts showed the situation was dire in Phoenix, Arizona, with Amazon projected to exhaust its entire potential workforce by the end of 2021. The Phoenix metro area has been a key market for Amazon since it opened its first warehouse there in 2007. The company currently operates more than 20 facilities in the region. But attrition at Amazon’s facilities in the area grew from 128 percent in 2019 to 205 percent in 2020, as the pandemic upended labor markets and online shopping boomed, putting pressure on fulfillment center employees.

 David Paul Morris/Bloomberg via Getty Images
Employees David Pace, left, and Leroy Morgan load a truck with boxes to be shipped at the Amazon distribution center in Phoenix, Arizona, in November 2012.

As a result, Amazon seemed to have reversed, or stopped enforcing, some workplace policies at Phoenix warehouses amid the labor shortage, according to a former manager.

“They were so concerned about attrition and losing people that they rolled back all the policies that us as managers had to enforce,” Michael Garrigan, a former entry-level manager at Amazon warehouses in Phoenix from 2020 to early 2022, told Recode. “There was a joke among the … managers that it didn’t matter what [workers] got written up for because we knew HR was gonna exempt it. It was almost impossible to get fired as a worker.”

Lunak, the Amazon spokesperson, declined to comment on Garrigan’s claims.

The internal research also identified the regions surrounding Memphis, Tennessee, and Wilmington, Delaware, as areas where Amazon was on the cusp of exhausting local warehouse labor availability. Amazon’s models used for this internal research were 94 percent accurate in predicting the US geographies where Amazon was significantly understaffed in the lead-up to the Amazon Prime Day shopping event in June 2021, the report noted, which contributed to delivery delays for customers in those markets. The warnings about Amazon’s labor supply shortages indicate that in at least some markets, Amazon shipments could face more severe delays in the future.

Despite its looming labor crisis, Amazon temporarily overcorrected in some markets, going from understaffed to overstaffed. Amazon’s chief financial officer had previously said that the company was understaffed by 10,000 employees during the end of 2021, before the omicron Covid-19 variant had wreaked havoc on much of the US. But in April, the company revealed that it was actually overstaffed in some areas in early 2022 as the first wave of omicron subsided and employees returning from sick leave worked alongside new hires who had been recruited to backfill their roles.

Amazon spokespeople have said that the company will count on natural attrition rates to solve much of the current overstaffing problem, and the Wall Street Journal reported on Thursday that a top company official pitched a plan internally to “[thin] out its worker base through attrition.” It’s unclear where exactly Amazon is overstaffed and how long it will take to rightsize its workforce, but it seems unlikely that it is thinning staff in competitive locales like Phoenix and the Inland Empire where it had already exhausted much of the labor pool. It’s also unclear how the current economic climate will impact consumer spending and, relatedly, Amazon’s hiring needs.

 Mark Makela/Getty Images
Job seekers wait in line during an Amazon jobs fair at the Amazon fulfillment center in Robbinsville, New Jersey, in August 2017.

For better or worse, the approach of reducing the temporary overstaffing issue through attrition should work for Amazon because it has long churned through its workers at a rapid clip. Amazon’s attrition rates were 123 percent in 2019 before jumping to 159 percent in 2020, according to internal data in the report Recode obtained, while turnover rates across the US transportation and warehouse sectors were much lower: 46 percent and 59 percent respectively in 2019 and 2020, according to Bureau of Labor Statistics estimates.

Turnover in the US retail industry was slightly higher than that — 58 percent and nearly 70 percent respectively in 2019 and 2020 — but still only about half as bad as Amazon’s. The high rates of attrition “made some [Amazon] executives worry about running out of workers across America,” the New York Times reported in 2021, though the article did not include specific timelines.

The leaked report viewed by Recode reads like an attempted wake-up call — along with potential solutions to avert the crisis — for some company leaders who long exhibited a nonchalant attitude toward employee attrition.

No silver bullet

Amazon has a variety of potential solutions for its people problem, but they will require the company to shift its mindset and overcome practical or logistical challenges.

On the surface, simply employing its current workers for longer would be a big help. The turnover rate disparity between Amazon and industry averages shows there is ample opportunity for the company to keep employees longer and delay the arrival of the day when it won’t have workers left to recruit. This is not some unsolvable, mysterious problem; the BLS stats show that plenty of companies retain workers much better than Amazon does. In fact, Amazon’s own data shows that nearly 90 percent of new workers say they want to stay at their jobs for at least six months. If Amazon could bring attrition rates down to its 2019 levels, which were still above 100 percent, the company would gain three more years of hiring runway, according to the internal projections.

 Craig Ruttle/AP
People arrive for work at the Amazon distribution center in Staten Island, New York, in October 2021.

In other parts of the country, though, where labor shortages aren’t yet a certainty, remnants of Amazon’s longtime aggressive termination practices persist. It’s not uncommon for some of Amazon’s automated computer systems to automatically fire employees for a variety of minor infractions, without exception. Jose Pagan, a former Amazon employee at a warehouse in Bronx, New York, says he got the automated ax recently despite nothing but positive feedback from his managers.

Pagan began working at the Amazon delivery hub in October and, within two months, had been promoted to a role on the safety committee for the facility. The new role didn’t come with a pay raise, and is on top of a worker’s core tasks, but Pagan saw it as a stepping stone to an official promotion. But in April, Pagan told Recode, he took two days off to have an infected tooth looked at and ultimately removed.

The problem, he said, was that he only had seven hours of unpaid time off but ended up missing 20 hours of work; he had enough paid vacation time to cover the absence, but he said the company did not pull from that separate bank of days because Pagan would have had to apply for vacation time in advance. Pagan said he also had a doctor’s note but was told the company did not need to accept it as an excuse, even though he had been excused from work with a doctor’s note previously. He said he worked for another full week without issue, until he showed up one night for his overnight shift and his badge no longer worked. He was eventually told he had been terminated.

An HR manager told Pagan that there was nothing he could do about the termination but that Pagan should reapply for a job at the company in three months, per Amazon policy.

“We would love you back in 90 days,” Pagan says the HR staff member told him. In the meantime, Pagan should “do some GrubHub or Uber,” the HR employee said.

“I find the whole situation crazy,” said the 35-year-old Pagan, who was supporting his wife and daughter on his Amazon income. “They’re gonna lose a good worker for nothing.”

Lunak, the Amazon spokesperson, said the company is looking into Pagan’s case.

Besides changing termination or retention policies, increasing pay is another obvious lever that Amazon could pull to expand its labor pool. (All of these are things that workers calling for unionization have demanded from the company.) The report predicted that for every dollar Amazon bumps up its minimum wage, it adds 7 percent more workers to its potential hiring pool. If Amazon were to do a little better, and raise its hourly minimum by just $1.50, that too would expand its pool of potential workers enough to extend its hiring ability in the US by three years.

 Johannes Eisele/AFP via Getty Images
Employees work at a distribution station in the 855,000-square-foot Amazon fulfillment center in Staten Island, New York, in February 2019.

The internal document also suggested Amazon needs to become more efficient at hiring. At the time the report was written, Amazon needed 6.7 job applicants to apply to fill a single warehouse role. Around 9 percent of applicants were rejected either because they were former employees not permitted to be rehired or because they failed a drug test or had an unsatisfactory background check. (Later in 2021, Amazon said it would stop screening many of its warehouse worker applicants for marijuana use.)

Of course, Amazon could also simply reduce the number of workers it needs by speeding up automation in its warehouses — a controversial approach. Nonetheless, the report revealed that Amazon executives had already in 2021 set a “conservative” goal of improving warehouse productivity by 25 percent by the end of 2024, strictly through increased automation. Hitting that goal on its own would push back the labor crisis as well, but only slightly.

The research team also pondered improvements that could be made to how Amazon already utilizes its existing staff. Amazon’s warehouse staff worked, on average, a little more than 27 hours a week in 2020, according to internal data. If Amazon had increased that weekly number by just 10 percent, the company could have reduced new hires by 118,000 people, the internal report estimated. The report also referenced a team in Amazon’s HR division, called Hamilton, that is building tools to automatically transfer workers between nearby facilities based on staffing levels and order volume. The relocations would come in the form of both “permanent transfers and short-term assignments.”

Lastly, according to the report, Amazon’s HR staffing division wants to play a bigger role in influencing where new warehouses are located so they can ensure the available labor pool is large enough for the company’s needs. For some types of Amazon warehouses, there is little wiggle room. Amazon delivery stations, for example, are the last stop for a package before it’s delivered, so they need to be located within a short driving distance to a large number of Amazon customers. But for others — like “cross dock” facilities that receive merchandise from suppliers, and fulfillment centers that receive goods from cross dock facilities and pack them into customer orders — there is more leeway in the location selection process and so an opportunity to better use internal labor forecasting tools.

“Our longer-term strategy … is to apply labor forecasts to future site selection,” the report read.

 Helen H. Richardson/MediaNews Group/The Denver Post via Getty Images
Warehouse associate Patricia Sahuaqu checks labels on boxes before they are loaded on trucks to be shipped out of Amazon’s fulfillment center in Thornton, Colorado, in March 2019.

Overall, the leaked report offers a variety of solutions to choose from, but each with trade-offs that Amazon executives may not find palatable. Raise wages and the company may need to pull back spending elsewhere. Increase automation and risk the wrath of critics concerned about replacing people with robots at the second-largest private sector employer in the country. A focus on better retaining employees could also mean reducing performance tracking and productivity quotas that have played a role, however controversial, in the company’s historic business success to date.

Amazon has shown time and time again that it values “customer obsession” — and the promises it makes to its customers — above all else. But the customer loyalty that results from that obsession is ultimately at risk if Amazon cannot employ enough people — or robots — to pack and ship the boxes people expect to find outside their front door a day or two after clicking “Place your order.” The company’s new CEO, Andy Jassy, has proclaimed that Amazon is “not close to being done in how we improve the lives of our employees.” As the internal report shows, doing so should no longer be optional for Amazon; it’s an imperative.

Leaked transcript: Inside Elon Musk’s first meeting with Twitter employees

Elon Musk standing lit on a dark stage with his arms folded.
Tesla and SpaceX CEO Elon Musk at the SpaceX launch facility in south Texas on February 10, 2022. | Jonathan Newton/Washington Post via Getty Images

The conversation provides the most detail yet about Musk’s plans to change the social media company.

On Thursday morning, Elon Musk addressed Twitter employees for the first time in a Q&A session about how he’ll run the social media company. The meeting comes after weeks of uncertainty about whether the deal is happening at all.

In the meeting, Musk answered challenging questions submitted from employees, including how he will handle contentious speech on the platform, whether he plans layoffs, and if he will allow employees to continue to work remotely.

While Musk provided few details that would assuage those at Twitter who fear Musk’s self-labeled free speech ideology and management style — it was one of the most substantial conversations Musk has had yet about how he actually plans to change the company.

The following is a rush transcript of Twitter’s internal meeting on June 16, 2022. This transcript has been edited for length and clarity.

The meeting started with a brief introduction from Parag Agrawal, Twitter’s current CEO. Twitter’s chief marketing officer, Leslie Berland, asked Musk questions submitted in advance by Twitter employees.


Parag Agrawal

So you’re going to hear from you live and direct. And we all appreciate you joining us today.

Elon Musk

Absolutely, Parag. Thanks for having me. Glad to be able to speak to everyone. And since we started late, I’m going to go right ahead, hand it over to Leslie so that she can moderate this Q&A session for us.

Leslie Berland

Amazing. Thanks, Parag. Hi, Elon. We have a lot to cover — a ton to cover. So I am going to ask you a question that usually gets asked at the end, which is: Will you come back for a part two at some point if there are things that we don’t cover?

Elon Musk

Oh, yeah, absolutely. I’m happy to do that.

Leslie Berland

Okay, great. ... So I really do see this as the beginning of a conversation, obviously, with the company at large, and then also with teams and leaders over the next coming weeks and months and beyond. So we’re just getting started. Okay, so I’m going to zoom all the way out to the reason that we’re actually here together today. And that is because you love Twitter.

Elon Musk

I do love Twitter, yeah. So I want to be clear about that. I love Twitter. In fact, I literally have tweeted “I love Twitter,”

Leslie Berland

You have. So tell us, say more. Why do you love Twitter? And also, why did you and do you want to buy Twitter?

Elon Musk

Well, let’s see. I find, like, I learn a lot from what I read on Twitter, and what I see in the pictures, videos, text, and memes that people create. I also find it’s a great way to get a message out over the phone, when I want to say something and make an announcement, I think Twitter’s the best way to do that. It just goes out immediately to everyone. And you know, I sort of made this joke already, but you know, some people use their hair to express themselves, I use Twitter. So you know, I find it’s the best forum for communicating with a lot of people simultaneously.

And getting that message directly to people in the past, you’d have to ... in order for somebody to read about something, you have to issue a press release, and then you’d hope that the regular media would write about the press release. And then they wouldn’t write about it in quite the way you’d like to write about it. I always find those like, the old-style press releases kind of, really quite strange because you’re writing a press release about yourself, which is sort of something that the media — it’s like, it’s overly flattering, it’s like vaguely sort of, you know, propagandist — effectively — quite propagandist, and then hope that the media writes something favorable, which they usually do not.

And, you know, I think that that actually is maybe one of the biggest reasons for using Twitter is so I communicate directly to people and not through the lens of the media. And, you know, I think there’s obviously an important role for the media to play. But as anyone knows who reads the newspaper, it’s coming through quite a negative lens. So you have to say, how many newspaper articles do you read that are positive? And how many news articles do you read that are negative? What percentage are positive, what percentage are negative? And then when you read about — it’s obviously overwhelmingly negative. And then when you read about something — newspaper is a dated term, in the news — where you actually personally understand the situation, how many times has the media gotten it right? I would say almost never. Not never, but almost never.

So this is a way for people to communicate directly with each other and not through a negative lens. And I think that’s extremely important for the world. So I’m sort of going waxing on about this, but I think it’s pretty important.

And you know, some of my comments about Twitter being sort of like a digital town square — but really much more than that, because you can’t put that many people in a town square, but you have the ability to communicate with millions of people on Twitter. That’s just an incredibly important thing. And I think it’s essential for a functioning democracy to function well.

I think it’s essential to have free speech and to be able to communicate freely. Now you know, the free speech stuff: It’s free speech within the context of the law. So I’m not talking about suggesting that we just flout the law, because we’ll just get shut down in that case.

And I think also, there’s freedom of speech or freedom of reach. And freedom of speech is one thing, because, like, anyone could just go into the middle of Times Square right now and say anything they want, they could just walk into the middle of Times Square and deny the Holocaust, okay? You can’t stop them, they will just do that. But that doesn’t mean that needs to be promoted to millions of people.

So I think people should be allowed to say pretty outrageous things that are within the bounds of the law, but then that doesn’t get amplified, it doesn’t get, you know, a ton of reach.

And I think an important goal for Twitter, really, is to try to include as much of the country, as much of the world, as possible. So currently, you know, it’s a relatively small percentage of the world that is — it is a small percentage of the world that is on Twitter — say, like daily active users, if you presume that that’s, say, 200 million, you’ve got 8 billion people on Earth, that 7.8 billion who are not on Twitter. So that’s a pretty big number.

And really, I think you want as much of the world as possible on Twitter, you want to be as inclusive as possible, the broadest demographic, and for that to happen, people must like being on Twitter.

So if they’re being harassed or if they’re uncomfortable, they’re just not gonna use Twitter. We have to strike this balance of allowing people to say what they want to say but also make people comfortable on Twitter, or they simply won’t use it. It will be sort of quite niche.

But I think there’s also a lot that should be done in terms of enhancing the core technology and operating of Twitter. Like right now, if somebody does, say, a video, like a content creator does a video, then they can put that video on YouTube and just put a link to it from Twitter because they’re able to monetize their content on YouTube, but not on Twitter. And I think it’s gonna be really important for you to want to put the content on Twitter, which we do, then there has to be a mechanism for content creators to monetize that content.

And so they could dual post and they can post it to YouTube and to Twitter. But it’s, I think it’s crazy right now that content creators will use Twitter to drive traffic to their YouTube video because that’s how they make a living. And that really should be on Twitter.

We want to basically address the reasons that people like — why aren’t more people using Twitter? And why do people click away from Twitter? And if we can address those reasons, then then they will use Twitter more, and they’ll get greater value from the service. And, you know, if I think of, like, WeChat in China, which is actually a great, great app, but there’s no WeChat movement outside of China. And I think that there’s a real opportunity to create that. You basically live on WeChat in China because it’s so useful and so helpful to your daily life. And I think if we could achieve that, or even close to that with Twitter, it would be an immense success. Hopefully, that is — I really went on there. And I’m happy to elaborate on any of those points.

Leslie Berland

Yeah, no, it’s great. And we’re gonna get a little bit deeper on free speech and policy a little bit later. So I do want to come back to this actually. But in terms of you, you clearly have a lot of thoughts around sort of the problems with Twitter, the things that aren’t working well, and the barriers to what’s possible. How do you see your buying the company? Did that sort of feed your desire to buy the company or how do you see these things come together? And what’s your thought process around that?

Elon Musk

Well, there’s definitely an ongoing challenge with Twitter with bot accounts and spam accounts. There’s quite a lot of crypto scams on Twitter. It’s gotten better, but there’s still a fair bit of that. There are also people where they’re not necessarily bots, but they might be operating. You know, one person’s operating hundreds of accounts and trying to make them look like individuals, but they’re not.

So you know, I think a lot of stuff is kind of reiterating stuff that I said publicly —in fact, on Twitter — but in order for people to have trust in Twitter, I think it’s extremely important that there be transparency. So that’s why I’m an advocate of having the algorithm be open source so that people can critique it, improve it, identify bugs, potentially, or bias. But when it’s transparent, transparency obviously increases trust. So I think it’s just very important, like, anything that’s happening on an automated basis be open source and be clear, and that if there is any action taken by someone within Twitter to boost, or de-boost, or something with a tweet that it’s just very clearly identified on the tweet, so people aren’t ascribing malice where there’s no malice.

But when it’s inscrutable, then people don’t know what to think. And they will sometimes think the worst when that’s actually not true. So I think that trust is extremely important. And then just the usefulness of the system, getting rid of sort of troll farms and bots and spam is incredibly important.

I have a thought in this regard, which I think might work, which is to — because this kind of leads us to Twitter Blue — but if you have Twitter Blue, your identification in the system doesn’t change at all, you still have a normal user ID. But I think if there was like a little Twitter Blue authenticated, not like authenticated like a celebrity, but authenticated at least by Twitter Blue payments, piggybacking on the payment system due to authentication, that I think a lot of people would be like, “Okay, that’s pretty helpful to have some designation that reflects my name, that indicates I’m probably not a bot, or spam, or one person who’s operating 100 accounts.” And that’s like three bucks a month, I believe, I think that would be pretty helpful.

And then, also prioritizing comments and mentions and whatnot, by who is verified in this broader sense of the word of “verification.” In the sense of you’re Twitter Blue verified, and just prioritize that above someone who’s not not verified. There will still be full read access to the system, still be full write access to the system. But essentially any tweets or our actions will be prioritized according to who’s verified. And then a very large number of people can be verified.

Leslie Berland

I’m gonna have a couple of follow-up questions on this, specifically, but given [that] you mentioned trust, I wanted to ask one of the employee questions around trust. They said, “Twitter has a lot of incredible, smart, talented people. What can we do to earn your trust? And what are you going to do to earn ours?”

Elon Musk

I think trust is as trust does. So, I tend to be extremely literal in what I say. So, aspirationally, one does not need to read between the lines, one can simply read the lines. So the things that I’ve said about Twitter, I think, need to happen in order for it … to really go to the next level. I think the potential is there for Twitter to be accessible to an order of magnitude more people, and for a lot more people to find it useful.

Currently, I guess it would be a cutback, for 4 percent of the world or something like that. Four or 5 percent of the world, optimistically, is finding Twitter useful, and maybe 50 percent of the world could find Twitter useful. So I want to take whatever actions would lead to that. I’m very much like [...] I wouldn’t say it’s necessarily a trust thing. It’s like, if somebody is getting useful things done, then that’s great. But if they’re not getting useful things done, then I’m like, okay, why are they at the company? So it’s really just, we need to improve the core technology, improve the design.

Leslie Berland

Trust emerges from that.

Elon Musk

Yeah. ... If somebody’s getting stuff done, great, I love them. And if they’re not, I don’t like that and I do not love them. It’s pretty straightforward.

Leslie Berland

I would love to stay on this topic of employees and how we work. So distributed work is something that has been core to our strategy. Most of our people work in a hybrid model. About 1,500 people work remote full time. We know that you’ve recently sent a communication to Tesla executives about remote work. Can you share what your point of view is on remote work, and specifically for Twitter?

Elon Musk

Now Tesla makes cars and you cannot make cars remotely, obviously. You have to make cars in a big factory, and the supply chain, and you have to bring in the parts, and assemble them, and then transport the car to the owner. All of these things must be done in person because it’s physically impossible to do them remotely. There are some roles at Tesla where the work can be done remotely, like, say, software or design. … I think that’s still a case where you want to aspire to do things in person, but if somebody is exceptional at their job, then it’s possible for them to be effective, even working remotely.

So with Tesla, I have simply asked for a list — that the manager has to confirm — that they’re an excellent contributor, and if they do, they’re allowed to work remotely. So it’s pretty basic, I think. There is a hit one takes, remotely, because it does reduce esprit de corps and ... it kind of matters to be in person, at least some of the time. So one of the things I’ve said, even if somebody’s working remotely, they gotta show up at the office occasionally so that they recognize their colleagues and don’t walk down the street and pass your colleagues and you don’t recognize them. That would not be good.

Leslie Berland

Well I think this is super clarifying, and resonates with us entirely in terms of how we work, so thank you for clarifying that topic. It’s really important to us. I would like to keep on the topic of employees and some of the questions that have come through. This one’s on compensation and benefits. Most people — especially, obviously, here — are used to working for a public company. Can you talk a little bit about how you compensate folks at SpaceX as a private company, how does it work, and what approach you plan to take at Twitter as a private company?

Elon Musk

Yeah. So SpaceX, I think, operates in the best of both worlds, where stock and options are issued to everyone. But we don’t have all the challenges of being a publicly traded company with a stock that can be up and down from one day to the next — it can be quite a distraction — and where one is at the mercy of short sellers and class action lawsuits. ... It’s like being in the public stockade in which they just throw tomatoes at you all day. SpaceX still allows liquidity, so every six months, there’s a liquidity event at SpaceX, and people have the opportunity to sell their shares. And that’s worked very well for the whole lot of the company. So I think something like that would make sense at Twitter. So it would still be stock and options and every day, and it would just be liquidity events twice a year.

Leslie Berland

Thanks. We are getting some real-time feedback on the remote work questions, so I just want to make sure I follow up.

Elon Musk

Sure.

Leslie Berland

Your approach to remote work and distributed work. ... What I’m hearing from you is that you are supportive of remote and distributed work as it is productive and meaningful. People show up when it’s important, and depending on their jobs. Is that an accurate reflection?

Elon Musk

The bias there definitely needs to be strongly toward working in person. But if somebody is exceptional, then remote work can be okay. But basically, if their work output is exceptional, then remote work is fine. There is some communication impact that one takes when working remotely because if you’re with people, and they’re just a few desks away, it’s very easy to communicate in real time, but it’s much harder to do that if you’re in different physical locations. So I do want to emphasize that the bias is very much toward in-person work. It’s just that it would obviously be insane if someone is excellent at what they do but can only work remotely, to then fire them even though they’re doing excellent work. ... So I’m definitely not in favor of things that are mad. I’m in favor of things that build the business and make it better.

Leslie Berland

Thank you. Question about layoffs. We received several questions from employees on this point. Obviously, they’ve read about the recent layoffs at Tesla. Can you speak to how you’re thinking about layoffs at Twitter?

Elon Musk

Well, I think it depends on, you know, the company does need to be — to get — healthy. So I mean, right now, the costs exceed the revenue. So that’s not a great situation to be in. And so there would have to be some rationalization of headcount and expenses to have revenue be greater than cost. Otherwise, Twitter is simply not viable or can’t grow. So, yeah, I think it would just be dependent on you know, like I said, anyone who’s obviously a significant contributor should have nothing to worry about. I do not take actions which are disruptive to the health of the company. So, you know, yeah.

Leslie Berland

One question connected to that, as you’re obviously learning and gaining information as we get closer to this deal being closed. What do you feel that you have deep understanding and grasp of? And what are the areas that you feel like you want to dive much more deeper on to understand and learn?

Elon Musk

Well, I certainly, I mean, I have a strong, a great understanding of the product because I use Twitter every day, practically. And, you know, I think I’ve got a really good understanding of how Twitter works from a product standpoint. What I have less understanding of is, you know, like, this sort of bot spam or multi-user account — basically, anything that affects the monetizable daily user number, that’s probably my biggest concern. Because that’s really what drives advertising revenue, as well as subscription revenue. And really, Twitter’s revenue is going to be subscription, advertising — I think payments would be an interesting thing to do, as well. But all of those things are only relevant as a function of how many unique humans are on the system. So that’s my biggest concern. And that’s what I’ve said publicly as well, like I said, I try to be as literal as possible, yeah.

Leslie Berland

And as we think about, obviously, the product and the service and serving customers all around the world, clearly, it’s critical and existential for us to serve diverse communities. And all people, as you said earlier. So inclusion, diversity is obviously core and central to our work at Twitter, both our employees and the customers that we serve. You have been vocal on a variety of different topics and issues that relate to inclusion and diversity. Can you talk about both your views and also your commitment to creating a diverse and inclusive workplace and also a service where everyone can feel included and safe?

Elon Musk

Yeah, I mean, well, it’s, to be clear, when talking about Twitter as a whole, there’s 8 billion people in the world; I’m told there’s 200 million daily users of Twitter. That’s a 7.8 billion-person gap. So I think we really want to have, I don’t know, at least a billion people on Twitter, maybe more, as many people as we can possibly get on Twitter. So that, I think, is the most inclusive definition of inclusiveness, just like, all humans. So that’s important. You know, from a company standpoint, I believe in a sort of strict meritocracy, so whatever, you know, whoever’s doing great work, great, they get more responsibility and authority. And that’s that.

Leslie Berland

And I know you mentioned in some of our conversations about your I&D team at Tesla; we have an amazing I&D team here at Twitter as well. So continue on the journey together.

I want to talk about content moderation, go back to a number of the things that you said earlier. So this is one I’ll take, I’ll take verbatim. So you’ve spoken a lot about the importance of free speech. Let’s start with the US, where we have a strong tradition around this. And you touched on this earlier, a lot of what’s called lawful but awful speech is allowed here in the United States, right? Animal abuse footage, doxxing, videos of sexual violence, etc. So allowing this type of content, obviously, could cause harm, and make Twitter unusable for the broad audience that you’re trying to reach. What is your approach to this type of content that’s legal but problematic as it relates to people actually using the service? How do you think about this tension?

Elon Musk

As I said earlier, really, I think people, we should allow people to say what they want, post what they want, within the bounds of the law. But that’s different from them being able to reach people who don’t want to be reached with that content. So if that content is offensive to people, they will, those people will simply stop using Twitter. So it’s important to make Twitter as attractive as possible. And really, that means not showing people content that they would find hateful or offensive, or even frankly content they would find boring is not good. We don’t even want them to see boring content.

We were talking about TikTok last night. And TikTok obviously does a great job of making sure you’re not bored. I mean, it’s just like ADD, but like next level — but TikTok does a great job of making you not bored. I mean, I do find some of the videos offensive, I think, but they’re not boring. So the folks — how do we ensure people have content that they find entertaining and engaging and interesting, such that they want to keep using Twitter and use it more. So that’s, yeah, that’s what’s essential to the growth of the service.

Leslie Berland

One of our employees asked about people who use Twitter having the right and the ability to filter out content that they don’t want to see — I think this gets to exactly what you’re pointing to.

Elon Musk

I mean, to be clear, the standard is much more than not offending people. The standard is, should be, that they’re very entertained and informed. Like, you could not offend someone, but you could also bore them and show a bunch of content that they don’t find interesting, and then they will not use the service or they will use it less. So that’s why I used the example of TikTok, where they just honed the algorithm to be as engaging as possible. And I think we want to also hone it to be as engaging as possible, in a different way, I think.

You know, TikTok is interesting, but, like, you want to be informed about serious issues as well. And I think Twitter, in terms of serious issues, can be a lot better for informing people about serious issues. I do you think it’s important that there be, you know, if there are two sides to an issue, it’s important to represent multiple opinions. But you know, and just make sure that we’re not sort of driving narrative. Give people an opportunity to understand the various sides of issues. Most issues in the world are complex. They don’t boil down to a simple, “this is 100 percent good; this is 100 percent bad.” So I think it would be — we’d have a more informed public — if people were presented with multiple sides to an issue.

Leslie Berland

One point I just want to go back to, on the law and how that impacts content and moderation: As we think globally around the world, there are some countries that have laws that limit speech, and sometimes actually use these laws to silence disagreement with the government, etc. You were talking about different points of view. So Twitter is historically focused on doing what we can do to enable people everywhere to have their voices. How do you think about that as it relates to, again, like the local laws and what that means?

Elon Musk

Well, I’m in favor of doing, of going, as far as the law will allow us. If the law will — if, say, Twitter employees would get arrested in the country if we didn’t adhere to the law, then we obviously must adhere to the law or exit the country or something. So I mean, as much as we can enable people to have a voice and to speak their mind, I think we want to do that.

Leslie Berland

And I know we talked about this as well, last night — about the teams doing this work and sort of your desire to connect with those teams and understand where we’ve been, where we are, where we’re going. And I think that would be usually productive across the board, both ways. Can we talk briefly about your political views? How if at all do your political views play into the leadership of the companies that you currently run? How would it affect Twitter, if at all?

Elon Musk

Well, my political views, I think, are moderate, at least as would be, you know, as if you said, like, what is the center of the normal distribution of political views in the country, I think that’d be pretty close to the center. You know, I’ve voted Democrat, every election until this recent one this week. And then I voted for Mayra Flores, who is Republican. She’s Mexican American, and I thought a good candidate and worth voting for. But I, you know, I’m in favor of moderate politics. But I’m allowing people who have relatively extreme views to express those views within the bounds of the law. So that’s, you know, as I said publicly, I think if, let’s say, the far left 10 percent and far right 10 percent were equally upset on Twitter, then that would probably be a good outcome.

Leslie Berland

I want to just talk about our business for a minute. You’ve spoken about incentives that the business creates for services like Twitter. What role does advertising play in the future of your business plan for the company?

Elon Musk

I think advertising is very important for Twitter. So in the case of, say, Tesla or SpaceX, there’s no need for advertising because the demand exceeds our production. So I mean, advertising is fundamentally a demand generator, and you occasionally want to get some other message out there. But it’s fundamentally a demand generator.

So given that, at Tesla, demand is far in excess of production, there’s no need for Tesla to advertise. But, you know, I’m not against advertising. I would probably, I don’t know, want to talk to the advertisers and say, like, “hey, let’s just make sure the ads are as entertaining as possible.” I think they’re more effective if they’re entertaining. Like, you want to not be strident or spammy in an ad. And then, of course, I don’t think it’s good to allow advertising of any products which are, you know, bad products.

I was literally scammed. I bought this thing off of a YouTube ad, and it doesn’t work. And then I Googled it and it’s like, oh, yeah, once you click on the second page of Google search results, it’s like, yeah, this product totally doesn’t work. It’s trash. And I’m like, well, why the hell is YouTube allowing advertising of scammy products? That’s totally not cool. So I think if your advertising is entertaining, interesting, it’s something you might actually want, and the product would be, you know, fulfilling to the Twitter user, then I think that’s great advertising. So, yeah.

Leslie Berland

So we’re gonna go over. Is that okay? Awesome. Thank you. Can you talk a little bit about Twitter and payments? You mentioned this a few times in different settings. I would love to understand your thinking there.

Elon Musk

Yeah. Your money is essentially a form of information. It’s information that allows us to exchange products and services without having to barter and allows people to shift obligations in time. But money is fundamentally digital at this point, and has been for a while. And PayPal, you know, I think it’s done a great job on the payments front. I think it would make sense to integrate payments into Twitter so that it’s easy to send money back and forth. And if you have currency as well as crypto. Essentially, whenever somebody would find it useful.

So my goal would be to maximize the usefulness of the service — the more useful it is, the better. And if one can use it to make convenient payments, that’s an increase in usefulness. News, entertainment, and payments, I think, are like three critical areas. But really, it’s just about thinking about how to make this, how to make using Twitter so compelling that you can’t live without it and that everyone wants to use it.

Leslie Berland

I want it to say on the product. Again, you did touch upon this earlier, but it’s a recurring question around the authentication piece, you know, in terms of you’re saying you want to authenticate all humans, so just to sort of double click into that, you know, balancing this with those who benefit from anonymity, right, from a safety perspective, especially, for example, human rights activists and marginalized communities. Can you just clarify, again, speak to that tension? And how you think about those words, specifically? Anonymity is sort of core to how people use the service.

Elon Musk

Yeah, I don’t think it’s necessary for someone to use their real name. So if one, say, does a payments-based authentication, I think it should be okay to not use your real name on Twitter. So Twitter would know who you are, at least from a payment standpoint, but you would not have to state your real name or anything. That’s obviously important, where if someone has different political views from their manager, let’s say, then they don’t really want to, you know, get crosswise there. And so it would be better for them to have a pseudonym on Twitter, but it would still be backend authenticated.

And like, at no point would I suggest that you have to be authenticated in order to use Twitter, it’s just that it would be prioritizing authenticated comments and actions on Twitter over unauthenticated in order to combat the bots and trolls. And essentially, it needs to be much more expensive to have a troll army. Whereas right now, it’s basically very inexpensive to have 100,000 fake Twitter accounts.

Leslie Berland

You have certainly been very vocal on Twitter. You are very vocal on Twitter. And often your tweets and even emojis create news cycles. You have been also critical of the company on Twitter, which obviously impacts lots of discussions, conversations, and perceptions from whether it be partners or even now employees. How do you think about these tweets? Do you look at the reaction and think about the reaction of these tweets? I’m just curious about the thinking behind the tweet, if you will.

Elon Musk

Well, I think that it would be helpful, you know — one thing about words is that it’s hard to convey tone. And so it’s possible for … Essentially, people will sometimes take the words and then assume they were said in maybe an angry way or a vindictive way or something like that. But, I mean, hopefully you can tell my normal tone is not ... I’m not an angry person. I almost never raise my voice. So like, in a year, I might not have raised my voice. So this is not a, you know ... Sometimes people may think, “oh, wow, he’s sort of yelling and screaming” or something, but I’m really not. So maybe there’s some way to indicate tone? I mean, emoji sorta do that. But I don’t know, maybe they could have like, I don’t know, an irony flag or something: This is an ironic tweet. Something like that.

Leslie Berland

Listen, I think Spaces is a great product for you as well. We also have voice tweets, which I don’t think I’ve seen you use before, but I think that would add sort of your literal voiceover and color some of the things that you tweet ...

Elon Musk

Oh sure. Yeah maybe I could just say it. Or you could read it, but then you can also see how I would have said it. Like, I wonder if you said that in an angry way. And then you can see how I actually said it.

Leslie Berland

Yes, absolutely, that’d be amazing. I know, we have 10 more minutes, up at the hour, so I’m holding you until then. Your role at the company — there’s been some discussion about will you be CEO, will you not be CEO? How can you speak to this? And how do you anticipate your role influencing strategy, day-to-day division?

Elon Musk

Well, I guess I’m not hung up on titles, but I do want to drive the product in a particular direction. So, you know, it could be like ... I don’t really care about being CEO. In fact, I renamed myself “Techno King” at Tesla in an official SEC filing. So ...

Leslie Berland

Yes, we saw.

Elon Musk

And then our CFO was renamed “Master of coin,” which I think is a cooler thing than CFO. So, I mean, what I really just want do is, like, drive the product and improve the product, and then it’s like, basically, software and product design. So you know, I don’t mind doing other things, you know, related to operating the company, but there are chores. There’s a lot of chores to do as CEO. And all I really want is to make sure that the product evolves rapidly and in a good way.

And I don’t really care what the title is, but I do ... Obviously, people do need to listen to me. If I say, like, “Hey, we need to improve the product and find ways and make the following changes, add these features.” Then, you know, I do expect that people listen to me, in this regard. I mean, that’s how I do it at SpaceX and Tesla. So you know, I’m really just working with engineering and production. And, like, it sometimes may seem that, wow, he’s really out there a lot. But actually, I’m not. If you see how many actual interviews I do, it’s quite a small number. But whenever I do a tweet, they’ll make an entire, like, two-page article about it, you know. So, I’m like, like, basically get far fewer.

I’m actually quite internally focused at SpaceX and Tesla, even though it may not seem that way. And it’s really just, you know, evolving the rocket technology at SpaceX and providing global internet with Starlink. And then at Tesla, it’s about accelerating sustainable energy, you know, electric cars and stationary battery packs and solar power. And the fundamental good of Tesla, I would say, is measured by how many years accelerate the advent of sustainable energy.

And then the final goal of SpaceX is, you know, are we able to make life multiplanetary and thus improve the probable lifespan of consciousness? Like you’ve already said, what is the unifying philosophy for me? It is, we should take the set of actions most likely to extend the scope, scale, and lifespan of consciousness as we know it. What sort of actions improve things at a civilizational level and improve the probable lifespan of civilization? Civilization will come to an end at some point, but let’s try to make it last as long as possible.

And it would be great to understand more about the nature of the universe. Why we’re here, meaning of life, where are things going, where we come from? Can we travel to other star systems and see if there are alien civilizations? There might be a whole bunch of long-dead, one-planet civilizations out there that existed 500 million years ago. Think about the span of human civilization from the advent of the first writing, it’s only about 5,000 years.

What you need to know about Elon Musk’s big meeting with Twitter employees

Tesla and SpaceX CEO Elon Musk spoke to employees at Twitter for the first time on Thursday since he put in a bid to buy the company. | Dimitrios Kambouris/Getty Images

Employees asked Musk tough questions. He still doesn’t have all the answers.

Elon Musk, the new would-be owner of Twitter, talked to the company’s employees for the first time today in a Q&A session. The meeting was meant to be an opportunity for him to assuage employee concerns after the Tesla CEO publicly criticized the company, its leadership, and the number of spambots on the platform in recent weeks. But Musk’s responses on some key topics like layoffs, content moderation, and remote work were vague. They likely did little to satisfy employees worried about Elon’s leadership, according to several staffers who talked to Recode after the meeting and internal Slack conversations viewed by Recode.

“I love Twitter,” Musk said at the beginning of the meeting, according to a recording of the meeting obtained by Recode. Musk, who dialed in around 10 minutes late to the videoconference, apparently from his cellphone, added, “Some people use their hair to express themselves, I use Twitter. I find it’s the best forum for communicating with a lot of people simultaneously, and getting that message directly to people.”

In the meeting, Musk seemed to back away from a more absolutist stance toward “freedom of speech” on the platform. He said that while people should have a right to freedom of speech, they don’t necessarily have “freedom of reach,” meaning that Twitter doesn’t have to amplify ideas like Holocaust denial on the platform. While his answer on this topic was more nuanced than some of his previous statements, it still seems unlikely to fully answer employee questions about how exactly Musk will change the company’s approach to moderating hateful and violent speech.

“There’s freedom of speech or freedom of reach,” Musk said. “And freedom of speech is one thing, because, like, anyone could just go into the middle of Times Square right now and say anything they want, they could just walk into the middle of Times Square and deny the Holocaust, okay? You can’t stop them, they will just do that. But that doesn’t mean you have to — that it needs to be promoted to millions of people.”

In the 45-minute meeting, Musk didn’t go into too much detail about his tactical plans as Twitter’s owner, giving non-committal answers about whether he has plans to lay off staff or force employees who are working remotely back in the office.

Twitter CMO Leslie Berland asked Musk selected questions that employees had submitted in the days ahead of the meeting, many of which were critical or pressed for more details about his plans to run the company. When asked about how he’s thinking about layoffs at Twitter, Musk replied vaguely.

“The company does need to get healthy. Right now, the costs exceed the revenue. So that’s not a great situation to be in,” Musk said. “And so there would have to be some rationalization of the headcount and expenses to have revenue be greater than the cost. Otherwise, Twitter is simply not viable.”

“Anyone who is obviously, like, a significant contributor, should have nothing to worry about,” Musk clarified. He similarly said that if an employee is “exceptional” then remote work is fine, but that the “bias is very much toward in-person work.”

Since first putting in his $44 billion bid to buy Twitter in April, Musk has created a flurry of uncertainty about the deal, at one point tweeting that it was “on hold” due to his concerns about the prevalence of spambots on the platform. The move raised questions about whether Musk was trying to renegotiate the deal at a lower price or attempting to back out altogether.

While some employees are excited for Musk’s arrival and hope he can help the company grow its size and profitability, the volatility around the deal and Musk’s unclear concept of freedom of speech have left many Twitter employees worried about how he plans to handle the platform once he’s in charge.

“He is demonstrating a dangerous lack of knowledge about technical, policy, and operational matters,” said one Twitter employee after the meeting, who has been granted anonymity over fear of retaliation. “The problem is that that lack could adversely affect the whole world. This isn’t just about employees. Employees care about the impact of their product in the world.”

Musk, however, seemed confident in his ability to run Twitter. When asked what he has an understanding of and what he needs to learn about the company, Musk said he gets Twitter because he’s a super user (Musk is one of the platform’s most-followed accounts with 98.3 million followers).

“I certainly am going to have a strong understanding of the product because I use Twitter every day, practically,” said Musk. “What I have less understanding of is, you know, like, this sort of bot spam or multi-user account — basically, anything that affects the monetizable daily user numbers is probably my biggest concern.”

Musk agreed to come to another Q&A with Twitter employees if there were more questions.