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Will Google reduce its tax?
What’s the news: Google said it will enforce rules that require app developers distributing digital goods on its Play Store to use its payment system, making it harder for app developers to escape its 30% commission. While Google has said it will impact only 3% of users who currently don't use this feature, app developers aren't too happy and have expressed their discontent about “Google Tax” and the power it gets thanks to its dominance in the mobile OS market.
Why you should care:
No monopolist will agree they are a monopolist, but others will feel the pain
- Google of course denies it’s a monopoly and that it’s abusing its power. Not surprising. "Monopolists lie to protect themselves. They know that bragging about their great monopoly invites being audited, scrutinized, and attacked," as Peter Thiel says in Zero to One. It's also not straightforward to determine if a tech business is a monopoly. Google might have a 95%+ share in the mobile OS market in India. But, it's not the only play store on the Android platform. Even as it clarified the rules on in-app sales, it also announced that it will make it easier for other play stores in the coming months.
So, it’s no wonder that Google/Apple’s rivals are joining hands, and a backlash is building up
- Techcrunch reports, “13 app publishers, including Epic Games, Deezer, Basecamp, Tile, Spotify and others, have launched the Coalition for App Fairness. The new organization formalizes efforts the companies already have underway that focus on either forcing app store providers to change their policies or ultimately forcing the app stores into regulation.”
- In India, CNBC reports, "several members of the Indian startup ecosystem came together over a virtual meeting to protest against Google's PlayStore billing policy and called for setting up an industry body. The proposed association has tentatively been named as the Aatmanirbhar Digital India Foundation," quoting unnamed sources.
Often, such conflicts end up doing good for the system as a whole
- There's no science behind the 30% Google Tax, even though 30% charged by these stores might have sounded reasonable at one point of time. Then people benchmarked it against retailers’ margins. Now, they benchmark it against merchant discount rates. "The art of taxation consists of so plucking the goose as to obtain the largest amount of feathers with the smallest amount of hissing" (Jean Baptiste Colbert). Google and Apple know that there is too much hissing right now. So, both Apple and Google are likely to bring their commissions down sooner or later.
- Bringing the taxes down might follow a Laffer Curve logic, and end up doing good for the ecosystem. Google will not be able to extract the same value, but the size of the pie will be bigger.
- Builders are learning lessons. Apps can be booted out. Taxes can be extracted. Unfair rules can be imposed. So, new systems will have to replace old systems. As @VitalikButerin tweeted: "Google going further in the Apple mandatory-in-app-payments direction. We need more competition in app stores and ultimately mobile phone operating systems, and we need it now." We might not get it now. But all these strengthen the shift towards more decentralisation.
Why science matters
What's the news: Scientists at Indian Agricultural Research Institute (IARI), Pusa have come up with a composition of eight microbes that can speed up the decomposition of crops, and turn them to manure in about 20 days.
Why should you care
Start with Delhi: Delhi has a huge air pollution problem. According to one report, 18% of it is caused by industries, 21.5% by dust, but 41% by vehicular emissions, a reason why Delhi government tried odd-even policy once. However, during winter it gets worse. Last year, Supreme Court judges Arun Mishra and Deepak Gupta called Delhi “worse than hell”. This year, people are already worried about the approaching winter. There are several reasons why it gets worse in winter, but a good part of it can be traced to Punjab and Haryana.
Go to Punjab and Haryana: Around this time every year, after the wheat harvesting season, farmers in Punjab and Haryana burn an estimated 35 million tonnes of stubble. And the smoke impacts Delhi. As Siddharth Singh, author of The Great Smog of India explained in an interview to ET, "Just as the stubble burning season begins in October, the wind direction changes to bring pollutants from Punjab and Haryana to Delhi. Wind speeds also slow down, meaning the pollutants then can’t be easily evacuated. The Himalayas to the north are—excuse the pun—a Himalayan barrier.” Farmers burn the stubble because that's the fastest way to clear the fields. There have been several proposals to disincentivize farmers from doing that. But they haven't worked well enough.
And, finally, land in a lab in Pusa: That’s where they developed the tech. Often the solutions to several problems lie outside the domain of tech. It's in the business strategy, incentive structures, mindsets. But, a lot of problems can be solved by science and technology—to a good extent. And the innovation by IARI is one such. We still don't know how exactly it will play out. Delhi chief minister Arvind Kejriwal, who has never been averse to trying out different solutions to solve some of the toughest problems, has said he would urge Union Environment Minister Prakash Javadekar to ask neighbouring states to implement the tech.
How to think about AI
What’s the news: The inaugural the Squirrel AI Award for Artificial Intelligence for the Benefit of Humanity, a new prize recognizing outstanding research in AI, was awarded to Professor Regina Barzilay of MIT’s Computer Science and Artificial Intelligence Laboratory (CSAIL), who has developed an approach to detect breast cancer using machine learning.
Here are three interesting things from a recent interview she gave to MIT Tech Review:
- It’s still early days: “Back when technology moved from steam power to electricity, the first attempts to bring electricity to industry weren’t very successful because people just tried to replicate steam engines. I think something similar is going on now with AI.”
- We will soon be staring into a black box: “Some decisions would be really easy to explain to a human. If an AI detects cancer in an image, you can zoom in to the area that the model looks at when it makes the prediction. But if you ask a machine, as we increasingly are, to do things that a human can’t, what exactly is the machine going to show you? It’s like a dog, which can smell much better than us, explaining how it can smell something.”
- Data is a bottleneck: “But the main reason AI hasn’t been more useful is not the lack of technology but the lack of data. You know, I’m on the leadership team of MIT’s J-Clinic, a center for AI in health care, and there were lots of us in April saying: We really want to do something—where can we get the data?”
- "The Allen Institute developed a resource called CORD-19 that provides more than 130,000 scholarly articles on Covid-19 in machine-readable format. The Kaggle community, among other groups, leveraged the data set to create multiple AI systems to help researchers keep up with literature and answer high-priority research questions." (IEEE Spectrum)
- "Amazon on Tuesday is unveiling a new biometric technology called Amazon One that allows shoppers to pay at stores by placing their palm over a scanning device when they walk in the door or when they check out." (Recode) (+ A list of regulatory developments around the use of biometrics this year from AI Now Institute)
- “Downloads [of Signal, a messaging app] rose by 50% in the U.S. between March and August compared to the prior six months, according to data shared with TIME by the analysis firm App Annie, which tracks information from the Apple and Google app stores. In Hong Kong they rose by 1,000% over the same period, coinciding with Beijing’s imposition of a controversial national security law.” (Time)
- In 2018, Twitter published a blog post that explained how it used a neural network to make photo preview decisions. One of the factors that causes the system to select a part of an image is higher contrast levels. This could account for why the system appears to favour white faces. This decision to use contrast as a determining factor might not be intentionally racist, but more frequently displaying white faces than black ones is a biased result. (Mashable)
- “Everyone knows the saying that ‘time flies when you’re having fun,’” said Sam Gershman, a cognitive neuroscientist at Harvard University who was not involved in the study. “But the full story might be more nuanced: Time flies when you’re having more fun than you expected.” (Quanta)