Data Sheet—Google Might Be Looking to Regain Entry to Chinese Ad Market

In the political world long-held alliances are fraying, at least those among the United States and many countries it once called friends.

In the business world, especially in technology, fascinating alliances are forming. Witness the tie-up announced Monday by Google and JD.com, the No. 2 Chinese e-commerce player. U.S. Media predictably played the move as a bid by Google, which invested $550 million in Nasdaq-listed JD, to inch its way into a China market that has blocked it for nearly a decade. JD will join Google’s shopping platform, and Google will have done a solid for a Chinese company, presumably pleasing Beijing.

But look closer, and the deal speaks volumes to important alliances. JD’s major corporate shareholders include Tencent, which counts JD as an extension of its retail-technology strategy, and Walmart. The U.S. Retailer, in turn, has been noodling on alliances with Google for the better part of a year.

The alliances at play are worthy of a 21st century Bismarck of global commerce. Google and Walmart are allied against the arch-foe of Western businesses everywhere, Amazon. Tencent and JD are allied against China’s dominant e-commerce player, Alibaba.

Could Google, prevented from selling ads in China, view Tencent as its entrée into the Chinese search market? Tencent operated a search engine for years but sold it to Sogou, a small competitor to Chinese search leader Baidu. Does this create an opening for Google?

It’s a tangled web. And an interesting one too—especially given the state of the political world, including the tenuous conditions of U.S.-China relations.

(Update: This story was updated on June 19 to correct that JD.com trades on the Nasdaq.)

NEWSWORTHY

Argument clinic. Careful complaining about your digital assistant—it might complain back. IBM unveiled a new twist on its AI efforts on Monday dubbed Project Debater. The showcase featured a black obelisk the height of a human that argued with human debaters over whether to subsidize space exploration and whether to increase the use of telemedicine.

The fish slapping dance. In a midnight email to Tesla employees, CEO Elon Musk charged that a rogue worker had "conducted extensive and damaging sabotage to our operations,” CNBC reports. The worker, who tampered with Tesla's in-house software that runs its manufacturing operations, admitted their guilt, Musk said.

Nudge, nudge. All of Tim Cook's cozying up to President Trump has paid off in a critical way as the country tumbled into a widening trade war with China. Trump assured Cook that the United States will not levy tariffs on the iPhone, which is made in China, the New York Times reported on Monday. Unfortunately, China could still slap a levy on the Apple device, which is popular with its citizens. Meanwhile, the Senate is moving to block Trump's effort to spare Chinese phonemaker ZTE from sanctions for violating the Iran embargo. Lawmakers on Monday added a provision to the must-pass Defense Authorization Act to reimpose the sanctions.

Nobody expects the Spanish Inquisition. A long-running legal case challenging Apple's sole control over selling apps for the iPhone has made its way to the Supreme Court. The SCOTUS will decide whether a lower court properly concluded that Apple could be held liable for triple damages for overcharging for apps.

The cheese shop. New York state granted payments startup Square a license to facilitate digital currency trading for New York residents. The company's Cash app already allows users in most other states to buy and sell bitcoin, but oddly does not yet allow bitcoin payments. Square's stock price jumped 3% to $66.20, its highest close ever.

(Headline reference explainer for the non-Gen X among you.)

FOOD FOR THOUGHT

The European Union is likely adopting some highly restrictive new rules for the Internet. Get ready for a load of unintended consequences. Under part of a proposed Copyright Directive, web sites will be required to install automated censoring algorithms to remove content deemed in violation of copyrights. And sites that link to news stories will need paid permission from the creators. Author Cory Doctorow at the web site Boing Boing breaks down some of the likely disasters waiting to happen.

Article 13's copyright filters are even more vulnerable to attack: the proposals contain no penalties for false claims of copyright ownership, but they do mandate that the filters must accept copyright claims in bulk, allowing rightsholders to upload millions of works at once in order to claim their copyright and prevent anyone from posting them.

That opens the doors to all kinds of attacks. The obvious one is that trolls might sow mischief by uploading millions of works they don't hold the copyright to, in order to prevent others from quoting them: the works of Shakespeare, say, or everything ever posted to Wikipedia, or my novels, or your family photos.

More insidious is the possibility of targeted strikes during crisis: stock-market manipulators could use bots to claim copyright over news about a company, suppressing its sharing on social media; political actors could suppress key articles during referendums or elections; corrupt governments could use arms-length trolls to falsely claim ownership of footage of human rights abuses.

IN CASE YOU MISSED IT

First the ACLU Asked Amazon to Stop Selling Facial Recognition Tech to Police. Now Investors Have Doubts Too By Hallie Detrick

How Roku's Planned New Offering Could Be a Boon for Cord Cutters By Aaron Pressman

Once a Big Fan, John McAfee Won't Touch Cryptocurrency ICOs Now Because of SEC 'Threats' By Natasha Bach

Why AMD's Stock Price Is Soaring and Intel's Is Falling Hard By Aaron Pressman

The Blockchain Bubble's Latest Victim: Digital Cats By Jeff John Roberts

Why Did Google Remove Uber Booking From Maps? By Don Reisinger

Ex-Denver Post Journalists Launch New Media Venture on the Blockchain By Polina Marinova

BEFORE YOU GO

Are you a fan of the notch, the little cut out at the top of the latest smartphones, like the iPhone X, that houses the front facing camera? If not, a new Android phone from Oppo may be more to your liking. The company's new Find X model has a huge 6.4-inch OLED screen with no notch. Click on the camera app and part of the top bit of the phone slides up to reveal a previously hidden camera. Ingenious, but perhaps a bit too finicky.

This edition of Data Sheet was curated by Aaron Pressman. Find past issues, and sign up for other Coins2Day newsletters.