Posts Tagged ‘Google’

Facebook Morale Takes a Tumble Along With Stock Price

November 14, 2018

Employee surveys show weaker optimism about future, confidence in platform’s mission

Image result for facebook, pictures

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Facebook Inc.’s FB +1.20% difficult year is taking a toll on employee morale, with several key measures of internal sentiment taking a sharp turn for the worse over the past year, according to people familiar with the matter and messages reviewed by The Wall Street Journal.

Amid a plunge in the stock price, ongoing leadership turmoil and critical media coverage, just over half of employees said they were optimistic about Facebook’s future, down 32 percentage points from the year earlier, according to the survey, which was taken by nearly 29,000 employees. Fifty-three percent said Facebook was making the world better, down 19 percentage points from a year ago.

Chief Executive Mark Zuckerberg directly addressed the survey results at a question-and-answer session in early November, some of the people said, saying he and other senior officials were taking steps to address the underlying issues.

The darkening mood within the social-media giant is notable in part because its workforce has been resilient through other difficult patches in the past. That includes the period after the 2016 presidential election, when many critics were blaming Facebook for allowing fabricated news articles to pervade the platform.

But many people inside Facebook say this period feels different, in part because of the unusual turbulence at the top of the company, which has struggled to respond to its various internal and external controversies. The declining stock price has also hurt morale among employees for whom stock options are a large part of their compensation, current and former employees say.

Facebook’s current data crisis involving Cambridge Analytica has angered users and prompted government investigations. To understand what’s happening now, you have to look back at Facebook’s old policies from 2007 to 2014. WSJ’s Shelby Holliday explains. Illustration: Laura Kammerman

“It has been a difficult period, but every day we see people pulling together to learn the lessons of the past year and build a stronger company,” a Facebook spokeswoman said. “Everyone at Facebook has a stake in our future and we are heads down shipping great products and protecting the people who use them.”

The biannual “pulse” survey asks employees to assess how strongly they believe in Facebook’s overall mission and whether they believe the company has a positive effect on the world, people familiar with the surveys say. It also asks them to measure their satisfaction with their individual managers and work-life balance.

These types of polls are increasingly common as companies try to gauge employee sentiment and identify any problems before they fester.

There are some 30 questions on the Facebook survey, which is conducted in April and October every year.

Employees on average said they intended to stay another 3.9 years at Facebook, down from 4.3 years a year earlier. About 12% said they planned to stay less than a year. Former employees said these figures typically rose.

In survey responses, some employees indicated they were worried about Facebook’s sharpened focus on growth and frustrated over a “lack of innovation” within the company. Employees also questioned the company’s higher emphasis on the main Facebook platform over Instagram, WhatsApp and other growing services that Facebook owns.

In July, Facebook startled investors with dour growth projections that sent its stock price tumbling. Shares haven’t recovered and remain down more than 35% in the past four months, putting the company on track to have its first annual share-price decline since going public in 2012.

Facebook is one of the few major tech companies whose stocks have dropped significantly in the past year, while rivals like Twitter Inc. have jumped and Google parent Alphabet Inc. has remained mostly flat.

Morale has also been hit by a near-constant barrage of criticism from outsiders about its lax data-privacy practices, growth-oriented culture and role in fanning violence in volatile countries such as Myanmar, current and former employees say.

Leadership turmoil is another factor. For most of its nearly 15-year history, Facebook’s leadership was remarkably stable, but nearly a dozen high-profile or senior executives have announced their departures this year, including Facebook’s top lawyer and longtime policy chief as well as co-founders of Instagram and WhatsApp.

Facebook’s employee base was 33,606 at the end of September 2018, up 45% from the year before. Many of the new employees work in the areas of safety and security and currently are sitting on stock options that are worth less now than a year ago.

Broader employee sentiment about the company has been slowly declining for nearly two years, according to surveys. The overall favorability score, or how Facebook measures broader sentiment toward the company, stood at 70% in October, down from 73% a year ago, the survey shows. It was 74% in early 2017.

Seventy percent of employees said they were proud to work at Facebook, down from 87% a year earlier, the survey shows.

In some areas, Facebook employees’ sentiment held steady. About 81% of employees said it was important to fulfill Facebook’s mission to “give people the power to build community and bring the world closer together”—roughly flat compared with a year ago.

Some current and former employees say sentiment has started to turn around after the midterm elections last week, during which the company appeared to have avoided major catastrophes. Mr. Zuckerberg and Chief Operating Officer Sheryl Sandberg addressed employees two days after the midterms to reflect on the lessons of 2018, a person familiar with the matter said.

Some employees indicated that they were cautiously optimistic that the company was heading in the right direction after more than two bruising years.

That turnaround is not yet reflected in the survey data. A year ago, 84% of Facebook employees said they were optimistic about the company’s future. At the time, Facebook had just disclosed that Russian-backed actors had purchased ads and spread disinformation on Facebook using fake identities.

That fell to about 67% in April, shortly after the company disclosed that an academic broke Facebook’s rules and shared user records with the political analytics firm Cambridge Analytica.

It now stands at 52%.

Write to Deepa Seetharaman at Deepa.Seetharaman@wsj.com

https://www.wsj.com/articles/facebook-morale-takes-a-tumble-along-with-stock-price-1542200400

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China’s Race to Dominate AI

November 12, 2018

In an interview, Kai-Fu Lee also discusses why he thinks U.S. tech giants will never succeed in expanding in China

Image result for Kai-Fu Lee, photos

Sinovation Ventures CEO Kai-Fu Lee

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By  Yun-Hee Kim
The Wall Street Journal

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The U.S. may be winning the race in artificial intelligence for now. But it won’t last for long.

So predicts Kai-Fu Lee, chairman and chief executive of Sinovation Ventures, a Beijing-based venture-capital firm. He believes the U.S.’s current technological edge over China could disappear within five years, thanks to government support, a growing force of entrepreneurs and their speed of execution.

Mr. Lee, who previously was the head of Google Inc. in China, recently spoke with The Wall Street Journal about the AI race, entrepreneurship in China, and prospects for leading U.S. tech companies in the world’s most populous country. Edited excerpts follow.

China vs. U.S.

WSJ: How do Chinese and U.S. strategies to develop AI differ?

MR. LEE: China’s techno-utilitarian policy encourages technology to be launched first, observed, and allowed to proceed without obstruction if things go smoothly. If there are issues, it could quickly come up with regulations. An example is mobile payments. In the U.S., this might raise all kinds of lobby, security, hacking concerns from the credit-card companies and banks. But in China, Tencent TCEHY -3.33% and Alibaba BABA -3.09% were permitted to try to run payment systems as software companies, and they did a great job. Mobile payment took over in China.

In China, a highway is being built with sensors to improve autonomous driving, new cities are being developed with autonomous vehicles; some with two layers of roads—one layer for pedestrians, pets, bicycles, and another layer for cars. All of these will help with testing for autonomous-vehicle systems to be launched sooner. With AI applications, you need a lot of data to do testing. China has a lot of data, so its approach allows it to move faster.

WSJ: What do you think the U.S. needs to improve on and where does China need to invest further when it comes to AI?

MR. LEE: It’s going to be about who has more data, faster entrepreneurs, lots of AI engineers and government support. China will continue to catch up against the U.S. in terms of building products and monetizing. What could work in the U.S.’s favor is if someone disrupts the whole thing with a brand new fundamental technological change.

WSJ: Which country is ahead?

MR. LEE: In internet AI, which is algorithms making profitable recommendations for people based on their Web browsing history, China and the U.S. are about equal. China will probably get ahead because it has more user data. In business AI, where companies mine their customer data to come up with new product ideas and improve service, or use it to monitor systems to make them more efficient or lucrative, the U.S. is ahead, and will probably stay ahead because its enterprise data is properly archived and more usable for AI. In perception AI, or things like facial recognition and other biometric interfaces, China is ahead because it is building more sensors cheaply and for broader uses, and it will probably get further ahead.

In autonomous vehicles, it’s incredibly hard to tell because it depends on policy. The question is, is the road ahead to making autonomous vehicles ubiquitous mostly about technology breakthroughs? Then the U.S. is ahead. If it’s a matter of rapidly testing and evolving without policy, lobbying and unions holding it back, it would be China in the lead.

Work and the workplace

WSJ: What jobs will disappear because of AI?

MR. LEE: Customer service, but not every kind. Customer service with very high-end human touch will stay. Telemarketing and telesales will disappear. Dish washing, fruit picking, assembly-line inspection will all disappear. Paralegals and accountants—but not 100%. Some lawyers who do form filling, those would be replaced.

Creativity-oriented jobs are safe. Working in a construction environment is safe. Cleaning is hard to do for a robot and every house is different, so that’s safe.

WSJ: China is known for its intense startup work culture. It’s often referred to as 996—work 9 a.m. to 9 p.m., six days a week. Is this a critical factor to the success of Chinese startups? Can this work culture foster true innovation?

MR. LEE: The most important things are focus, tenacity, operational excellence, speed of execution and hard work. They all come together. If you are just hard working but working dumb, that’s not good. Then you get burned out. I’m personally concerned about my entrepreneurs but I don’t have much hope of changing them. This culture cannot be changed in the next two to three decades as China still emerges from its current state.

WSJ: Do you think Chinese tech companies will be more successful because entrepreneurs there do the grunt work?

MR. LEE: The Chinese companies are not nearly as breakthrough-innovative as the many Silicon Valley greats. Whether it’s Elon Musk or Steve Jobs. The whole Chinese education system doesn’t really easily train these types of brilliant thinkers. But on the other hand, I think if Silicon Valley or the U.S. continues to view China as copycats, then it will miss many opportunities. The stereotype of looking at Chinese companies as lower-quality copycats will cause American entrepreneurs to have blinders on and miss stuff they should learn.

Chinese innovation

WSJ: Is there real innovation coming out of China now?

MR. LEE: Absolutely. WeChat [a payment and messaging platform from Tencent] is an example. If you look at ByteDance [the company that operates the news-aggregation app Toutiao], while traditional media may not like the content that’s being put through, it’s a very innovative way for displaying content. Think about minivideos—Vine [a video app that was owned by Twitter] never worked out, but Chinese companies are doing great with minivideos. Bike-sharing apps like Mobike, these are innovative, creative business solutions that add value, but they weren’t created the Silicon Valley way.

WSJ: Trade tensions between China and the U.S. are making it more difficult for foreign companies in China and Chinese companies looking to expand in the U.S. What are the prospects for U.S. tech companies in China?

MR. LEE: It’s almost irrelevant. The U.S. and China are almost parallel universes. American companies will not succeed in China, with or without significant regulation. Same for Chinese companies in the U.S. We’re almost at a point, at least in consumer internet and AI companies, where U.S. companies don’t fit the ecosystem. Let’s say ByteDance wants to come to the U. S.—how are they going to get people to trust this brand? How will it answer questions about the newsfeed?

WSJ: So you don’t think the Chinese government is making it more difficult for foreign companies to operate there? Or is it more an issue that U.S. companies built products that don’t work for consumers in China?

MR. LEE: I actually think Google and Facebook FB -2.27% will get some element of their products in China. But I don’t think they will be successful, just because of the parallel-universe reason. Clearly, they are talking [about expanding into China] and Waymo [the autonomous-driving unit of Alphabet Inc. GOOGL -2.48% ] got approval in Shanghai. Where American companies are likely to have a chance would be to work in a simple, nontangled part of this parallel universe such as doing something brand new.

Ms. Kim is a technology editor for The Wall Street Journal in New York. She can be reached at yun-hee.kim@wsj.com.

https://www.wsj.com/articles/chinas-race-to-dominate-ai-1542037623

Desperate for Tech Talent, Israel Turns to an Untapped Labor Pool: Palestinians

November 10, 2018
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TEL AVIV—An intense labor shortage is pushing Israeli tech firms to hire Palestinians in the West Bank, establishing new economic links between the two sides despite persistent political tension and the continuing absence of a peace agreement.

Israel’s innovative technology sector—which inspired the nickname “Startup Nation”—faces a shortage of 10,000 software programmers and engineers, the government says, posing one of the biggest threats to economic growth outside of war with its neighbors.

The reasons include competition from American companies such as Alphabet Inc.’s Google, Amazon.com Inc. and Microsoft Inc. that are willing to pay high salaries for Israeli talent. Israel’s immigration laws also make it difficult to import skilled non-Jewish workers.

About 1,000 Palestinian engineers currently work for Israeli and international companies, an increase of roughly 10% from last year, said Murad Tahboub of West Bank-based Asal Technologies, which matches Palestinian workers with employers.

Oday Dahadha, a 25-year-old computer engineer with Asal, said he had never met an Israeli before he began working as a contractor for Mellanox , an Israeli technology and hardware company, in 2014.

“It’s like working with any other international company,” said Mr. Dahadha, who said he learned the coding language Python on the job over the years and hopes one day to start his own firm.

Mr. Dahadha is based in the West Bank and said he travels to Tel Aviv about 10 times a year for meetings at Mellanox, spending hours passing through security checkpoints. “I feel bad about that,” he said.

Oday Dahadha, Asal engineer
Oday Dahadha, Asal engineer PHOTO: KOBI WOLF FOR THE WALL STREET JOURNAL
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Palestinians were once a rarity in Israel’s high-powered tech sector. Many Palestinians oppose working for Israeli companies without a peace agreement, fearing such links enshrine the status quo of Israeli control of the West Bank and Gaza.

“We hoped these [Israeli] companies could do business with us on equal footing, but now we don’t do any business with them,” said Munib al-Masri, a prominent Palestinian businessman who at one time discussed with Israeli business leaders through the World Economic Forum ways to support the Obama administration’s peace efforts. He said he has stopped working with Israeli companies until there is a peace agreement.

Some Israelis, meanwhile, worry that violence or political upheaval could interrupt business with Palestinian workers.

But the depth of Israel’s talent shortage and the high wages Israeli companies can offer are breaking down political barriers.

Murad Tahboub CEO of Asal Technologies
Murad Tahboub CEO of Asal TechnologiesPHOTO: KOBI WOLF FOR THE WALL STREET JOURNAL
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“The more the Israeli market has a demand, the more they flip every stone to look for talent,” said Mr. Tahboub.

Israel depends on the tech sector for almost half its exports. If the labor shortage persists, economic growth will stall, said Ami Appelbaum, chief scientist at Israel’s Innovation Authority, a government agency that supports the tech industry, among others.

“What’s at stake here is Israel’s economy,” Mr. Appelbaum said.

Israel’s needs are converging with Palestinian efforts to broaden the economy in the West Bank, where the unemployment rate is over 18%, and lay the financial foundations for a state.

Palestinian universities produce between 2,500 to 3,000 information-technology graduates annually, and many want the experience and higher salaries that Israeli companies offer, according to the Palestinian Information Technology Association of Companies, an umbrella group representing Palestinian ICT companies.

“With the older generation it was more of an issue with politics, but young Palestinians are much more willing to work,” said Eliran Sharon, whose Israeli outsourcing company One Execution Hub, based in Herzliya, began working with engineers in the West Bank a year ago.

The Qalandia checkpoint from the West Bank into Israel. Palestinians who work for tech companies in Israel often spend hours going through security checkpoints on their way to visiting the firms.
The Qalandia checkpoint from the West Bank into Israel. Palestinians who work for tech companies in Israel often spend hours going through security checkpoints on their way to visiting the firms. PHOTO: MATTHEW HATCHER/LIGHTROCKET/GETTY IMAGES
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The Trump administration team has consulted with Israelis and Palestinians in the tech sector as it crafts a peace plan, which it is set to unveil in the coming months. So far, Palestinian political leaders have boycotted contacts with the Trump administration since it said in December it would move the U.S. Embassy to Jerusalem and recognize the city as Israel’s capital.

Israel tech executives say there still could be much more use of the nearby Palestinian workforce. Israel tech companies currently outsource an estimated 20,000 jobs to Eastern Europe and India, while employing around 62,000 workers in Israel, according to research published by the Israel-based firm Ethosia-Human Resources in May.

But the number of Palestinian workers employed by Israeli companies is growing, as Israeli companies learn the advantages of outsourcing closer to home, including developers who work at a fraction of the price of Israelis.

Palestinian tech workers at Asal Technologies offices in the West Bank.
Palestinian tech workers at Asal Technologies offices in the West Bank. PHOTO: KOBI WOLF FOR THE WALL STREET JOURNAL
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The average Israeli engineer in the tech sector makes around $130,000 annually while their Palestinian peers make on average $42,000, according to Israeli business newspaper TheMarker.

Mellanox, the company with which Mr. Dahadha works, employs 145 Palestinians—more than any other company in Israel—who represent about 4% of its workforce. The company has plans to add more.

There are unexpected advantages. During the Jewish holidays this past September, when most employees in Israel were off, a problem arose that affected one of Mellanox’s largest customers, Microsoft.

“The Palestinian guys understood the problem, fixed the problem,” said Eyal Waldman, the company’s chief executive, who added that he hires Palestinians because it makes economic sense: “We’re not a philanthropy.”

Write to Felicia Schwartz at Felicia.Schwartz@wsj.com

https://www.wsj.com/articles/desperate-for-tech-talent-israel-turns-to-an-untapped-labor-pool-palestinians-1541854800

See also:

Women Driving Palestine’s IT Sector Growth

https://www.asaltech.com/women-driving-palestines-it-sector-growth1/

Peter Navarro Blasts China and Wall Street ‘Globalists’

November 10, 2018

Image result for china, us, flags

U.S. and Chinese presidents are set to meet at the end of the month

Peter Navarro, seen here at the White House in June, is President Trump’s trade adviser.
Peter Navarro, seen here at the White House in June, is President Trump’s trade adviser. PHOTO: JIM WATSON/AGENCE FRANCE-PRESSE/GETTY IMAGES
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WASHINGTON—President Trump’s senior trade adviser, Peter Navarro, excoriated China and attacked Goldman Sachs and Wall Street as Beijing’s “unpaid foreign agents” who are weakening the U.S. leader before his meeting this month with China’s president.

Less than a mile away from where Mr. Navarro spoke, Secretary of State Mike Pompeo and Defense Secretary Jim Mattis met with their Chinese counterparts to try to mend fences with Beijing, while discussing North Korea, Iran, the South China Sea and trade.

Decoding Xi Jinping's Strategy on Trade

At a mega-trade show in China, global businesses and political leaders were looking for hints of Xi Jinping’s strategy ahead of planned trade talks with President Trump. Photo: Reuters

They emerged with a consensus on some issues and differences on others.

The mixed messages reflect bitter tensions in the Trump administration about how to approach China.

Mr. Navarro and U.S. Trade Representative Robert Lighthizer are deeply skeptical that China will make the kinds of the changes sought by the Trump administration and urge additional tariffs.

Other officials, including Treasury Secretary Steven Mnuchin and National Economic Council Director Larry Kudlow, have been trying to line up a deal. Mr. Trump sometimes favors one group and sometimes the other.

As a summit with Chinese President Xi Jinping looms at the Group of 20 meeting in Buenos Aires, the economic council is coordinating what kind of trade deal the U.S. might accept from China. It is focusing on intellectual property, agricultural tariffs, forced technology transfer and requirements that U.S. firms form joint ventures to operate in China.

. It is focusing on intellectual property, agricultural tariffs, forced technology transfer and overturning requirements that U.S. firms form joint ventures to operate in China.

Mr. Navarro is pushing for a hard line on the talks, but made his position in an unusually personal terms.

“If Wall Street is involved and continues to insinuate itself in these negotiations, there will be a stench around any deal that’s consummated because it will have the imprimatur of Goldman Sachs and Wall Street,” Mr. Navarro said in a talk at the Center for Strategic and International Studies, a Washington think tank. He didn’t provide any evidence to back up his claims. A Goldman Sachs Group Inc. spokesman declined to comment.

Mr. Navarro also trained his rhetoric on Mr. Xi, who he said had failed to live up to deals with the Obama administration on demilitarizing the South China Sea and ending cyber hacking of U.S. firms. He referred to a “high-ranking member of the Chinese government,” in his address, but his description only fit Mr. Xi.

A senior White House official said Mr. Navarro didn’t speak for the administration or Mr. Trump. “It’s the president who rejuvenated the China negotiations” when he called Mr. Xi on Nov. 1, he said. Mr. Navarro “is freelancing; he’s speaking for himself.”

The security dialogue, initiated last year by Messrs. Trump and Xi, aims to boost cooperation between the two powers. Mr. Trump frequently refers to Mr. Xi as a friend and others in the administration rarely criticize him personally, as a way to create political space for potential deals.

“This was an incredibly productive conversation,” Mr. Pompeo said after the meeting in Washington with senior Communist Party official Yang Jiechi and Defense Minister General Wei Fenghe. “The United States is not pursuing a Cold War or containment policy with China, rather we want to make sure ensure that China acts responsibly and fairly.”

The two sides said they reinforced their commitment to complete denuclearization of the Korean Peninsula and discussed Iran’s nuclear activities.

The two sides said they reinforced their commitment to complete denuclearization of the Korean Peninsula and discussed Iran’s nuclear activities. But Mr. Pompeo said there remained “significant differences” over the militarization South China Sea islands, China’s policy toward Taiwan and human rights.

Mr. Pompeo didn’t address trade issues but senior Communist Party official Yang Jiechi suggested they discussed the subject, noting that a trade war isn’t good for either side. On trade, the fight appears to be as much within the U.S. administration as with China.

Mr. Navarro, in his talk, took a subtle jab at his main adversary, Mr. Mnuchin, who has tried to sideline Mr. Navarro and arrange talks with Beijing. Mr. Navarro said, “You’re not in good hands when negotiations get outside” of Messrs. Trump and Lighthizer.

Mr. Navarro lashed out at what he called “a self-appointed group of Wall Street bankers and hedge-fund managers” who he described as “globalist billionaires.”

“The mission of these unregistered foreign agents—that’s what they are; they are unregistered foreign agents—is to pressure this president into some kind of deal,” Mr. Navarro said.

While administration trade hawks frequently rail privately against U.S. executives who acts as back channels between the two nations, it rare for one to do so publicly. For one thing some of the executives, including Blackstone Group LP CEO Stephen Schwarzman, are friends of the president and speak to him frequently.

Others including former Goldman Sachs Chief Executive Hank Paulson, who was President Bush’s Treasury secretary, consults with Mr. Mnuchin. Mr. Schwarzman declined to comment. A spokesman for Mr. Paulson didn’t respond to a request for comment.

The U.S. complains that Beijing hasn’t given it a formal proposal, while China says that it needs to meet again, before the summit, before it can offer something concrete.

While the administration is refining what it wants from China—essentially trying to create a negotiating bottom line—it is also lining up additional tariffs should negotiations stall. So far, the U.S. has imposed tariffs on $250 billion in Chinese goods, about half what China sends to the U.S. Of that, the levies on $200 billion of goods are scheduled to increase to 25% on Jan. 1 from the current 10%.

The administration is also putting the finishing touches on prospective tariffs on most of the rest of Chinese imports, said the senior White House official. Administration and business officials expect that any additional tariffs would exempt mobile phones and perhaps laptops, to reduce the chance of a reaction by consumers hit with a big price increase.

Write to Bob Davis at bob.davis@wsj.com and Gordon Lubold at Gordon.Lubold@wsj.com

Appeared in the November 10, 2018, print edition as ‘White House Tensions Grow Over China.’

https://www.wsj.com/articles/peter-navarro-blasts-china-and-wall-street-globalists-1541787254

Related:

White House adviser Navarro warns Wall Street ‘globalist elites’ over China

November 10, 2018

White House trade adviser Peter Navarro took a shot at Wall Street Friday, warning “globalist elites” against meddling with the Trump administration’s policy on China.

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Bankers are putting a “full court press” on the White House to make a deal that would end the escalating trade war between the two nations, Navarro said during a speech at the Center for Strategic and International Studies in Washington, DC.
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“If and when there is a deal, it will be on President Donald J. Trump’s terms — not Wall Street terms,” he said.
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“If Wall Street is involved and continues to insinuate itself into these negotiations, there will be a stench around any deal that’s consummated because it will have the imprimatur of Goldman Sachs and Wall Street,” Navarro added.
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Andrew Harrer | Bloomberg | Getty Images
Peter Navarro, director of the National Trade Council.
Navarro, a former economics professor, accused billionaires and hedge fund managers of engaging in “shuttle diplomacy” between the United States and China, which he says weakens the President and his negotiating position. It wasn’t immediately clear what he was referring to.
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His remarks come ahead of Trump’s expected meeting with Chinese President Xi Jinping at the G20 summit later this month in Argentina. The administration has sent mixed messages about whether the two are nearing a truce that would lift more than $250 billion in retaliatory tariffs on an array of goods ranging from chemical products and motors to luggage and hats.
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The comments reflect the ongoing divisions inside the Trump administration between free traders — including those with Wall Street backgrounds like Treasury Secretary Steven Mnuchin and economic adviser Larry Kudlow — and the so-called nationalists, who hew to the “America First” stance laid out during the campaign and early months of Trump’s presidency by former chief strategist Steve Bannon.
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“Wall Street is a very easy boogeyman to attack in situations like these,” said Rufus Yerxa, a former US trade official who now leads the National Foreign Trade Council, in an interview with CNN. “But look, the concern about making sure that the US gets the right results in China without provoking a trade war comes from Main Street, and from the American companies that make things, produce jobs and export stuff.”
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Yerxa said his members, which include companies like Google, Walmart, Visa, General Electric and Caterpillar, have been offering input to the Trump administration wherever possible, but notes there’s still “a bit of confusion” over which direction the White House may be going given ongoing internal discussions.
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“We don’t have any clear sense of where they are,” said Yerxa, referring to any developing proposals. “A lot of the business community isn’t being brought into details of that.”
Trump earlier this week promised a positive meeting with Xi.
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“We’ll have a good meeting and we’re going to see what we can do,” the President said at his Wednesday news conference following the midterm elections.
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But fault lines between the US and China were on clear display Friday during a meeting between senior military officials, who challenged each other over the South China Sea, Taiwan, religious freedom and trade.
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Trump has made it a priority to take an aggressive stance against China for what he says are unfair trade practices, including intellectual property theft and forced technology transfers. He’s threatened to escalate the trade war further by taxing the remaining Chinese goods sold to the United States.
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Many American manufacturers, farmers and lawmakers from both sides of the aisle say they appreciate the administration’s efforts to change China’s trade policies. But some argue the tariffs aren’t the best way to address the issues. They pose a dilemma to US importers who must decide whether to absorb the higher cost of the goods or pass it on to consumers, and some exporters are hurting from China’s retaliatory tariffs.
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Former White House economic adviser Gary Cohn left the administration in the wake of a fierce disagreement over tariffs on steel and aluminum. Earlier this week, Cohn, a former Goldman Sachs executive, told the BBC that the tariffs could hurt the US economy.
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“I look at tariffs as a bit of a consumption tax [and] we do not want to tax our consumers when they’re going to spend their disposable income on what we produce, which is services,” he said.
In his remarks Friday, Navarro also blamed Wall Street for the decline in manufacturing and the opioid crisis.
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“If they want to do good, then spend their billions in Dayton, Ohio, in the factory towns of America where we need a rebirth of our manufacturing base and end to the opioid crisis — which they helped create by off-shoring our production,” he said.
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Source: CNN
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Updated 4:23 PM ET, Fri November 9, 2018

See also: (Includes video)

Navarro Warns Wall Street to Stay Out of China Trade Talks

https://www.bloomberg.com/news/articles/2018-11-09/navarro-warns-wall-street-not-to-interfere-in-china-trade-talks

Facebook Portal Non-Review: Why I Didn’t Put Facebook’s Camera in My Home

November 8, 2018

Facebook’s new video-calling device works great… if you can bring yourself to use it

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I’ve had one of Facebook ’s FB -2.92% new video-calling gadgets, the Portal+, in my home for the last week. And by “in my home,” I mean, in the basement, in a closet, in a box, in a bag that’s in another bag that’s covered with old coats.

I just couldn’t bring myself to set up Facebook’s camera-embedded screen in the privacy of my family’s home. Can you blame me when you look at the last 16 months?

The personal data of millions of users was accessed for political purposes without consent. Whoops. False news articles were deliberately spread across our feeds to hoax us. Whoops again. Hackers gained access to nearly 50 million accounts, the largest-ever security breach at the social network. Giant whoopsies.

Ironically, Facebook thinks its first branded hardware products might help with its current challenges. Equipped with wide-angle follow-you-around cameras, microphones and screens, the $200 Portal and $350 Portal+ are all about saying good night to Pop-Pop and Grammy at bedtime, or calling Uncle George for the secret pasta-sauce recipe when you’re cooking in the kitchen. Facebook’s Portals can call other Portals, or anyone with the Facebook Messenger app.

The Facebook Portal and Portal+ come with camera covers for those times when you want to be extra sure no one is watching.
The Facebook Portal and Portal+ come with camera covers for those times when you want to be extra sure no one is watching. PHOTO: DAVID POTVIN FOR THE WALL STREET JOURNAL
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“People continue to use Facebook because they want to stay close to friends and family,” Facebook’s vice president of consumer hardware, Andrew Bosworth, told me. “This device is entirely focused on those deep and meaningful connections that, going back 10 years, were the core of Facebook.”

Except it is so not 10 years ago. Just over half of Facebook users age 18 or older say they have adjusted their privacy settings in the past 12 months, according to a Pew Research Center survey. Plus, people in the U.S. are spending less time on Facebook, according to Pivotal Research Group’s analysis of Nielsen data.

“We have to earn that trust back,” Mr. Bosworth says. “This device is up to the challenge and could be a part of that shift.” The problem? No matter how good this gadget is—and it is good—trust has to be earned. All of Facebook’s promises now need to be more carefully evaluated. Here’s my trust evaluation of the Portal.

Facebook’s Promise: Portal feels like being together in the same room.

My Assessment: True. The Portal+, with its 15.6-inch giant rotatable screen, is one of the most immersive video-chatting experiences I’ve ever had. (I never did set it up in my home, but I tested it at work.)

The devices provide a really great experience, especially when a couple of people are together on it. With a 12-megapixel camera, wide-angle lens and person-detection software, the system recognizes where different people are. (If you both have Portals, you can tap faces on the screen to zoom in.) The camera also pans and zooms, virtually, following the people as they move in the room. It sounds creepy, but it really did make me, in New York City, feel like I was in the room with Mr. Bosworth and Rafa Camargo, Portal team vice president, who were at Facebook headquarters in Menlo Park, Calif.

In addition to video calling, the Portal supports music-streaming services and selected news and entertainment apps.
In addition to video calling, the Portal supports music-streaming services and selected news and entertainment apps. PHOTO: DAVID POTVIN FOR THE WALL STREET JOURNAL

Facebook has loaded the device up with fun features, too. The face masks are entertaining—at least for a few moments. The interactive children’s books are neat—if I were willing to put my son’s face in front of this thing. And Spotify’s group listening allows you to fire up your favorite song—so everyone can do the macarena. There’s even Alexa—yes, that Alexa—ready to tell you the weather and turn off the lights.

Facebook’s Promise: Facebook doesn’t listen to, view or keep the contents of your Portal video calls.

My Assessment: True. But don’t fool yourself if you think Facebook isn’t collecting some data about you from this device.

A button on the top of the device physically disables the microphone and camera.
A button on the top of the device physically disables the microphone and camera. PHOTO: DAVID POTVIN FOR THE WALL STREET JOURNAL
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When I asked about the popular Facebook mic conspiracy, Mr. Bosworth assured me that “it is not true, it will continue to not be true.” On the Portals, specifically, he made a number of privacy and security assurances:

  • You can disable the camera and microphone by pressing the button on top of the device. This physically disconnects them so even if the Portal were hacked, they wouldn’t be accessible.
  • As an added measure, you can block the camera lens with an included plastic camera cover.
  • All the smart-camera technology—the person detection, etc.—happens locally on Portal, not on Facebook servers. Portal’s camera doesn’t use facial recognition to identify people on the call.
  • Like all Messenger calls and messages, all communications are encrypted.
  • Like Amazon Echo or Google Home, Portal only sends voice commands to Facebook servers after you say, “Hey Portal.” You can delete Portal’s voice history in your Facebook Activity Log.

However, because this is using Facebook Messenger, the data that is typically collected from a call is still collected. That includes your call history, how long you spent talking to certain contacts, etc. Also, the sheer use of the device indicates to Facebook you’re interested in video calling, so you may be targeted for that. Speaking of ads, Facebook said there are no ads on the Portal’s screen, and the company doesn’t have plans to show ads there.

The $200 Portal, the smaller of the two devices, has a 10.1-inch display.
The $200 Portal, the smaller of the two devices, has a 10.1-inch display. PHOTO: DAVID POTVIN FOR THE WALL STREET JOURNAL
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Facebook’s Promise: The Portal was designed so you’re always in control of your privacy and security.

My Assessment: It’s hard to believe we really have any control of our Facebook data and privacy given the last year. I might be a little more comfortable if Facebook could just roll out the privacy controls it already promised us, but that’s not the only thing keeping me away from the social network.

Even Facebook Chief Executive Mark Zuckerberg believes the company is at least a year away from fighting abuse and misinformation “at the level we want.” Plus, there have just been too many instances of inattention and sloppiness. Remember in June when a bug changed default privacy settings for 14 million users? Whoops again. With Apple , Amazon and even Google, things feel different.

Despite Mr. Bosworth’s earnest assurances, I still couldn’t bring myself to set up the Portal in my kitchen and call my mother-in-law with my son in my lap. Luckily for all of us, Facebook didn’t invent video calling.

Write to Joanna Stern at joanna.stern@wsj.com

https://www.wsj.com/articles/facebook-portal-non-review-why-i-didnt-put-facebooks-camera-in-my-home-1541685600

U.S. Stocks Gain After Midterms

November 7, 2018

Election results remove one source of angst, as a split Congress will make radical policy changes less likely, analysts say

Image result for wall street, photos

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U.S. stocks extended a recent rebound Wednesday as investors weighed a congressional power divide and looked ahead to signals about interest-rate and trade policies.

The S&P 500 rose 0.8%, while the Dow Jones Industrial Average added 134 points, or 0.5%, to 25769. Both indexes were on track for their sixth advance in the past seven sessions. The Dow is about 4% below its recent record, while the S&P 500 is 5% off its September peak.

The tech-heavy Nasdaq Composite climbed 1.2% Wednesday.

Anxiety about the health of the global economy and rising rates pulled major indexes off recent all-time highs last month with investors eyeing several sources of uncertainty heading into the end of the year.

But analysts said Tuesday’s anticipated midterm election results, with Democrats claiming a majority in the House of Representatives and Republicans retaining control of the Senate, removed one source of angst.

Even though worries about tighter financial conditions and trade policy continue to hang over markets, some investors said a split Congress will make radical economic policy changes less likely.

“Markets typically do well when you have a split Congress,” said Todd Jablonski, chief investment officer at Principal Portfolio Strategies. “Investors feel comfortable with that; it gives a sense of stability and a sense that change won’t happen too quickly.”

Few investors expect Tuesday’s results to mean a reversal in recent tax cuts and pushes for deregulation that have helped propel stocks higher. Now, many are now turning their attention to the Federal Reserve’s two-day meeting that begins Wednesday.

The central bank is expected to hold rates steady before raising them again next month, but some analysts think adjustments to the central bank’s projected path for next year could jolt markets again. Higher rates tend to make stocks less attractive and push up borrowing costs for large companies and consumers.

“There’s this delicate balance of not hiking too fast,” said Peter Lazaroff, co-chief Investment Officer at Plancorp. “It will be really interesting to hear what they say.”

About 65% of investors expect at least three more interest-rate increases by the end of 2019, CME Group data show.

On Wednesday, the yield on the benchmark 10-year U.S. Treasury note edged down to 3.187%, according to Tradeweb, from 3.214%. Bond yields fall as prices rise. The WSJ Dollar Index, which tracks the dollar against a basket of 16 other currencies, declined 0.3%.

How a Divided Congress Could Defy Gridlock

How a Divided Congress Could Defy Gridlock

Here are three key issues that could provide common ground​ for Democrats and President Trump​, despite a split Congress. Photo: Getty Images.

A voter waiting to get a ballot at a polling station in Hillsboro, Va., on Tuesday. PHOTO: ANDREW CABALLERO-REYNOLDS/AGENCE FRANCE-PRESSE/GETTY IMAGES

Analysts are also closely monitoring trade signals ahead of a scheduled meeting between President Trump and President Xi Jinping of China at the Group of 20 leaders summit in Buenos Aires later this month.

Cautious comments from corporate executives this third-quarter earnings season about tariffs and rising input costs have largely overshadowed another period of strong profit growth, analysts said. Some continue to cite signs that sales increases might be peaking, potentially removing a factor that has powered stocks higher in recent years.

“Whilst one element of uncertainty has eased as a result of this election, other areas of uncertainty remain high and may well increase over the coming months,” said Richard Turnill, BlackRock’s global chief investment strategist. “Our view is that U.S.-China trade tensions are the single greatest geopolitical risk that could threaten the sustained economic expansion.”

Health-care stocks were among the market’s leaders, with CVS Health helping lift the group for the second straight session following upbeat Tuesday earnings. The S&P 500 health care sector rose 1.8%.

Investors were also keeping a close eye on oil prices Wednesday, with U.S. crude on the brink of entering a bear market barely a month after hitting its highest level in nearly four years. The slump has come after the Trump administration granted more waivers for sanctions against Iran than some had expected, leading to projections for oversupply. Oil stabilized in early trading, adding 0.8% and lifting energy shares.

Large technology companies also rose, with Amazon.com, Netflix, Google-parent Alphabet and Microsoft all up at least 2%. The market’s best performers have been among the hardest hit by recent volatility amid signs that outsize revenue gains might not be sustainable.

Chip giant Qualcomm is slated to post earnings after the market closes, another key event for the technology sector and investors monitoring the rate of sales growth.

“It’s the trend that needs to be the focus for investors to try to identify where things are going as the impact of the tax cuts wanes from an earnings perspective next year,” Mr. Lazaroff said.

Elsewhere, the Stoxx Europe 600 rose 1%, with oil-and-gas stocks among the best performers.

Stocks in Asia were mixed. Hong Kong stocks closed up 0.1% after earlier rising more than 1%. Japan’s Nikkei Stock Average fell 0.3%.

—Steven Russolillo and Saumya Vaishampayan contributed to this article.

Write to Riva Gold at riva.gold@wsj.com and Amrith Ramkumar at amrith.ramkumar@wsj.com

https://www.wsj.com/articles/as-midterm-election-results-come-in-u-s-futures-asian-stocks-rise-1541559473

Companies who support dictatorships while bashing America should lose all federal funding

November 5, 2018

Google stopped Pentagon work after its engineers balked, but doesn’t blink when helping Communist China (a country that has killed tens of millions of its own citizens) censor or track dissidents.

McKinsey & Company, meanwhile, ceased its work with the U.S. Immigration and Customs Enforcement in anger over ICE’s role in countering illegal immigration, explaining that it “will not, under any circumstances, engage in any work, anywhere in the world, that advances or assists policies that are at odds with our values.” Perhaps McKinsey might then explain which values attracted it to work in Saudi Arabia or to assist Recep Tayyip Erdogan’s dictatorial regime in Turkey.

The imprisonment of more journalists than any other country on earth? Ethnic cleansing of Kurds in Afrin? Support for Islamist terrorist groups? The mercurial Erdogan ultimately turned on McKinsey in a fit of pique at Washington, but the consulting firm still walked away with the Turkish cash.

Opinion
By Michael Rubin
Washington Examiner

U.S. administrations come and go. While domestic and foreign policy remains broadly consistent across administrations, both pundits and press amplify differences and demonize opponents. Too often, the political base believes the rhetoric. Progressives believed George W. Bush or Mitt Romney were extremists or devils incarnate. Journalists labeled mainstream Republicans as “ultra-conservatives,” if not racists. To be fair, the same phenomenon manifested itself on the political right with regard to anti-Obama conspiracy theories.

Beyond political mudslinging, however, there is a crisis of confidence within America about what it means to be American. Revisionist historians seek to transform the United States from a beacon of freedom and democracy to a country responsible for all the world’s ills. Keith Ellison, the vice chairman of the Democratic National Committee, for example, last year told progressive activists that North Korean communist leader Kim Jong Un was a more responsible leader than President Trump.

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Keith Ellison

Alas, young engineers and consultants living sheltered, insulated lives secure in prominent U.S. companies may believe such rhetoric. Not all have traveled outside Western liberal democracies and, when they do, it is usually in luxury. While it is easy to throw around terms like fascism, few have a visceral understanding of just what that means. When financially secure and free to opine, socialism may seem cool, never mind that it is an ideology which has contributed to the murder of almost 100 million people in the last century. Intersectionality is epistemological nonsense; in reality, it is just an excuse to embrace without consequence or thought the most illiberal ideas and causes.

Despite what partisan web outlets suggest, for example, there is no moral equivalence between the United States and Iran. Anyone never threatened by Iran’s purges, death squads, and mass repression may not realize that the progressive rhetoric and human rights rhetoric employed by Supreme Leader Ali Khamenei or Foreign Minister Mohammad Javad Zarif are simply cynical efforts to shape perceptions that contradict reality.

Image result for Mohammad Javad Zarif, photos

Mohammad Javad Zarif

But what should policymakers do when moral and cultural equivalence has run amok and the employees of tech firms and consultancies would rather, whether because of naivete or ignorance, aid autocratic and murderous regimes than accept contracts from the U.S. government? What is the proper recourse?

Here, perhaps the 1996 Solomon Amendment can provide some direction: During the Vietnam War, many universities kicked ROTC chapters off campus and prohibited U.S. military and intelligence community recruitment on campus. Decades after the Vietnam War ended, such bans continued. Universities might rhetorically embrace a competition of ideas but, too often the progressivism at top universities like Yale, Harvard, and Stanford is an intolerant strain meant more to shield dominant campus narratives from challenge. The 1996 Solomon Amendment sought to compel an end to discrimination against the ROTC by enabling the Defense Department to deny grants to universities which engaged in such anti-military discrimination. This woke up even the most partisan university administrator, as they recognized what could happen if their universities lost tens of millions of grant dollars upon which so many departments had become dependent.

The parallels aren’t identical, but if American tech firms and consultancies would rather bolster dictatorships like China, Turkey, and Saudi Arabia while they simultaneously impose a political litmus test upon their U.S. work, then perhaps it is time for Congress and the federal government to create a new Solomon Amendment for the 21st century: To discriminate against the United States should mean an end to federal contracts and other government or taxpayer-funded revenue streams. Simply put, U.S. funds should never enable anti-Americanism at home or abroad, nor should there be no accountability when U.S. companies play politics with national security.

Michael Rubin (@Mrubin1971) is a contributor to the Washington Examiner’s Beltway Confidential blog. He is a resident scholar at the American Enterprise Institute and a former Pentagon official.

Dozens of US spies killed after Iran and China uncovered CIA messaging service using Google

November 4, 2018

Dozens of American spies were killed in Iran and China during the Obama administration after a flawed communications service that allowed foreign foes to see what the agents were up to using Google, official sources have claimed.

Between 2009 and 2013 the US Central Intelligence Agency suffered a “catastrophic” secret communications failure in a website used by officers and their field agents around the world to speak to each other, according to a report in Yahoo News, which heard from 11 former intelligence and government officials about the previously unreported disaster.

“We’re still dealing with the fallout,” said one former national security official. “Dozens of people around the world were killed because of this.”

By Margi Murphy
The Telegraph
November 3, 2018

Image result for china, iran, pictures

The internet-based communications platform was first used in the Middle East to communicate with soldiers in war zones and had not been intended for widespread use but due to its ease of use and efficacy, it was adopted by agents despite its lack of sophistication, the sources claimed.

Cracks only began to show when Iran, angered that the government under Barack Obama had discovered a secret Iranian nuclear weapon factory, went out with a fine tooth comb to find moles.

It discovered the existence of one of the websites used by US agents using Google. US officials believe that Iranian spies were able to use Google as a search tool to find secret CIA websites, unbeknown to those using them.

By 2011, Iran had infiltrated the CIA spy network and in May it announced that they had broken up a 30-strong ring of American spies.

Some informants were executed and others imprisoned as a result, the sources claimed.

This was corroborated by a report on ABC news at the time, which referred to a compromised communications system after a tip off from the CIA.

Meanwhile in China 30 agents working for the US were executed by the government after compromising the spy network using a similar means. Beijing had managed to break into a second temporary communications system, splintered from the initial platform and were able to see every single agent the CIA had placed in the country, the sources told Yahoo.

The sources said that it the general consensus was that that Iran and China had traded technical information with each other to form a two-pronged attack.

A CIA agent in Russia who was warned about the attacks were able to change communication channels before anyone was uncovered.

The government had already been warned about the hackability of the system by a defence contractor named John Reidy, whose job it was to hire human sources for the CIA in Iran. He alerted authorities in 2008. His official statement claimed that 70 percent of operations at the time may have been compromised already and that any agents using versions of the system were in danger. “The design and maintenance of the system is flawed,” he said.

Mr Reidy was later fired for “conflicts of interests”. According to Yahoo’s report, there is anger among the intelligence community that there has been no accountability for the failure, despite being discussed in a secret hearing at the House and Senate Intelligence committee. One former official claiming that “our biggest insider threat is our own institution”.

https://www.telegraph.co.uk/technology/2018/11/03/dozens-us-spies-killed-iran-china-uncovered-cia-messaging-service/

Vietnam could give tech companies one year to obey cyberlaw

November 3, 2018

Vietnam may give internet companies like Google and Facebook one year to comply with a controversial cybersecurity law, according to a draft decree that outlines how the draconian bill could be implemented.

The cybersecurity bill, which observers say mimic China’s repressive web control tools, is set to come into effect in January despite drawing sharp criticism from the US, the EU and internet freedom advocates.

The bill would require tech companies to store data in the country, and remove “toxic content” from websites and hand over user information if asked by the government to do so.

© AFP/File | The bill would require tech companies to store data in Vietnam, and remove ‘toxic content’ from websites and hand over user information if asked by the government to do so

Critics of the bill say it will be a chokehold on criticism in the one-party state where activists are routinely jailed and all independent media are banned.

According to a draft decree on how the law may be implemented, published by the Ministry of Public Security Friday, companies offering internet services in Vietnam may be given 12 months to comply.

“Enterprises… must archive data (and) set up branches or representative offices in Vietnam,” the decree said.

It did not outline the punishment for failing to comply, but any country in breach of the law could be barred from offering its services in Vietnam.

An enterprise can mean internet service providers, e-commerce sites, online payment firms and social networks.

The draft decree added that companies must store user data in the country for at least 36 months.

Personal data required to be stored includes everything from a user’s name to passport number, medical records, credit card information and biometric data.

Google declined to comment Saturday, while Facebook did not immediately respond to a request from AFP.

The public has two months to provide feedback on the decree, in line with Vietnamese law, though public comments have not traditionally led to dramatic alterations to proposed bills.

The law was passed by Vietnam’s rubber-stamp parliament in June, part of a broader crackdown on internet freedoms that has sparked outcry from the country’s activists.

This week, the government said it had set up a web monitoring unit that can scan up to 100 million items per day to sniff out “false information”. A few days later officials said 3,000 sites featuring “inappropriate content” had been blocked.

With 53 million users, Facebook is by far the leading site in Vietnam, a country of 93 million.

It is a crucial platform for activists — and many have been jailed based on Facebook posts — but also a leading site for business owners.

Any efforts to block access to the site are likely to spark widespread opposition across the country.

AFP