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DAILY BRIEFING

Mark's metaverse mission

Written by Li-Ann Chin, associate
Edited by David Gaffney, partner

25 October 2021

Good morning,

A month ago, Frances Haugen, a former Facebook product manager leaked tens of thousands of internal company documents that reveal Facebook “knew its products were damaging teenagers’ mental health”fomented ethnic violence in countries such as Ethiopia and failed to curb misinformation before the 6 January Washington riots. Today, Haugen testifies before MPs and peers at Westminster.
 
Haugen’s former employer is now embroiled in its worst PR crisis since the Cambridge Analytica scandal three years ago, when it was revealed that 87 million Facebook profiles were harvested for Cambridge Analytica, a political data analytics consultancy, via a seemingly innocuous personality quiz and third-party app.
 
Against this tumultuous backdrop, Facebook has reportedly signalled that it is considering changing the name of its holding company to reflect the tech giant’s focus on building the ‘metaverse’, and to highlight its ambition to be known for more than social media and all the messiness that goes with it.
 
The ‘metaverse’ concept was initially coined by novelist Neal Stephenson in his 1992 science fiction novel Snow Crash where humans, as avatars, interact with each other and software agents, in a three-dimensional virtual space.
 
Mark Zuckerberg, Facebook’s co-founder, is known to be fascinated with the role the ‘metaverse’ will play in the next chapter of the internet and how Facebook is poised to cash in on the phenomenon. The company recently announced plans to create 10,000 jobs in Europe to build the ‘metaverse’ and is said to have more than 10,000 employees already building consumer hardware like Augmented Reality glasses, which Zuckerberg believes will eventually be as ubiquitous as smartphones.
 
The rebrand is expected to position Facebook, also known by employees as the “big blue app”, as merely one of the many social media platforms under a larger parent company overseeing products such as Instagram, WhatsApp, Oculus, and more. If the rumours are true, the name change will be unveiled at the Facebook’s annual Connect conference later today.
 
Is Facebook’s rebrand merely a ploy to throw legislators, regulators, and the public off its scent? Some evidently seem to think so. Either way, the ‘metaverse’ is a big concept. Selling that to consumers and businesses will be made all the more challenging given that public trust in Facebook has remained in a downward spiral ever since 2018. Facebook currently ranks the lowest in digital trust among consumers – a pertinent issue that will take more than a rebrand to fix.

News

With Covid cases across the UK on the rise, Labour has called on the government to introduce ‘Plan B’ measures to tackle Covid in England, including advice to work from home and the reintroduction of compulsory face coverings in public places. Plan A, which is currently in place, involves offering booster jabs to frontline workers and the most vulnerable, a single dose to healthy 12- to 15-year-olds, and encouraging unvaccinated people to get jabbed. In Wales, ministers are reportedly considering whether to extend the use of Covid passes for a wider range of venues.
 
Scottish health secretary Humza Yousaf admitted there is a risk of a surge in Covid infections following the COP26 summit in Glasgow next month and has refused to rule out further restrictions amid growing fears of a winter spike in cases.
 
A statement released on Sunday by the US State Department reveals that “high-level representatives” had met with Taiwan’s foreign ministry on Friday to discuss plans to expand the island’s participation at the United Nations (UN) and in other international fora. President Xi Jinping is expected to deliver a speech at the UN today to mark the 50th anniversary of the People’s Republic taking China’s seat at the UN.
 
Sudan’s prime minister and other senior members of its government and sovereign council have been arrested as part of a coup attempt by the military after Prime Minister Abdalla Hamdok refused to issue a statement in support of the coup. Internet and phone signal outages have also been reported across the country.

Business and economy

Speaking to Times Radio on Sunday, Rishi Sunak confirmed that he will use the Budget on Wednesday to encourage overseas investment in key British industries such as electric vehicle and life sciences with £1.4bn in grants. The chancellor also plans to make it easier for foreign companies to relocate to the UK and  find and attract skilled workers into the UK, including in professional services such as audit, accounting and legal. (£)
 
The NHS in England will receive an extra £5.9bn in funding in this week’s budget, on top of the £12bn a year that was announced in September. The money is meant to help clear the record of backlog procedures, which has been worsened by the pandemic, and also to buy equipment and improve IT infrastructure.
 
Channel 4’s former chief executive, Lord Grade, and ITV are reportedly mulling takeover bids amid government plans to privatise the network. Ministers launched a consultation over the summer on the future ownership of Channel 4 which is currently state-owned but self-funded through advertising revenues. Other potential bidders include Sky, Channel 5 owner ViacomCBS and an unnamed US private equity firm. (£)
 
From today, drivers of vehicles that do not comply with minimum emissions standards will be charged £12.50 to drive into London’s ultra low emission zone.. This move has been implemented by the Mayor of London, Sadiq Khan, in a bid to reduce air pollution in central London.

Columns of note

Almost 45 million people in the UK have been a target of financial scams in the past three months. In 2020, American consumers reported losing $3.4bn to fraud, much of it through a range of online scams. John Gapper writes in the Financial Times that an unfortunate byproduct of the internet and free communication is that fraudsters are now dangerously efficient at preying on the naïve or distracted. “Humans are notoriously poor at detecting deceit, if the liar is fluent enough and the story mildly convincing,” he says. (£)
 
I live near London Docklands. According to this interactive website created by campaign group the Central Office of Public Interest, the air pollution in my neighbourhood is ranked  four-out-of-five, two levels above the World Health Organisation’s (WHO) recommended air pollution level. Most, if not all, of Londoners live in areas recording scores well above the WHO’s recommended air quality levels. Writing in The Guardian, London mayor Sadiq Khan and Maria Neira discuss the importance of expanding the ultra-low emission zone in London, in a bid to reduce polluting vehicles on the roads and provide cleaner air for millions of Londoners.

Cartoon source: The New Yorker

Markets

The week ahead

Expect the environment to take centre stage in world news this week as we approach the opening of COP26 in Glasgow on Sunday. US president Joe Biden and Australian prime minister Scott Morrison have confirmed their attendance, but Russia’s Vladimir Putin and China’s president Xi Jinping are unlikely to travel. It is anticipated that there will be a problematic few days trying to negotiate major moves forward at the conference with both Putin and Xi absent.
 
Earnings season will be in full swing over the next week in Europe and the US, with approximately 200 S&P 500 companies reporting. Big tech will feature heavily with= Amazon, Apple, Microsoft, Alphabet, Spotify, Twitter and Facebook all due to post financial results.
 
Central banks across the world are likely to take further measures to rein-in inflation this week, as the European Central Bank and its counterparts in Japan, Brazil and Canada meet to discuss monetary policy. Advance third-quarter GDP readings will be published in the US, France, Germany, Italy, Spain, Mexico, South Korea and the eurozone.
 
Wednesday is Budget Day in Westminster, with the chancellor due to speak at lunchtime. Another one to watch is the UK government’s publication of its Integrated Rail Plan, setting out how major projects such as High Speed 2, Northern Powerhouse Rail and the Midlands Engine will be phased and connected.

What’s happening today?

Finals
Sareum

Interims
Dp Poland

Q3 Results
HSBC Holdings

AGMs

Bezant Res

Challenger En

Galileo Resourc

Xtract

Int. Economic Announcements

(09:00) IFO Expectations (GER)

(09:00) IFO Current Assessment (GER)

(09:00) IFO Business Climate (GER)


(15:30) Crude Oil Inventories (US)

Source: Financial Times

did you know

The ghost on the Snapchat app icon is named ‘Ghostface Chilla’, a moniker inspired by Ghostface Killah from hip hop group Wu-Tang Clan.

Parliamentary highlights

House of Commons

Oral questions
Levelling Up, Housing and Communities (including Topical Questions)
 
Legislation
The Animal Welfare (Kept Animals) Bill: Second Reading
 
Adjournment
First anniversary of the Abraham Accords

House of Lords 

Oral questions
Various
 
Debate
Procedure and Privileges Committee report ‘Virtual participation in Grand Committee; Divisions: pass-readers; Leave of Absence’
 
Legislation
Skills and Post-16 Education Bill [HL] – third reading
Police, Crime, Sentencing and Courts Bill – committee stage (day 2)
 
Short debate
Calls by the Confederation of British Industry, the Trades Union Congress and the Equality and Human Rights Commission for the introduction of mandatory ethnicity pay gap reporting
 

Scottish parliament 

No business scheduled.

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