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OnlyFans tries to win back its spurned lovers

August 25, 2021, 11:30 PM UTC

After an outpouring of shock, dismay, and betrayal from its once and former fans, OnlyFans said Wednesday it was reversing a week-old decision to ban sexually explicit content on its service. 

Blame the banks. OnlyFans said it recently “secured assurances” from banks that will enable it to continue processing people’s payments, despite earlier warning that “unfair” actions by financial institutions were making its operations difficult. The company’s walk-back of the ban came a day after OnlyFans CEO Tim Stokely told the Financial Times that companies like BNY Mellon, UK-based Metro Bank, and JPMorgan Chase were hurting business by broadly rejecting money transfers and closing related accounts.

OnlyFans is a posterchild of the rising “creator economy,” the big business of connecting influencers and fans. Sex workers and porn stars helped build the young company’s success, translating into projected revenues of $1.2 billion this year, according to an investment pitch deck obtained by Axios. The week-long debacle over what would be permitted on its platform provoked tremendous backlash from the service’s users and questions about the company’s future.

OnlyFans is just the latest tech company to face a head-on collision with its community. Robinhood experienced a similar dust-up earlier this year, during the GameStop stock-buying frenzy, when it suddenly halted GameStop share purchases. The move enflamed retail investors, the core of Robinhood’s service, who alleged that the company was manipulating GameStop’s stock price. 

Apple is getting a taste of similar drama lately, too. The iPhone-maker caused a stir when it presented plans for an update that will scan photos across its devices for signs of child sexual abuse imagery. Critics are describing the update as a “backdoor” that nation states can exploit to find, flag, and censor content of any sort, a fear Apple rejects as unfounded. 

These points of conflict, where the interests of a company (or the financial institutions that support it) diverge from the desires of its community, can prove deadly for a business. Robinhood, Apple, and perhaps even OnlyFans appear poised to pull through their recent scraps. But others have met untimely demises by ignoring the wants of their most committed users. (See: blogging service Tumblr after its porn ban.) 

A company that does wrong by its community must prepare to face its wrath. For that, one needs no assurances. 

Robert Hackett
@rhhackett
robert.hackett@fortune.com

NEWSWORTHY

The electoral college of Facebook. Political and policy experts have been approached by Mark Zuckerberg's social network about joining an election commission, according to The New York Times. Expected to be announced in the coming months ahead of the 2022 midterms, the group would be tasked with effectively freeing Facebook of some of the decisions around political ads and election-related misinformation that have previously resulted in blowback from liberals and conservatives alike.

Going all in. A potential deal valued at more than $20 billion is on the table between chip makers Western Digital and Kioxia, The Wall Street Journal reported Wednesday. The potential stock deal, which could be announced in the coming weeks, would likely leave Western Digital CEO David Goeckeler in charge, The Journal said, citing people familiar with the matter. 

A call to action. On Wednesday, President Joe Biden met with the heads of AppleGoogleAmazon, and JPMorgan Chase, among others, to discuss the need for the private sector to "raise the bar on cybersecurity." The summit came on the heels of a string of high-profile cyber attacks, including that of the Colonial Pipeline and T-Mobile. 

Is free stock free? Hip brokerage apps like Robinhood have been giving away free shares of companies' stocks for years. But, because those companies then have to pay the brokerages back for the costs of disseminating proxy material to their shareholders, the practice is coming under new scrutiny with issuers fighting back. Companies like a drugmaker in Florida called Catalyst Pharmaceuticals want U.S. market regulators to institute a rule change that would bar the brokers from pursuing reimbursement for issuing the materials to shareholders who got in on the company for free. Catalyst said it had to spend more than $200,000 last year because of Robinhood's free-share program. 

COVID-19 misinformation. Since early 2020, Google-owned YouTube has removed more than a million videos related to what chief product officer Neal Mohan called in a blog post "dangerous coronavirus information, like false cures or claims of a hoax." And while contextualizing that data is not a perfect science, CNET reported Wednesday it is roughly double the amount that YouTube said it had removed related to COVID-19 misinformation back in January. 

This edition of Data Sheet comes courtesy of Declan Harty.

FOOD FOR THOUGHT

Algorithmic bias. In a new investigationThe Markup has discovered that people of color were more likely to be denied for a home loan in 2019 than white people with similar financial characteristics. For Black applicants, lenders were 80% more likely to reject a mortgage application. Banks were 70% more likely to deny Native American applicants. And Latinos applying for a mortgage were 40% more likely to be turned down than similar white applicants. So what's to blame? A 1990s-era algorithm used by the quasi-governmental housing agencies Freddie Mac and Fannie Mae.  

From the article:

This algorithm was developed from data from the 1990s and is more than 15 years old. It's widely considered detrimental to people of color because it rewards traditional credit, to which White Americans have more access. It doesn't consider, among other things, on-time payments for rent, utilities, and cellphone bills—but will lower people's scores if they get behind on them and are sent to debt collectors. Unlike more recent models, it penalizes people for past medical debt even if it's since been paid. 

"This is how structural racism works," said Chi Chi Wu, a staff attorney at the National Consumer Law Center. "This is how racism gets embedded into institutions and policies and practices with absolutely no animus at all."

IN CASE YOU MISSED IT

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The pandemic is the gift that keeps on giving for Best Buy by Phil Wahba

What Pfizer's FDA approval means for Americans and businesses by Sy Mukherjee

Former Microsoft, Amazon exec sentenced for $5.5 million in PPP fraud by Chris Morris

Nancy Pelosi leads divided Democratic Party to agreement on infrastructure by Nicole Goodkind

Even Europe's anti-vaxxers have to admit: Vaccine mandates really work by Vivienne Walt, David Meyer, Ian Mount, and Bernhard Warner

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BEFORE YOU GO

Good to bee back in the office. Corporate America is struggling to get people back. Not even factoring in that work-from-home has proven to be more effective than long believed, there is still the matter of stagnating vaccination rates in the face of the raging COVID-19 Delta variant. So, some companies are starting to think outside the box by installing beehives on the terraces of their New York office towers, vegetable gardens to their properties, and "treehouse" lounges to provide their returning employees a sample of nature at work. 

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