Should Silicon Valley worry about Trump’s TRUTH Social?

But if we’ve learned anything from the last six years, it should be this: don’t underestimate The Donald.

TRUTH Social shot to the top of Apple’s App Store on Monday following a late decision to launch the app on Presidents’ Day. Trump Media & Technology Group, the parent company behind the social network, hasn’t commented on the number of downloads so far, but the waitlist approached 400,000 as of Tuesday morning.

As Gizmodo documented, the rollout hardly went well. Multiple bugs caused sign-up issues. The terms-of-service page briefly went dark. A Daily Dot reporter poked around an internal beta version of the app. Hundreds of thousands of potential users couldn’t gain immediate access, with no timetable given for when they could start “truthing” (the app’s version of tweeting). 

The glitchy debut provided plenty of immediate fodder for those who see the social media platform as little more than a Trump temper tantrum.

It didn’t, however, shed much light on what remains the defining question of TRUTH Social: What is Trump’s end goal with this app?

As the anti-MAGA crowd snickers about the rickety rollout of TRUTH Social, Trump is not-so-quietly crafting a tool that he can wield against Silicon Valley in multiple ways, to varying degrees of success.

In one relatively benign scenario, Trump merely tries to build a traditional social media network that caters to staunch conservatives, ala Parler and Gettr, with money from wealthy right-wing investors. He uses the platform to rail against Big Tech, further entrench himself as the center of the Republican Party, and drive fundraising for his eventual 2024 presidential campaign.

The effort siphons off a few million active daily users from mainstream social media platforms—Gettr and Parler combined to report about a million daily active users as of late 2021, per The Washington Post—but remains largely a right-wing echo chamber. Meanwhile, Facebook (1.93 billion daily active users) and Twitter (217 million) barely blink at the financial impact of any losses.

Another scenario, however, creates more chaos for Big Tech: TRUTH Social intentionally or unintentionally fails to police extremist content on its platform, forcing Apple and Google to ban the app from their respective App Stores for violating their terms of service. Both tech companies temporarily suspended Parler following the Jan. 6 attack for this reason.

In turn, Trump goes on a crusade against Apple, Google, and other Silicon Valley giants, accusing them of censorship and monopolization. Republican-led state governments and conservatives in Congress take their cue from the former president, passing profit-killing legislation that targets Big Tech. And if Trump wins in 2024? Watch out.

Endless ink has been spilled in recent years trying to predict Trump’s long-term plans (if they even exist). For the moment, TRUTH Social looks to be playing by traditional rules, instituting content policies that will keep it in the good graces of app store owners.

But when faced with an unpredictable opponent willing to weaponize the faintest of slights, the tech industry would be wise to stay on guard.

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Jacob Carpenter

NEWSWORTHY

The crackdown marches on? The rout on Chinese tech stocks continued Tuesday following reports of additional regulations and investigations launched by President Xi Jinping’s administration. The Hang Seng Tech Index, which tracks 30 companies on the Hong Kong stock exchange, ended the day down about 2%, while the U.S. listing for e-commerce giant Alibaba slumped by 5% in mid-day trading Tuesday. Bloomberg reported Monday that Chinese authorities ordered state-owned firms and banks to review their ties to payment processor Ant Group, prompting a fresh wave of concern about another wave of tech regulations.

Employees everywhere celebrate. Slack and Amazon Web Services experienced outages Tuesday morning that snagged workers returning from the extended Presidents’ Day weekend. Neither outfit reported the extent of their outages, though Slack officials acknowledged that the service was “not loading for some users.” The Amazon snag does not appear to be nearly as serious as the outage that briefly took down Netflix, Disney+, and several other commercial customers last December.

A buying spree. SoFiTechnologies will buy banking-software developerTechnisys SA for about $1.1 billion in an all-stock deal, as the lender looks to expand its digital financial services offerings, The Wall Street Journal reported Tuesday. The deal will give SoFi in-house access to a banking platform, helping the company reach its goal of becoming an all-in-one financial hub for consumers. SoFi completed a bank acquisition earlier this month and agreed to buy a payment processing company for $1.2 billion in 2020.

Out with the old. AT&T’s planned shutdown of 3G wireless service Tuesday prompted concerns that several products still using the legacy technology, including home security systems and medical alert monitors, could go haywire, Axios reported. Several corporate leaders and advocacy groups warned that gaps remain in the transition away from 3G service, which could render some important products ineffective for the time being. Federal officials said they do not plan to halt the phase out, predicting “limited disruption” this week.

FOOD FOR THOUGHT

Fresh out of ideas. Amazon has solved darn near every riddle in the e-commerce world, with one big exception: groceries. Despite huge internal investments and its acquisition of Whole Foods, Amazon remains well behind the competition in the grocery and food delivery game, CNBC reported. The failure to launch hasn’t hurt Amazon’s bottom line too much, given the massive gains in its Amazon Prime and cloud services units. But a growing list of rivals and a sense of impatience are weighing on Amazon’s stagnant food foray.

From the article:

Amazon has introduced a dizzying array of services — Prime Now, Fresh, Go and others — in its effort to become a giant in the $750 billion U.S. grocery market. In 2017, it spent $13.7 billion to acquire Whole Foods, a price tag more than 10 times higher than Amazon had paid in any prior deal.

Still, it’s just a niche player in the industry. As of mid-December, Amazon.com and Whole Foods accounted for a combined 2.4% of the grocery market over the past 12 months, while Walmart controlled 18%, according to research firm Numerator. Amazon’s delivery services have struggled to stand out in a crowded field, while the Go automated convenience stores have been deprioritized, according to people familiar with the company’s strategy.

IN CASE YOU MISSED IT

Elon Musk laughed at the idea that Tesla’s German Gigafactory would use too much water. Now it’s a main reason why the plant isn’t open, by Monica Raymunt, William Wilkes, and Bloomberg

Tech investors are suffering the second stocks rout of the COVID pandemic—and Wall Street thinks it could get far worse, by Bernhard Warner

A CEO’s key to success: Ban as many meetings as possible, by Amiah Taylor

Fed up Ottawa residents win secret suit to freeze the crypto wallets funding Canada’s ‘Freedom Convoy’ protesters, by Yvonne Lau

‘Top Chef’ star Tom Colicchio’s just invested in a startup that hopes to help restaurants make dinners happier, by Jonathan Vanian

Virgin Hyperloop’s mass layoffs and pivot to freight all but kill the dream of traveling by tube, by Eamon Barrett

BEFORE YOU GO

Mile high goals. Forget the U.S. Constitution. This DAO has its sights set way bigger. Three months after a decentralized autonomous organization’s failed bid for a copy of the founding document, CoinDesk reported that a new DAO has sprouted with aspirations to buy the National Football League’s Denver Broncos. The price tag: a cool $4 billion or so. The DAO structure would operate similarly to the Green Bay Packers, which is publicly owned by shareholders. However, this DAO might be DOA, given that the NFL no longer allows such ownership structures.