Stuff Worth Knowing for the Week of November 7, 2022
The twisted saga of Twitter and Elon Musk continues as FTX implodes and everyone else preps for layoffs.
Welcome back to Stuff Worth Knowing! Each week, I'll round up news related to tech, video games, film, television, anime, and more. At the end of each newsletter, there will be a section called On The Calendar, which will include some of those notable dates that are near-term. Oh, and I also launched my Patreon, SavePhile, where my more thoughtful musings on any topic will go.
I'm going to be honest, half the newsletter is about Musk and Twitter. So much happened this week in that space and even summarizing it takes a lot.
Tech ⌨️
The Check of Verification: The Epic Saga of Musk and Twitter This Week
Last week, Twitter's new boss laid off half of the existing staff, promising a leaner, more profitable operation. Reports pointed to Musk moving full steam ahead with a new version of Twitter Blue, an $8-per-month subscription offering something like the checkmark symbol used previously for Verified accounts.
Since then, it's been a dizzying week of nonsense for Twitter.
Let's start on Sunday, when Musk backtracked a bit on his original "Comedy is now legal on Twitter" tweet. He laid down an edict that joke impersonation accounts would need to specify "parody" in the bio or risk being banned. That's largely because certain Verified accounts were changing their names to "Elon Musk" to make fun of him. Twitter also began to ask a few employees who were fired to return. According to Bloomberg, the company realized that some were fired in error, while others had key skills needed to keep Twitter running or build out new features Musk wanted.
On Tuesday, Twitter revealed one of those new features, the Official Checkmark. This system was intended to sidestep the problems with Twitter Blue offering users paid verification. Certain organizations and people were marked as "Official," so folks would know they were real accounts related to those key figures.
The Official marks went live on Wednesday morning, only to disappear again two hours later. In a reply to tech YouTuber Marques Brownlee, Musk stated that he had killed the feature. An hour later, Twitter officially launched Twitter Blue, allowing users to subscribe to the platform for additional features and the blue Verified checkmark.
Musk held a Twitter Spaces call with advertisers that same day, hoping to assure them that Twitter would remain a viable platform in the future. On the call with Musk were Yoel Roth, Twitter head of trust and safety, and Robin Wheeler, head of ad sales. While Musk said the service would remain safe for brands, his public tweets had him joking about account impersonations, which didn't look great to advertisers.
The issues with the new Twitter Blue began immediately. Some Verified users noted that they couldn't change their display names on Monday and those problems persisted into the rest of the week. Those who subscribed to Twitter Blue also found they were stuck with the display name they had when they subscribed.
The account impersonations were the big problem, however. Early examples included an account impersonating LeBron James, stating he was leaving the Lakers; another acting as NBA insider Adam Schefter, saying that Josh McDaniels was out as coach of the Las Vegas Raiders; and one faux Valve Software, announcing the reveal of the new, rumored game Ricochet. While others were more overt in their trolling, these plausible announcements are the worrying ones from a business perspective.
Two of the major impersonations led to an appreciable drop in stock value for the companies involved. A fake Lockheed Martin posted about the weapons company halting sales to Saudi Arabia, Israel, and the United States, while an account posing as pharmaceutical company Eli Lilly tweeted that insulin would be free. The latter company had to officially apologize for the fake tweet, which also prompted a public look at how much it charges for insulin.
US Senator Ed Markey also noted that a Washington Post reporter was able to impersonate him, prompting him to send an official letter to Musk about the issue. Twitter has been dutiful about banning these accounts, but they only need to stay up for a few hours to cause problems. And some accounts are still live days later. Twitter paused Twitter Blue subs today in response.
The Official checkmarks returned on Thursday evening to certain accounts. As of the writing of this newsletter, Official marks appear on the Twitter app, but not the web client. Honestly, the back-and-forth has been simply amazing.
Executive-level departures from Twitter also accelerated during the week. Yoel Roth, the head of Twitter's trust and safety, who was on the advertisers' call on Wednesday? He resigned the very next day. He was joined by chief privacy officer Damien Kieran, chief information security officer Lea Kissner, and chief compliance officer Marianne Fogarty.
The departures caused some employees to worry about compliance with an FTC consent order over privacy issues, requiring Twitter to do a privacy review before it makes certain changes. Musk's personal lawyer told employees not to worry about these potential legal problems, but an unnamed Twitter lawyer told their fellow employees that moving forward with further changes would be "extremely dangerous." In response to the executive departures, Musk himself brought up the possibility of filing for bankruptcy and sold nearly $4 billion in Tesla stock in order to cover Twitter's debt.
The capper on this entire thing is best explained with the comment at the end of an earlier link, an article from The Verge. "The Verge reached out to Musk for comment. Twitter no longer has a communications department," said Verge reporter Alex Heath.
Dire.
The Shout Out: Platformer has an inside look at the most recent happenings at Twitter. Well worth a read.
FTX Implodes, Tanking $8 Billion in Value and Sequoia Capital's Reputation With It
2022 is the year that crypto got taken out back and beaten with a pipe. Sadly, the beatings are still ongoing. FTX, one of the largest crypto exchanges in the world, is filing for bankruptcy. In addition, FTX CEO Sam Bankman-Fried is resigning his position in the company.
The pain started on November 2, when CoinDesk reported that trading firm Alameda Research's foundation relied on $14.6 billion in crypto from FTX. The problem with this is both companies were owned by Bankman-Fried, leading some to ask about FTX's balance sheet. When your speculation-based asset comes under scrutiny, things can go bad very quickly. When users attempted to withdraw from FTX en masse, it forced the exchange to scramble for money to back those withdrawals.
Binance, the world's biggest crypto exchange, agreed to acquire FTX on Tuesday after doing some proper due diligence. (Interestingly, part of the value drop in FTX's FTT token was down to Binance CEO Changpeng "CZ" Zhao selling his FTT token holdings.) Two days later, Binance walked away from the deal entirely. According to The Wall Street Journal and Binance's own tweets, the exchange reviewed FTX finances and noted "mishandled customer funds," stating "the issues are beyond our control or ability to help."
Following that move, Sequoia Capital, one of the investment firms behind FTX, marked its investment in FTX.com and FTX US down to zero. As the venture capital firm tried to downplay its exposure, some investors slammed it for a lack of due diligence, many pointing to a glowing profile of Bankman-Fried on its own website. (Sequoia Capital has since removed the profile, so the previous link is pointing toward an archived version.)
Bankman-Fried noted on Twitter that he "fucked up," but that's probably cold comfort for the many average users who have lost their money. Of course, that's a key problem with crypto, isn't it?
Why It's Worth Knowing: Again, this is the third-largest crypto exchange in the world. Other tokens and exchanges have fallen this year, including the Luna token and Terra stablecoin. (Funny thing, Bankman-Friend noted earlier this year that some crypto exchanges are already "secretly insolvent." Was he talking about FTX ahead of time?) Crypto is faltering everywhere; even Binance is under investigation by U.S. agencies over money laundering. The gamble simply isn't paying off for most.
The Shout Out: CoinBase has an ongoing page for coverage surrounding FTX. Considering they kicked off the shenanigans, it’s worth going there for further reading.
Meta Lays Off More Than 11,000 Employees
The season of layoffs continues. Twitter, Microsoft, and Intel have all fired employees within the past month. Now it's Meta's turn. In a letter to employees, Meta CEO Mark Zuckerberg said that the company was getting rid of 13% of its current workforce.
"At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth," said Zuckerberg. "Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. [Editor's Note: Who said that? That seems like a bad call.] Unfortunately, this did not play out the way I expected. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that."
Still, that's a staggering number of employees to let go all at once. It's not as dire at the halving of Twitter's workforce by Musk, but it'll be interesting to see the knock-on effects. Also, that's 11,000 people out of work, just ahead of the holidays.
DeviantArt Launches Its Own AI-Generated Art Tool, Angering Its Community
Early on Friday, DeviantArt announced DreamUp, its own AI image-generation tool powered by Stable Diffusion. Users of DreamUp can create AI art by going to the DreamUp page and entering a text prompt. The resulting images can then be uploaded directly to DeviantArt, automatically tagged as artificial intelligence.
Users get 5 generation prompts for free, with further prompts requiring a subscription to one of DeviantArt's membership plans. The service expands upon DeviantArt's existing partnership with Stable Diffusion, and the service touted the ability of artist to opt-out of their work being used for AI trainings.
The news was not welcome in DeviantArt's overall community, however. Many artists absolutely hate AI-generated art, noting that it's generally built on traditional art and can in some cases actually devalue the art from working artists. Some artists also noted that all DeviantArt posts are opted-in by default and fully opting-out required filling out a separate form. In response, a number of artists announced their intentions to leave the service entirely.
In response, DeviantArt changed course, making it so all Deviations are opt-out by default. "When an artist declares that their content may not be used as input to AI models, an HTML tag with the noimageai directive is placed on the page and an HTTP header with the noai directive is sent when the image is directly downloaded from DeviantArt’s servers," the company said in its update. "In order to remain in compliance with DeviantArt's updated Terms of Service, third parties that continue to use DeviantArt-sourced content to train machine-learning models of any kind must ensure their training data set excludes all content for which either of these directives are present."
DreamUp remains, but for many artists, there is joy knowing their work won't be mined for derivative work.
Film, Television, and Streaming 🎞️
Disney Revenue and Disney+ Subs Are Up, But Company Still Planning Cost-Cutting and Lay Offs
We're nearing the end of numbers season! On Tuesday, Disney announced its fiscal fourth quarter and 2022 full-year earnings report. For the fourth quarter, revenue was up 9% to $20.1 billion and net income was near-flat at $162 million. For the full year, revenue was up 23% to $82.7 billion and net income was up 58% to $3.2 billion.
In addition, the combined subscribers for Disney+, Hulu, and ESPN+ came to more than 235 million, up 57 million subscriptions. Disney+ alone rose 12.1 million subscribers, landing at 162.2 million subscribers as of October 1, 2022. Despite that, operating income for Disney's direct-to-consumer segment—which contains Disney+, Hulu, and ESPN+—brought down the media side of the company, totaling losses of $4 billion this year, versus $1.7 billion last year. That's… pretty steep. Disney promised that the enhanced losses were temporary.
"With our expectation that peak losses are behind us, direct-to-consumer results should improve going forward as we lay the foundation for a sustainably profitable business model,” said Disney chief financial officer Christine McCarthy during the investors call.
Of course, when executives need to find money, they turn to that stable mainstay: layoffs. CEO Bob Chapek sent a memo to employees noting a hiring freeze, general cost-cutting, and layoffs. "While certain macroeconomic factors are out of our control, meeting these goals requires all of us to continue doing our part to manage the things we can control—most notably, our costs," wrote Chapek in the memo, obtained by Variety. There's no size given for the layoffs, as Disney still needs to have a "rigorous review."
CNN Also Preparing For Layoffs
Disney isn't the only company looking to cut costs. CNN, the news division of Warner Bros Discovery, is also plotting to cut its staff. According to a report by Puck News, new CEO Chris Licht will be cutting staff in early December.
The report states that the leadership at CNN already knows who is getting cut and the layoffs will affect hundreds of employees. Licht's plan involves shrinking the original films and series division, while also diminishing the studio space that the network has in New York. This is not surprising, given that Warner Bros Discovery is already looking to tighten the belt and CNN is losing the news war to MSNBC.
Netflix Picks Up Rights to Microsoft's Gears of War
Netflix is still searching for new content to stay ahead in the streaming war. Its latest catch is Gears of War, Microsoft's third-person shooter franchise. Netflix will work with Gears of War developer The Coalition to develop a feature film and an animated series.
This adds another project to Netflix's growing list of video game adaptations. The streamer's track record is mixed, with successes like Arcane, Castlevania, Cyberpunk: Edgerunners, and The Witcher, middling efforts like Dota: Dragon's Blood, and outright failures like Dragon's Dogma. Netflix still has a whole host of video game shows and films in development as well, including Horizon Zero Dawn, The Division, several Assassin's Creed projects, Devil May Cry, Pokemon, and BioShock.
Dave Bautista is lobbying hard to play Marcus Fenix in Gears of War. The actor has appeared in Gears 5 as himself and he posted a video on Twitter of himself in the familiar COG armor from the game. Netflix could make worse choices, and Bautista has worked with the streamer in the past, notably on Zack Snyder's Army of the Dead.
Superhero Watch: James Gunn and Peter Safran Planning 8-10 Year Plan For DC Studios
In a virtual town hall with Warner Bros. Discovery CEO David Zaslav, new DC Studios bosses James Gunn and Peter Safran said that they're currently developing a long-term plan for the DC Universe. The pair also said that they're looking forward to telling an overarching story for the brand.
"We spent the past couple days with a group of some of the best thinkers in the industry, the best writers in the industry starting to map out that eight- to 10-year plan of what it’s going to look like in theater, in TV, in animation, across the board for these characters," said Gunn, according to the Hollywood Reporter.
"This was such a unique opportunity to tell one great overarching story," added Safran. "One beautiful big story across film, television gaming, live-action, and animation." Hopefully, they'll offer a few inklings about this plan soon, most likely at next year's San Diego Comic-Con.
Video Games 🎮
Studio ZA/UM Founders Speak Out As Studio Says They Were Fired For Misconduct
Studio ZA/UM hit the scene as the developers behind the hit RPG Disco Elysium. At the beginning of October this year, it was revealed that a number of the founders behind the studio, including art director Aleksander Rostov, designer Robert Kurvitz, and writer Helen Hindpere, had left the studio at the end of 2021.
On Wednesday, Kurvitz and Rostov offered further details about their departure in a post on Medium. The pair allege that an Estonian company called Tütreke OÜ gained control of Zaum Studio OÜ by fraud, and then pushed out the founding members.
"We have now learned that Tütreke OÜ must have obtained control over Zaum Studio OÜ by fraud. We believe the money used by Tütreke OÜ to buy the majority stake was taken illegally from Zaum Studio OÜ itself, money that belonged to the studio and all shareholders but was used for the benefit of one. Money that should have gone towards making the sequel," wrote the pair. As such, they are now reviewing legal options.
In response, the studio countered with reports of studio mismanagement and harassment aimed at the dismissed founders. Studio leadership told Estonian news outlet Estonian Ekspress and Gamesindustry.biz that the studio was a "toxic environment."
"They treated their co-workers very badly," Ilmar Kompus, one of the men behind Tütreke OÜ, told the Ekspress. "Despite talking to them repeatedly, things did not improve. Therefore, the company was forced to fire them. Robert [Kurvitz] is said to have been known for belittling women and co-workers in the past, but this was previously unknown to the company. It would be very short-sighted of a growing international company to tolerate such behavior."
Gamesindustry.biz independently confirmed some of the reports of misconduct. Other sources told the outlet that the situation was fraught, pointing to "CEO corporate scheming on one side, a toxic auteur on the other." It sounds like the situation is less clear-cut than previously reported, so we'll have to see where all the legal fallout lands.
Why It's Worth Knowing: Disco Elysium landed with a bang, winning Best Role-Playing Game at The Game Awards 2019 and Best Narrative at the 20th Game Developers Choice Awards. That's high praise for a debut title and everyone has been looking forward to a follow-up. This contentious business matter involves many of the creative leads from the first game and it's hard to parse if either side is wholly at fault here. That puts any sequel or original project in jeopardy and brings us back to questions about gaming auteurs.
Doom Eternal Composer Mick Gordon Accuses id Software Studio Director of Lying… With Receipts
The drama in the gaming industry isn't over! On Wednesday, Mick Gordon, composer for Doom and Doom Eternal, posted a lengthy essay on his Medium blog. The post was a response to a May 2020 Reddit post made by id Software Studio Director Marty Stratton. The Reddit post was meant to address the community's problems with the Doom Eternal OST, which many fans felt wasn't up to snuff. The post made a number of assertions about Gordon's role in the OST's creation.
Gordon's post is massive, very detailed, and written in a manner that attempts to establish facts in the situation, as opposed to an attack on id Software, something he takes care to point out. "This statement is not an excuse for a hate campaign. Acts of hate dished out online won’t result in any positive change," he notes early on.
Gordon notes that the development of Doom Eternal was "a nightmare" from his perspective, with poor scheduling, overwork, massive changes in direction, a lack of resources, and ultimately a whole host of pay issues. He also notes that Bethesda announced the OST as part of the Collector's Edition at E3, despite no current plan for a standalone OST at that point.
I won't go into further details here. Gordon took the time to make his case and if you care about the trials and tribulations of his time working on Doom Eternal, it's worth reading them in full. Suffice it to say, it does not paint the current leadership of id Software in a positive light. For their part, id Software and Zenimax have yet to respond.
PlayStation 5 Ad Reveals Final Fantasy XVI is Exclusive for Six Months
Console exclusives are a major boon these days. Just ask Microsoft, who has to convince UK regulators that it won't make Call of Duty Xbox exclusive if it acquires Activision Blizzard. One upcoming exclusive is Final Fantasy XVI, which is coming to PlayStation 5 in Summer 2023.
In a recent ad for upcoming PlayStation 5 titles, it's revealed that FFXVI will be exclusive for six months. It's unclear if that's when the console exclusivity or PC exclusivity ends. It's likely that FFXVI will come to PC after some time on PS5. Square Enix has been better about Xbox support recently, but major games like Final Fantasy VII Remake are still only available on PS4, PS5, and PC.
Books! 📖
HarperCollins Workers Begin Strike
I didn't think that there'd be more book-related news, but we work with what we got. Last week, I mentioned that a U.S. federal judge blocked the merger of Penguin Random House, LLC and Simon & Schuster, Inc. This leaves us with five major publishers worldwide: Penguin Random House, Simon & Schuster, Macmillan, Hachette, and HarperCollins.
This week, workers at the latter publisher are going on strike. According to a report by NPR, the HarperCollins Union has begun an indefinite strike today. The employees are asking for higher wages, improved family leave, and a commitment to a more diverse staff. The employees have been without a contract since April of this year.
"The mainly women workers average $55,000 annually, with a starting salary of $45,000. Many employees cite pressure to work extra hours without additional compensation," said the Union in a statement last month.
Why It's Worth Knowing: HarperCollins is one of the Big Five and its staff going on strike presents it with some problems heading into 2023. The publishing industry, like many others, is looking towards unionization and if HarperCollins succeeds with its strike, it could help other publishers unionize.
On The Calendar 📅
Not much interesting stuff that's coming over the next week or so! Mostly layoffs!