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The Reg's review of 2014: Naked JLaw selfies, Uber and monkey madness

Put it on a stick and 'cheesie'

GCHQ, Google, Amazon, Facebook and corporation tax

The smoking gun was the message one of Rigby’s attackers - Michael Adebowale - had sent to an overseas individual via Facebook not seen until after the attack, in which Adebowale said he intended to murder a soldier.

Leading sections of the influential mass-circulation UK media overlooked M15’s failings and took the bait on Facebook bashing.

In truth, whether Facebook in this case and other social networks in general are culpable is irrelevant and it seemed clear we were being softened up. Earlier in November, GCHQ chief Robert Hannigan reckoned web firms are “in denial” in their role they play helping terrorism saying they’d become “command and control networks of choice” for web-savvy extremists. “GCHQ and its sister agencies, M15 and the Secret intelligence Service, cannot tackle these challenges at scale without greater support from the private sector, including the largest US technology companies which dominate the web,” he wrote in the Financial Times.

At the end of November, the final shoe dropped: UK home secretary Theresa May proposed a Counter-Terrorism and Security bill that would force firms to hand details to police letting them identify who is using a computer or a mobile phone.

GCHQ's Above-Top-Secret base in the desert revealed

Snowden - yeah, we’ve heard all about that. But what about this extract: a beyond top-secret GCHQ listening post in the Gulf sucking up voice and data comms from nine submarine cables passing through the Gulf and into the Red Sea. Uncovered by investigative journalist Duncan Campbell writing in The Reg, the base operates six large satellite dishes and is part of the ECHELON intercept system run by the Five-Eyes intelligence services run by the US, UK, Australia, Canada and New Zealand.

GCHQ Benhall doughnut aerial view

Based at Seeb in the state of Oman, the base is something of a jewel in the intelligence crown because of its position at the apex of those nine cables, with data copied and then sifted. It has a broad remit with spooks free to operate under a set of cursory controls and official warrants.

The Reg ran with the story, despite pressure from officials who’d persuaded other publications to not go public.

Tax loopholes close for Google, Amazon and Facebook

What does Take-That’s Gary Barlow have in common with Google, Amazon and Facebook? No, not that he’s probably a user of each - rather they all got in hot water for avoiding paying tax to HMRC. In Barlow’s case, he and his Take Thaters were outed for avoiding £66m using an aggressive tax planning service run by Icebreaker - once employed by comedian Jimmy Carr.

In the case of Google, Amazon and Facebook the story of their aggressive tax planning entered a new chapter as governments began closing the loopholes that had let them minimize their tax bills.

Amazon was found to have routed more than £11bn through its Luxembourg strategy, Amazon EU SARL, leaving it paying just £4m in UK corporate tax while also claiming a £4bn tax rebate from the Luxembourg government. Multi-billion-dollar-earning Facebook was found to have paid less than a tiny fraction of that amount to tax to the UK government in 2012 - while also claiming a rebate that earned the giant a credit of £192,027. Google in the same year paid just £11.2m in corporate tax in the UK having funnelled billions out of the country to its European HQ in tax friendlier climate of Ireland.

All reckoned they complied with the law, which was the problem.

Britain fought back with a planned “Google Tax” - a 25 per cent tax on multinationals who do “a lot of activity in the UK” like sales. It follows a recent proposal in Spain and similar plans in Germany and Belgium that fell apart.

To stop companies simply swapping jurisdictions, though, will take greater action. And so the EU has promised to fast-track legislation that would mean greater scrutiny of sweetheart tax deals for big firms. Meanwhile, EU’s chief, Jean-Claude Juncker came under pressure to resign over his involvement in tax breaks for firms when he was Prime Minister of Luxembourg.

On a bigger scale, the OECD began putting in measures that would see firms under detailed reporting of their assets and operations to stop companies moving money around the planet based on where they claimed their operations are based - tax-treaty shopping. But legislation and enforcement don’t move at the same speed as righteous indignation: the OECD’s rules don’t come into effect until 2020.

As for Gary Barlow? His TT unit lost another band member while Gary continued in his multi-year, multi-media odyssey to attain the status of national treasure.

Europe Vs Eric Schmidt and Google

Google’s Eric Schmidt is a proud capitalist, he says. It would only take a bunch of effete, latte-drinking socialists Europeans to get in his multinational's path to glory.

Which is what they did.

Google chairman Eric Schmidt, speaking at the 'How Green Is the Internet Summit'

Schmidt's firm was told its handling

of data makes it accountable

The European Court of Justice ruled Google is accountable for the data that its gargantuan engine searches, indexes and retrieves and, as such, individuals can ask Google to delete links. The thinking is that in the year 2014 you might not want something you did in 2004 being repeatedly pushed to the top of a Google search by Google’s weighting based algorithms. It was called the 'right to be forgotten'.

The ruling was applied to all search providers, but mattered most to Google, which dominates the European search market - on 90 per cent. What followed in the reporting of the ruling was a flood of sensationalist, sky-is-falling media coverage, stoked by Google PR. History, as we knew it, was over it was said.

The ruling was more important to Google than the world: not being held responsible for content posted by their members and users is a sacrosanct principle for firms like Google and social networks. Whole businesses are based on this. Give ground in one area, who knows where you retreat next?

So far, the sky hasn’t fallen in, and history is still breathing. By December, Google had received 174,226 requests versus 669 for search rivals Bing from Microsoft. Google and Co are not compelled to comply with requests and - if they refuse - the matter goes to EU member states’ information commissioners. So 2014 wasn’t exactly the end of history.

But the Low Lands’ latte-sippers weren’t done with Mountain View and they delivered a string of anti-Google pronouncements - useless in deed but symbolic in act. The right to be forgotten should be applied to Google world-wide, not just the EU, they argued.

The European Parliament also delivered a near unanimous but symbolic vote that Google should be broken up, with search and ads divorced, and finished 2014 with a vote bemoaning Google’s domination of European search with a call for competition regulators to “monitor and prevent the abuse” of such positions.

Last time the EU got interested in monopolies in tech, it was against Microsoft on Windows, media players and browsers.

The EU has no powers of break up over Google and cannot act on the topic of monopoly; but, Google can be left in no doubt about where the land lay.

The question for Google is if the EU choses to - and succeeds in - engaging their regulatory peers in the US. That’s a big “if”. Of more tangible concern is the call to vigilance competition - that could be a ticking time bomb for the search and ads shop.

What will be Google’s response? Ultimately, to take its toys home, as it’s proven it’s willing to do in Spain and Russia, where the state has been throwing its weight around.

Uber's $2.4bn fender bender

To fans of the sharing economy they can do no wrong: startups lean on staff, built on a bread-line army of volunteers, their shop-front is an app. Firms hailed for cracking open the status quo, closed shops and/or for undercutting prices in their chosen field.

The other story is the aggressive business practices and immature cultures; in years past that was GroupOn. In 2014 it was Uber, the ride-sharing car service that is toast of the McKinsey-Consulting-Shoreditch thinker. Alas, Uber’s bubble burst under the combined weight of 12 months’ bad publicity culminating in the disclosure its executives were indulging a taste for Nixonian politics in their approach to business, the competition and journalists.

For early 2014, Uber was on cruise control - cities and states updated their laws to let the firm’s volunteer drivers operate taking the list of cities the San-Francisco-based firm operated in to 250 five years after it started. It landed $1.2bn in funding from some of tech’s biggest VC names - Google Ventures, Kleiner, Perkins Caufield & Byers, with early money in the bank from Jeff Bezos, too.

Mid year, it was the establishment that seemed on the wrong side of history as 10,000 black-cab drivers in London and taxi drivers in European cities brought traffic to a standstill in June in a massive protest at the lack of regulation on such apps such as Uber.

Police direct a cabbie at the Uber protest in London

London's black-cab drivers blocked traffic

in protest against Uber

Then Uber took a prang: staffers were found trying to sink rival Lyft by ordering and cancelling rides - more than 5,000 between October 2013 and August this year.

Uber exec Emil Michael was exposed talking at a New-York hob-nobbing event about paying private investigators to dig up dirt on journalists critical of Uber while there were reports of execs and staff having abused users’ data using a so-called God-view tool, monitoring the rides and travel information of journalists.

Ongoing concerns about the firm’s lack of driver training and screening peaked with drivers accused of raping female passengers in Delhi, India - a driver previously arrested for assault - and in Boston, Massachusetts.

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