Short-Run Effects of GDPR on Technology Venture Investment
papers.ssrn.com
papers.ssrn.com
While I am absolutely open to the possibility that the GDPR has negative effects on technology venture investment (as their paper suggests), I am a bit disappointed that they did not attempt to correct for the effects of the UK leaving the EU. At the very least it would have been nice if, in addition to graphs for the entire EU, there were graphs for the UK alone, and also for the EU without the UK. That way it might have been possible to get a vague impression of how much these numbers are affected by Brexit instead of the GDPR.
That would seem to require that the Crunchbase dataset referenced in the paper (but not discussed in terms of its content or format) was broken down in terms of specific businesses and their host country.
The actual effects of the UK's exit are not yet known (the post-Brexit UK might even grandfather in some EU law like GDPR), and the article [0] mentioned in the other HN story (your ref 1) is not definitive, e.g. for Pfizer it says: "Pfizer’s preparations are well advanced to make the changes necessary to meet EU legal requirements after the U.K. is no longer a member state, especially in the regulatory, manufacturing and supply chain areas". To me this isn't a basis for inferring what Pfizer will do with respect to GDPR
[0] https://twitter.com/uk_domain_names/status/10615540262848348...
By default all existing EU law is grandfathered in, as a new legal category of "retained EU law". Changing or dropping individual laws would be considered on a case-by-case basis. The main legal significance of Brexit is that EU institutions will no longer be able to impose new legislation on the UK.
https://en.wikipedia.org/wiki/European_Union_(Withdrawal)_Ac...
Again, this isn't to say that I don't think the GDPR could possible result in lower investment, it's just since Brexit is happening in slow-motion at the same time, and I don't think the authors have tried to measure how much that contributes to their results.
However the effects ahead of Brexit are already occurring.
GDPR isn't going to slow down research projects into new approaches to OS design, or physical hardware development. No one is stopping their generalized AI thesis work over customer data laws.
The entire media coverage of GPDR and to an extent Brexit, seems like big business throwing a tantrum akin to a spoiled child. Flinging themselves on their bed crying that their entire life is over because they can't stay out past midnight.
All these reports are investment graphs and earnings reports. Slight to moderate downturns at a time of record highs in the market. Thinly veiled blackmail and ultimatums by those that have against those that have-not. "Let us do whatever we want or it would be a shame is something happened to your 401k.(or your research grant for that matter)"
From the abstract: "in the overall dollar amounts raised across funding deals, the number of deals, and the dollar amount raised per individual deal" by "EU ventures, relative to their US counterparts."
I would love to see this analysis re-run with a separation maintained between adtech and non-adtech companies. The effect on the former is expected and, to a degree, desired. The effect on the latter deserves scrutiny.
Bad luck, be responsible.
Why would you think so?
Will my project run afoul of the 3rd party rules? No. May I have to spend money on legal protection from the EU when they erroneously come asking for money? Maybe. This is my issue. I don't know. The EU says it has policing power across the globe. If an EU citizen steps foot in the sovereign territory of another country, the EU says that all their privacy laws apply.
That's not true. The GDPR doesn't apply to citizens of the EU, but to people in the EU or services performed there.
An in fact, it's even less than that: the site only has to care if they target people in the EU (not necessarily exclusively) or if they're tracking behaviours. Simply being accessible online doesn't mean it has to comply, whereas e.g. accepting Euro payments probably does.
Meanwhile you’re sitting here daydreaming about how your startup is going to be so big EU regulators are going to come after you. Well that would be an excellent problem to have, in actuality you are far more likely to be killed by Google sucking the oxygen out of your market.
I use them for email. My email is essentially a curated spam folder. I seldom use it for anything of value. When I do use it, I could care less if the information was made public.
I use it for online storage,but again for nothing important. If I lost it all tomorrow my only care would be an outstanding, meaning not yet turned on, assignment for my ML class.
Everything else I accept in trade: my data for their service. I use Google Maps. I accept that when I’m driving they will track me. I hope they do. I want to know if I should get off the interstate due to a traffic issue.
I don’t watch TV. I have Ad Guard filtering at the network router level. I block Facebook and Twitter there too. I don’t use porn. All Google knows is that I’m a particularly boring human being that probably purchased a dobro given my uptick in how to play the dobro videos. They probably also infer I have mild body dismorphia given some Sapien Medicine videos/sounds I listen too regularly.
All this I, a consenting adult, allow them to know in trade for their service. If you don’t like them, there are free means to thwart them. Google will provide you the means to figure this out with their search. As a result, no I don’t care for this kind of worthless handwringing.
Go after the leaks at the credit agency. I have no choice but to participate with them. No banner would allow me to opt out.
Don’t go after some social media company that we all know is going to sell your data that you traded to get their service. We scientifically know that social media is bad for us all. Why regulate straws when that pandora’ Box of depression is allowed to continue? Grow up. Be an adult. Take responsibility for your choices and entitlement.
Are you really so sure of your views that you feel that those you disagree with must be less mature than you?
> I use Google Maps. I accept that when I’m driving they will track me. I hope they do. I want to know if I should get off the interstate due to a traffic issue.
You may well already do this, but to actually achieve only being tracked while actively using Maps, I believe you'd have to turn location services on and off each time you use Maps, otherwise Google is tracking you all the time, not just when Maps is open. Assuming an Android device, I'm less sure about how this would play out on iOS.
> All this I, a consenting adult, allow them to know in trade for their service. If you don’t like them, there are free means to thwart them. Google will provide you the means to figure this out with their search. As a result, no I don’t care for this kind of worthless handwringing.
i.e. you are A) aware of what they are doing B) understand that you can intervene and have the skills to put such efforts in place C) hold values such that the tradeoffs doing so implies is acceptable to you.
If everyone was similar to you in these regards, there wouldn't be an issue, but people's awareness of the issues, skills, and values are hugely variable across a population. So while it's worthless handwringing to you, people who hold different values could (and do) disagree.
> Go after the leaks at the credit agency. I have no choice but to participate with them. No banner would allow me to opt out.
Good idea. However, I don't think it's reasonable to assume that the efforts against misuse of personal data online are entirely fungible towards efforts of credit agency reform. i.e. not doing this doesn't mean more of that would happen, or that doing this keeps that from happening too.
> Take responsibility for your choices and entitlement.
AFAIK, telling people this isn't effective, so it can really only serve to make yourself feel superior, not really effect change (since I'm assuming you consider yourself to already follow this advice)
I don't see how any of that follows. You can either a) leave the net of Google by switching browsers, going back to flip phones, going to Apple, etc, or b) say that the cost is worth your inertia.
As for not being effective, please look at Unions (non-government means to counter corporate power). Look at the black community before the Democrats got a hold of them. Harlem had its problems, but was the seat for art and culture that still benefits humanity to this day.
> Are you really so sure of your views that you feel that those you disagree with must be less mature than you?
Yes. The people that hold the view that papa Government will fix everything are thinking emotively like a child. Reagan, for all his flaws, was right: "The most terrifying words in the English language are: I'm from the government and I'm here to help." The EU is going to crush, either through GDPR or the new copyright tracking system all startups in the tech area until the tech companies bootstrap without ads. Maybe this is ultimately good, but it would be a side effect of the regulation, not the government's wisdom.
> You may well already do this, but to actually achieve only being tracked while actively using Maps, I believe you'd have to turn location services on and off each time you use Maps, otherwise Google is tracking you all the time, not just when Maps is open. Assuming an Android device, I'm less sure about how this would play out on iOS.
If you're a good citizen of the world you should turn off location to save on greenhouse gases. Android is terrible at efficiency with those on. They should lock out when not directly used by an application.
> If everyone was similar to you in these regards, there wouldn't be an issue, but people's awareness of the issues, skills, and values are hugely variable across a population. So while it's worthless handwringing to you, people who hold different values could (and do) disagree.
So because there are dumb and or lazy people, the EU needs to attempt another centrally plan attempt at controlling the evolution of the species? Are we going to get State monitors for using the toilet correctly? Think about how many diseases are from improper flushing and wiping. How about a bathroom monitor that's armed with a stun gun to make sure people wash their hands?
>>> - You
>> AFAIK, telling people this isn't effective, so it can really only serve to make yourself feel superior, not really effect change
>> - Me
> I don't see how any of that follows. ... look at Unions
> - You
I think you misunderstood me, or are replying to more than what you quoted here, because I'm not sure what unions have to do with the statement you did quote from me.
I am saying that the literal act of telling people to "take responsibility for your choices and entitlement" isn't an effective way to have more people take responsibility for their choices and entitlement. Your saying it is not useful in furthering your implicit goal of getting more people take responsibility. 99% of the time the only thing that that statement will do is make you feel superior because you believe you're already doing that.
> The people that hold the view that papa Government will fix everything are thinking emotively like a child.
I mean, the way you phrased that makes it practically a tautology. I'd suggest you consider that there could possibly be other reasons look towards the government for solutions beyond mere naivete.
If you understood those reasons, then you could address them and potentially convince people that they should change their mind. However, I will again point out that it is your approach here that will get in your way. Calling a person childish, if they are not being childish, will result in them dismissing what you have to say because you are insulting them. But calling a person childish, when they are being childish, will result in a metaphorical fingers-in-ears-going-la-la-la-la response because they are being childish.
> Government will fix everything
I agree the government cannot fix everything, however I also believe there are classes of problem that a government, or government-like-entity, are better capable of addressing than the alternatives, but you're so busy calling people immature and smugly telling us how you've got it all figured out that I doubt you'd be willing to take the time to try to understand that (I'd love to be wrong about that, mind you)
>If you're a good citizen of the world you should turn off location to save on greenhouse gases.
If you're a good citizen of the world, you wouldn't use a phone containing compounds taken from strip-mines that poison the surrounding ecosystem and then had to be shipped on a pollution belching freighter halfway around the world.
> Android is terrible at efficiency with those on.
How much worse? Over the lifetime of a phone, how much more energy will be used? A ballpark, order-of-magnitude, fermi estimation would be good to have for this. Heck, I'll do it so we can see:
Assumptions:
* 5,000 mAh battery (this is higher than all flagship phones this year[0])
* To get watt-hours assume a li-po battery operating at 4.2 volts (higher of two standard voltages for li-po[1])
* 3 year lifespan (Higher than the US avg replacement cycle length[2])
* The phone battery is completely drained by the end of the day
* The phone battery is fully charged by the next morning
(3 years * 365 days) * (5,000 mAh * 4.2 volts) = 23 kWh[3] which is about 7.66 kWh/yr.
To put this in perspective a kWh costs 12 cents on average in the US, and boiling 1 cup of warm-ish (65-70 degree F) water takes around 150 Wh[4], which works out to mean that a person could offset their phone's energy usage by having one less cup of coffee per week.
But I estimated high on everything, so in practice a phone will use less than 23 kWh over its lifetime, probably significantly less.
This all puts aside the immediate question of why are you bringing energy efficiency into a discussion about privacy?
> controlling the evolution of the species?
Maybe I'm missing something, but I don't really understand what privacy laws and evolution have in common. I'd appreciate an explanation.
>> people's awareness of the issues, skills, and values are hugely variable across a population
>> - Me
> So because there are dumb and or lazy people, the EU needs to attempt another centrally planned ...
> - You
First, I'm kind of impressed that you managed to interpret what I said to mean that some people or dumb and/or lazy. Why do you believe that different from you is bad?
Second, assuming your real question is more like "On what basis is the EU passing a law imposing these restrictions about personal data on companies?". I would say the reason is because a majority of the EU constituent country leaders believe that doing so upholds the values and goals of the EU. For example "The goals of the [EU] are... promote peace, its values and the well-being of its citizens" and "Individual freedoms such as respect for private life,... and information are protected by the EU" and "Human rights are protected by the EU Charter of Fundamental Rights. These cover ... the right to the protection of your personal data"
tl;dr That's the point of the EU [5]
> Think about how many diseases are from improper flushing and wiping. How about a bathroom monitor that's armed with a stun gun to make sure people wash their hands?
As long as we're being sarcastic, I'll say that that sounds like a great way to create jobs.
More seriously, I believe the EU does have laws about food workers washing their hands after using the restroom. If it could be shown that enough lives would be saved by extending those laws, and their enforcement, to be worth the expense, I don't doubt the laws would eventually change to account for that.
[0] https://www.digitaltrends.com/mobile/which-2018-flagship-pho...
[1] https://learn.adafruit.com/li-ion-and-lipoly-batteries/volta...
[2] https://www.statista.com/statistics/619788/average-smartphon...
[3] https://www.wolframalpha.com/input/?i=((365+*+3)+*+(5000+mil...
[4] https://www.plotwatt.com/2011/05/21/plotwatt-labs-boiling-fo...
[5] https://europa.eu/european-union/about-eu/eu-in-brief_en
As to the general idea of the government figuring things out, I'd rather have a world where humanity comes to a homeostasis due to conflict and pollution than to live in the dystopian world that Merkel and her ilk are bring forward with their new Empire. https://www.telegraph.co.uk/business/2018/11/12/france-calls...
However, I don't think we need to go to that extreme. People should take responsibility for their data. They should figure out what they care about and seek means to realize their ends without requiring an Empire to bring its claws to bare by fines.
As to "dumb or lazy" you implied it. I said if they cared about it, they can shut it off by doing a simple Google search. If they don't care about it, they can leave the status quo. If they care and can't be bothered figure it out, which I don't think there will be too many that can't even ask for help, then they are lazy. Your argument is that the bulk of the EU population is in the lazy/dumb camp since the primary reaction you're condoning is regulation.
Some good discussion here:
With the big dialogs that one systematically finds at websites now, in practice you are being forced to accept those cookies, if only to avoid seeing those monster dialogs again.
So in practice the EU is massively driving people to accept permanent cookies. That's IMHO a valid reason to complain about GDPR.
What else is new?
But in addition to that, there is the deadweight economic loss from the compliance cost destroying low margin operations with positive externalities, and reducing competition which allows incumbents to become more abusive.
And even then the tax complexity still disadvantages small players because their larger competitors have the resources to use the complexity to their advantage and end up paying less tax.
- Senator Robert F Kennedy, 1968
> These commodities and services must be offered to the consumer with a special urgency. We require not only “forced draft” consumption, but “expensive” consumption as well. We need things consumed, burned up, worn out, replaced, and discarded at an ever increasing pace. We need to have people eat, drink, dress, ride, live, with ever more complicated and, therefore, constantly more expensive consumption.
-- Victor Lebow, "The Real Meaning of Consumer Demand", Journal of Retailing, 1955
Whether or not we can eat is determined by farmers, truck drivers, distribution centre workers, store clerks, etc.
Whether or not we have somewhere to live is determined by construction workers, electricians, plumbers, engineers, etc.
Access to health care is determined by doctors, nurses, pharmacists, etc.
All these things existed well before the internet. In other words, we'll be fine.
Not all parts of the economy are equal. Losing 25% of farmers or doctors would be catastrophe. Losing 25% of electricians would be a problem. Losing 25% of software developers would be a bit annoying. Losing 25% of marketers would be a reason for a party.
Good software engineers are needed to work on problems that matter. Quite the delta from where we are today.
Second thing, I did not seen enough evidence that in general EU has more birocracy then other similar countries.
I assume you also complain about don't spam me law, because you have to actualy do some work to comply,
If they get bankrupted by a GDPR fine then their business model needs a review.
This is an odd statement to continue seeing, given we’ve now seen GDPR weaponised by an EU member to stifle journalists investigating corrupt politicians [1].
We need regulation protecting privacy. The debate is whether GDPR does that effectively (i.e. causes the intended effects) and efficiently (i.e. with minimal undesirable side-effects). Saying “if they get bankrupted by GDPR...then their business model [is bad]” is extreme because it assumes without evidence GDPR’s efficiency.
[1] https://www.occrp.org/en/40-press-releases/presss-releases/8...
Food safety laws are a nightmare. Instead of serving dishes you have to spend >50% of your time making sure the kitchen is clean and food is uncontaminated.
But the GDPR gives small companies at least some extra privileges, so I don't see that one as a particular harmful law.