News from Sacramento

I went to the SB 690 hearing at the California Assembly Privacy And Consumer Protection committee meeting this week.

• Opponents of SB 690 say that, in its original form, the bill would have removed the right of victims to sue over heinous abuses by Big Tech.

• Supporters of SB 690 say that without it, small businesses are at legal risk for some ordinary online marketing practices.

The hard part is that they’re both right.

Big Tech’s oligopoly on small business advertising makes the villainous and the ordinary hard to tease apart.

And that’s by design. Big Tech’s advertising systems are designed to maximize their own revenue from harmful practices at the expense of small business advertisers. Whether it’sInstagram promoting child sexual abuse material, or Facebook getting away with enabling a real estate scam, the common enabling practice is AI-powered adversarial personalization—targetingthe social media scam epidemic and other problematic material to those likely to fall for it, whileavoiding enforcement. (Update: India orders Meta to pull Instagram child abuse ads by Alina Maria Stan)

And Mark Zuckerberg was not born with supernatural surveillance powers. The adversarial personalization is done by AI systems trained on customer data that small businesses send to Big Tech. Small business decision-makers are no more fans of Big Tech’s crimes than anyone else. But the Meta Pixel and other enabling technologies for Big Tech value extraction are easy to set up, and come with friendly tutorials and free credits to get started. Meanwhile, legit forms of advertising are often prohibitively complex, come with hard-to-afford minimum spending levels, or both.

you gotta FIGHT for your (private) RIGHT (of action)

An amended version of SB 690 made it out of committee. The new version would preserve CIPA private right of action for wiretapping and confidential recording, but remove private right of action for pen register and trap and trace. Bethany G. Lukitsch, Paul G. Karlsgodt, Andrew C. Burnquist and Safina Motiwala summarize the new version inClick, Track, Sue: California Reconsiders CIPA’s Reach.

And preserving the private right of action for the most heinous Big Tech surveillance would be a quiet win for small business. Lawsuits and lawyer letters are noisy and obvious, but the risks to small businesses of not having CIPA protection in place are larger and longer-lasting.

• Big Tech must keep growing at startup-like rates even in an advertising business they already dominate—so must extract a larger and larger piece of each sale. (Ifthe claims of Big Tech fans in academia were true, the rise of smartphones would have meant a small business boom. Instead, we have, well,all this.)

• The surveillance data collected from small businesses ends up being used to train machine learning that works against customers, and when customers lose, the small businesses they buy from lose too. Money that is lost to Big Tech-enabled fraud, or gambled away on lootboxes and sportsbook apps, or just wasted on regrettable drop-shipped crap is money that’s not available to be spent at legit businesses.

The immediate problem for small businesses in California now is how to keep marketing working while fixing the Big Tech value extraction.

Big Tech won’t make it easy. They are doing as much as possible to snarl up the process for setting up the marketing basics with the process for feeding data into all kinds of harmful schemes.

And, I hate to say it, but privacy people aren’t making it any easier, either. The conventional privacy nerd party line is something like, Big Tech companies are surveilling users for the benefit of advertisers when that can’t even make sense in a market economy. Legit businesses and their customers are on the same side. The whole point of a working market is win-win deals.Every beneficial purchase by a consumer is also a sale by some legitimate company.

For those who provide any kind of online service to small businesses in California, it’s time to figure out the roadmap to a common sense,research-driven approach to data practices. There’s an immediate to-do item for removing the most obvious, most heinous tracking, which is easy to justify because lawyer letters.There are LinkedIn thought leaders and even lawyers who will tell you the way to do this is to stick a Europe-style consent dialog on a site, and then do adtech/martech as usual as soon as the user clicks through. This is bad advice. I am not a lawyer and can’t give legal advice, but I can call out bullshit when I see it. More:common sense one, bullshit documents zero And yes, it is possible to do this while continuing toparticipate in society. But the real wins will come as service providers are able to protect small businesses from Big Tech’stendency to force everyone into economic central planning and better enable a free market approach. History shows [citation needed] that societies with an empowered jury system have rewarding entrepreneurship.

Fun California fact: Until 1907, the state of California was not allowed to use banks or paper money, so the entire state budget was stored in the form of gold and silver in theTreasurer’s office on the first floor of the Capitol building.

Related

Sacramento Bee coverage by Kate Wolffe: CA considers state privacy act changes to curb lawsuits.

California Senate Bill 690 Loses Key Business Exemption In Latest CIPA Amendment by Tim Ashour.

Opinion: Senate Bill 690 could unintentionally harm immigrant communities by Marcela Miranda on the Times of San Diego site.

SENATE BILL 690 AMENDED: California Scales Back Its Proposed CIPA Overhaul by Eliminating the “Commercial Business Purpose” Exemption—Here’s What the Latest Means for CIPA Litigation by Puja “Queenie” Amin. So while the bill may knock out one category of claims, claims under Sections 631 and 632 are still fair game for plaintiffs.

Digital elbows up by Cory Doctorow. I do not attribute blame for enshittification to poor consumer choices. So where does the blame lie? It lies with policymakers. Regulators and politicians who created an enshittogenic environment: a rigged game whose terrible rules guarantee that the worst people doing the worst things will fare best. (Right to repair and right to circumvent are necessary pro-competition policies. We also need privacy laws that keep Big Tech from rigging the data collection to work against legit advertisers.)

Bonus links

6 tonnes, 3 000 km de portée: le FP-5 Flamingo est-il l’arme qui peut changer la guerre en Ukraine? par Sylvain Biget. (No, there’s no one Wunderwaffe/arme qui peut changer la guerre, but this one is an open source story. ArduPilot is GPLv3.)

Those bots sending discounts to your email is dynamic pricing in action. Get revenge on those bots by abandoning your cart by Catherina Gioino. (Marketing thought leaders say that people want a personalized customer journey, but what we really want is a customer journey personalized to whoever got the best deal. More:personal AI in the rugpull economy)

Mike Huckabee’s False-Advertising-Related Case Against Meta Can Go Forward by Eugene Volokh. (Another interesting case where a judge says §230 is not the “anything Meta does is legal neener neener” law. More:Big Tech platforms: mall, newspaper, or something else?)

The bottleneck might be the air in the room by Mike Bowler. 1,000 ppm is not an extreme number. A closed room with a few people breathing in it reaches that inside the first hour. Your all-day planning session, your architecture review, your quarterly strategy offsite in the windowless boardroom: those are precisely the conditions that push CO2 into the range where decision quality measurably falls. (Product idea: Speech to text system that annotates meeting notes with the current CO2 concentration.)

Bring Back Crappy Forums by Ernie Smith. The thing about social media these days is that the good stuff all too often pulls you in, but at the end of the day, you end up feeling hollow. Perhaps it’s for this reason that, when I spotted a thread asking about what my favorite social network of all time was, my answer wasn’t Twitter or Bluesky or even Tumblr. It was, of all things, a forum for news designers that existed in the mid-2000s called Visual Editors.

Pluralistic: Technocarcinization (01 Jul 2026) Lately, I’ve watched the American Big Tech platforms as they underwent their own form of technocarcinization, which is when every tech company turns into Facebook.

Papa Johns Surveillance-Based Advertising by Bruce Schneier. (Read this blog post and the linked-to AdExchanger piece. Good example of how marketing’sgroup cohesion means losing a connection to regular people’s privacy norms.)

Ireland is big tech’s lapdog – and that compromises its EU presidency by Johnny Ryan. (This is why “privacy compliance” that tracks what works in the EU is a bad fit for California. Irish politicians and the revolving door of Meta execs/Irish regulators are going to react differently from a California jury.)

Frequent AI chatbot users more likely to believe anti-vaccine myths, poll finds by Nick Robins-Early. (So what else can those chatbot users be sold on? Especially weird politics, too?)

People training new AI models admit they just get chatbots to do it by Matthew Sparkes. The seemingly widespread practice risks undermining the future of AI… (Oh no! Anyway…)

Gas station owners have found a use case for AI, lawsuit says: colluding to fix prices by R.J. Rico and The Associated Press. (If people knew how much “AI” investment has to be justified by price discrimination to capture consumer surplus, then data centers would be even more unpopular here.)