[Plura-list] Mexican indigenous telco wins spectrum fight; How apps steal your location; Understanding /r/wallstreetbets

[Cory Doctorow]

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Join me this afternoon for the launch of the print edition of my 2020
book HOW TO DESTROY SURVEILLANCE CAPITALISM!

https://medium.zoom.us/webinar/register/WN_GfnYHzZCSY-cCMVL5ZCDBw

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Today's links

* Mexican indigenous telco wins spectrum fight: First Nations treaties
do not sign away electromagnetic franchises.

* How apps steal your location: A deep dive into the murky depths of
surveillance markets.

* Understanding /r/wallstreetbets: More than a bull run, a symbiosis of
a market maker and market destroyers.

* Knowledge is why you build your own apps: Outsourcing software
development squanders vital understanding.

* This day in history: 2006, 2011, 2016, 2020

* Colophon: Recent publications, upcoming/recent appearances, current
writing projects, current reading

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🥉 Mexican indigenous telco wins spectrum fight

In the early 2000s, dramatic shifts in radio spectrum allocation for
mobile data applications, combined with advances in radio transmission
and receiving prompted some networking engineers to propose a radical
rethink of radio.

Our current spectrum management assumes that senders and receivers have
characteristics that are fixed at the point of manufacture, determined
by things like the shape of an antenna and the type of quartz crystal
used as an oscillator.

But software-defined radios (SDRs) and software-tunable phased-array
antennas make those assumptions obsolete. Today, a radio can be a
commodity computer that can sense other devices' RF use and transmit and
receive on multiple frequencies to share the airwaves.

This was dubbed "cognitive radio" and its proponents imagined a world
where the exclusive spectrum allocations handed out to telcos,
broadcasters and other powerful entities would be replaced by a
cooperative spectrum model.

Two radios that needed to talk to one another might make contact in one
band, switch to another, or ask a third receiver to relay messages for
them, using just enough power to reach one another, avoiding the bands
that were already in use.

These proposals - which would vastly increase wireless data capacity -
were met with fierce resistance, from incumbent licensors, from spectrum
speculators, and from HAMs, who are brilliant but also tend to be
conservative about spectrum allocation.

These debates inevitably ran up against a hard limit: no one had ever
built any kind of serious cognitive radio network. Just trying it would
likely trigger massive, brutal FCC enforcement action, as it would
trample all that exclusive spectrum.

But that didn't cool the ardor of cognitive radio's fiercest proponents.
People like Dwayne Hendricks roamed the world, looking for spectrum
havens - places where cognitive radio could be tried. The King of Tonga
greenlit one project!

https://www.wired.com/2002/01/hendricks/

But the most promising on-shore spectrum laboratories were First Nations
territories - sovereign nations whose treaties predated any
understanding of electromagnetic spectrum and thus did not cede spectrum
rights to settler colonial powers.

Though the legal theory was as untested as the technical one, some First
Nations bands dallied with it, wondering if they leverage their position
to race past the hidebound rules in the US and Canada to bring money and
connectivity to their communities.

I wrote a short story about this in 2002, "Liberation Spectrum," which
Salon published in 2003:

https://www.salon.com/2003/01/16/liberation_spectrum/

Making sovereign spectrum policy is one of the better interpretations of
treaty law; it has the potential to be as lucrative as, say, casinos -
and could also bridge the digital divide for First Nations communities.

Certainly, it's a better idea than the pharma trolls who briefly
experimented with transfering patent portfolios to sovereign bands in
the hopes of of muddying the jurisdictional questions so that their
profiteering would be harder to shut down.

https://arstechnica.com/tech-policy/2017/09/how-a-native-american-tribe-ended-up-owning-six-key-patents-on-an-eye-drug/

Thankfully, that plan petered out. Likewise, First Nations experiments
with spectrum policy seem also to have lost momentum, since then - at
least, none have crossed my radar.

Until now.

On Jan 13, the Mexican Supreme Court found in favor of Indigenous
Community Telecommunications (TIC), unanimously finding that community
groups like TIC were entitled to free "social use" spectrum licenses.

https://globalvoices.org/2021/01/27/indigenous-led-telecommunications-organization-wins-historic-legal-battle-in-mexico/

The decision did not rely on treaty rights, but rather upon a carve out
in Mexican spectrum policy that gives free spectrum to community groups.
TIC is an incredibly effective network of 80 towns in 18 Indigenous
communities operating voice and data mobile networks.

Since 2018, TIC has been under threat, with the regulator demanding 1m
pesos for continued access to spectrum; a demand the Supreme Court
unanimously voided.

The decision will ease expansions of TIC's service into the vast
majority of Indigenous communities that lack reliable mobile service.

http://www.ift.org.mx/sites/default/files/reporte-coberturapueblosindigenas_finalpublicar.pdf

And it also allows for services beyond telephony. As TIC's Erick Huerta
says, this paves the way for other Indigenous media being exempted from
regulatory barriers.

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🥉 How apps steal your location

A new research report from Sean O'Brien and Expressvpn in honor Data
Privacy Day reveals the incredible extent of commercial location
tracking hidden in everyday apps.

https://www.expressvpn.com/digital-security-lab/investigation-xoth

App vendors use free software development kits (SDKs) to build their
products, not realizing (or not caring) that the SDKs come from
commercial surveillance companies that harvest all their users' data and
sell it in hidden, sprawling commercial markets.

That's how the US military was able to buy location data on users of a
Muslim prayer app: the app was built with one of these surveillance
SDKs, so the data was extracted, packaged and sold on the cheap to the
Pentagon.

https://www.vice.com/en/article/jgqm5x/us-military-location-data-xmode-locate-x

The survey encompasses 450 apps with 1.7b downloads. It found that
messenger apps (including many masquerading as Wechat, FB Messenger, and
Telegram) were rife with location tracking. Other major offenders
include dating and social apps.

The sleaziest SDK vendors are also the most prolific. X-Mode (a company
that is theoretically banned from app stores) is in 44% of the analyzed
apps. X-Mode is especially prevalent in religious apps, especially
Islamic ones.

The researchers did me the honor of naming their report Project Xoth -
Xoth is the name of one of the sinister commercial surveillance
companies in Attack Surface, the third Little Brother book.

http://attacksurface.com

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🥉 Understanding /r/wallstreetbets

There is no shortage of takes about what's going on with Gamestop (and
other surging stocks), Robinhood and Reddit's r/wallstreetbets, many of
them contradictory - at least on the face of them. But I think it's
possible for most of these takes to be right. Here's how.

First you need to understand the underlying mechanics of the story.
Stock markets are fundamentally a way of making bets, including bets on
the outcome of other peoples' bets, and bets on the outcomes of *those*
bets.

All this complexity creates lots of exploitable opportunities. Some of
these opportunities are considered legitimate and are given respectable
names like "arbitrage." Others are considered illegitimate, and are
called disreputable things like "stock manipulation."

A hypothetical Martian observing all this through a telescope could not
tell you which kinds of bets were honest and which were dishonest,
because the difference isn't about any objective standard, but rather,
about power.

The strategies of powerful people are legit, while the strategies of
their would-be dethroners are not legit. Sometimes, even outright frauds
are OK if they're done by people with enough power.

If your scam pays out quickly enough, you can sometimes parlay the
resulting cash into retrospective legitimization, so even the strategies
of the out-group can end up being retconned as legit, if they're
successful enough.

That's why Amway isn't illegal: Betsy DeVos's father-in-law was
simultaneously the boss of Amway and head of the US Chamber of Commerce,
and Gerry Ford was his Congressman, who was then elevated to president
in time to legalize its business model.

To understand the Gamestop rise, you have to understand a couple of
different kinds of bets.

"Shorting": this is a bet that a stock will go down. There's a
complicated backstory to how you make this bet, but it doesn't matter.

The thing to know here is that shorting a stock can make you rich...if
the stock goes down. But if the stock goes up, you lose money. There's
not really any limit to how much you can lose here.

Every time the stock goes up, the shorts have to pony up more money to
keep their bet alive (in the hopes that it will go down again later), or
they have to take their losses, pay out the winner of the bet and
surrender any chance of winning later.

Shorting isn't just a bet on someone else's failure - it's a way to fund
bullshit-detection. If you know (or suspect) that a company is lying
about its prospects, you can bet against it.

Shorts fund a lot of research into defective products and scammy
businesses, because they win when bad companies are exposed and their
stocks go down. Some of the scary security research you read about bad
IoT software is funded by shorts.

That's why habitual bullshitters like Elon Musk *hate* shorts. Musk
leads a cult of credulous worshippers who buy whatever he's selling.
Shorts make bets that Musk's cultists will get deprogrammed. Musk uses
this to sharpen his cultists' resolve: "they want us to fail!"

"Options": many different bets get lumped in as "options" but for the
purposes of this discussion, buying an option means buying the right to
buy stocks later. The people who sell you the option usually go out and
buy the stock right away so they'll have it to sell.

"Front-running": Cheating. Front-runners insert themselves into
transactions by spying. If I know that Alice is buying a bunch of Bob's
shares, I can snap them up a millisecond before Alice gets there, mark
them up, and sell to Alice at a profit.

"Retail investor": An "average joe" who buys stocks from a brokerage
like Robinhood.

"Institutional investor": Hedge funds, private equity funds, pension
funds, index funds, investment banks, etc. Whales and sharks.

"High-frequency trader": A bot. Someone (usually an institutional
investor) who uses an algorithm to buy and sell shares very quickly.
HFTs might buy a stock and sell it less than a second later (when
they're front-running, for example).

With that all out of the way, here's what seems to be going on. Reddit's
r/wallstreetbets is a "retail investor" forum of average joes, many of
them angry at the scammy, evil stuff that the big institutional
investors get up to.

Their grievances are mixed: some are angry that big investors have
figured out how to destroy good businesses for money. Some are angry
because *only* big institutionals get in on the action when that happens
and average joes are locked out of those plays.

They are stuck at home, have little to spend their money on, and -
critically - have access to "trading platforms" like Robinhood that let
them buy and sell stocks without any fees (institutionals often have
sweetheart deals like this, but average joes used to pay to play).

They're getting together to make money and to punish their enemies. The
easiest enemies to punish are shorts, because if they push up a stock
even a little, the shorts get pounded for millions of dollars.

If they can keep the stock up long enough, the shorts will give up and
the average joes will collect their winnings. And the average joes are
clever. They've figured out that they don't even have to buy the stocks
to force the price up - they can buy cheaper options instead.

An option is a bet. The people on the other side of the bet usually buy
the stocks they sell options on. If I buy an option to buy a stock from
you and then the stock goes up, you have to go out and buy the stock and
sell it to me at a loss.

If you're an option seller who thinks a stock will go up, you protect
yourself by buying shares now.

Buying options is a cheap way to get someone else to buy a stock, which
pushes the price up. If the price is going up, options sellers will snap
up more stock.

There's two prominent versions of the Gamestop story. The first is that
r/wallstreetbets represents so many angry average joes that they can
"move markets" by buying unlikely shares, like Gamestop or AMC, and
confound the markets.

https://marketsweekly.ghost.io/what-happened-with-gamestop/

The second story is that r/wallstreetbets has figured out a hack. They
inflict asymmetric pain on shorts (a tiny gain for average joes is a
huge wound to the sharks). By buying options, they can eke out tiny
gains for a fraction of the price.

https://www.cnet.com/news/reddits-gamestop-stock-surge-is-a-terrifying-new-occupy-wall-street/

But there's a *third* story, and I think it's the most important one.
That's Alexis Goldstein's account of what's going on with Robinhood and
the institutional investors it's in bed with.

https://marketsweekly.ghost.io/what-happened-with-gamestop/

Recall that all of this is only possible because Robinhood lets average
joes buy and sell stocks for free. How can Robinhood give away a service
that costs it money and still stay in business? (Hint: They're not
making it up in volume).

The answer is: surveillance. Robinhood partners with institutional
investors and lets them spy on what the average joes are buying and
selling. Sometimes, this is just "market intelligence" ("Hey, people
like fidget spinners") but the main event is front-running.

If you're paying Robinhood to tell you what assets its customers are
about to buy, you can go out and buy them up first and sell them for a
profit to Robinhood's customers.

Or you can buy some of that asset up because you know its price will go
up once Robinhood's customers orders are filled.

Or both.

Citadel Securities is Robinhood's main institutional investor partner.
Founded by billionaire Ken Griffin, they combine tech (high-frequency
trading), an "asset manager" (they spend other peoples' money) and a
"market maker" (they sell things like options).

Citadel gets to see all those r/wallstreetbets buy orders before they're
filled. They can fill some of those orders, making a profit. They can
buy some of the same stock for themselves, making a profit. They can
sell options, making a profit.

A little bit of this profit comes at the expense of average joes: if
there wasn't a front-runner marking up the stocks they buy, the average
joes would pay a little less. But the average joes are still profiting
from the destruction of the shorts.

Citadel is merely taxing their winnings. The real losers here, though
are Citadel's competitors, funds like Melvin Capital, who were seriously
short on Gamestop and went bust thanks to all of this. Guess who bought
Melvin at fire-sale prices? That's right, Citadel.

So the third story goes like this: there are a lot of average joes.
They're numerous, pissed and smart. They move a lot of money against
shorts and make it go farther thanks to the force-multiplier effect of
options.

*Then* all this activity is multiplied again by Citadel, a fund that is
no better (and no worse) than Melvin or the other targets of the average
joes' wrath. Citadel's bots are triggered by the average joes' activity,
which turns kilotons of damage into gigatons.

It's not clear whether the average joes know they're triggering
Citadel's bots, or whether this is just Citadel's bet on frontrunning
average joes paying off for Citadel. It's possible Citadel is the joes'
patsy, and the joes are *also* Citadel's patsies.

It's also not clear whether Citadel - and its feuding cohort of
competing finance-ghouls - can contain the storm. Maybe they profit off
the average joes now, but the joes figure it out and turn their weapons
on Citadel and the whole system later.

Remember, the "legitimacy" of a financial strategy isn't determined by
its objective decency, but rather by the power of the people who deploy
it. If the average joes can attain respectability, they may be legitimized.

But the road to legitimacy is rocky. Yesterday, the finance monopolist
TD-Ameritrade halted trading on the stocks targeted by the average joes.
Today, Robinhood followed suit. Maybe they fear that they can't control
the monster they created?

https://www.theverge.com/2021/1/28/22254102/robinhood-gamestop-bloc-stock-purchase-amc-reddit-wsb

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🥉 Knowledge is why you build your own apps

"How to Build Good Software" is the Singapore's Civil Service College's
excellent white-paper on, well, how to build good software. Much of
what's in here is well-stated repetition of common wisdom from the
field, but there's one standout and novel section.

"Software Is about Developing Knowledge More than Writing Code" presents
a really important perspective on software development I'd not seen
before: that the complex, messy, iterative process of software
development is a feature, not a bug.

Author Li Hongyi argues that getting working software out the door
involves making tradeoffs, compromises, and paint-to-cover/file-to-fit
style engineering. If you do that work in house, you know where the weak
spots are.

But if you outsource this work, the shameful secrets become the property
of your contractors, who probably don't even bother to document them. So
you lose out on knowledge - and even on the ability to buy that knowledge.

"Even if the system is very well documented, some knowledge is lost
every time a new team takes over. Over the years, the system becomes a
patchwork of code from many different authors. It becomes harder and
harder to keep running; eventually, there is no one left who truly
understands how it works.

"For your software to keep working well in the long term, it is
important to have your staff learning alongside the external help to
retain critical engineering knowledge in your organisation."


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🥉 This day in history

#15yrsago Photographer’s bust-card silkscreened on white-balance cards
https://web.archive.org/web/20110124150125/http://store.petapixel.com/products/Photographers-Rights-Gray-Card-Set.html

#15yrsago What the LibreOffice fork means for Oracle’s shabby treatment
of Sun’s free software projects
https://web.archive.org/web/20110131052702/http://blogs.computerworlduk.com/open-enterprise/2011/01/the-deeper-significance-of-libreoffice-33/index.htm

#15yrsago Danny O’Brien’s Open Source con presentation on Evil
https://web.archive.org/web/20130729205907id_/http://itc.conversationsnetwork.org/shows/detail665.html

#10yrsago William Gibson on Stuxnet
https://www.nytimes.com/2011/01/27/opinion/27Gibson.html

#10yrsago Fair use for poets, demystified
https://cmsimpact.org/code/code-best-practices-fair-use-poetry/

#5yrsago Bill Gates sold rights to the Tiananmen 1989 pictures to a
Chinese company
https://qz.com/601830/bill-gates-has-sold-a-set-of-iconic-images-to-a-beijing-firm-including-of-tiananmen-in-1989/

#5yrsago Guess who donated all the money to Black Americans for a Better
Future Super PAC? Rich white men.
https://theintercept.com/2016/01/28/black-americans-for-a-better-future-super-pac-100-funded-by-rich-white-guys/

#5yrsago Anaheim: the happiest surveillance state on earth
https://arstechnica.com/tech-policy/2016/01/city-cops-in-disneylands-backyard-have-had-stingray-on-steriods-for-years/

#1yrago “A piece of shit”: Government report on Wells Fargo corruption
shows top executives’ direct complicity in millions of acts of fraud
https://www.latimes.com/business/story/2020-01-27/wells-fargo-scandal

#1yrago A vase ringed with razor-sharp knives
https://chrisbathgate.blogspot.com/2020/01/sculptural-knife-vase.html

#1yrago “The Art of Computer Designing”: stark, beautiful
black-and-white images from 1993
https://archive.org/details/satoArtOfComputerDesigning/page/119/mode/2up

#1yrago RIP, Jason Polan, who tried to draw every single person in New
York City https://kottke.org/20/01/remembering-jason-polan

#1yrago What happens when you steadily ramp up the speed at which you
listen to podcasts
https://onezero.medium.com/i-tried-listening-to-podcasts-at-3x-and-broke-my-brain-d8823edecb7c

#1yrago After ransomware took Baltimore hostage, Maryland introduces
legislation that bans disclosing the bugs ransomware exploits
https://arstechnica.com/information-technology/2020/01/good-news-maryland-bill-would-make-ransomware-a-crime/

#1yrago The “ops lessons we all learn the hard way”
https://www.netmeister.org/blog/ops-lessons.html

#1yrago Ajit Pai promised that killing net neutrality would spur network
investment, but instead Comcast cut spending by 10.5%
https://arstechnica.com/information-technology/2020/01/ajit-pai-promised-faster-broadband-expansion-comcast-cut-spending-instead/

#1yrago The Catholic Church broke its promise to publish a list of
“credibly accused” abuser priests, so Propublica did it for them
https://www.propublica.org/article/catholic-leaders-promised-transparency-about-child-abuse-they-havent-delivered

#5yrsago Microsoft billionaire Paul Allen wipes out coral reef with his
superyacht
https://caymannewsservice.com/2016/01/billionaire-boater-destroys-wb-reef/

#5yrsago Florida mayors write to GOP presidential hopefuls demanding
action on climate change
https://arstechnica.com/science/2016/01/florida-mayors-to-rubio-were-going-under-take-climate-change-seriously/

Colophon (permalink)

Today's top sources: Nat Torkington (), Naked Capitalism
(https://nakedcapitalism.com/).

Currently writing:

* My next novel, "The Lost Cause," a post-GND novel about truth and
reconciliation. Yesterday's progress: 547 words (104156 total).

* A short story, "Jeffty is Five," for The Last Dangerous Visions.
Yesterday's progress: 253 words (1885 total).

Currently reading: Analogia by George Dyson.

Latest podcast: Someone Comes to Town, Someone Leaves Town (part 29)
https://craphound.com/news/2021/01/25/someone-comes-to-town-someone-leaves-town-part-29/

Upcoming appearances:

* Launch for the print edition of HOW TO DESTROY SURVEILLANCE
CAPITALISM, Jan 28,
https://medium.zoom.us/webinar/register/WN_GfnYHzZCSY-cCMVL5ZCDBw

* Launch for the young adult edition of Edward Snowden's memoir
PERMANENT RECORD, Feb 9,
https://www.eventbrite.com/e/edward-snowden-in-conversation-with-cory-doctorow-tickets-136734968973

* Boskone, 58, Feb 12-15, https://boskone.org/

* Keynote, NISO Plus, Feb 22-25,
https://niso.plus/cory-doctorow-to-keynote-at-niso-plus-2021/

Upcoming appearances:

* Launch for the print edition of HOW TO DESTROY SURVEILLANCE
CAPITALISM, Jan 28,
https://medium.zoom.us/webinar/register/WN_GfnYHzZCSY-cCMVL5ZCDBw

* Launch for the young adult edition of Edward Snowden's memoir
PERMANENT RECORD, Feb 9,
https://www.eventbrite.com/e/edward-snowden-in-conversation-with-cory-doctorow-tickets-136734968973

* Boskone, 58, Feb 12-15, https://boskone.org/

* Keynote, NISO Plus, Feb 22-25,
https://niso.plus/cory-doctorow-to-keynote-at-niso-plus-2021/

Recent appearances:

* Monocle Reads
https://monocle.com/radio/shows/meet-the-writers/monocle-reads-87/play/

* Hedging Bets on the Future (Motherboard Cyber):
https://play.acast.com/s/cyber/hedgingbetsonthefuturewithauthorcorydoctorow

* Applying the Pandemic Mindset to Climate Change:
https://hbr.org/podcast/2020/12/applying-the-pandemic-mindset-to-climate-change-with-cory-doctorow

Latest book:

* "Attack Surface": The third Little Brother novel, a standalone
technothriller for adults. The *Washington Post* called it "a political
cyberthriller, vigorous, bold and savvy about the limits of revolution
and resistance." Order signed, personalized copies from Dark Delicacies
https://www.darkdel.com/store/p1840/Available_Now%3A_Attack_Surface.html

* "How to Destroy Surveillance Capitalism": an anti-monopoly pamphlet
analyzing the true harms of surveillance capitalism and proposing a
solution.
https://onezero.medium.com/how-to-destroy-surveillance-capitalism-8135e6744d59
(print edition:
https://bookshop.org/books/how-to-destroy-surveillance-capitalism/9781736205907)

* "Little Brother/Homeland": A reissue omnibus edition with a new
introduction by Edward Snowden:
https://us.macmillan.com/books/9781250774583; personalized/signed copies
here:
https://www.darkdel.com/store/p1750/July%3A__Little_Brother_%26_Homeland.html

* "Poesy the Monster Slayer" a picture book about monsters, bedtime,
gender, and kicking ass. Order here:
https://us.macmillan.com/books/9781626723627. Get a personalized, signed
copy here:
https://www.darkdel.com/store/p1562/_Poesy_the_Monster_Slayer.html.

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