10 ms·

Short-Run Effects of GDPR on Technology Venture Investment

47 points by Dowwie 8y ago

Carpetsmoker 8y ago
Not everything is about the economy.
- Jedi72 8y ago
  "Too much and for too long, we seemed to have surrendered personal excellence and community values in the mere accumulation of material things. Our Gross National Product, now, is over $800 billion dollars a year, but that Gross National Product - if we judge the United States of America by that - the GNP counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl. It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. It counts Whitman's rifle and Speck's knife, and the television programs which glorify violence in order to sell toys to our children. Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country. It measures then, in short, everything except that which makes life worthwhile. And it can tell us everything about America, except whether we are proud to be Americans." - Senator Robert F Kennedy, 1968
  - PavlovsCat 8y ago
    > Our enormously productive economy demands that we make consumption our way of life, that we convert the buying and use of goods into rituals, that we seek our spiritual satisfactions, our ego satisfactions, in consumption. The measure of social status, of social acceptance, of prestige, is now to be found in our consumptive patterns. The very meaning and significance of our lives today expressed in consumptive terms. The greater the pressures upon the individual to conform to safe and accepted social standards, the more does he tend to express his aspirations and his individuality in terms of what he wears, drives, eats - his home, his car, his pattern of food serving, his hobbies. > 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
- SmellyGeekBoy 8y ago
  Considering "the economy" determines whether or not we can eat, have somewhere to live, get access to healthcare etc. (rightly or wrongly), I'd say it's pretty central to everything that we do as a species.
  - skrebbel 8y ago
    Nobody is starving because of GDPR.
  - onion2k 8y ago
    Suggesting that everything people spend money on in the economy is equally important to necessities like food and housing is a gross false equivalence.
  - Carpetsmoker 8y ago
    Facebook isn't contributing one iota to any of these things, and neither are most tech/internet companies. 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.
    - Mary-Jane 8y ago
      Is this perspective so pervasive on this forum that no one's going to challenge these incredibly naive statements? The economy is intertwined with virtually all parts dependent on or at least benefiting from the others. Software contributes to increased efficiencies all across the economy; from food production to fuel consumption to medical diagnosis the world would be demonstrably worse of without it (and the people who wrote it).
      - deleted 8y ago
germanyhater 8y ago
EU is a nightmare for any startup. Instead of developing new products, you have to spend >50% of your time just to comply with all those laws. and it keeps coming. Soon, every company will also be required to build copyright filter for all uploaded media files (content-id)...
- simion314 8y ago
  First of all, the copyright laws int he entire world were forced by the US companies and the US state. 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,
- phatfish 8y ago
  I trust the EU to respect my rights far more than some startup trying to get an exit as fast a possible. If they get bankrupted by a GDPR fine then their business model needs a review.
  - JumpCrisscross 8y ago
    > I trust the EU to respect my rights far more than some startup 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/8875-occrp-strongly-objects-to-romania-s-misuse-of-gdpr-to-muzzle-media https://www.occrp.org/en/40-press-releases/presss-releases/8...
- ndnxhs 8y ago
  Building codes are a nightmare. Instead of building bridges you have to spent >50% of your time complying with these laws. 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.
mellett68 8y ago
It's fun when people complain about having to handle personal data properly and not to collect more than they need. Bad luck, be responsible.
- virmundi 8y ago
  I’m interested in how the vagraties of the law plays out. I’m working on software that won’t use ads or CDNs. All traffic terminates with my system. I will use cookies. I have no intent on putting up one of those cookie notification banner. All data I collect is to run the site. While that is valid under GDPR, I bet the EU will come a knockin for a fine if the site gets big enough
  - ginko 8y ago
    >While that is valid under GDPR, I bet the EU will come a knockin for a fine if the site gets big enough Why would you think so?
    - icebraining 8y ago
      Yeah, has the EU actually fined any company that wasn't playing fast and loose with people's data? There's someone keeping a list[1], and they seem pretty reasonable to me. [1] https://www.nathantrust.com/gdpr-fines-penalties https://www.nathantrust.com/gdpr-fines-penalties
    - virmundi 8y ago
      I don't trust the EU. They seem to go after companies with deep pockets when they need money. Look at the Google Android controversy lately. Nokia, any EU phone creator (are there any?), any EU phone creator that wants to get in the market can all create a phone that is not Android. Google traded the OS for install preference rather than money. It's called bartering. The EU let this go for years. Now Alphabet has money and no one in the EU stepped up to take on Android, so the EU wants its pound of flesh. 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.
Thiez 8y ago
I notice Brexit is mentioned only once in the paper, in a footnote mentioning that Great Britain is considered part of the EU for the purpose of their research. Another article currently on the HN frontpage discusses the effects of Brexit on companies [1], blaming Brexit for reduced investment and companies leaving the UK. 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. 1: https://news.ycombinator.com/item?id=18431564 https://news.ycombinator.com/item?id=18431564
- KineticLensman 8y ago
  > 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 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/1061554026284834817 https://twitter.com/uk_domain_names/status/10615540262848348...
  - newaccoutnas 8y ago
    From all the material I've seen, the UK is keeping GDPR post-Brexit
  - mrec 8y ago
    > 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) 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)_Act_2018 https://en.wikipedia.org/wiki/European_Union_(Withdrawal)_Ac...
robertsd247 8y ago
I could be oversimplifying this but would the way to defeat GDPR is to make sure an individual cannot be identified through routine web site data collection?
- seszett 8y ago
  That's the very goal of GDPR, yes.
- mikro2nd 8y ago
  That would not be "defeating" GDPR, but cooperating with the spirit and intent of that law.
- lmkg 8y ago
  Yes, one way to "defeat" GDPR is to comply with the spirit and letter of the law by not performing routine automated surveillance.
StavrosK 8y ago
Otherwise read as "turns out that you make less money if you aren't allowed to sell people's private data off". What else is new?
- AnthonyMouse 8y ago
  There are two effects here. One is you don't make as much money from advertising, true. Though even that is still a cost -- that money had been funding R&D and subsidizing access to services for low income people. 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.
  - StavrosK 8y ago
    I expect the latter to be reduced as the kinks get ironed out and knowledge of compliance becomes more widespread, kind of like the economic loss from the compliance cost of not cheating on your taxes is pretty low by now.
    - AnthonyMouse 8y ago
      That is completely the opposite of what happened with taxes. The complexity was such a problem that the law was changed so that as many people as possible would take the standard deduction, i.e. the tax law basically exempted small players from the complex rules. 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.
Proven 8y ago
enjoy your made up rights, euroslaves

47 points by Dowwie 8y ago

Carpetsmoker 8y ago

Not everything is about the economy.

Jedi72 8y ago
"Too much and for too long, we seemed to have surrendered personal excellence and community values in the mere accumulation of material things. Our Gross National Product, now, is over $800 billion dollars a year, but that Gross National Product - if we judge the United States of America by that - the GNP counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl. It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. It counts Whitman's rifle and Speck's knife, and the television programs which glorify violence in order to sell toys to our children. Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country. It measures then, in short, everything except that which makes life worthwhile. And it can tell us everything about America, except whether we are proud to be Americans." - Senator Robert F Kennedy, 1968
- PavlovsCat 8y ago
  > Our enormously productive economy demands that we make consumption our way of life, that we convert the buying and use of goods into rituals, that we seek our spiritual satisfactions, our ego satisfactions, in consumption. The measure of social status, of social acceptance, of prestige, is now to be found in our consumptive patterns. The very meaning and significance of our lives today expressed in consumptive terms. The greater the pressures upon the individual to conform to safe and accepted social standards, the more does he tend to express his aspirations and his individuality in terms of what he wears, drives, eats - his home, his car, his pattern of food serving, his hobbies. > 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
SmellyGeekBoy 8y ago
Considering "the economy" determines whether or not we can eat, have somewhere to live, get access to healthcare etc. (rightly or wrongly), I'd say it's pretty central to everything that we do as a species.
- skrebbel 8y ago
  Nobody is starving because of GDPR.
- onion2k 8y ago
  Suggesting that everything people spend money on in the economy is equally important to necessities like food and housing is a gross false equivalence.
- Carpetsmoker 8y ago
  Facebook isn't contributing one iota to any of these things, and neither are most tech/internet companies. 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.
  - Mary-Jane 8y ago
    Is this perspective so pervasive on this forum that no one's going to challenge these incredibly naive statements? The economy is intertwined with virtually all parts dependent on or at least benefiting from the others. Software contributes to increased efficiencies all across the economy; from food production to fuel consumption to medical diagnosis the world would be demonstrably worse of without it (and the people who wrote it).
    - deleted 8y ago

germanyhater 8y ago

EU is a nightmare for any startup. Instead of developing new products, you have to spend >50% of your time just to comply with all those laws. and it keeps coming. Soon, every company will also be required to build copyright filter for all uploaded media files (content-id)...

simion314 8y ago
First of all, the copyright laws int he entire world were forced by the US companies and the US state. 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,
phatfish 8y ago
I trust the EU to respect my rights far more than some startup trying to get an exit as fast a possible. If they get bankrupted by a GDPR fine then their business model needs a review.
- JumpCrisscross 8y ago
  > I trust the EU to respect my rights far more than some startup 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/8875-occrp-strongly-objects-to-romania-s-misuse-of-gdpr-to-muzzle-media https://www.occrp.org/en/40-press-releases/presss-releases/8...
ndnxhs 8y ago
Building codes are a nightmare. Instead of building bridges you have to spent >50% of your time complying with these laws. 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.

mellett68 8y ago

It's fun when people complain about having to handle personal data properly and not to collect more than they need. Bad luck, be responsible.

virmundi 8y ago
I’m interested in how the vagraties of the law plays out. I’m working on software that won’t use ads or CDNs. All traffic terminates with my system. I will use cookies. I have no intent on putting up one of those cookie notification banner. All data I collect is to run the site. While that is valid under GDPR, I bet the EU will come a knockin for a fine if the site gets big enough
- ginko 8y ago
  >While that is valid under GDPR, I bet the EU will come a knockin for a fine if the site gets big enough Why would you think so?
  - icebraining 8y ago
    Yeah, has the EU actually fined any company that wasn't playing fast and loose with people's data? There's someone keeping a list[1], and they seem pretty reasonable to me. [1] https://www.nathantrust.com/gdpr-fines-penalties https://www.nathantrust.com/gdpr-fines-penalties
  - virmundi 8y ago
    I don't trust the EU. They seem to go after companies with deep pockets when they need money. Look at the Google Android controversy lately. Nokia, any EU phone creator (are there any?), any EU phone creator that wants to get in the market can all create a phone that is not Android. Google traded the OS for install preference rather than money. It's called bartering. The EU let this go for years. Now Alphabet has money and no one in the EU stepped up to take on Android, so the EU wants its pound of flesh. 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.

Thiez 8y ago

I notice Brexit is mentioned only once in the paper, in a footnote mentioning that Great Britain is considered part of the EU for the purpose of their research. Another article currently on the HN frontpage discusses the effects of Brexit on companies [1], blaming Brexit for reduced investment and companies leaving the UK. 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. 1: https://news.ycombinator.com/item?id=18431564 https://news.ycombinator.com/item?id=18431564

KineticLensman 8y ago
> 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 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/1061554026284834817 https://twitter.com/uk_domain_names/status/10615540262848348...
- newaccoutnas 8y ago
  From all the material I've seen, the UK is keeping GDPR post-Brexit
- mrec 8y ago
  > 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) 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)_Act_2018 https://en.wikipedia.org/wiki/European_Union_(Withdrawal)_Ac...

robertsd247 8y ago

I could be oversimplifying this but would the way to defeat GDPR is to make sure an individual cannot be identified through routine web site data collection?

seszett 8y ago
That's the very goal of GDPR, yes.
mikro2nd 8y ago
That would not be "defeating" GDPR, but cooperating with the spirit and intent of that law.
lmkg 8y ago
Yes, one way to "defeat" GDPR is to comply with the spirit and letter of the law by not performing routine automated surveillance.

StavrosK 8y ago

Otherwise read as "turns out that you make less money if you aren't allowed to sell people's private data off". What else is new?

AnthonyMouse 8y ago
There are two effects here. One is you don't make as much money from advertising, true. Though even that is still a cost -- that money had been funding R&D and subsidizing access to services for low income people. 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.
- StavrosK 8y ago
  I expect the latter to be reduced as the kinks get ironed out and knowledge of compliance becomes more widespread, kind of like the economic loss from the compliance cost of not cheating on your taxes is pretty low by now.
  - AnthonyMouse 8y ago
    That is completely the opposite of what happened with taxes. The complexity was such a problem that the law was changed so that as many people as possible would take the standard deduction, i.e. the tax law basically exempted small players from the complex rules. 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.

Proven 8y ago

enjoy your made up rights, euroslaves