In 2001, if you listened to digital music, you did it with a large folder of MP3 files. How you acquired them is probably best left between you and a priest, but you may have ripped them from a CD, downloaded them from a file sharing service, or bought them from one of a few nascent download sites.
Whichever option you picked, you’d play them on your computer with a program built for the task. And if you were lucky enough to have an early standalone MP3 player, it was probably made by another company again.
Whether or not MP3s interested you, you probably bought your music on CD, and had a couple of players in the house – maybe a portable one and a hi-fi. Your headphones, of course, connected to whatever you were using, be that a simple Discman or a fancy Nomad Jukebox, with a normal 3.5mm plug.
Today, for millions of people around the world, all those companies have been replaced by one: Apple. You listen to Apple Music on your Apple iPhone through your Apple AirPods. Sure, competitors exist, but with each passing year they struggle to offer a service on parity. Want to use headphones made by a different company? You need to buy a dongle to plug them in if they’re wired, and you won’t have access to the fancy new “spatial audio” streams Apple now offers if they’re Bluetooth. Want to switch to Spotify? You can, but make sure you never accidentally hit “play” when nothing’s on, or Apple Music will start right back up.
Nostalgia is an ill-fitting emotion for the technology sector, where exponential growth rules. The phone in your pocket – possibly even the watch on your wrist – is substantially more powerful than the desktop computer you may have stashed those music files on, and is connected via a cellular connection a hundred times faster than the 56K modem you used to download your MP3s to an internet unimaginably larger and more useful.
But alongside those wild improvements have come other changes with a more mixed outcome. A concentration of power at the top of the industry; a focus on building easy-to-use gadgets over powerful general-purpose devices; and a shift from programs and files to websites and APIs: all have left us in this slightly run-down sci-fi future. Simply put, nothing works with anything else any more, and it’s starting to become a problem.
Interoperability is the technical term for what we’ve lost as tech has matured. Software can be interoperable, either through common, open file formats, or through different programs speaking directly to one another, and so too can hardware: open standards are what allow you to use any headphones with any music player, for instance, or buy a TV without worrying if it will work with your streaming set-up.
It was a hard-fought victory. Think, for instance, of the hassle of receiving a text document a few years back. Not only would you be lucky to be able to open it using a different program from the one that made it – you would frequently need to have exactly the same version of the program, or face issues.
Some of those difficulties were deliberate. Microsoft’s .doc file format, for instance, was used by MS Word for decades, with key details kept hidden behind a restrictive licence. The company very deliberately didn’t want competitors to be able to make software that could read and make Word files without paying it for the trouble. Microsoft’s market dominance meant that it could hamper competing software with the opposite approach: refusing to support their file formats on its own platforms, effectively limiting the ability to collaborate.
Even with the best will in the world, though, it’s a hard goal to achieve. A notorious instalment of the XKCD webcomic details one pitfall: “Situation: there are 14 competing standards,” says the caption to two people discussing how they need to come up with a better way to make all these things work together. The punchline is that “Soon: there are 15 competing standards.”
But by the dawn of the mobile era, there had been progress. The success of standards such as MP3 for music, JPEG for pictures and MPEG for movies had led to a blossoming of consumer tech that could display and play media, while the internet had helped push compatibility to the front of users’ minds: when your pool of collaborators is larger than the people you can walk a floppy disk over to, it’s more important than ever that your software work with everyone, to the point that even Microsoft switched Word over to an open standard.
And then the industry changed.
When the iPhone came out, it was a very different device from what it became. With no App Store, and a model that required a computer to sync to on a regular basis, it was firmly an accessory to the machines where the real business happened. But even as the App Store arrived and the mobile economy flourished, one limitation stuck around: the phones eschewed the old files-and-folders-based model entirely, in favour of each app having access to its own data and nothing else. It would prove consequential.
In the PC files-and-folders era, interoperability was, ultimately, down to users. Software may or may not be compatible, but the decision to try to make a file in one program and open it in another was entirely up to you. You could use two programs made by developers that had never even heard of each other and, so long as they worked with the same open file format, there was interoperability. That’s not true any more.
Even as updates to mobile phone operating systems have allowed apps more freedom to send data back and forth, the same freedom hasn’t been restored to the user. And when two apps are negotiating whether or not to work together, it’s more than just a simple question of technology.
“There’s a ton of issues here,” says Ari Lightman, professor of digital media and marketing at Carnegie Mellon University’s Heinz College in Pittsburgh, Pennsylvania, “but I think one of the major ones is economics. As data becomes more of an asset, it becomes difficult to exchange that data across multiple different parties in an ecosystem, because they’re monetising that asset. And there’s also a lot of stipulations associated with what happens should there be a violation.”
For many companies, the obvious way around this is to give up on those tricky negotiations altogether – or to hand them off to a larger, more powerful third party. “One of the things that we’re seeing more of, because there’s a consumer push towards this, is using things like Google and Facebook as data sinks,” Lightman says. “Consumers are pushed to say, ‘Well, I want to use this other app,’ a dating app or a productivity app, ‘but I don’t want to fill in all this information, I just want a connection between the two, and I want to shove all the information that I have in Google into this app.’”
Sharing everything you have via Facebook or Google is interoperability of a sort. It’s certainly convenient to be able to log in to Tinder without typing a password, and to automatically populate your dating profile with pictures lifted straight from Instagram. But it’s necessarily limited, both to the services offered by these big companies, and by the fact that they’re not going to help competitors. Notoriously, for instance, Facebook blocked Twitter-owned short video app Vine from this sort of interoperability because, according to an FTC complaint, it wanted to kneecap its rival’s chances of succeeding in the field.
There are exceptions. Perhaps the most famous service bucking the trend has the unwieldy name “IFTTT”, short for “If this then that”. The site’s goal is to be a sort of plumbing for the internet, letting users link together disparate services in all the ways they are normally barred from doing. You can use it, for instance, to send a tweet every time you like a YouTube video, to play the radio when you turn on the (smart) lights in the morning, or just to wire up a big button that orders pizza from Domino’s when you slam it.
But even IFTTT has simply smoothed over the difficulties with making things work together, rather than solving them completely. In fact, its very presence has hindered further openness, some users say: Amazon’s smart home devices, for instance, bar users from building automation using other tools, even if they’re more powerful. For a company of Amazon’s size, simplicity isn’t just a selling point to users: it’s also appealing for Amazon itself. Better to funnel people down one supported service than have to train staff on how to deal with myriad potential problems.
For some, there’s only one outcome that will properly fix things: regulation. Damien Geradin is outside counsel for the Coalition for App Fairness, an industry group that represents companies including Spotify, Tile and Tinder, and has been leading the charge to make interoperability a legal requirement.
“When it comes to Apple, they really like this vertically integrated business model,” Geradin says. “I don’t think that we can say that interoperability has been lost, because it’s never been there. It’s been like that from day one. They like to do everything in house, and they don’t like to make things compatible.
“Now, I think that nobody would challenge that when Apple was a very small company. But now it has become this giant. And it has become a bottleneck in the sense that if you want your app to be distributed on the on iOS devices, you have to go to the App Store. You cannot live without Apple if you’re an app developer. You can’t say ‘screw Apple’, but we want to be able to interoperate, we want to be freer.”
Geradin’s group is spearheading a complaint with the European Commission demanding that Apple restore some of that freedom. It’s just one of many such pushes across the world: in America, Epic Games is in the midst of a bruising legal showdown with Apple over much the same issues, while Amazon, Facebook and Google have been dragged into identical battles over their control of their own platforms.
There’s a real chance that we come out of this decade with some of tech’s largest players legally required to begin the painful process of opening up their platforms to the competition – and so, slowly, restoring some of that dream.
In fact, some of the change is coming already. In April, Facebook, seemingly to pre-empt regulatory enforcement, announced an expansion to its “data portability tool”, a feature of the site that lets users send their data from Facebook to other sites and services.
“The ecosystem we are building to support data portability will not come to fruition without regulation that clarifies which data should be made portable and who is responsible for protecting data once it has been transferred,” wrote Facebook’s Steve Satterfield, director of privacy and public policy, in a post announcing the company’s latest feat of interoperability: the ability to directly transfer text posts on Facebook into Google Docs.
Nearly a year after he’d been laid off because of Covid, my dad – a jubilant, always-smiling, 58-year-old Michigander best known for befriending everyone he meets – told me he wanted to go back to work.
Specifically, he wanted to work at Costco.
“OK,” I said, thinking: that is weirdly particular. “You’ll need a résumé. And, God, a different email. Not that Yahoo one you’ve had since before I was born.”
“I want to work on my feet,” he told me. “I want to work somewhere that appreciates me until I can retire. Can you help me apply?”
We’d been in Florida for a week, caring for my grandparents, and I’d started waking up at ungodly hours to accompany him on his five-mile morning walk. It had been six years since I’d moved out, and I missed him. Helping him find a job felt like the least I could do.
After a year of unemployment, Dad had hunted, fished, landscaped and DIYed himself to death. He was bored. He had worked all his life – first as a newspaper delivery boy, then a grocery store clerk, an automotive plant supervisor, a janitor and, for the past decade, a materials coordinator for a local hospital, until last April, when the hospital initiated mass layoffs facing a budget deficit from Covid.
There were other places that seemed ideal to him: delivering packages for UPS or FedEx, he reasoned, meant he’d get to move around. But he’d grown up only 15 minutes from our local Costco, and had heard their reputation for treating their employees well. With no college degree and a lifetime of working thankless jobs, a big-box store offering healthcare, paid time off and a decent work culture sounded like the dream.
“OK,” I promised. “We’ll apply tonight.”
And then I opened Twitter. I fired off a few funny tweets explaining my dad had been laid off due to Covid and really, really wanted to work for Costco.
In retrospect, I probably should’ve asked my dad if it was all right to tweet his job-hunting status.
I was hoping people would get a kick out of it. At best, maybe someone might have connections to a local store. I added a few more tweets to the thread, fondly joking about needing to fix his resumé, and included a picture of him in all of his Costco-hopefulness.
And then I forgot about it.
Until I logged into Facebook, and had a message request from an unfamiliar name.
A manager of a local Costco had contacted me. The company’s chief executive, Craig Jelinek, had somehow found my dad’s tweets, emailed several Michigan stores, and suggested they bring him in for an interview.
He ran a store 40 minutes away, but, he said, if my dad wanted to work at a different location, he’d be happy to give their store manager a call.
I freaked out.
I called my dad, who didn’t answer, texted him a screenshot, and called him again. As someone who only FaceTimes by accident, he didn’t really understand why I was freaking out. The sheer ridiculousness of a random tweet making it to the desk of the Costco chief executive mostly escaped him.
“Dad,” I said. “This is nuts. They’re going to hire you.”
“Maybe,” he said. “I’m not sure. But I’ll keep my fingers crossed.”
The next day, while jumping between meetings and client work, I refreshed my phone obsessively. When I got a text from my dad, I leapt on it, hoping to hear interview news. He had an interview.
“And do me a favor,” he said. “Don’t put that in a tweet.”
I laughed and promised I wouldn’t.
He called me after, bubbling over with excitement. It’d gone well, he thought. He was impressed by the fact that many of the staff had stayed on for years. He told me – somewhat maddeningly – that he’d avoided the subject of the tweets because he “didn’t want to get into all that” which was Dad-speak for “I am still very confused by that part, so I figured I’d best leave it alone”.
I congratulated him, and in his trademark style, he said: “Well, I might not get the job. But at least I tried.”
They called him in for a second interview, and then we heard nothing. But last Tuesday, a text from my dad popped up from my phone. It was just a picture, and the words: thank you. A picture of his new Costco badge.
He’d been hired part-time, starting in two days. I asked his permission to share on Twitter.
“Sure,” he said. “Not sure why people would care, though. It’s just a job.”
The social media explosion that followed was surprisingly pleasant. Some expressed that their parents had also, after a lifetime of working, found joy in working for big-box stores where they had the freedom to move around and talk to customers. A few hundred informed me the story made them cry. Some asked for his walleye fishing spot. (They’re out of luck, because he won’t even tell me.)
Mostly, after a nightmare year of record unemployment rates and unprecedented grief, it seemed people were just happy to share in a moment of weird, collective joy on a website often aptly described as a cesspool.
During his break on his first day, he called to tell me it had gone well. He liked his co-workers, and was looking forward to having a job working on his feet. The past year has not been a kind one to my family; like many, we didn’t emerge from the pandemic without the loss of loved ones. It’s a gift to have this odd, wonderful, weird spark of joy amid a time of grief and chaos.
It’s extra lovely that it happened to my dad.
Before he went back to work, Dad had one more detail for me. He laughed as he said it. He said towards the end of his first shift, during a tour of the store, a bakery employee had off-handedly mentioned: “I wonder when they’ll hire the Twitter guy.”
To my dad’s utter delight, he got to say: I am the Twitter guy.
An IT contractor has lost an appeal [PDF] which found he was an employee in the eyes of HMRC, with the judges agreeing he fell under the new IR35 off-payroll tax rules.
Robert Lee, working as a contractor under the company name Northern Light Solutions, had challenged an earlier First-tier Tribunal ruling which found his work for the Nationwide Building Society to be “employment” for tax purposes.
But his appeal in the Upper Tribunal on 6 and 7 May failed, partly because his legal team did not convince the judges that the clauses in his contract suggesting he and the agencies had the “right” to offer a substitute IT professional did in fact mean such a substitution could happen.
The ruling meant Lee would have to pay an additional £74,523 in income tax and National Insurance Contributions.
The tribunal found Lee, under the terms of the “hypothetical contract”, was paid a “day rate in the region of £450 and required to work a professional week, which for the Clarity Contracts is specified to be 7.5 hours a day.”
A contractor or agency’s right to substitute their work to another person of equivalent skill has been held as a key signal that the contractor is self-employed, rather than a “disguised employee”, and thus can be considered as falling outside of the IR35 rules.
Reforms to the IR35 off-payroll working rules, which critics argue classes contractors as paid employees without the employment benefits, were introduced in the private sector in April this year, after a year’s delay due to COVID-19. The new rules put certain liabilities on employers and make it more difficult for contractors to place themselves outside the revamped tax laws. Some employers – including BAE systems – have introduced blanket bans on contractors working outside IR35.
Lee worked for Nationwide through his Northern Light agency, which contracted with another agency, AxPO, which in turn contracted with the building society itself between 2012 and 2014.
What is IR35?
IR35 is a tax reform that was unveiled in 1999 by the UK tax authorities. The latest regulation change will force medium and large private sector businesses in the UK to set the tax status of their contractors and freelancers. Previously this was set by the contractors themselves.
Those workers found to be within the scope of the legislation – i.e. inside IR35 – will have to pay more tax than they might expect, despite not receiving benefits enjoyed by full-time employees, such as holiday or sick pay, pension, or parental leave.
The reforms are part of the government’s crackdown on so-called “disguised employment,” where workers behave as employees but avoid paying regular income tax and national income contributions by billing for their services through personal service companies (PSCs), which are taxed at lower corporate rates.
Critics say that being inside IR35 is essentially “no-rights employment,” meaning techies are paid and taxed similarly to regular employees but do not receive any of the security or protections that go along with permanent employment.
Contractors within IR35 can be hired and fired at will and without reason. The measure came into effect in the public sector in 2017. The British government hoped the reforms would recoup £440m by bringing 20,000 contractors in line.
The implementation in that area has been described as an “utter shambles.” HMRC reckons that only one in 10 contractors in the private sector who should be paying tax under the current rules are doing so correctly. It estimates the reforms will recoup £1.2bn a year by 2023.
Barrister Michael Collins, acting for Lee, had earlier argued that the “right of substitution meant that the hypothetical contracts could not be a contract of employment.”
Although the First-tier Tribunal had found that there was a right to provide a substitute in these contracts, this right was qualified. The tribunal found that Nationwide would have had to agree to a substitution, and that it was under “no obligation to accept such a replacement if in [its] reasonable opinion such replacement was not wholly suitable.”
The ruling said that “in practice it would be impractical for [Nationwide] to accept substitutes due to the necessary restrictions on access to [Nationwide’s] systems and restricted site access. Any substitute would need to go through vetting checks and an interview and get up to speed on the project.”
The Justices found a hypothetical contract – one that would have described the agreement between Lee and Nationwide – showed that his relationship with the building society was one of employment and the tribunal dismissed the appeal.
Lessons from the case include the need to effectively describe and communicate working practices at an early stage in the relationship, according to Dave Chaplin, CEO of ContractorCalculator, a firm advising contractors on their IR35 status.
Chaplin also claimed HMRC’s evidence from the notes of meetings, which underpinned several aspects of the ruling, appears to frame the facts relating to substitution in a manner that does not align with what really happens on the ground in IT projects. It was therefore important to keep a good, evidenced audit trail on projects to establish off-payroll working, he said.
“Lee’s contract did include a legitimate unfettered right of substitution, but it was never exercised, and the client never gave witness evidence to back it up as a genuine right. The judges chose to disregard those substitution clauses. Substitution is no silver bullet to definitively proving a worker is not employed unless it has taken place,” Chaplin said. ®
It received bids up to $4bn from investors but around $1bn was sold in the end. The company has not commented on the investments.
Shopify, Sequoia Capital, Silver Lake and Capital Group purchased stakes in the company as part of this latest transaction, according to the report. In some cases, these investors increased their existing holdings in the fintech giant.
Meanwhile long-standing employees may have sold their shares in the company before their share options expire, which is typically a 10-year window.
Rumours and speculation continue to swirl around Stripe going public with 2022 touted as the year that the company makes the leap, 12 years after it was founded. For shareholders, a Stripe flotation could make for a hefty payday. For now, investors are looking to shore up bigger stakes in the company.
The company’s recent moves give some indication of the broad plans that the company has.
Seemingly every week the company is rolling our new or expanded products that go beyond its core payments processing functions. On Monday (14 June), it released Stripe Identity, an AI-powered tool for verifying a person’s identity in a payment transaction and last week it released Stripe Tax to automate businesses’ calculation and collecting of VAT and sales taxes.
Stripe has a mission to be an all-encompassing payments and banking infrastructure company. It has become a frequent investor in fintech start-ups in recent years as well, keeping tabs on what might be the next big thing in finance, payments and banking tech.