Good Monday morning. It’s July 30th. Lots more financial news ahead this week: the July jobs report is out Friday morning and the Fed meets to tackle monetary policy starting Tuesday.

Today’s Spotlight takes about 3 minutes to read.

Highlights

• • Wall Street pummeled tech stocks last week. We’ll break down why Facebook, Amazon, and Google have reason to be optimistic.

• • A national privacy law similar to the EU’s GDPR is attracting more attention in Washington. Remember that California has already passed its own stringent legislation with an 18 month window.

• • Google’s guidelines for its search raters is newly revised.Biggest news: more focus on a website’s “Expertise / Authoritativeness / Trustworthiness”. Yes, EAT.

Thanks for your responses!

Your responses to last week’s question about images in Spotlight were great. Many suggested only showing images when they’re relevant to understanding news. We have the smartest readers! That’s what we’ll be doing. We responded to everyone so let George know if you emailed us and didn’t receive a response.

Straight Shooting on Tech

Facebook is Fine

Headline writers trumpeted the plunging price of Facebook stock last week, but skipped two important contextual facts: Facebook stock is down 4% since the beginning of 2018 and the company reported 42% revenue growth with 2.5  billion accounts. Facebook’s growth rate slowed. It’s hard to think that 42% revenue growth is bad.

The growth rate slowed because 81% of U.S. adults who have Internet access have a Facebook account. Don’t forget that India, not the U.S., has the most Facebook accounts. Meanwhile, the number of daily U.S. users is up, revenue is up, and the company owns three other wildly popular platforms: Instagram, Messenger, and WhatsApp. Your organization ignores Facebook at its own peril.

Long-term bet: Human interfaces with devices. Think sub-vocalizing, optical imaging, the whole direct-brain interface of last year’s conference. It’s not science fiction. Facebook is funding dozens of engineers and has agreements in place with Johns Hopkins, UC Berkeley, and others.

Google is Great

Yes, the company received its second hefty fine from the EU in two years, this one for $5 billion. But we also learned that Google parent Alphabet has $14 billion plus in cash-on-hand and quarterly operating income was $7.8 billion.

Google’s advertising model is being tweaked hard for local mobile advertising–searches on a mobile device about local activity. That’s especially true for retail. If your organization has any retail presence, you need to be looking at the new advertising offerings Google has rolled out this year.

Long-term bet: Google Translate handles 143 billion words each day. Business Insider has a great piece on monetizing that traffic.

Amazon Ads Are Its Secret Weapon

Remember the joke about Amazon never making a profit? That stopped three years ago. The company has a high margin (25%+) business in cloud computing services and a North American retail business that has been over 3.7% margin since Q4 2017. We continue to be thrilled with Amazon Web Services, where our websites are hosted, and what else can you say about a company that takes in about half of all digital retail spending in the U.S.?

Amazon’s ad business is also leveraging direct sales with big brands while keeping ad agencies busy with the rest of the market beyond the Fortune 500. The Google-Facebook duopoly isn’t over yet, but Amazon is the only tech company positioned to make it a three company race.

Long-term bet:  The health care industry is in full-on panic about what Amazon could do to their world.

Spotlighted

Some of Yelp’s restaurant listings have scores based on health department health inspection. VentureBeat reports that Yelp is expanding that program to 750,000 listings in 42 states.

None of Google’s 85,000 employees have been successfully phished since the last year when the company began requiring “security keys”, a USB device used instead of passwords or codes. Security guru Brian Krebs has details.

We’ve written several times about advertisers on Facebook acting improperly if not illegally when using indicators about a person’s race to choose whether ads were displayed to that person. Facebook is now prohibiting race as part of its selection criteria.

Nextdoor CEO and founder Nirav Tolia announced that he is stepping down. A new player in hyperlocal advertising, Nextdoor has raised a lot of money and is a unicorn–one of those tech companies with a billion dollar value. There are now 200,000 Nextdoor neighborhoods of mini social networks in five countries. (Full disclosure: Sue and George were contractors at Tolia’s first company and worked with some of the Nextdoor team)

Great Data