FTI Consulting News Bytes – 4th March 2022

This week’s news

The information wars

Social media companies have been dragged into an information war this week by Western governments urging platforms to remove Russian state-backed media, following the conflict in Ukraine. Facebook, TikTok and YouTube all announced in subsequent days that they would block access to Russia Today and Sputnik across the EU. Twitter announced it would label content from Russian state websites and reduce its visibility. Social media companies have sought to employ fact checks to remove misinformation surrounding the conflict. In response, Russia has accused the platforms of censorship and taken steps to restrict user access to Big Tech within the country, starting with Facebook. The prime ministers of Estonia, Latvia, Lithuania and Poland have all signed a joint letter to the Big Tech platforms, demanding action against Russian state media. Social media giants now find themselves in the middle of claims and counterclaims in a battle for information and influence, according to the Financial Times.

Netflix will not comply

Similarly, Netflix announced this week that it will not comply with new Russian rules to carry 20 state-backed channels on its platform. The rule came into force for Netflix on Tuesday, requiring platforms with excess of 100,000 subscribers in the country to distribute free-to-air Russian TV channels. The regulations are overseen by Russia’s communications regulator, Roskomnadzor, with one of the channels in question having close links to the Kremlin, according to Politico. On Monday, Netflix released a statement to the media, announcing that “given the current situation, we have no plans to add these channels to our service”, in reference to the conflict in Ukraine. It is currently unclear how the streaming service will be impacted by the decision, the timing of any repercussions or whether the company has held talks with Russian regulators.

Apple suspends Russian operations

Joining a growing list of well-known brands, Apple suspended sales of its products in Russia on Tuesday, due to the conflict in Ukraine. The announcement followed similar moves by carmaker Ford, athletic clothing company, Nike, and aerospace company, Boeing. Apple will pause all product sales in Russia and block access to Russia Today and Sputnik from the iPhone’s App Store. Currently, purchases cannot be made from the Russian version of Apple’s online shop with key products, including the latest iPhone, listed as “unavailable”. Apple said all exports to the country had been halted last week. The company has also taken the decision to drop Russian-sanctioned banks from its list of supported entities for Apple Pay, following a similar move from Google Pay in the country in recent days. Apple will not see a significant business impact from these restrictions with data from Counterpoint Research suggesting that Russians buy about 2% of the more than 220 million iPhones sold around the globe each year.

Airbnb opens its doors

On Monday, Airbnb announced that it will offer free, short-term housing for up to 100,000 refugees fleeing the conflict in Ukraine. This will be funded by a combination of Airbnb itself, donors to the Airbnb Refugee Fund and through the generosity of hosts opening their homes to support the humanitarian effort. The company has been in contact with local governments across key adjacent states including Poland, Germany, Hungary and Romania to offer support in welcoming those fleeing Ukraine within their borders. The initiative follows the announcement from the U.N. Refugee Agency on Tuesday, warning that Europe would soon be facing the continent’s “largest refugee crisis this century”. Neighbouring countries including Poland, Hungary, Moldova, Romania and Slovakia have all kept their borders open to refugees that have fled the conflict. On Wednesday, the U.N. announced that one million Ukrainian refugees had left the country.

Cyber-attack hits Toyota

Finally, turning to Japan where the world’s largest carmaker, Toyota, was forced to close all 14 of its factories on Tuesday following a possible cyber-attack. The company’s general component supplier, Kojima Industries Corporation, suspected it had been hit by a targeted virus, affecting Toyota’s system for ordering parts and causing a halt in production. The Japanese factories account for about a third of Toyota’s total production capabilities and could set the company back around 13,000 vehicles. Toyota did not identify the source of the attack but there appeared to be limited evidence of financial motivation in this case, according to one cyber security adviser to the Japanese government. The Financial Times reported that senior Japanese officials said they feared that “leading companies were now targets for reprisals” after the government applied further sanctions against Russia, in line with the G7.

Top Tweets of the Week

• Kate Conger, Tech Reporter at The New York Times, Tweets “The conflict in Ukraine is stress-testing systems of collaboration between tech companies and governments.”
• Olga Tokariuk, Freelance Correspondent at EFE Noticias, Tweets on Ukraine “One important result of this war is that fight against disinformation and propaganda is finally taken seriously. Tech giants, individual countries and the EU are blocking Russian propaganda media. It’s said and it’s being done so late, as they’ve spent years dehumanizing Ukrainians.”
• Ben Collins, Senior Reporter at NBC News (US), Tweets his latest article on Facebook and Twitter removing disinformation accounts targeting Ukrainians.

Number of the Week

$26m – of crypto donations to Ukraine so far

What’s happening next week?

• 7 March – Ukraine lawsuit against Russian invasion heard at the Hague
• 7 March – Virgin Orbit Inc Q4 2021 results
• 8 March – International Women’s Day

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