by Tom Kaneshige

Is Silicon Valley’s Image Going Up in Flames?

Jul 29, 20145 mins
IT JobsStartupsTechnology Industry

It’s getting ugly in the Valley. And it's not just about gentrification. Tech companies are under fire for indirectly helping con artists dupe the public, secretly manipulating people's emotions and engaging in what looks an awful lot could be discriminatory hiring practices.

Some of the most popular tech companies in Silicon Valley have been feeling the heat lately. We’re not talking about the summer scorcher or record drought, rather the white-hot spotlight from the media.

Let’s count the ways.

The Online Sting

Talk of the town today is about two brothers, Maksym Pashanin and Denys Pashanin, and their ability to wreak havoc on two digitally disruptive tech companies, Airbnb in San Francisco and Kickstarter in New York.

With Aribnb, the brothers gained entrance to a vacation condo in Palm Springs and became squatters, living for free by manipulating California tenant-protection laws. Maksym also has threatened to press charges against the condo’s owner, Cory Tschogl, for blackmail, negligence, even over tap water that allegedly damaged an espresso machine and caused his brother’s ulcer to act up, Tschogl told SFGate.

Tschogl begged Airbnb for help to no avail. Once the media got involved, though, Airbnb changed its tune.

“Our initial response to this inquiry didn’t meet the standards we set for ourselves and we’ve apologized to this host,” says Airbnb spokesman Nick Papas in a statement to SFGate. “In the last week, officials from our team have been in incredibly close contact with this host and she has been paid the full cost of the reservation and we’re working with her to provide additional support as we move forward.”

The about-face makes Airbnb look insincere.

Airbnb isn’t the only one to suffer a public-relations black-eye at the hands of the Pashanin brothers. The squatters are also principals of Kilobite and raised $40,000 from Kickstarter to develop a zombie game, which they never did create. Kickstarter investors are crying foul and demanding their money back, but they’re out of luck because Kickstarter doesn’t offer any guarantees. Kilobite recently appealed to Kickstarter investors again for another game.

Kickstarter’s image took a beating: Its online service appears to be full of easy marks where grifters can ply their trade with impunity.

Rats in a Maze

Earlier this month, the social-networking universe erupted with outrage over revelations that Facebook was toying with users’ emotions, delivering uplifting or depressing content to users in a creepy experiment. The idea apparently is to manipulate emotions in order to sell ads. Now the Federal Trade Commission might look into this.

Adding fuel to the fire, Facebook COO Sheryl Sandberg offered up a non-apology apology: “This was part of ongoing research (that) companies do to test different products, and that was what it was. It was poorly communicated… And for that communication we apologize.”

If Facebook can do it, others can too, right? Dating site OkCupid is following Facebook down a dangerous path with covert and arguably unethical tests on users, followed by inflammatory comments trying to justify the practice by its co-founder, Christian Rudder.

[Related: Silicon Valley Tech Execs Behaving Badly ]

In a July 28 blog post, Rudder admitted that OkCupid experimented by, at times, removing user pictures or profile texts, and indicating a good match or bad match even though the algorithm showed the opposite. The goal apparently was to find out how much importance is being placed on a user’s picture, the power of suggestion, and how effective OkCupid’s matching engine works.

Ethical questions about secret experimentation be damned.

“We noticed recently that people didn’t like it when Facebook ‘experimented’ with their news feed,” writes Rudder in a blog post, adding, “But guess what, everybody: if you use the Internet, you’re the subject of hundreds of experiments at any given time, on every site. That’s how websites work.”

In Rudder’s world view, this makes everything OK. But OkCupid looks shady.

Lack of Diversity

This spring, Google disclosed demographics of its technical workforce showing that 83 percent are men, 60 percent are white. A bunch of tech companies — Salesforce, Linkedin, Facebook, Yahoo, Cisco, Adobe, among others — also released numbers that fall in line with Google’s lack of diversity. White males not only dominate tech jobs but the leadership ranks as well. At Twitter, for instance, 90 percent of the technical workforce is male, and 72 percent in leadership positions are white.

If this wasn’t bad enough, there’s a workforce demographic missing from diversity disclosures: age of workers. The San Francisco Chronicle has called upon tech companies to disclose this demographic, and so far most have refused. Ageism is Silicon Valley’s dirty little secret; it looms largest because it remains hidden.

[Related: Is Silicon Valley’s Youth Movement Really Just Age Discrimination?]

Only Hewlett-Packard has been open about the age of its workers: A quarter of its U.S. employees are 30 or younger, more than half are between 31 and 50 and about 18 percent are over 51, SFGate reports.

But Hewlett-Packard might be more the exception than the rule. Last summer, Cisco began embracing a youth movement while letting middle managers go. A Twitter executive said that the average age of a Twitter employee is 30. Signs point to hiring practices that weed out older workers, too.

With the media focused on gender, ethnic and age discrimination in the tech industry, people are lighting up comment boards — and it ain’t pretty.

All of this bad publicity comes at a time when Silicon Valley tech companies’ public images are most vulnerable. Tech workers and their big paychecks, along with luxury buses that take them from their San Francisco diggs to offices along the peninsula, have become targets. They are being accused of causing gentrification in San Francisco and elsewhere.

This summer, tech companies are under fire for indirectly helping con artists dupe the public, secretly manipulating people’s emotions, and engaging in what looks an awful lot like discriminatory hiring practices. The media is fanning the flames, as the tech industry’s image gets torched.