Facebook is shutting down its decade-old facial recognition software, the company announced yesterday. As part of the change, the newly minted Meta will delete the facial scan data of more than 1 billion users from its social network.

The technology, introduced in December 2010, automatically recognizes the identity of people in photos and videos and suggests that users tag them. Before that, if you recall, we had to tag people in images ourselves or (if you can believe) leave a photo untagged altogether and suffer the consequences of fewer likes.

What’s changing:

• Users’ faces will no longer be recognized in photos, videos, or Memories on Facebook. Tagging is still possible, but it will have to be done manually.
• Users who have opted in to the technology will have their templates deleted.

In a blog post, Meta’s VP of Artificial Intelligence Jerome Pesenti cited a lack of clear regulation by the government and “concerns about the place of facial recognition technology in society” as the main reasons behind the company’s decision.

What concerns?

How much time do you have? What initially seemed like an innocuous feature to save you precious seconds while you dropped apple picking albums on the timeline has become a highly controversial technology seen by critics as a privacy nightmare. The ACLU calls facial recognition tech an unprecedented threat that “gives governments, companies, and individuals the power to spy on us wherever we go.”

There’s also the issue of algorithmic bias. An MIT study of facial analysis software showed an error rate of 0.8% in the identification of light-skinned men, but that jumps to 34.7% for dark-skinned women.

Zoom out: Despite heavy investments by tech giants, facial recognition has suffered some major setbacks. Last year, Amazon, Microsoft, and IBM announced they would stop selling facial recognition software to police departments, who have come under scrutiny for using the technology to identify protesters. And Baltimore, Portland, and New York City have begun regulating private and public sector use of biometric data like face scans.—MK

Zillow’s home-flipping business is a flop. The online real estate company said yesterday it’s shutting down the unit and reducing its overall workforce by 25%.

Why? “We’ve determined the unpredictability in forecasting home prices far exceeds what we anticipated,” CEO Rich Barton said. In other words, what happened in the Excel spreadsheet didn't translate to real life…

Zillow Offers, the company’s algorithmic home-buying business, lost $381 million last quarter.

And its demise wasn't exactly a shock:

• Over two weeks ago, Zillow said it would stop buying homes for the remainder of 2021 because it didn’t have the bandwidth to work its way out of a backlog.
• Earlier this week, an analyst pointed out that 66% of the homes Zillow bought were listed below their purchase price.

Looking ahead...Zillow also said yesterday that it has 9,800 homes it still needs to sell, and an additional 8,200 beyond those it’s already in contract to purchase (and would then need to flip). It expects to lose 5%–7% on those sales.—JW

Seriously—what in the $31 per day liability charge is going on in the rental car industry? It’s bananas.

Let’s start with Avis. Shares in the car rental company blasted 108% higher yesterday. The heavily shorted stock had to be halted at least 11 times for investors to catch their breath, and the volume of shares traded was 15x more than last month’s levels.

We've been down this road enough times before to know a meme stock when we see one. Sure enough, the surge appears to be driven by individual traders, who posted about Avis on r/WallStreetBets with the same frequency as GameStop and Tesla. They were apparently jazzed about a comment by Avis’s CEO earlier in the day, when he said the company would play a “big role” in the adoption of electric cars.

Speaking of Tesla…

Remember its deal with Hertz for 100,000 EVs? The one that propelled Tesla’s market cap past $1 trillion? That’s become a lemon. Elon Musk tweeted on Monday night that “no contract has been signed yet” with Hertz for those vehicles, which sent its stock down 3% yesterday. But a Hertz spokesperson said Tesla deliveries had already started.

We’ll leave it to the SEC to sort this one out.—NF

Stat: Pfizer expects its Covid-19 vaccine, which it developed in partnership with BioNTech, to bring in at least $65 billion in revenue in 2021 and 2022. With $36 billion in revenue projected this year alone, Pfizer’s Covid vaccine would set the record for the single-best year for a medical product...ever.

Quote: “Facebook brought a lot of joy to my face.”

Metta World Peace, the retired NBA player formerly known as Ron Artest, told MarketWatch he was ecstatic to hear that Facebook changed its name to Meta Platforms. What is World Peace even up to these days? It’s actually pretty cool—he started a company whose app allows basketball players in underserved communities to book time at high-quality indoor courts.

Read: Google’s map of our lives. (The Guardian)

Companies are jumping into the metaverse like they’re being chased by a swarm of bees. Last week, Facebook reemerged as Meta in order to emphasize its metaverse ambitions, and yesterday...

• Microsoft said that it’s adding virtual reality avatars and workplaces to Teams, its web meeting service. The new capability mimics a Facebook virtual reality product called Horizon Workrooms.
• Nike filed seven trademark applications for virtual sneakers and apparel. It has dipped a toe into the space before by selling Nike-branded items in Fortnite and on the Roblox gaming platform.

Big picture: Companies, in the tech sector or otherwise, are starting to see real $$$ in metaverse products, or at the very least they want to cover their assets for the possibility that the metaverse is, as Mark Zuckerberg put it, “the next chapter for the internet.”

Looking ahead...Jensen Huang, the CEO of Nvidia, which makes graphics cards that can support virtual experiences, said, “The top companies in the next few years are going to be based on connected worlds.”—JW

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New Twitch category: Animals, aquariums, and zoos. Much cuteness.

New acronym alert: CX, or customer experience. Learn all about what that means and how retailers should approach their relationship with customers at Retail Brew’s virtual event next week. Register here.

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It’s our favorite time of year—hoodie season. And this hoodie season is the best one yet because you can now rock these cozy WFH wardrobe staples while repping your favorite newsletter.

Word Search: Take a trip to the international box office to identify foreign movie posters. Play the Word Search here.

Sandwich Trivia

Had to do it on National Sandwich Day. Here’s the question: Which of the following sandwiches traditionally contain pickles?

Your options: McDonald’s Big Mac, lobster roll, the Cuban sandwich, Philly cheesesteak, Burger King Whopper, Chick-fil-A’s Chicken Sandwich, Greek gyro