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Judge Rejects Facebook’s ‘Sponsored Stories’ Settlement (CNET)
U.S. District Judge Richard Seeborg of San Francisco, Calif., has rejected Facebook’s settlement of a class-action suit regarding an ad feature that publicizes users’ “likes” of products and services to their Facebook friends but doesn’t pay the users for the endorsements or allow them to opt out. Under the proposed deal, Facebook would have given its users more control over how their “likes” were handled and would have allowed users under 18 to opt out of sponsored stories. Wired Seeborg was concerned that the deal, which provides a $10 million payout to attorneys suing Facebook and $10 million to charity in what is known as a cy pres award “was merely plucked from thin air.” In his Friday ruling, he ordered the parties to provide more information on how it reached that amount. Bloomberg Businessweek Seeborg also said that while it isn’t feasible to divide $10 million among as many as 70 million affected customers, it isn’t sufficient to justify giving that money only to advocacy groups. Lawyers for customers had argued the groups would be “watchdogs” over Facebook. Inside Facebook Facebook is once again the second-largest video site in the United States, according to comScore. The social network saw 53 million unique video viewers in July, about a third of Google’s audience but higher than the number of unique viewers on Yahoo and Vevo. Mashable Google, thanks largely to YouTube, still enjoys a comfortable lead in the race with nearly 157 million total unique viewers. Yahoo users, however, watched more videos — 625 million to Facebook’s 327 million. Facebook users watched an average of 21.7 minutes of video throughout July, while Yahoo users consumed 70.4 hours of video content.

AT&T to Require Shared Data Plan for FaceTime Over Cellular (PC Magazine)
AT&T customers who want to use FaceTime over cellular on their iPhone after the debut of iOS 6 will need to sign up for one of the carrier’s shared data plans. At its Worldwide Developer Conference in June, Apple said iOS 6 would allow for FaceTime access over cellular networks, a move that will likely broaden the reach of a product that has thus far been overshadowed by solutions like Skype. ars technica AT&T’s scheme to allow only shared data plan customers to use FaceTime over cellular connections could run afoul of FCC’s net neutrality rules. Blocking FaceTime over 3G for some users could be seen as “unreasonable discrimination,” according to John Bergmayer, senior staff attorney at Public Knowledge. The Hill Meanwhile, Free Press Policy Director Matt Wood argued that customers will have to buy a more expensive data plan “with extra voice minutes and texts they’ll never use thrown in” just to use FaceTime on AT&T’s mobile network. “The FCC’s rules prohibit such blatantly anti-competitive conduct by wireless companies,” Wood said.

Zynga Sets Aside a Huge Pile of Low-Priced Stock for Employees (VentureBeat)
Zynga is setting aside a huge allotment of stock options for employees in an attempt to keep them around and on target, even as its stock price sinks downward. It’s part of the casual gaming company’s efforts to remain focused on its long-term objectives as it struggles with weak earnings, lawsuits and deflated expectations.

The World Watched 231 Million Olympic Streams on YouTube (SocialTimes)
The 2012 Olympics may be over, but the Olympic stats are still rolling in. YouTube has released statistics showing how the Olympic games played out on YouTube.

Google Plus Deletes Comments in Gmail; Facebook Doesn’t (ZDNET)
If you need to keep copies of comments on Google Plus, you have to save them separately. You can’t rely on emailed comments or on “emails” from G+, because Google deletes them from your Gmail inbox if someone removes the post.

Twitter’s API changes Will Have a Real Impact on News Developers (Nieman Journalism Lab)
Twitter’s newly fortified mission to “deliver a consistent Twitter experience,” which is freaking out the tech world right now, will also force some news organizations to re-examine their code. News apps like The Washington Post’s @MentionMachine, which tracks presidential candidates on Twitter, will have to be reworked on the front end, where tweets are presented to readers, to match a style similar to Twitter’s own tweet embeds.

Apple’s Surprising Response to SMS Spoofing Flaw: Use iMessage Instead (VentureBeat)
Apple responded this weekend to reports of a vulnerability in the SMS service of its iOS devices, a flaw that lets hackers spoof their identities via text and send you messages asking for private information. In a statement sent to media outlets, Apple said it takes security very seriously, but it directs users to use Apple’s own iMessage service instead of texting.

One Month After Selling to Microsoft for $1.2B, Yammer CEO Predicts End of Silicon Valley (TechCrunch)
There is a pretty fascinating debate happening right now on David Sacks’ Facebook page. Exactly one month after the Yammer sale to Microsoft closed, Sacks is feeling pretty bearish about the startup ecosystem.

Cool Twitter Project Sends Morse Code Using Tweets (AllTwitter)
Trying to think up a unique way to incorporate Twitter into your next college project? Well, Ana Catharina Marques, Kostantinos Frantzis and Markus Schmeiduch came up with a pretty cool idea: Morse code through Twitter.