By Reuters | Updated: 1 October 2020
The European Union (EU) is preparing to force big technology companies to share their customer data with smaller rivals, the Financial Times reported on Wednesday, citing an early draft of its landmark ‘Digital Services Act’ regulations.
“The likes of Amazon and Google shall not use data collected on the platform…for (their) own commercial activities…unless they (make it) accessible to business users active in the same commercial activities,” the FT reported, quoting the draft.
When asked for comment by Reuters, Google pointed to a blog from earlier this month where it first detailed its response to the Act, supporting measures that allow users to move between platforms without losing access to their data.
“The question is not whether data mobility or data access should be facilitated, but how to achieve their benefits without sacrificing product quality or innovation incentives,” Google had said in the blog.
Amazon did not immediately respond to a request for comment.
EU antitrust chief Margrethe Vestager would announce by the end of this year tough new rules under the Act, aimed to increase social media companies’ responsibilities and liability for content on their platforms.
The draft suggests that technology giants may be banned from preferential treatment of their own services on their sites or platforms, to the detriment of rivals, according to the report.
Companies should not be allowed to pre-install their own applications on hardware devices, such as laptops or phones, or force other companies to exclusively pre-install their software, it added.
Reuters reported on Wednesday that China is preparing to launch an antitrust probe into Google.
In the United States, a government panel is expected to release a report into antitrust allegations against big tech companies as soon as Monday.
© Thomson Reuters 2020
Alphabet Posts Strong Results as Google, YouTube Ads Rebound
By Agence France-Presse | Updated: 30 October 2020
Google-parent Alphabet said Thursday its profit climbed to $11.2 billion (roughly Rs. 83,300 crores) in the latest quarter, beating expectations, as ad spending rebounded after being hit by the pandemic.
Money made from cloud computing offerings and from its Google Play shop for smartphones powered by its Android software also helped fuel the 42 percent jump in revenue to $46.2 billion (roughly Rs. 3,44,802 crores) in the quarter, the company said.
“We had a strong quarter, consistent with the broader online environment,” said chief executive Sundar Pichai.
Blockbuster revenue in the quarter was led by an increase in ad spending at Google’s search engine and video streaming platform YouTube, according to chief financial officer Ruth Porat.
Alphabet has spent years evolving YouTube from its roots as a free video-sharing to an online television platform competing with titans such as Netflix and Amazon Prime.
“We expected Google’s ad revenues to recover across search, YouTube, and Network Members (in the quarter), and all three segments outperformed our expectations,” said analyst Nicole Perrin of eMarketer.
She said the gains were especially true of YouTube and pointed to ‘notable increases in political ad spending during the quarter.”
Google’s cloud computing business revenue grew nearly 50 percent to $3.4 billion (roughly Rs. 25,369 crores) as the pandemic boosted a trend toward working, playing, shopping and learning online.
Alphabet shares jumped more than 8 percent in after-hours trading before giving up some of the ground.
Amazon Said to Be Close to Securing Exclusive Rights to Broadcast Champions League Matches in Italy
By Reuters | Updated: 29 October 2020
Amazon is set to secure exclusive rights to screen top European Champions League matches in Italy for the 2021-2024 seasons, three sources close to matter said, in what would be its first foray into broadcasting sports events in the country.
UEFA last month invited broadcasters to submit bids for the rights to screen Europe’s premier soccer competition in Italy, in one of the biggest broadcasting rights sales in the European soccer industry after the outbreak of the coronavirus this year.
Amazon is nearing exclusive rights to broadcast Wednesday’s Champions League matches on its streaming platform Prime Video in Italy for some EUR 80 million (roughly Rs. 696 crores) -90 million (roughly Rs. 783 crores), the sources said, in a move seen as a way to boost its Prime subscription service. Italy’s top pay-TV broadcaster SKY, owned by US Comcast’s is nearing a deal to buy most of Champions League matches and Europa League matches, the sources said.
SKY’s bid was worth about EUR 100 million (roughly Rs. 870 crores) -110 million (roughly Rs. 957 crores) per season, two sources said. Italy’s top commercial broadcaster Mediaset is close to winning non-exclusive rights for top Champions League matches to be played on Tuesdays for some EUR 45 million (roughly Rs. 391 crores) -50 million (roughly Rs. 435 crores), the sources added. Final sale results of the deal are expected to be announced by the end of this week, the sources said. One source said a separate tender to sell Europa League streaming rights might be held in January, as SKY was unable to buy those rights due to an Italian antitrust ruling preventing the pay-TV from securing exclusive contents for its video-streaming platform.
In 2017, SKY bought exclusive rights to broadcast Champions League and Europe soccer matches in Italy for an estimated EUR 270 million (roughly Rs. 2,350 crores) per season.
SKY and Amazon declined to comment. Mediaset said it was still waiting for the rights to be awarded.
© Thomson Reuters 2020
Google’s Legal Woes Far From Over if Biden Wins: Antitrust Experts
By Reuters | Updated: 22 October 2020
The US Justice Department’s nascent antitrust case against Google will get the attention it needs to succeed if Democrat Joe Biden wins the US presidency next month, antitrust experts said.
William Kovacic, an antitrust professor at George Washington University Law School, said he expects a Biden Justice Department would do one of two things: support the case all the way as it is, or amend the complaint to add new claims.
“What they will not do is drop this case,” Kovacic predicted.
The Justice Department asked a court on Tuesday to find that Alphabet’s Google had broken antitrust law to maintain its dominance in search and search advertising. Google has denied wrongdoing.
While the Biden campaign declined comment on the lawsuit, spokesman Bill Russo said a Biden administration would work closely on Big Tech issues with Rep. David Cicilline, whose House panel produced a report that accused Google of using aggressive business tactics to thwart its search competitors.
Russo added a Biden administration would be committed to doing “far more to ensure that excessive market power anywhere … is not hurting America’s families and workers.”
In May, Biden told the Associated Press that breaking up Big Tech “is something we should take a really hard look at.”
Herbert Hovenkamp, who teaches antitrust at the University of Pennsylvania Carey Law School, said he expects the federal lawsuit, which is narrowly focused on Google’s dominance in online search and search advertising, would be expanded under Biden, saying: “The prudent thing to do is to bring as many counts as you can bring plausibly.”
A case aiming to hold a company to account for several anticompetitive acts would enable prosecutors to ask for a more significant remedy with a bigger impact on Google.
A Biden administration would not need to look far on how to expand its suit. Colorado Attorney General Phil Weiser, a veteran of President Barack Obama’s Justice Department, heads a bipartisan group of states looking at “the full scope of Google’s activity,” according to a source familiar with the probe.
This means that Colorado could be looking at other aspects of Google’s business, such as allegations that Google uses its popular search function to favour big advertisers and its products, like YouTube.
Weiser and other state attorneys general lauded Tuesday the “good working relationship with the DOJ on these serious issues” and said their probe would end “in coming weeks.”
“If we decide to file a complaint, we would file a motion to consolidate our case with the DOJ’s,” they said. The group includes Colorado, Iowa, Nebraska, New York, North Carolina, Tennessee and Utah.
To be sure, it’s also possible that the Biden team would be willing to consider settling with Google, something that there is no sign that the Trump administration tried to do, but only if they are able to get tough remedies.
“I’m not predicting settlement, but I’m saying that settlement becomes much more possible,” said Seth Bloom of Bloom Strategic Counsel.
President Donald Trump and other conservatives have sharply criticised some tech companies for allegedly stifling conservative voices, a concern that Biden’s team would not share.
Settlement options might include Google agreeing to non-discrimination in search or ending insistence that Google products like Chrome be pre-installed in Android smartphones in exchange for access to Google’s Play Store.
© Thomson Reuters 2020
Amazon Announces $100 Million Logistics Investment in Mexico
By Reuters | Updated: 22 October 2020
Amazon said on Thursday it has invested $100 million (roughly Rs. 736 crores) in opening new warehouses in Mexico, including its first shipping centers outside the populous capital area, in a bid to offer faster deliveries.
The new sites include two so-called fulfillment centers, one near the northern city of Monterrey and another near the central city of Guadalajara, as well as a support building in the State of Mexico, just outside Mexico City.
Amazon also opened 12 delivery stations, bringing its total to 27 across the country, it said.
“The construction of a solid infrastructure network allows the company to stay closer than ever to clients, and thanks to that, it’s possible to offer fast deliveries,” Amazon said in a statement.
Monterrey and Guadalajara are the two biggest metropolitan zones of the country after the sprawling Mexico City area.
The new facilities represent 69,000 square metres (742,710 sq ft) altogether and create 1,500 direct and indirect jobs, Amazon said.
Amazon in total now runs five fulfillment centers, two support buildings and two classification centers in Mexico, where it launched its marketplace in 2015.
Enrique Alfaro, the governor of Jalisco state that is home to Guadalajara, said the new local warehouse would help more small and medium sized businesses ship their products faster and at lower costs.
Amazon is also striving to make inroads in Brazil, where it recently opened its fifth and biggest fulfillment centre in the country, with 100,000 square metres (1,076,391 sq ft).
In both countries, which are the biggest economies in Latin America, Amazon is vying with local rivals for shopper loyalty, despite its ranking as the world’s biggest online retailer.
© Thomson Reuters 2020
Airbnb Hires Former Apple Designer Jony Ive’s Firm LoveFrom for Multi-Year Partnership
By Gadgets 360 Staff With Inputs From Reuters | Updated: 22 October 2020
Home rental company Airbnb on Wednesday said it was hiring former Apple designer Jony Ive and his firm LoveFrom to design new Airbnb products and services under a multi-year deal. Ive was a close creative collaborator with Apple co-founder Steve Jobs.
Ive spent nearly three decades at Apple, leading the design of the candy-coloured iMacs that helped Apple re-emerge from near death in the 1990s and the design of the iPhone.
He left Apple last year. In a blog announcing the work relationship, Airbnb Chief Executive Brian Chesky said Ive will also help develop the Airbnb internal design team. “Jony and I have been good friends for many years, and he has been gracious enough to provide me with guidance and advice. We share the same belief in the value and importance of creativity and design. We each believe not only in making objects and interfaces, but in crafting services and experiences. We’ve seen how design can facilitate trust and enable more human connection, something people are desperate for during an unprecedented time of loneliness and disconnection,” Chesky said.
Airbnb on Wednesday told employees Chief Design Officer Alex Schleifer would be moving to a part-time role and that the company would be looking for a permanent replacement, according to a source close to the company.
The deal with Ive and his firm, LoveFrom, coincides with Airbnb’s effort to raise around $3 billion (roughly Rs. 22,100 crores) in its upcoming initial public offering, according to sources.
Airbnb is expected to be one of the largest and most anticipated US stock market listings of 2020 which has already been a blockbuster year for IPOs.
© Thomson Reuters 2020
Google’s ‘Free’ Business Model Put to Test in US Antitrust Suit
By Agence France-Presse | Updated: 22 October 2020
Google’s long-running business model based on free services and advertising will be put to the test in the landmark antitrust lawsuit filed this week by the US Justice Department.
But the government is likely to face challenges proving monopoly allegations against the tech firm which grew into one of the world’s most successful companies by leveraging its powerful search engine for a network of services such as maps, email, shopping and travel that feed its data-driven digital advertising.
Legal experts point to the fact that it may be difficult to show Google’s conduct was illegal under the longstanding “consumer welfare” standard in monopoly cases because its services are largely free.
Avery Gardiner, a former US antitrust enforcement lawyer who researches competition for the Center for Democracy & Technology, said the government appears to be skirting the question of whether Google benefits consumers by offering free services.
The lawsuit “basically ignores price and focuses on quality and innovation,” she said.
While not entirely a new strategy, “the antitrust agencies in the past have been reluctant to move forward without evidence of price effects,” Gardiner added.
Data provided by the Justice Department showed Google controls 88 percent of US search queries, with the share in the mobile market at 94 percent, and argued that Google reinforces it monopoly with its “exclusionary” deals.
With a market value over $1 trillion (roughly Rs. 73,72,250 crores), Google generated $161 billion (roughly Rs. 11,86,892 crores) in revenue last year, the bulk of which comes from digital advertising including messages linked to people’s search queries.
‘Not truly free’
Christopher Sagers, a Cleveland State University law professor, said Google’s use of free services is unlikely to be a serious hurdle for the government.
Sagers said that Google’s search “is arguably not truly free, since every search can be conceived as a transaction in which the consumer gives their attention to advertisements in exchange for search results.”
A key element of the case will be Internet advertising which “is a product that Google definitely does not give away for free,” Sagers said.
Maurice Stucke, a University of Tennessee law professor specialising in antitrust, said the case appears based not on prices but “the harm to privacy, data protection and the use of consumer data.”
This takes a broader view of antitrust by examining the competitive harms to the marketplace and not just prices to consumers, Stucke said.
He said government lawyers have evoked the Microsoft case from two decades earlier which, despite the failure to break up the company, resulted in a more open technology landscape.
“The perception is that the Microsoft case unleashed significant innovation, because competitors no longer operated in the shadow of Microsoft,” Stucke said.
The case joined by 11 states, all of which have Republican attorneys general, could take years to play out and comes against a backdrop of a fierce political backlash against Big Tech giants which have extended their dominance in recent years.
The Justice Department argues that Google has cemented its monopoly position using deals with device makers to ensure its apps and services are prominently displayed, and sometimes can’t be deleted.
Any settlement, whether imposed by the court or agreed to by Google, could involve changes to business practices or “a structural” remedy, the code word for a breakup of the California titan.
Google called the lawsuit “deeply flawed.”
“People use Google because they choose to, not because they’re forced to or because they can’t find alternatives,” Google general counsel Kent Walker said in a blog post.
Asheesh Agarwal of the activist think tank TechFreedom said it would be wrong to use the Microsoft case as a precedent for the Google probe.
“Today, consumers can easily use a variety of other sites and apps to search generally and especially to search for specific goods and services,” said Agarwal. “This isn’t the 1990s, when consumers had to go to the store and pay $100 (roughly Rs. 7,300) to try an alternative to Microsoft Office.”
Independent technology analyst Richard Windsor said the case against Google appears strong but that “the most likely remedy is not a break-up of the company but measures that enforce fairer competition.”
This could include allowing non-Google services and apps more prominence on the Google Play Store.
“To be fair to Google, its digital ecosystem services are the best available in many categories,” Windsor said in a blog post. “However, Google forces handset makers to put them front and center on their devices and to set them by default.”
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