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Nokia Posts Surprise Second-Quarter Profit Jump as Pekka Lundmark Is Poised to Take Over as CEO

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By Reuters | Updated: 31 July 2020

Finnish telecom network equipment maker Nokia reported an unexpected rise in its second-quarter underlying profit on Friday despite the COVID-19 crisis, while its new Chief Executive Officer Pekka Lundmark takes over this weekend.

Lagging behind its rivals China’s Huawei and Sweden’s Ericsson in 5G network sales, Nokia said its April-June underlying earnings rose to EUR 0.06 per share from a profit of EUR 0.05 a year ago, beating the EUR 0.03 consensus in a Refinitiv poll.

Nokia, which had warned of a weak second quarter due to the virus, upgraded its forecast for 2020 underlying earnings per share to between EUR 0.2 and EUR 0.3 from EUR 0.18 to EUR 0.28.

Its more profitable Nordic peer Ericsson reported a rise in 5G network sales and software revenue two weeks ago, and also maintained its financial targets for 2020 and 2022.

However, Nokia’s quarterly revenue fell 11 percent to EUR 5.09 billion (roughly Rs. 45,071 crores), missing the EUR 5.28 billion (roughly Rs. 46,755 crores) consensus figure, according to Refinitiv data.

Nokia-level revenue was down in the quarter, with the majority of that the result of COVID-19 as well as a sharp decline in China, its outgoing Chief Executive Officer Rajeev Suri said in a statement.

The company estimated that COVID-19 hurt net sales by about EUR 500 million (roughly Rs. 4,428 crores) in the first half of the year.

“We expect that the majority of sales missed in the quarter due to COVID-19 will shift to future periods,” Suri said.

Suri, who steps down after more than a decade in charge of Nokia and Nokia Siemens Networks, leaves the company to his successor Pekka Lundmark with weak profitability in a highly competitive market situation.

The leadership change at Nokia comes as turbulence prevails in European telecoms markets, with increasing pressure from certain governments for operators to exclude or limit the usage of 5G equipment from China’s Huawei Technologies.

Lundmark, who takes over on Saturday, will team up with new chairwoman Sari Baldauf.


© Thomson Reuters 2020

Internet

Bitcoin Slumps 10 Percent as Pullback From Record High Gathers Pace

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By Reuters | Updated: 21 January 2021

Bitcoin slumped 10 percent on Thursday to a 10-day low, retreating further from record highs, with traders citing fears of tighter US regulation.

The world’s most popular cryptocurrency Bitcoin was last down 7.5 percent at $32,779 (roughly Rs. 23.9 lakhs) after falling as low as $31,977 (roughly Rs. 23.3 lakhs). It has lost nearly a quarter since touching a record $42,000 (roughly Rs. 30.6 lakhs) on January 8.

The pullback comes amid growing concerns that Bitcoin is one of a number of financial market price bubbles.

Fears that US President Joe Biden’s administration could attempt to regulate cryptocurrencies have also weighed on sentiment, traders said.

During a Senate hearing on Tuesday Janet Yellen, Biden’s pick to head the US Treasury, expressed concerns that cryptocurrencies could be used to finance illegal activities.

“I think many are used, at least in a transactions sense, mainly for illicit financing, and I think we really need to examine ways in which we can curtail their use and make sure that money laundering does not occur through these channels,” said the former chair of the US Federal Reserve.

Joseph Edwards of cryptocurrency broker Enigma Securities said these comments had a substantial impact.

“The action over the last 36 hours or so has largely been rippling outwards from the Janet Yellen comments on crypto,” he said, adding that it was still unclear exactly what, if any, moves the Biden administration would take.

“We do think it’s probably still just a lapse in momentum rather than a sea change, though.”

© Thomson Reuters 2021

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Google Signs Deal on Copyright Payments to French Press

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By Agence France-Presse | Updated: 21 January 2021

Google and French newspapers said Thursday they had signed an agreement aimed at opening the path to digital copyright payments from the online giant after months of heated negotiations.

The accord signed with the APIG alliance of French dailies involves “neighbouring rights,” which call for payment for showing news content with Internet searches, a joint statement said.

It said the agreement sets a framework for Google to negotiate individual licence agreements with newspapers on the payments and will give papers access to its new News Showcase programme, which sees it pay publishers for a selection of enriched content.

Payments are to be calculated individually and will be based on criteria including Internet viewing figures and the amount of information published.

APIG head Pierre Louette said the deal amounts to the “effective recognition of neighbouring rights for the press and the start of their remuneration by digital platforms for the use of their publications online.”

Google France chief Sebastien Missoffe called the deal proof of a “commitment” that opens up “new perspectives.”

News outlets struggling with dwindling print subscriptions have long seethed at Google’s failure to give them a cut of the millions it makes from ads displayed alongside news search results.

The COVID-19 crisis has hurt sales even further.

A Paris appeals court ruled in October that the US giant had to continue to negotiate with French news publishers over a new European law on neighbouring rights.

France was the first country in the EU to enact the law but Google had initially refused to comply, saying media groups already benefit by receiving millions of visits to their websites.

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Facebook Said to Be Questioned on WhatsApp’s Privacy Terms by Parliamentary Panel

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By Reuters | Updated: 21 January 2021

Facebook executives will field questions from a parliamentary panel on Thursday about the changes to WhatsApp’s privacy, a source said, days after the messaging platform was asked by the country’s technology ministry to withdraw them.

The panel will ask why Facebook needed to change WhatsApp’s privacy policy and how it will impact users, the source said. WhatsApp did not immediately respond to Reuters request for comment.

The messaging platform earlier this month kicked off a storm when it informed users it was preparing a new privacy policy, under which it could share limited user data, including phone number and location, with Facebook and its group firms.

Demand for rival applications such as Signal and Telegram surged on privacy concerns and WhatsApp last week decided to delay the new policy launch to May from February.

With 400 million users, India is WhatsApp’s biggest market, and the messaging service has big plans for the country’s growing digital payments space, including selling health insurance via partners.

Facebook last year invested $5.7 billion (roughly Rs. 41,600 crores) in the digital unit of Mukesh Ambani-led conglomerate Reliance Industries, with a big part of that aimed at drawing in ten of millions of traditional shop owners to use digital payments via WhatsApp.

Earlier this week, India’s Ministry of Electronics and Information Technology said in an email to WhatsApp boss that the new privacy policy terms take away choice from Indian users.

© Thomson Reuters 2021

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US President Joe Biden Calls for Coders in Hidden Message on White House Website

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By Reuters | Updated: 21 January 2021

The recently updated website for US President Joe Biden’s White House carried an invitation for tech specialists savvy enough to find it.

Hidden in the HTML code on the White House website was an invitation to join the US Digital Service, a technology unit within the White House.

“If you’re reading this, we need your help building back better,” the message said.

Former President Barack Obama launched the service in 2014 to recruit technologists to help revamp government services – for example by modernising Medicare’s payment system or reforming hiring practices across government agencies.

Tech specialists join the Digital Service for typically one or two years.

Joe Biden was sworn in as president of the United States on Wednesday, offering a message of unity and restoration to a deeply divided country reeling from a battered economy and a raging coronavirus pandemic that has killed more than 4,00,000 Americans.

Standing on the steps of the US Capitol two weeks after a mob of then-President Donald Trump’s supporters stormed the building, Biden called for a return to civic decency in an inaugural address marking the end of Trump’s tempestuous four-year term.

“To overcome these challenges, to restore the sou,l and secure the future of America, requires so much more than words. It requires the most elusive of all things in a democracy: unity,” Biden, a Democrat, said after taking the oath of office.

“We must end this uncivil war that pits red against blue, rural versus urban, conservative versus liberal. We can do this – if we open our souls instead of hardening our hearts.”

The themes of Biden’s 21-minute speech mirrored those he had put at the centre of his presidential campaign, when he portrayed himself as an empathetic alternative to the divisive Trump, a Republican.

Saying there was “no time to waste,” Biden signed 15 executive actions shortly after entering the White House on Wednesday afternoon to set a new course and overturn some of Trump’s most controversial policies.

The orders included mandating masks on federal property, halting the withdrawal from the World Health Organization, rejoining the Paris climate accord and ending a travel ban on some Muslim-majority countries.

Biden told reporters in the Oval Office that Trump had left him “a very generous letter,” but he would not disclose its contents.

© Thomson Reuters 2021

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Departing US FCC Chairman Ajit Pai Warns of Espionage Threats to Telecoms From China

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By Reuters | Updated: 21 January 2021

Outgoing US Federal Communications Commission (FCC) chairman Ajit Pai said potential Chinese espionage and threats to US telecommunications networks and Internet freedom are the biggest national security issue that regulators will face in the next four years.

Ajit Pai told Reuters in an interview there is a “wide array” of activity from China that was of concern, including of surveillance, economic espionage and potential “injection of malware into networks here in the United States or around the world. There are a number of bad things that can happen when insecure equipment is used to handle sensitive information.”

Pai was named chairman in January 2017 by former President Donald Trump and stepped down on Wednesday. During his tenure, the FCC cracked down on Chinese network manufacturers like Huawei and ZTE.

Last month, the FCC began the process of revoking China Telecom’s authorisation to operate in the United States. China Telecom is the largest Chinese telecommunications company.

“The Chinese Communist Party has a very determined world view. They want to dominate this space and exert their will – even beyond their own borders,” Pai said Tuesday. “That is a serious threat not just to Internet freedom but to national security for us and for many of our allies.”

The Chinese foreign ministry said in December US claims about risks to national security were false.

The FCC first warned in April that it might terminate US operations of three state-controlled Chinese telecommunications companies including China Telecom.

In 2019, the FCC voted to deny state-owned China Mobile the right to provide US telecommunications services, citing risks the Chinese government could use the approval to conduct espionage.

Under Pai, the FCC formally designated China’s Huawei and ZTE as national security threats, barring US firms from tapping an $8.3 billion (roughly Rs. 60,550 crores) government fund to purchase equipment from the companies. Congress approved $1.9 billion (roughly Rs. 13,900 crores) in December to pay for replacement of Chinese-made equipment in US networks.

In April, the FCC approved Alphabet unit Google’s request to use part of an US-Asia undersea telecommunications cable, but not to Hong Kong, after US agencies raised national security concerns.

© Thomson Reuters 2021

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Internet

Google Asks US Judge to Move States’ Antitrust Lawsuit to California

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By Reuters | Updated: 21 January 2021

Alphabet’s Google has asked a US judge in Texas to transfer an antitrust lawsuit filed by 10 states in December to a court in California, a state that has more relevant witnesses and documents needed by the company, it said.

In December, Texas and nine other states sued Google in a US court in Sherman, Texas, accusing the search engine company of working with Facebook in a way that violated antitrust law to boost its already-dominant online advertising business.

Google said in a court filing that the first case alleging it monopolised online display advertising was filed in May by an advertiser, and that since then five other cases have been filed.

All were filed in the Northern District of California, “the venue where Google is headquartered and where more relevant witnesses and documents are located than in any other district in the country,” Google said in its request to move the case, which was filed late on Tuesday.

Google adds that the states’ lawsuit “does not identify a single company or person who might be a witness at trial and lives or works within 100 miles” of the Texas courthouse where the case was filed.

The states asked that Google, which controls a third of the global online advertising industry, compensate them for damages and sought “structural relief,” which is usually interpreted as forcing a company to divest some of its assets.

“As internal Google documents reveal, Google sought to kill competition and has done so through an array of exclusionary tactics, including an unlawful agreement with Facebook, its largest potential competitive threat,” the lawsuit said.

Google previously called the Texas lawsuit “meritless.”

In total, Google has been sued three times since October by US states and the Justice Department, including the Texas lawsuit.

In December, a separate group of 38 US states and territories filed their own antitrust complaint Google.

© Thomson Reuters 2021

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