🛑 TikTok Ban is Here!

What’s in today’s Business Edge update?

Today's newsletter brings you the boldest moves in tech. Montana takes a stand against TikTok, citing privacy concerns, while OpenAI's CEO alerts Senate about potential AI election risks.

In other key updates, Meta is girding itself for an unprecedented privacy penalty, while Netflix's ad-based tier impresses with a rapid user growth, hitting five million monthly users. Plus, rejoice mobile users! OpenAI's ChatGPT is now at your fingertips with their new iOS app. Lots to unpack, let's dive in!

🌐 Big Tech Digest

Concise summaries of the most interesting tech news stories from Big Tech.

[1] Montana Blazes a Trail, Bans TikTok Statewide Amid Privacy Concerns

Montana Governor Greg Gianforte has signed a pioneering bill banning the operation of TikTok in the state, setting the stage for a First Amendment legal skirmish. Despite strong opposition from the Chinese-owned platform and the American Civil Liberties Union (ACLU), the prohibition is due to come into effect on January 1. The law not only hinders TikTok from functioning within the state, but it also prohibits app stores from offering the app for download in Montana.

More:

• The law imposes a daily fine of $10,000 on TikTok and app stores for any violation.

• Uncertainties remain about enforcement of the ban and its impact on Montanans who downloaded the app before the ban.

• Critics of the bill, such as the ACLU, argue that the ban runs roughshod over First Amendment rights.

_{Tags: #TikTok, #Privacy, #Regulation}

Read more about it at —> (read time: 8 minutes)

Insight:

This legislative move by Montana has a company and potentially industry-wide impact. The decision could be a precursor for nationwide policy on social media regulation, particularly as it concerns apps owned by foreign entities. However, this law could face serious legal hurdles due to its potential conflict with First Amendment rights, prompting other states to think twice before enacting similar bans. If Montana's ban is upheld, it could significantly change the way states regulate foreign-owned social media platforms. We expect to see intense legal scrutiny and debate around this matter, which will influence future legislation and policy-making.

[2] OpenAI CEO Alerts Senate on AI Election Risks

Sam Altman, CEO of OpenAI, has voiced concerns to a Senate panel about the potential for artificial intelligence to compromise election integrity, urging for clear regulation and guidelines. As AI technology becomes increasingly advanced and widespread, critics warn of societal harms, including misinformation and prejudice.

More:

• Altman suggested considering licensing and testing for AI model development.

• He stated that AI capable of persuading or manipulating beliefs should be subject to licensing.

• Public web content, according to Altman, should be fair game for AI training data.

• There's a proposal for a U.S. licensing agency for AI, potentially named Office for AI Safety and Infrastructure Security (OASIS).

• OpenAI, backed by Microsoft, advocates for global cooperation on AI and safety compliance incentives.

_{Tags: #AI, #Regulation, #OpenAI, #Microsoft}

Read more about it at —> (read time: 5 minutes)

Insight:

This news speaks to the Industry-wide impact of AI regulation and governance. We are in a pivotal moment where rapid AI development can greatly benefit or harm society, depending on how it is managed. It raises questions about how to regulate an incredibly diverse and rapidly evolving technology and about the potential negative outcomes, such as election manipulation. The tech community must play a crucial role in these discussions, informing policymakers about the potential risks and rewards. Moving forward, we can expect this topic to be a significant focus for both companies and regulators.

[3] Meta Braces for Record Privacy Penalty Over Data Transfers

Meta, previously Facebook, is set to receive a record privacy fine due to improper handling of user data during transfers to the U.S. The fine, imposed by Ireland's Data Protection Commission, is speculated to exceed Amazon's 2021 fine of €746 million for similar privacy violations within the European Union. The announcement, scheduled for Monday, could include demands that Meta ceases using standard contract clauses for EU data transfers to the U.S.

More:

• The case has origins in Edward Snowden's 2013 revelations regarding U.S. authorities' access to data via tech companies.

• This ruling stems from a decade-long battle initiated by Austrian privacy campaigner Max Schrems against Facebook's alleged privacy rights violations.

• Recent U.S. legal protections updates seek to assure the EU of stricter data access governance by American intelligence agencies.

_{Tags: #Big tech, #Privacy, #Regulation, #Meta}

Read more about it at —> (read time: 5 minutes)

Insight:

This impending penalty against Meta signifies an escalation in global privacy regulation, potentially impacting industry-wide. We see increasing tension between data-driven tech companies and regulatory bodies striving to protect user privacy, particularly in cross-border data transfers. Such hefty fines impact the bottom line of firms like Meta and may force them to revise their data practices. This could result in operational and strategic shifts for such tech companies, while startups must tread carefully to avoid similar pitfalls.

[4] Netflix's Ad-Based Tier Enjoys Rapid Growth with Five Million Monthly Users

In its inaugural upfront advertising event, Netflix revealed that its ad-based tier has amassed nearly five million global monthly active users, just six months post-launch. Additionally, more than a quarter of new subscribers opt for the ad plan in regions where it's offered. Netflix's Vice President of Global Ad Sales, Peter Naylor, announced new sponsorship opportunities during the event, reinforcing the company's stance as a growing player in the streaming ad market.

More:

• Netflix's ad-based member base has more than doubled since the beginning of the year.

• Netflix's overall global subscriber count stands at 232.5 million.

• The "Netflix Effect" is attributed to promoting older songs and niche sports to mainstream popularity through their shows.

• Beginning in Q4, advertisers will be able to measure their campaign reach via Nielsen Digital Ad Ratings.

_{Tags: #Streaming, #Netflix, #Advertising}

Read more about it at —> (read time: 7 minutes)

Insight:

The rapid adoption of Netflix's ad-based tier demonstrates a market-wide shift in consumer behavior as audiences become more receptive to ad-supported streaming services. We find this change significant as it can alter the business models of streaming platforms, leading to the diversification of revenue streams. Moreover, such models provide a competitive alternative for customers unwilling to subscribe to premium ad-free plans. If this trend continues, we may witness an industry-wide adaptation to cater to this growing user segment.

[5] ChatGPT Now Mobile! OpenAI Launches iOS App

OpenAI is taking ChatGPT mobile with its new iOS app, providing users with convenient access to the AI-powered tool. The app, which includes the integration of Whisper, OpenAI's open-source speech-recognition system, is free and syncs across devices. It also boasts GPT-4’s capabilities for ChatGPT Plus subscribers. Starting with a rollout in the US, OpenAI plans to expand to additional countries in the coming weeks.

More:

• ChatGPT app offers diverse utility including instant answers, tailored advice, creative inspiration, professional input, and learning opportunities.

• ChatGPT Plus subscribers get early access to features and faster response times.

• Android users can anticipate the arrival of the ChatGPT app on their devices soon.

_{Tags: #AI, #OpenAI, #iOS, #ChatGPT, #MobileApps}

Read more about it at —> (read time: 3 minutes)

Insight:

OpenAI's move to bring ChatGPT to mobile devices underscores the increasing demand for AI-enabled services in our daily lives. We observe this as a company-level impact, boosting OpenAI's reach and utility for its users. However, it has industry-wide implications too, potentially influencing other AI-based service providers to increase their accessibility. Given the versatile use-cases of ChatGPT, this shift can further fuel the integration of AI tools into various professional and personal contexts. This will likely shape how we interact with AI, creating novel opportunities for innovation.

⚡️Startup bites

Brief news summaries from the world of startups that provide quick and easy-to-consume information.

IBM and Google pledge $150M for quantum computing research at the University of Chicago and University of Tokyo, aiming to maintain the American lead in this critical technology. (link)

Tesla co-founder JB Straubel, acclaimed for his expertise in batteries and power electronics, has officially rejoined the company as a board member, following a positive shareholder vote. (link)

Google's latest language model, PaLM 2, leverages almost five times more training text data (3.6T tokens) than its 2022 predecessor, according to an internal document. (link)

Cisco's Q3 report shows a 14% YoY revenue increase to $14.6B and a 6% YoY net income rise to $3.2B, both surpassing estimates, along with a positive Q4 sales forecast. (link)

Snowflake is reportedly in advanced discussions to acquire Neeva, a search startup, potentially enhancing its AI offerings by integrating search with large language models for internal data exploration. (link)

Online fashion retailer Shein has raised $2 billion at a $66 billion valuation, a third less than last year, amidst tech share price drops, increased scrutiny, and rising competition. (link)

Amazon Web Services plans to invest $12.7 billion in Indian cloud infrastructure by 2030, estimated to support an average of 131,700 full-time jobs annually in the country. (link)

Adobe's new AI-powered Auto-Tag API automates the process of tagging PDFs for accessibility, targeting a more inclusive experience for people with disabilities. (link)

Elon Musk's acquisition of Twitter led to a surge in his mentions and a decline in user activity, with the most active users posting 25% less. Partisan differences also emerged in user behaviors. (link)

ServiceNow and NVIDIA are partnering to develop enterprise-grade generative AI for enhanced workflow automation, focusing on custom large language models for ServiceNow's platform and improving IT operations, customer service, and employee experiences. (link)

YouTube is introducing 30-second unskippable ads on TV and testing "Pause Experiences" ads, boosting its reach and interactivity. This follows its exclusive rights to NFL Sunday Ticket games and significant U.S. viewership growth. (link)

🔍 Extra

A mix of learning links, software products, deals, and other interesting content.

Apple's Augmented Reality Ambitions Face Extended Delay

Apple's much-anticipated augmented reality glasses face a considerable delay, possibly up to four years, due to challenges in product development. According to Bloomberg's Mark Gurman, technical limitations have adjusted the company's initial ambitions from AR glasses to a 'ski-goggle' style headset with video pass-through. Even as development resources for the product are limited, it remains a project of interest for Apple, despite jokes within the team about its feasibility.

More:

Originally, Apple CEO Tim Cook and former design chief Jony Ive aimed to develop AR glasses.

The device's power consumption requirements and the subsequent overheating issue have presented significant technical challenges.

Mike Rockwell, leading the development of Apple's experimental head-worn devices, views the current headset as a stepping stone towards the future AR glasses.

The AR glasses project has made limited progress since 2019, pushing the development timeline out to at least four years.

_{Tags: #Apple, #AR, #Big tech}

Read more about it at —> (read time: 4 minutes)

Google, Meta, and Amazon Race Towards AI-Powered Advertising Future

Tech giants Google, Meta, and Amazon are utilizing AI to revolutionize advertising, according to reports. Google plans to leverage its new PaLM 2 AI language model to help advertisers create content for their ads, potentially providing video ideas for YouTubers and integrating an AI chatbot for customer support in the Play Store, Gmail, and Maps. Concurrently, Meta and Amazon are exploring AI tools for advertisers and customer engagement.

More:

• Google is considering using AI to aid content creation for ads, including generating video ideas and integrating AI chatbots for customer service.

• Meta recently launched the AI Sandbox, a platform for developing AI-powered advertising tools aimed at improving content creation for advertisers.

• Amazon is purportedly developing technology to create photos and videos for companies advertising on their platform and working on a conversational AI search tool for customer assistance.

_{Tags: #AI, #Google, #Meta, #Amazon, #Big tech}

Read more about it at —> (read time: 5 minutes)