Even though Friday was brutal for tech stocks, major indices ended up last week. The Dow Jones rose 2%, S&P 500 was up 1.5%, and the Nasdaq eked out a 0.7% gain despite falling 3.8% on Friday. Twitter and Elon Musk will not be seeing each other in court—yet. The parties, who were scheduled to go to trial in Delaware on October 17, have until October 28 to close Musk’s acquisition of Twitter for US$54.20 per share. Meanwhile, Carl Icahn scored an estimated US$250 million gain on Twitter stock. South Korea’s internet giant Naver is buying ecommerce firm Poshmark for US$1.2 billion, taking advantage of the big drop in Poshmark’s stock price. Amazon freezes corporate hiring in retail and operations businesses. Peloton cuts 500 more jobs; CEO Barry McCarthy, said he is giving the company about another six months to significantly turn itself around. DraftKings stock jumps on report of partnership with ESPN. Rivian stock price jumps after EV maker backs 2022 production guidance even as the company recalled nearly almost all of its vehicles. TSMC sales top estimates as clout helps chip giant during slowdown. TikTok parent ByteDance Ltd. saw its operating losses more than triple last year to above US$7 billion as it spent heavily to continue its torrid growth. Fast-fashion retailer Shein has shed up to one-third of its value in private markets in recent months after reaching a valuation of more than US$100 billion earlier this year. Horizon Worlds metaverse app so bad that Meta has to force employees to use it. The US Supreme Court agrees to hear case on tech companies’ legal immunity. Around US$100 million of Binance Coin was stolen Friday. Visa partners with FTX in a bet that shoppers still want to spend cryptocurrencies in a bear market. Sophic Client UGE International (UGE-TSXV) acquired 3.5MW community solar project and closed a US$15 million credit facility.
Canadian Technology Capital Markets & Company News
Sophic Client UGE International (UGE-TSXV, UGEIF-OTC) acquires 3.5MW community solar project in Oregon, closes US$15 million credit facility for acquisitions and project development expenses.
The Company acquired a 3.5MW ground-mounted community solar project in Marion County, Oregon, the Company’s first project in the state. Limited construction will begin on the project before the end of the year, with commercial operation expected in the first quarter of 2024. The Oregon acquisition is among several recent initiatives that UGE has made in expanding its acquisition of solar and battery energy storage system (BESS) projects across the United States. Earlier in the year, the Company announced it was acquiring two rooftop solar projects in Arizona which total over 1MW. In September UGE also closed a US$15 million credit line to be used for acquisitions and development expenses. The first draw against the credit line was used to fund the Oregon acquisition. The credit line allows for draws and repayments without associated fees. The Company intends to use the credit line for shorter term acquisition- and development-related expenses. https://bit.ly/3RL1MTB
GameSquare (GSQ-CSE) announces US$3.0 million private placement led by strategic investors.
The Company announces closing of a US$3.0 million non-brokered private placement (the “Offering”). This capital injection will further support already accelerated revenue growth, while strengthening the Company’s balance sheet as GameSquare approaches profitability. The Offering is led by strategic investors from Silicon Valley, key executives from media & entertainment, and professional athletes. The Offering consisted of 29,900,000 units of the Company (the “Units”) at a price of C$0.14 per Unit for gross proceeds of US$3 million. The subscription was paid in US dollars based on an agreed to Bank of Canada exchange rate. Each Unit consisted of one common share of GameSquare (a “Common Share”) and 0.200669 of a purchase warrant of the Company (each whole warrant, a “Warrant”) resulting in 6 million Warrants. Each Warrant will entitle the holder to purchase one Common Share at an exercise price of C$0.20, commencing on September 30, 2023, and expiring on September 30, 2027. https://bit.ly/3Eozr2f
HIRE Technologies (HIRE-TSXV) announces the sale of its real estate and construction vertical.
The Company entered into a definitive agreement to divest Vancouver-based Taylor Ryan Inc. to the vendors in the original transaction on October 7, 2022 (the “Transaction”). As a result of this Transaction, HIRE i) extinguishes a 2023 capital commitment of $9.7 million, and ii) expects to record a gain on sale in the fourth quarter. The Transaction closed (“Close”) October 7, 2022 and is cashless. The purchasers (the “Purchasers”) received 100% of the shares of Taylor Ryan Inc., and will receive transitional services from HIRE. A gain on sale will be recorded in Q4-2022 along with an estimated reduction to current liabilities of $7.9 million in contingent remuneration and an estimated reduction in net assets of $4.8 million. Prior to Close, the Company purchased certain receivables of Taylor Ryan Inc. in exchange for a $1.0 million secured 8% promissory note. The promissory note will rank junior to the Company’s senior secured lending facilities. https://bit.ly/3ClscFG
Tobi Lütke, Round13 part of US$40 million Series A for blockchain gaming startup Horizon.
Horizon Blockchain Games has secured US$40 million in Series A capital from a group of investors that span Shopify CEO Tobi Lütke, traditional gaming companies, and players in the Web3 space. Horizon was founded in 2017 by a Toronto-based team. The startup is best known for its Web3 game Skyweaver. The Series A round was led by Brevan Howard Digital, the crypto and digital asset division of investment management group Brevan Howard, and Morgan Creek Digital, another United States-based fund focused on digital asset management. The round also saw participation from a number of investors including traditional video gaming firms Ubisoft Entertainment and Take-Two Interactive Software, Polygon, Xsolla, Round13 Capital, Initialized Capital, Bitkraft Ventures, CMT Digital, Quantstamp, Xchange, and Everyrealm. Angel investors also took part, including Lütke, The Sandbox’s co-founder Sebastien Borget, Sky Mavis and Axie Infinity co-founder Aleks Larsen, Lolli’s co-founder Alex Adelman, and Ethereum educator and The Daily Gwei’s founder Anthony Sassano. Prior to this Series A round, Crunchbase data shows that Horizon had raised $13.3 million in seed financing. Past Canadian investors in Horizon include Golden Ventures. https://bit.ly/3CeZtCn
Two Small Fish goes big with third fund, targets $40 million final close.
Eva Lau’s Two Small Fish Ventures is moving upstream with the launch of a third fund. The venture firm has secured $24 million (US$17.5 million) in an initial close as it targets an overall fund size of $40 million. With 40 investments under its belt, including notable bets and exits, https://bit.ly/3rJGWsZ
Ownly secures $2.55 million, aims to become “Shopify for real estate”.
Calgary-based start-up, Ownly, has raised $2.55 million in seed funding led by previous investor Calgary’s Bluesky Equities with support from National Bank of Canada’s NAventures and Kitchener-Waterloo-based Garage Capital to help developers sell new residential construction units through its e-commerce platform. Founded in 2020, Ownly describes itself as an e-commerce platform for the real estate industry. To date, Ownly has amassed 15 home builder and developer customers, 11 in Canada and four in the United States (US). The startup currently serves over 27 communities with a focus on Alberta, and plans to use its seed capital to fuel its expansion into Ontario and US markets like Florida, Texas, and Georgia over the coming months. https://bit.ly/3McIDbY
In Canadian first, Gatik and Loblaw take safety drivers out of autonomous delivery trucks.
Toronto and Palo Alto-based autonomous trucking company Gatik is setting fully driverless commercial trucks on the streets of Ontario. Gatik announced Wednesday that through its partnership with Loblaw, the startup is taking safety drivers out of its vehicle – making them fully autonomous. The move marks a Canadian first for fully driverless vehicles, as Gatik claimed that this is the first time that an autonomous trucking company has removed the safety driver from a daily delivery route in the country. Since it was founded in 2017, Gatik has developed technology that automates short-haul, middle-mile delivery vehicles. Loblaw and Walmart are among Gatik’s main customers and it is through partnerships with both that the startup has been able to test its tech in real-life scenarios over the past few years. https://bit.ly/3CC3WAx
Shopify (SHOP-NYSE, SHOP-TSX) to change procedures over illegal practices of traders, EU says.
Shopify has agreed to change procedures dealing with the illegal practices of traders on its platform, the European Commission said Friday. Shopify has committed to design templates for contact and refund policies to include company information and contact details, provider clear guidance on applicable EU consumer law and provide company details about any EU trader when requested by any national consumer authority. Shopify committed to taking down web shops when they engage in fake scarcity claims, pressure selling, selling counterfeit goods, or not delivering product. https://on.mktw.net/3VarrIg
Global Markets: IPOs, Venture Capital, M&A
Judge puts trial on hold for Twitter and Musk.
Twitter and Elon Musk will not be seeing each other in court—yet. The parties, who were scheduled to go to trial in Delaware on October 17, have until October 28 to close Musk’s acquisition of Twitter for US$54.20 per share, according to a Thursday evening ruling made by the judge in the case, Chancellor Kathaleen St. Jude McCormick. The ruling is a win for Musk who filed a motion to stay the case and put the trial on hold. Musk argued that moving forward with the trial took away his team’s attention from securing the financing needed to complete the US$44 billion deal. Without a trial, Musk argued, the deal could be done on or around October 28. Twitter opposed the motion, calling it “an invitation to further mischief and delay,“ and cited a Thursday morning testimony from one of Musk’s bankers that Musk had not communicated his intention to close the deal with the bank. If the deal doesn’t close by 5 p.m. on Musk’s chosen date, October 28, the trial will be rescheduled for November, the judge said. https://bit.ly/3MeZQl4
Carl Icahn makes US$250 million on Twitter stock by calling Musk’s bluff.
Carl Icahn has scored an estimated US$250 million gain on Twitter stock by calling Elon Musk’s bluff. The billionaire investor and Icahn Enterprises chairman plowed about US$500 million into the social-media company in recent months, The Wall Street Journal reported on Tuesday. He bought the shares in the mid-$30s, sources told the newspaper, suggesting he purchased around 14 million shares or close to 2% of the business. Icahn’s stake, assuming he hasn’t sold it yet, is now worth about US$750 million on paper — a 50% gain in a few short months. https://bit.ly/3Vb94mr
South Korea’s Naver to buy Poshmark for US$1.2 billion.
South Korea’s internet giant Naver is buying ecommerce firm Poshmark for US$1.2 billion, taking advantage of the big drop in Poshmark’s stock price to get the company at a relative bargain. Poshmark’s bottom line has been battered by rising marketing costs, causing losses to soar last year and so far this year. That sent its stock price to a low in August of US$10.80, about a quarter of its US$42 IPO price. In a statement, Naver CEO Choi Soo-Yeon said that Naver’s technology in search, AI recommendation and ecommerce tools “will help power the next phase of Poshmark’s global growth.” https://bit.ly/3rDR0DR
Amazon freezes corporate hiring in retail and operations businesses.
Amazon is freezing corporate hiring across its sprawling Amazon stores business, a division that includes retail and operations teams around the globe, The New York Times reported Tuesday. An email to Amazon recruiters viewed by The Times suggested that all early recruiting activities, such as screening interviews, be canceled. The message noted that prospective job candidates with interviews scheduled before October 15 could potentially still receive an offer, but they would not be permitted to start till next year. Additionally, all open internal requests for new hires within the Amazon stores business will be closed in the coming days, according to the email. The hiring freeze will not impact Amazon Web Services, the company’s profitable cloud computing services division. https://bit.ly/3eiBvOO
Peloton to cut 500 more jobs in latest bid for turnaround.
Peloton said it plans to cut about 500 jobs, roughly 12% of its remaining workforce, a move its chief executive said was necessary to save the connected-fitness-equipment maker. Chief Executive Barry McCarthy, who took over in February, said he is giving the unprofitable company about another six months to significantly turn itself around and, if that fails, Peloton likely isn’t viable as a stand-alone company. The job reductions, announced to staff on Thursday, are the fourth round of cuts this year and will leave Peloton with roughly 3,800 employees globally, less than half the number of people the company employed at its peak last year. It also has eliminated about 600 more jobs since June than previously disclosed through retail store closings, attrition and other moves, Peloton said. Mr. McCarthy said that the latest cuts mark Peloton’s final significant move to reduce its operating footprint and that executives would now focus on increasing revenue. He said the cuts are companywide but would be heaviest in its marketing operation, which he said is too big for a company of Peloton’s size. https://on.wsj.com/3yrq7qK
Apple’s app store revenue fell in September quarter, analyst estimates.
Apple’s App Store, once a hugely profitable growth engine for the iPhone maker, is slowing down. A report out Monday from Morgan Stanley estimates that App Store net revenue fell 2% year on year in the September quarter, citing data from Sensor Tower. Monday’s report estimated that App Store net revenue fell 5% in the month of september, following a much smaller decline in August. The slowdown reflects a shift in consumer spending away from apps, Morgan Stanley said, implying the impact of the economic slowdown is being felt by Apple’s App Store. The report estimated Google’s Google Play app store revenue also fell in September. If Morgan Stanley’s report is accurate, it would fit with a trend that was evident in Apple’s report for the June quarter, when Apple notably didn’t mention the App Store as one of several businesses driving growth in the services segment, as it had done for many years. The App Store has long been a hugely important contributor to the fast-growing services segment, which now accounts for nearly a fifth of Apple’s revenue but likely a higher proportion of its profits. Morgan Stanley estimated that the dip in App Store revenue means Apple’s services revenue will grow just 7.9% year on year in the September quarter, below the 12% June quarter growth rate and sharply below the 25.6% growth rate in the September quarter of 2021. Morgan Stanley’s report follows a news report by Bloomberg last week that Apple had scrapped plans to boost production of the new iPhone due to slower than expected demand. Apple stock fell 8% between Wednesday and Friday in response. https://bit.ly/3Cga1RL
DraftKings stock jumps on report of partnership with ESPN.
DraftKings is close to signing an exclusive partnership with sports network ESPN, according to a report from The Action Network, sending shares 7.9% higher after hours. The terms of the deal between the sports-betting platform and sport-media giant are not yet clear. But The Action Network said that ESPN was seeking US$3 billion over a set time period that would “lead to a sportsbook rebranding itself with the ESPN name.” And it said an exclusive partnership could feature broadcasts integrated with betting odds. DraftKings, in a statement to the Action Network, didn’t comment directly on any potential deal, while ESPN had no comment. Bob Chapek, Chief Executive of Walt Disney Co., ESPN’s owner, recently said that Disney had been examining the possibility of adding sports gambling to ESPN, and said the growing popularity of sports betting helped make ESPN a “good long-term bet.” https://on.mktw.net/3Emj2vr
Rivian stock price jumps after EV maker backs 2022 production guidance.
Rivian stock surged as much as 12% on Tuesday after the EV maker reiterated its prior guidance of producing 25,000 vehicles this year. That affirmation of its 2022 target gave confidence to investors that have been on edge about ongoing supply chain disruptions in the auto market, as evidenced by recent woes experienced at Ford. Rivian said it produced 7,363 vehicles in the third quarter and delivered 6,584 vehicles to customers. The company did not breakdown the production and delivery split between its R1S and R1T electric trucks. To meet its full-year production guidance, Rivian will have to produce at least 10,683 vehicles in the fourth quarter. Meanwhile, Rivian’s third-quarter deliveries were up 47% relative to the second quarter, and up 437% from the company’s first-quarter deliveries. The company is clearly ramping up, but it’s still losing a lot of money. Rivian registered more than US$3 billion in losses during the first half of the year, and the losses are expected to continue for years to come, according to analyst estimates. After peaking in November 2021 shortly after its IPO, Rivian has shed about US$120 billion in market value. https://bit.ly/3SUrsy6
TSMC sales top estimates as clout helps chip giant during slowdown.
Revenue at the world’s largest contract chipmaker rose 48% to about NT$613 billion (US$19.4 billion) in the third quarter, according to Bloomberg’s calculations. Analysts estimated NT$603 billion on average. Rising revenue at Apple Inc.’s most important chipmaker signals that the largest players in the US$550 billion semiconductor industry may avoid the severe downturn investors have feared, helped by resilient demand for some electronics products in the face of rising interest rates and soaring inflation. Morgan Stanley this week projected a return to growth for the chip industry by the second half of 2023. Other chipmakers warned in recent weeks that they are facing a tougher market as inventories build up and orders are being cut by data center as well as consumer tech clients. Micron Technology Inc. and Kioxia Holdings Corp. are cutting output to try and rebalance supply and avert a price crash. Earlier on Friday, Samsung Electronics Co. reported its first profit drop since 2019. Shortly before Samsung’s results, US processor and graphics chip maker Advanced Micro Devices Inc. also missed estimates with its third-quarter sales figures, which came in US$1 billion shy of its own forecast. Shares of TSMC fell 2.9% in Taipei on Friday and have lost 29% this year. TSMC, the world’s most advanced maker of silicon chips, has benefited from Apple launching new types of chips to boost the performance of its devices. Still, Bloomberg reported in September the Californian company is backing off plans to increase production of its new iPhones, raising questions about underlying electronics demand. https://bloom.bg/3RNTXfT
TikTok parent ByteDance sees losses swell in push for growth.
TikTok parent ByteDance Ltd. saw its operating losses more than triple last year to above US$7 billion as it spent heavily to continue its torrid growth, according to a financial report shared with employees that offers a rare look inside the private company’s closely guarded finances. ByteDance also produced an operating profit in the first quarter of 2022, the report showed, indicating one of the world’s most valuable startups could be turning a corner after years of incurring large losses. https://on.wsj.com/3RN0Jma
China’s Shein sheds up to one-third of its value in stake sales.
Chinese fast-fashion retailer Shein has shed up to one-third of its value in private markets in recent months after reaching a valuation of more than US$100 billion earlier this year, said people briefed about the matter. The rapidly expanding retailer, which sells cheap clothes and lifestyle products targeting Gen-Z shoppers mainly in the west and the Middle East, has been valued at US$65 billion-US$85 billion in private markets, according to three people with knowledge of the situation. Shein was valued at just above US$100 billion in a fundraising round in April, according to three people with direct knowledge of the matter, making it the world’s third most valuable private company, behind ByteDance and SpaceX. Only two years ago, the company was valued at US$15 billion. https://on.ft.com/3rGwwKU
Tencent lost title as China biggest company to Kweichow Moutai.
Tencent Holdings Ltd. has lost its title as China’s biggest company to liquor giant Kweichow Moutai Co., the latest sign of how far regulatory risk and dimming growth prospects has set back the country’s technology industry. Shares of the online gaming company have tumbled 64% in Hong Kong since a January 2021 peak, wiping US$623 billion off its market value. That’s more than any other firm globally, driven by concerns about Tencent’s outlook after Beijing’s yearlong regulatory crackdown. As of the Hong Kong close on Friday, the company was valued at about US$5.4 billion less than Moutai. https://bloom.bg/3Rypt1s
Horizon Worlds metaverse app so bad that Meta has to force employees to use it.
It seems Meta is having problems persuading even its own employees to don one of its virtual reality headsets and use its primary metaverse app, Horizon Worlds. So much so that an internal memo says the company would “hold managers accountable” for their teams using it. It’s one of a set of leaked memos that suggest Apple may not have too much to fear from Meta’s competition to its own upcoming VR/AR headset. It is currently available through the company’s Oculus Rift S and Meta Quest 2 VR headsets, and will be available on the upcoming Meta Quest Pro VR/AR headset, which is expected to have a similar spec to the long-awaited Apple Headset. Part of Meta’s vision for Horizon Worlds is that it will be used by businesses as well as consumers, but so far it appears that even the company’s own staff are struggling to think of a reason to do so. https://bit.ly/3MkKVpt
HTC teases a new smaller Vive VR headset.
While Meta and TikTok owner ByteDance battle to be the premium social media / metaverse company making virtual or augmented reality hardware, HTC is reminding everyone that it has a place in the game, too. Without providing any extra details, it released a simple teaser tweet on Thursday morning, promising to “go small or go home.” A brief HTC press release sent to The Verge described the tweet as a teaser for “a new headset” and noted that it’s been a year since the Vive Flow — HTC’s early stab at a consumer VR headset that looks (sort of) like sunglasses. It references the Flow as the “first” headset made under Project Proton, a super-small headset initiative HTC discussed in 2020. Coupled with the tagline on the tweet, our best guess is something like a second-generation Flow that’s hopefully smaller, more stable, and home to a bigger app ecosystem. https://bit.ly/3em4LnE
Google Cloud’s medical imaging suite to make AI-based diagnosis more accessible.
Google Cloud is bringing its expertise in vision-based artificial intelligence to the healthcare industry with the launch of its new Medical Imaging. Medical imaging is one of the most critical tools used by hospitals to diagnose patients, and each year billions of images are made by clinicians to help them understand why people are sick. Google said medical images are so important that they account for about 90% of all healthcare data. The problem doctors have is that medical images are complex, as it takes expertise to look at one and understand if the patient is inflicted with some kind of disease. Until now, that has always meant human expertise. As a result, radiologists and other healthcare professionals in many hospitals face a huge workload. Available now, Google Cloud’s Medical Imaging Suite is designed to change this, using AI algorithms to scan medical images and provide faster and more accurate diagnoses. In this way, it thinks it can help increase productivity for healthcare workers while improving care access and patient outcomes. The Imaging Lab provides access to ready-made AI-based annotation tools created by Nvidia Corp. and Monai that can perform repetitive, manual tasks such as labeling medical images. https://bit.ly/3CGw9WW
Walgreens turns to prescription-filling robots to free up pharmacists.
The company says the setup cuts pharmacist workloads by at least 25% and will save Walgreens more than US$1 billion a year. The ultimate goal: give pharmacists more time to provide medical services such as vaccinations, patient outreach and prescribing of some medications. Those services are a relatively new and growing revenue stream for drugstores, which are increasingly able to bill insurers for some clinical services. Walgreens has reduced pharmacy hours at a third of its nearly 9,000 U.S. stores, and in some markets is offering signing bonuses of up to US$75,000 to fill pharmacist jobs. Walgreens in the past two years has opened eight automated drug-filling centers serving 1,800 stores and plans to operate close to two dozen by 2025. One of the biggest, near Dallas, fills 35,000 prescriptions a day, serving about 500 stores in Texas, Louisiana and Arkansas. https://on.wsj.com/3ROOt4l
Amazon abandons autonomous home-delivery robot Scout in latest cut.
Amazon.com Inc. is shutting down tests of its home delivery robot, the latest sign that the e-commerce giant is starting to wind down experimental projects amid slowing sales growth. Work on Scout, an autonomous machine launched about three years ago, has already been halted, according to a person familiar with the situation. Amazon spokesperson Alisa Carroll said the Scout team was being disbanded and would be offered new jobs in the organization. About 400 people were working on the project globally, according to the person, who requested anonymity to discuss a private matter. A skeleton crew will continue to consider the idea of an autonomous robot, but the current iteration isn’t working. https://bloom.bg/3SRyR1G
Robot makers including Boston Dynamics pledge not to weaponize their creations.
A group of robotics companies including Boston Dynamics — makers of the well-known quadrupedal robot Spot — have pledged not to weaponize their most advanced robots. However, the pledge will likely do little to stop the wider weaponization of this technology. In an open letter addressed to the entire robotics industries (and first reported by Axios), the companies said they “believe that adding weapons to robots that are remotely or autonomously operated … raises new risks of harm and serious ethical issues.” Boston Dynamics, which is owned by Hyundai, has come under particular scrutiny as maker of the most recognizable quadrupedal robot, Spot. The company’s robots have also been trialed for use by police departments (including, unsuccessfully, by the NYPD) and by the French military. In both cases, the robots were not weaponized, but were instead used for reconnaissance while being controlled remotely by humans. Notably, Boston Dynamics’ early development was thanks almost entirely to US military funding. The US Army thought it could use the company’s experimental, larger robots as pack mules, toting equipment for infantry troops. But it scrapped their development because the machines were too noisy, and Boston Dynamics pivoted to commercial sales. https://bit.ly/3Me0FdQ
Media, Streaming, Gaming & Sports Betting
TikTok’s European revenue hits US$990 million in 2021.
TikTok’s European revenue soared 477% in 2021 as its userbase grew and the company improved its advertising offering. Revenue hit about US$990.5 million for the year ending December 31, 2021, according to a filing with U.K.‘s Companies House, up from US$171.6 million a year earlier. The Financial Times earlier reported on the revenue figures. The ByteDance-owned company said the increase was driven by its growing number of users and “enhanced monetization tools” to improve the effectiveness of ads, inckluding new “creative, branding and commerce” tools. Last September, TikTok said it had 1 billion monthly users. Its operating loss widened to US$895.6 million, compared to a loss of US$654.2 million in the prior year. The company said it hired thousands of new employees and increased sales and marketing efforts. https://bit.ly/3Mg4FdP
You hated your cable package. Your streaming services are bringing it back.
Not long ago, TV watchers rebelled against the tyranny of the cable “bundle”—paying US$100 or more for a roster of dozens of channels, many of which they never watched. They cut the cord and celebrated the joy of ordering new streaming services one by one. But now the a la carte streaming menu is adding up to an expensive meal of Netflix, Hulu, Disney +, HBO Max, Peacock, Paramount +, and countless others. The industry’s major players are finding it harder to grow in such a crowded market and are realizing they need to package their offerings in new ways. That means less a la carte ordering and a new era of bundles. Executives at Amazon Inc. have considered selling clusters of rival streaming services at a discounted price through the company’s Prime Video Channels platform, according to people who have spoken to the company about the idea. Warner Bros. Discovery which is already combining its HBO Max and Discovery+ streaming services, has discussed eventually participating in new bundles with rivals, according to people familiar with the situation. Some streaming services are hoping to tack on their services to retail memberships. Paramount Globalstruck a deal for its Paramount+ streaming service to be offered as part of Walmart Inc.’s $98-a-year Walmart+ membership program. Costco Wholesale Corp. has also engaged in similar discussions with streaming services over the past year, according to people familiar with the talks. It’s a classic case of companies finding that when a new business model runs into trouble, they can crib from the old business model. What’s emerging isn’t anything like the traditional cable bundle; no one in the streaming industry anticipates stitching all the big services together into a $100-a-month package. But there’s a growing sense—from the companies and consumers—that some level of bundling is a good thing. https://on.wsj.com/3ypXVo6
Adtech, Privacy & Regulatory
Supreme Court agrees to hear case on tech companies’ legal immunity.
The Supreme Court on Monday agreed to hear a case in which the family of a U.S. citizen who was killed in an ISIS attack in Paris in 2015 is suing Alphabet’s Google business, according to multiple published reports. The case, Gonzalez v. Google, involves the scope of tech companies’ immunity under Section 230 of the Communications Decency Act, SCOTUSblog reported. https://on.mktw.net/3fEuA2D
Facebook security warning for 1 million users: Scam apps stole login credentials.
Meta has issued a Facebook security warning to around one million users that their login credentials may have been stolen by scam apps. While most of the apps were Android ones, 47 of them were iOS apps found in Apple’s App Store, Many apps and websites offer third-party login options, with the most common ones being: Login with Facebook, Login with Google, Login with Apple. https://bit.ly/3ejsftJ
TikTok to launch live shopping in US using outsourced technology.
TikTok is launching live shopping in North America and plans to outsource its operation after the social media platform’s experiments with ecommerce in the UK struggled to take off. Los Angeles-based TalkShopLive is due to enter a partnership with TikTok on bringing TikTok Shop to the US. It will provide the underlying technology and support for live streams hosted by influencers, brands and retailers that want to sell their products on the app, said two people familiar with the operations. The companies are still finalising the arrangements and no contracts have been signed. TikTok Shop, which allows users to buy products through links on the screen of the app during live broadcasts, was launched in the UK last year, its first market outside of Asia. It is available in Thailand, Malaysia, Vietnam, Singapore, the Philippines and Indonesia. Although TikTok had planned to launch shopping features across Europe earlier this year, this was postponed as the experiments in the UK market failed to reach sales targets and influencers and brands dropped out of the scheme, several people familiar with the company strategy said. TikTok has previously denied the existence of any formal expansion ambitions in Europe and the US. TalkShopLive raised US$6 million in July last year in a seed extension led by Raine Ventures, five months after a US$3 million seed round. https://on.ft.com/3yqwdrb
Amazon to hire 150,000 workers for holiday season and pay average of US$19 an hour.
Amazon.com Inc. said Thursday it plans to hire 150,000 workers to help it get through this year’s holiday season, with roles spanning packing and picking to sorting and shipping. The company said it will pay US$3,000 sign-on bonuses in certain markets, and will pay on average US$19 an hour. Interested candidates can see all the regions with open positions at www.amazon.com/apply, the company said in a statement. The states with the greatest number of holiday openings include California, Idaho, Illinois, Iowa, Michigan, Missouri, Oregon, Texas, Tennessee, Utah, and Washington. Amazon shares were down 0.6% premarket and have fallen 27% in the year to date, while the S&P 500 has fallen 21%. https://on.mktw.net/3CI1aK3
Fintech, Blockchain & Cryptocurrency
Around US$100 million of Binance Coin stolen friday.
In the latest round of cyberattacks, Binance, the world’s largest cryptocurrency exchange, was hacked, and around US$100 million of Binance Coin was stolen. An exploit on a cross-chain bridge resulted in extra Binance Coin, the CEO of Binance, Changpeng “CZ” Zhao, tweeted Friday morning Singapore local time. Zhao lives in Singapore. “The issue is contained now. Your funds are safe. We apologize for the inconvenience and will provide further updates accordingly,” Zhao continued on Twitter. The current impact is estimated to be around US$100 million, about “a quarter of the last BNB burn,” Zhao wrote in a separate tweet. BNB is a Binance coin. A Binance spokesperson told Bloomberg that at least US$7 million of stolen funds have already been frozen. https://bit.ly/3fPHzyJ
Visa partners with FTX in a bet that shoppers still want to spend cryptocurrencies in a bear market.
The payments giant is teaming up with global exchange FTX to offer debit cards in 40 countries with a focus on Latin America, Asia and Europe. The cards, which are already available in the U.S., will link directly to a user’s FTX cryptocurrency investing account. The move allows customers to spend digital currencies without moving those off an exchange, “like you would with any bank account,” according to Visa’s CFO. It’s Visa’s latest foray into the space and adds to more than 70 crypto partnerships. The San Francisco-based company has already joined forces with FTX’s competitors Coinbase and Binance. Rival Mastercard has been on a similar spree, also partnering with Coinbase on NFTs and Bakkt to let banks and merchants in its network offer crypto-related services. American Express has said it’s exploring using its cards and network with stablecoins, which are pegged to the price of a dollar or another fiat currency. https://cnb.cx/3rFpwOl
Mastercard pushes deeper into crypto with new tool for combating fraud.
Mastercard will on Tuesday launch a new product called Crypto Secure that helps banks assess the risk of crime associated with crypto merchants on its network. The service is powered by CipherTrace, a blockchain security startup Mastercard acquired last year. Mastercard is launching the service against a backdrop of growing crime in the nascent digital asset market. Compliance has become an important focus in crypto lately as more banks and payment companies enter the fray with their own services for trading and storing digital assets. Last month, Nasdaq became the latest established financial firm to join Wall Street’s embrace of crypto, launching custody services for institutional clients. Meanwhile, governments on either side of the Atlantic are looking to implement fresh curbs on the crypto sector, which so far been mostly lacking in regulation. Last month, the Biden administration released its first-ever framework on regulation of the crypto industry in the U.S., while the European Union has approved landmark crypto laws of its own. The payments giant is doubling down on crypto at a time when prices of digital currencies are falling and volumes have dried up. The entire market has shed roughly US$2 trillion in value since the peak of a huge rally in November 2021. Despite the slump in digital token prices, crime in the industry has shown no signs of abating. A particularly popular method of swindling crypto investors of their funds this year has been to exploit blockchain bridges, tools used to exchange assets from one crypto network to another. Around US$1.4 billion has been lost to breaches on these cross-chain bridges since the start of 2022, according to Chainalysis data. https://cnb.cx/3ebXirv
Coinbase paused transactions in US for hours to address bank transfer issues.
Coinbase temporarily stopped transactions for users in the US due to an issue preventing the company from processing withdrawals or deposits involving bank accounts. At the time of the outage, Coinbase said on Twitter that users’ funds are “safe,” before announcing that transactions have been restored about three hours later. For the past couple of days, Coinbase users also had to deal with delayed transactions with Solana after its network suffered an outage on Friday. This has been a rough year for Coinbase and crypto in general, as the value of cryptocurrency has taken a nosedive. Coinbase laid off over 1,000 employees in June and is reportedly facing an investigation from the Securities and Exchange Commission. https://bit.ly/3Rz7DLF
Kim Kardashian settles SEC charges over Instagram EthereumMax crypto promo.
Kim Kardashian’s crypto misadventure has landed her in hot water with federal regulators. The reality TV superstar and influencer has settled Securities and Exchange Commission charges that she failed to disclose a payment she received for touting a crypto asset on her Instagram feed. “This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean that those investment products are right for all investors,” Gary Gensler, chairman of the SEC, said in a news release. Gensler said the case also serves as a reminder that the law requires celebrities and others to disclose when and how much they are paid to promote investing in securities. Kardashian, who is reportedly worth US$1.8 billion, agreed to pay us$1.26 million to settle the charges over a promotion on Meta’s Instagram for EthereumMax’s crypto asset, the SEC said. She will also cooperate with an ongoing investigation, and has agreed to not promote crypto securities for three years, the regulator added. https://cnb.cx/3VecbdA
US issues sweeping restrictions on chip sales to China.
The Biden administration announced sweeping new restrictions on the sale of semiconductor chips and manufacturing equipment to China on Friday in a major effort to impair Beijing’s military and technological capabilities, according to The Wall Street Journal. The new rules require manufacturers, like Intel and Micron, to receive a license from the Commerce Department in order to export semiconductors and chip-making equipment to Chinese companies. In addition, the administration issued several foreign direct product rules, banning international companies from exporting chips built with US technology. The decision follows months of increased investment by the US in domestic semiconductor manufacturing. In August, President Joe Biden signed the US$280 billion CHIPS and Science Act, providing US$52 billion in subsidies to boost companies choosing to build chip manufacturing plants in the US. Over the last few weeks, chip makers have announced multibillion-dollar investments in states like Ohio and Idaho. https://bit.ly/3yq7Dqs
NXP warns EU microchips funding falls far behind 2030 targets.
The leader of one of Europe’s most prominent microchips companies on Thursday warned the bloc’s intended investment into the semiconductor industry isn’t enough to reach its 2030 targets. “We have calculated that we would need €500 billion investment in Europe to reach the 20 percent market share goal formulated in the EU Chips Act,” Kurt Sievers, chief executive officer of NXP Semiconductors. The European Commission proposed a European Chips Act in February that would unlock private and public investments up to €43 billion, in an effort to boost its share in the global semiconductor market to 20 percent by 2030 from 10 percent today, a target announced last year. https://politi.co/3fFtwvz
Apple reportedly agrees to TSMC chip price increase.
According to the report, TSMC has informed its customers (such as Apple and Nvidia) that it has plans to raise the prices of up to 8-inch chip wafers by 6% and 12-inch chip wafers by up to 5%. At first, Apple reportedly told the Taiwanese semiconductor manufacturer that it wouldn’t accept the price increase. But today’s news suggests that Apple will pay the new price set by TSMC. Given the high number of orders Apple places every year, it’s easier for the company to negotiate better prices. Even so, some price increases are inevitable due to the current global economic situation. In the meantime, Samsung has been racing to compete with TSMC in building chips with the 3-nanometer process. It’s worth remembering that Samsung provided Apple with A-series chips until the iPhone 6s. Then, in 2016, iPhone 7 was the first model to have chips made exclusively by TSMC. If the South Korean company succeeds in building 3-nanometer chips, perhaps it could become one of Apple’s suppliers for upcoming products. https://bit.ly/3SIIxLz
Micron Pledges Up to US$100 billion for semiconductor factory in New York.
Micron announced on Tuesday that it planned to spend as much as US$100 billion over the next 20 years or more to build a huge computer chip factory complex in upstate New York, the latest move by a major semiconductor maker to invest in the United States. The commitment by Micron is a sign that the federal government’s prodding and package of generous incentives are helping to steer investment decisions. Legislation that passed in August, the CHIPS and Science Act of 2022, provides US$52 billion in grants and subsidies for companies to build and expand computer chip factories in the country. The investment is a long-term bet by the company and by the federal and state governments. Micron estimated that it would spend US$20 billion through the end of the decade and described that plan as a first phase. The company said it planned to invest as much as US$100 billion in New York over the next two decades or more. The giant factory will be built in Clay, N.Y., about 15 miles north of Syracuse. Micron said site preparation would begin next year, construction in 2024 and production in volume after 2025. Over the next 20 years, Micron said, the project will generate nearly 50,000 jobs — about 9,000 Micron employees and more than 40,000 jobs for suppliers, contractors and others. The plan also calls for Micron and the state to spend US$500 million on community and work force training. https://nyti.ms/3MfJsAH
Tesla competitor Rivian recalls nearly almost all of its vehicles: ‘we are acting with urgency and caution’.
Tesla competitor Rivian recalled 13,000 vehicles on Friday after a steering wheel error was found. The front steering wheel fastener “may not have been sufficiently torqued,” CEO RJ Scaringe wrote to staff. A spokesperson for Rivian said the recall was voluntary and that the cost would not be material. Rivian, a company backed by Amazon and Ford, has met with challenges this year, including backlash from customers after raising its prices for pre-orders — and backtracking — in March 2022. The company also laid off 6% of its workforce and saw a slew of shareholder lawsuits claiming that the company artificially inflated its share price and underpriced its cars. https://bit.ly/3MeVbQf
Sixt to buy 100,000 electric vehicles from China’s BYD.
Car rental company Sixt said Tuesday it intends to purchase more than 100,000 electric vehicles from Chinese automaker BYD for its European fleet between now and 2028. Sixt has initially only committed to buying “several thousand” EVs, the first of which will be delivered this year, the company said in a statement. Sixt said it will first deploy its new BYDs to Germany, France, the Netherlands and the U.K. in the fourth quarter of 2022. The agreement comes a couple of weeks after competitor Hertz announced plans to order up to 175,000 General Motors EVs over the next five years. Hertz has also signed deals to buy thousands of Polestar and Tesla vehicles in order to reach its goal of a 25% EV fleet by the end of 2024. https://tcrn.ch/3CFISt3
Clean-energy advocates want Puerto Rico to adopt more renewables.
Nearly three weeks after Hurricane Fiona triggered a blackout in Puerto Rico, power has been restored to 94% of residents, but the problems plaguing the island’s energy grid are far from resolved. Before the Category 1 storm made landfall on September 18, Puerto Ricans this summer took to the streets of San Juan to protest recurring power outages and rising rates, while a local coalition of clean energy, environmental, and union groups criticized the slow pace of renewable-energy development. The target of the frustration is Luma Energy, the grid operator that took over in early 2021 with the task of rebuilding a system that had long been mismanaged and suffered from underinvestment. The system was decimated after a pair of hurricanes — Irma and Maria — struck Puerto Rico in 2017, leaving some residents without power for 11 months, a federal watchdog found. Since then, the Trump and Biden administrations earmarked more than $12 billion to rebuild Puerto Rico’s power grid and protect it from disasters. Renewables account for only 3% of the island’s energy generation. The rest comes from natural gas, petroleum, and coal, much of which is imported. https://bit.ly/3EpNULj
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