Tesla is to raise a further $5bn (£3.75bn) on US markets this month after already raising billions of dollars as its stock price surged this year.
The electric car maker will issue new shares, it in a filing said as US markets opened, as it prepares to enter the S&P 500 market index. Telsa’s shares are up more than 620pc so far this year, propelling its chief executive Elon Musk into the ranks of the world’s top billionaires, second only to Amazon chief executive Jeff Bezos.
Tesla is on track to sell more than half a million of its electric cars this year, a record, but only a fraction of what traditional car companies sell. Tesla’s share price has eclipsed rival car manufacturers and it is now worth more than $620bn.
In a boost for Tesla’s autonomous driving plans, meanwhile, Uber announced it would be pulling out of the self-driving car market and selling its unit to a rival.
In the UK, competition regulators are lining up a new regime that could land technology companies that break new rules with fines worth billions of pounds.
Here is what the tech giants think of the CMA’s proposals
In submissions to the CMA, tech giants including Facebook, Google and Amazon urged caution on some of the more aggressive elements of the proposed regulatory regime.
Tech giants hit back against the proposals in their submissions to the CMA. Google warned the use of some powers could risk «hindering innovation and economic growth».
Amazon, meanwhile, warned against the CMA applying a broad brush approach on its regulation of digital markets that would also apply to retail. It claimed retail markets remained competitive, unlike some other digital sectors, and cautioned assessing online retail sector in the same way would be «both rushed and fundamentally flawed».
Facebook said regulators needed to «carefully weigh the potential trade-offs of intervention and ensure that the value created by Facebook is not destroyed».
Consumer watchdog Which? however urged the Government not to «water down» its proposals.
Details on the DMU
We have been digging through the submissions and full details of the competition regulator’s proposed Digital Markets Unit (DMU). As well as the power to levy fines, the regulator would be granted the powers to force greater powers for consumers over their data, more choice of apps or default services such as search engines, and interoperability.
It will also have the power to enforce the structural separation of units at tech companies. One particular deal regulators have been concerned about it Google’s deal to acquire ad provider Doubleclick in 2007 that turned it into an online advertising powerhouse.
But while the unit would have the power for this structural split, it could not enforce a change of ownership. The CMA wrote in its proposal: «This recommendation recognises the significance of a decision to pursue a divestiture remedy, given the costs associated with this remedy, the fact it interferes to a greater extent with a company’s property rights, and that the decision cannot be reversed.»
Breaking: Apple launches Fitness+ app and new over-ear headphones
Apple has launched a new Fitness app that will put it into competition with home cycle company Peloton and a host of smaller workout apps. Its Fitness+ app will include home workouts, yoga, dance, cycling and treadmill in an effort to encourage more users to sign up to its subscription products when they buy an iPhone.
The workouts will be launched on December 14 and work across iPhone, iPad and Apple Watch products. Workouts will range between 10 and 45 minutes and be given by personal fitness instructors.
Lockdowns have already forced many gyms into temporary shutdowns or pushed them into doing online fitness classes, often for free. Apple’s arrival spells yet another challenge for the sector. Shares in Peleton, which makes fitness bikes, fell 1.7pc in early New York trading. Apple’s service will start at $9.99 per month.
It is not the only new thing Apple is revealing today. The tech giant also has something for gadget fans, a new set of over-ear headphones. Its AirPods Max will launch on December 15 and come in five different colours. The headphones are noise-cancelling and have up to 20 hours of battery, Apple says. They are also far from cheap, starting at $549.
Apple to update App Store with data warnings
Regulators have been busy today, the competition watchdog the CMA is also announcing that Apple has agreed to make changes to its App Store to better inform users how their data will be used by different apps.
The changes were announced in June by Apple, but will only be coming to iOS in the coming days, the CMA said. It added it was also in talks with Google to make changes to its Play Store.
Here is how those changes are going to look in the App Store:
Meanwhile, on the CMA’s plans for a new Digital Markets Unit, this is what Which? policy director Rocio Concha had to say:
“We’ve seen how a lack of competition has stifled innovation in the tech sector and given a few companies a stranglehold over the market – leading to higher prices, reduced choice and consumers giving up more data than they would like. It is vital that the new Digital Markets Unit is fully up and running as soon as possible – and that the government resists any calls to water down the powers it needs.»
Meditation app Calm commands $2bn valuation
A meditation app founded by British entrepreneur Michael Acton Smith and backed by singer Harry Styles has secured a $2bn (£1.5bn) valuation in its latest funding round, Ben Woods reports.
Calm, which offers a subscription-based app with guided meditation and sleep exercises, raised $75m from investors including existing backer Lightspeed Venture Partners, with support from Goldman Sachs, TPG, Insight Venture Partners and Salesforce boss Marc Benioff.
The start-up has raised a total of $217m since it was founded eight years ago, making it one of the best-funded «wellness» apps in the world.
Tesla raising another $5bn
Tesla is to take advantage of its huge stock surge and optimistic predictions by analysts to raise another $5bn in its third share offering this year.
The electric car maker’s stock is up 670pc this year, making its chief executive Elon Musk the world’s second richest man. It follows a $5bn share offering in September and a $2bn sale in February.
The interest in Tesla shares has made it far and away the world’s most valuable car company, worth a total of $600bn, despite only selling a tiny fraction of the cars that its rivals do.
Australia debates plans to make Facebook and Google pay for news
Australia’s government is to introduce a bill that would force Facebook and Google to pay news outlets for use of their journalism in what would be a world first law.
The rules mandate a bargaining process where independent judges can force Facebook and Google to come to a deal with news publishers so they pay for use of articles. Tech companies face fines of up to $10m Australian dollars if they refuse to comply.
Google has pushed back heavily against the rules, saying it will make its service worse for consumers. Facebook has warned it might block Australian news content rather than pay for it.
Live now: DCMS hears from Nile Rodgers on music streaming
Sitting on the Digital Select committee might just be the best gig in the House of Commons. This week, they are hearing from music legend Nile Rodgers on the streaming sector and its impact on the industry.
Musicians are unhappy with the amount of revenue split they receive from plays on streaming apps from Spotify to YouTube.
Rodgers, the co-founder of the band Chic, says: «Not one person can tell me what a stream is worth.»
MOBO award winner Soweto Kinch, meanwhile, tells MPs he believes the lack of transparency is by design, since musicians are kept in the dark as to what fees they might be entitled to.
Shake-up of online gambling rules announced
This morning, the Government confirmed a host of planned changes to gambling rules, including online gambling companies. Among them are increasing the minimum age of playing online games from 16 to 18, limiting the size of online stakes and also the possibility of setting up a new gambling regulator. The Gambling Commission is also investigating gambling-like Loot Boxes in children’s video games.
Big Tech firms face huge fines if they break rules
Britain should be able to fine Big Tech firms up to 10pc of their worldwide revenue if they breach proposed «tailored» rules designed to curb each individual company’s dominance in its market, Hannah Boland reports here.
The new recommendations out from the Competition & Markets Authority this morning suggested the watchdog be granted powers to enforce a «new, legally binding code of conduct, tailored to each firm and to where the evidence demonstrates problems might occur». This would be designed and overseen by a Digital Markets Unit, which is to sit within the CMA. Takeover rules should also be strengthened over the digital sector, including making it
mandatory to notify the CMA of a transaction and imposing a block on completing a deal until the CMA has investigated.
The CMA said the Government should also look at putting in place a «more cautious legal test when looking at the likelihood of harm to consumers in order to address concerns about historic under-enforcement of mergers involving big tech firms». Those breaching the rules should face «substantial penalties», including fines of up to 10pc of worldwide revenue.
Breaking: Competition watchdog calls for sweeping new powers to tackle Big Tech
Britain’s competition watchdog, the Competition and Markets Authority, has advised the Government to implement fines of up to 10pc on tech giants with significant market power for abuses of their dominance.
In a report this morning, the watchdog said it wanted to make sure “consumers and businesses are treated fairly and help to level the playing field for smaller rival tech firms”.
The new powers will include a legally binding code of conduct, enhanced powers to intervene in the market, and strict new takeover controls, backed up by fines for breaches.
The full report is here. We will have more as we dive into the details.
Key iPhone supplier Foxconn hit by $34m ransomware attack
Foxconn, a key supplier in Apple’s iPhone supply chain, has been hit by a ransomware attack that is demanding a $34m payment to unlock its files, James Cook reports.
The attack took place around November 29 and targeted the Foxconn CTBG MX facility in Mexico, Bleeping Computer wrote. The facility is used by the company to assemble and ship electronics across North and South America. Its website has been unavailable since the reported ransomware incident.
A ransom note has been published online and the hackers behind the incident are demanding more than $34m worth of cryptocurrency in payment from Foxconn in return for unlocking its systems and deleting files the group claimed to have stolen.
We wrote earlier this year about the cottage industry of digital hostage negotiators who specialise in sending ransom payments to hackers.
Revealed: The UK secures $12.5bn in tech investment despite pandemic
The UK’s tech scene has shrugged off Brexit and the pandemic to maintain its lead as Europe’s most attractive venture capital market, my colleague James Cook writes.
Since 2016, $50bn has been invested in UK start-ups, 36pc of all start-up funding in Europe. London, meanwhile, remains the technology investing capital of Europe. Germany took the second largest share of funding, with 17pc of the European total.
However, there is still a lack of major technology company listings, although that could be about to change as Deliveroo and Darktrace gear up to go public.
Tommy Stadlen, an investor at Giant Ventures who sold his start-up Swing to Microsoft in 2017, said: “The only missing piece of the jigsaw for London tech is to have a true giant technology company go public in the UK. That’s what we’re missing. The impact of that is it creates huge numbers of tech-savvy millionaires who go on to become angel investors.”
The chart below shows how the UK has maintained its lead over other European nations in the venture capital league tables.
Mark Zuckerberg was ‘afraid of scrutiny’ after Cambridge Analytica
Facebook chief executive Mark Zuckerberg has been accused of running from scrutiny after he refused to appear before MPs in 2018, but spoke in private to Matt Hancock just days later.
Damian Collins, the Conservative MP who chaired Parliament’s digital committee at the time, said:
“The notes from this meeting clearly show that Mark Zuckerberg was running scared of the DCMS committee investigation on disinformation and fake news and was actively seeking to avoid being questioned by us about what he knew and when about the Cambridge Analytica scandal.”
Collins has long been furious that Facebook sent deputies of the Mr Zuckerberg to meet with MPs in the wake of the Cambridge Analytica scandal, which saw data on 50 million Facebook profiles collected for political targeting. Now, it seems, he was meeting in private with ministers while declining to appear and give evidence in public.
The MP has the full note from Matt Hancock’s meeting with Zuckerberg in 2018 here:
Encrypted messages putting millions of children at risk of abuse
Social media companies could be using encryption in a «cynical» attempt to get around duty of care laws, according to the Children’s Commissioner.
Anne Longfield said tech giant’s plans to further encrypt messaging risked more child exploitation and abuse, in a report released on Tuesday.
She said the end-to-end encryption made it impossible for platforms to read the content of messages and also risked preventing police and prosecutors from gathering the evidence they needed to prosecute child abusers.
“I worry that this could be a cynical attempt on the part of some tech firms to side-step sanctions and litigation, especially as the UK Government prepares to establish a new legal duty of care on companies towards their users,” said Ms Longfield. “If a platform is unable to read a message shared across their server, it follows that it would be hard for a Government to hold them accountable for its contents.”
The Telegraph’s Home Affairs Editor Charles Hymas has the full story here.
TikTok granted injunction against Trump order
Chinese social media sensation TikTok has been given reprieve against the Trump administration’s desire to upend its ownership in the US.
Its parent company ByteDance has been granted a preliminary injunction that should curtail the power of US commerce officials to ban transactions with the tech giant.
President Trump had signed an executive order in August, stipulating that deals between American firms and TikTok should be blocked.
In the order Mr Trump used the International Emergency Economic Powers Act, insisting that both ByteDance and WeChat’s presence in America constituted an emergency.
However, district judge Carl Nichols said in a ruling this week that the government had “likely exceeded” the limitations of the act and granted the Chinese firm an injunction, according to The Verge. The order will undoubtedly grant the Chinese firm more time to sidestep the advances of Mr Trump.
Coming up today
Rumours are swirling that a US antitrust case against Facebook will be dropping this week, potentially as soon as today.
5 things to start your day
1) Uber is giving up on driverless cars: The ride hailing company has dropped plans to build its own driverless car and has sold the division developing the technology to a US start-up, after repeated setbacks to its dreams of having a network of robot taxis.
2) Mastercard and Visa threaten to cut off payments to Pornhub over child abuse claims: The card company is reassessing their relationship with Pornhub after an investigation found numerous videos of child abuse, rape and «revenge porn» still present on the service.
3) Palantir shares rise on announcement it will work with US food and drug regulator: The three-year deal is worth $44.4m and will allow the Food and Drug Agency to use Palantir software to integrate and analyse data to help approve drugs and monitor the safety of items like hand sanitizer.
4) Britain eyes leading role in $21bn OpenRan technology: UK telecoms companies are gearing up for a major role in a new kind of radio technology in an effort to break free from Huawei.
5) Calmer, quieter and more alert: why electric cars could change the way we drive: Electric and hydrogen fuel cell cars might inspire their drivers to become more calm and conscientious on the road.