Morning Consult Tech: What's Ahead & Week in Review

Morning Consult Tech: What’s Ahead & Week in Review

Tech

Essential tech industry news & intel to start your day.

April 30, 2023

By AJ Dellinger

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Happy Sunday, Morning Consult Tech readers.

I spend far too much time on Twitter, to the point that I take my weekly screen time report as a personal attack on my character. But there’s a weird thing happening on that platform at the moment: For the first time in what feels like months, the thing being most discussed on Twitter is not Twitter itself. It’s … well, it’s Different Twitter.

Bluesky, which is Twitter by another name right down to being created by Jack Dorsey, appears to have reached a critical mass. The platform added some major Twitter power users this week: Chrissy Teigen, Rep. Alexandria Ocasio-Cortez (D-N.Y.) and, perhaps most importantly, Dril — the Weird Twitter fixture who somehow ended up warring with Elon Musk after the Twitter Inc. owner apparently decided to try to affix Dril’s account with Twitter Blue against his will.

Bluesky is decentralized in a similar way to Mastodon, the original Twitter lifeboat platform, but onboarding is more streamlined. That has encouraged more people to join, and things are apparently quite lively over there — and it appears that Bluesky has overtaken Mastodon, at least in interest if not in usage.

That might be because of some secret sauce that Bluesky has. The association with Twitter’s original founder makes one think that perhaps he’s distilled all the good parts of Twitter into this new platform while letting Musk deal with the bloat of his first attempt.

Really, it’s probably the fact that it’s still relatively small. Exclusivity goes a long way on social media, as does curation. Good posters invite other good posters and quality stays high. It’s when the floodgates open to everyone when that intangible magic starts to wear off. Ask people who remember what Reddit felt like before it became so mainstream that people started adding “reddit” to the end of Google searches to get better results. You just can’t hold onto that feeling forever.

Also key here: The brands haven’t shown up yet. No offense to the corporate interests of the world, as most of these projects need your money to survive, but your content is the death knell for any platform experiencing a golden era. Companies’ desire to be on a platform is a sign of its success, but companies’ actual presence there is a sign that the best times are in the rear view.

If you’re on Bluesky, enjoy it while you can. It’s only a matter of time before Doritos posts its first skeet (yes, seriously, they are called skeets) and it’s all downhill from there.

What’s Ahead

Earnings keep rolling in this week, with Apple Inc. leading the way on Thursday with its second-quarter report. Also reporting this week: chipmakers AMD Inc. and Qualcomm Technologies Inc. and rideshare firms Uber Technologies Inc. and Lyft Inc.

The Massachusetts Institute of Technology is hosting two major events this week: Future Compute, kicking off today, will focus on emerging technologies and feature appearances from Manuvir Das, head of enterprise computing at Nvidia Corp., and Amazon.com Inc. Chief Technology Officer Werner Vogels. On Tuesday, the college will kick off its EmTech Digital event, an artificial intelligence conference that will feature speakers including Bill Marino, principal product manager at Stability AI; and Diya Wynn, senior practice manager for responsible AI at Amazon Web Services.

Federal Trade Commission Chair Lina Khan continues her media tour with a fireside chat at the American Economic Liberties Project’s Anti-Monopoly Summit, set to be held in Washington, D.C., on Thursday. Assistant Attorney General Jonathan Kanter will also make an appearance at the event.

The Wall Street Journals’ Future of Everything Festival kicks off Tuesday and features a star-studded speaker list highlighted by Michelle Obama, former Yahoo! Inc. Chief Executive Marissa Mayer, New York City Mayor Eric Adams and DeepMind founder and CEO Demis Hassabis.

Vanderbilt University’s Summit on Modern Conflict and Emerging Threats will start Thursday and will focus on how the military and intelligence communities are responding to new technologies like artificial intelligence and the ever-changing cyberthreat landscape. Speakers include Jen Easterly, director of the Cybersecurity and Infrastructure Security Agency; Gil Herrera, director of research at the National Security Agency; and Gen. Paul Nakasone, commander of U.S. Cyber Command.

Week in Review

Artificial intelligence

The Supreme Court declined to hear a challenge to the U.S. Patent and Trademark Office’s decision to not issue patents for inventions created by artificial intelligence systems. The appeal, brought by computer scientist Stephen Thaler, sought to overturn a lower court ruling that determined patents can only be issued to human inventors and AI systems cannot be considered the legal creator of an invention.
Regulators including the FTC and Equal Employment Opportunity Commission unveiled a plan to enforce civil rights laws against artificial intelligence systems, including generative AI tools like ChatGPT, that could perpetuate bias and discrimination. The regulators, speaking at a joint news conference, raised concerns about “digital redlining,” in which AI systems could perpetuate existing racial disparities through bad data or poor design.
Democratic Sen. Mark Warner (Va.), the chair of the Senate Intelligence Committee, called on executives at several artificial intelligence companies to prioritize security measures and address bias as they introduce new technologies to the public. “Beyond industry commitments, however, it is also clear that some level of regulation is necessary in this field,” Warner said in a letter sent to OpenAI, Meta Platforms Inc. Alphabet Inc., Apple, Microsoft Corp. and others.
The European Parliament has put forward a new draft of European Union legislation that would require artificial intelligence tools like ChatGPT to disclose copyright material used to build and train the system as a way to give publishers and content creators the ability to seek payment when their work serves as source material for AI-generated content. The language around copyright, which was reviewed by The Wall Street Journal, is expected to be inserted into an existing E.U. bill that will aim to create new regulations for AI, and a final version of the bill is expected to pass later this year.
Sen. Michael Bennet (D-Colo.) introduced a bill that would establish an AI task force that would review U.S. policy around the technology and identify ways to reduce threats to privacy, due process and civil liberties. The proposed AI Task Force, which would work for 18 months to issue a report before shutting down, would include officials from the Office of Management and Budget, the National Institute of Standards and Technology and the Office of Science and Technology Policy, as well as civil liberties officers from the Departments of Justice, State, Treasury and Defense, along with other executive branch agencies.

Earnings

Alphabet’s Google saw its search advertising business beat revenue forecasts in the first quarter of 2023 while Microsoft’s growth was carried by a 16% increase in revenue from its cloud computing division. Both companies, which are currently battling for supremacy in the artificial intelligence space, hinted to investors that the technology is not yet driving revenue but is in high demand from clients.
Meta beat expectations after the company reported a 3% increase in sales from $27.91 billion a year earlier and better-than-expected guidance for the second quarter.
Amazon beat expectations during its first-quarter earnings release, turning in $127.4 billion in revenue on the back of a stronger-than-expected quarter from its cloud computing segment Amazon Web Services, where sales rose by about 16%, and the company’s advertising business.

Antitrust and competition

The United Kingdom’s Competition and Markets Authority will block Microsoft’s $69 billion purchase of Activision Blizzard Inc. over concerns that the planned largest-ever acquisition in gaming would hurt competition in the cloud gaming space, despite Microsoft making agreements with a number of competitors to ensure access to the “Call of Duty” franchise across gaming platforms. Microsoft said it remains committed to the deal but additional hurdles remain, with the European Union and FTC still reviewing the proposed acquisition.
The White House asked South Korea to urge its chipmakers including Samsung Electronics Co. Ltd. and SK Hynix Inc. not to increase sales in China if the country bans U.S.-based Micron Technology Inc. from selling within its borders, according to four people familiar with the talks between the White House and the presidential office in Seoul. Micron is currently being probed by the Cyberspace Administration of China in what is viewed as a possible retaliatory effort by the Chinese government in response to the Biden administration’s crackdowns on Chinese technologies.
A panel of three judges on the 9th U.S. Circuit Court of Appeals upheld the 2021 decision that mostly favored Apple in an antitrust challenge from Fortnite maker Epic Games Inc. that accused Apple of engaging in monopolistic behavior by controlling the distribution of third-party apps through its App Store. The court also upheld the one claim that Apple lost, finding that the company is in violation of California’s Unfair Competition Law by not allowing app makers to direct customers to payment services outside of the App Store.
Microsoft agreed to stop automatically installing its Teams app for video conferencing and messaging on devices that use the company’s popular Office software, in a move meant to appease E.U. regulators and avoid an antitrust probe, according to two people with direct knowledge of the decision. The concession follows a 2020 complaint from rival Slack Technologies LLC, which accused Microsoft’s bundling practice of being anticompetitive, the people said.
Meta is expected to receive a fine from the Irish Data Protection Commission and a potential ban on the use of unsafe contractual clauses to carry out its data transfers between the United States and the European Union. The decision is expected to be announced next month, according to Meta’s latest quarterly earnings report, and the company will have an opportunity to appeal the decision before being required to comply.

Social media

The Supreme Court agreed to take up two appeals cases that could determine whether the First Amendment bars government officials from blocking critics on social media. One appeal comes from school board members in California who were sued for blocking parents from Facebook pages and a Twitter account maintained by the officials, while the second appeal comes from a Michigan man who was blocked by a city official for making Facebook posts critical of the local government’s response to COVID-19.
In an interview with Bloomberg TV, Meta Head of Global Affairs Nick Clegg said that TikTok benefits from a “lack of a level playing field” because it is allowed to operate in the United States despite being owned by a Chinese company, while Meta is not able to operate in China. “And in the end, there’s always an underlying issue of values: What values are the underpinning of new technologies?” Clegg said, echoing the sentiments of some lawmakers who have pushed for a potential ban of the app.
Democratic Sens. Brian Schatz (Hawaii) and Chris Murphy (Conn.) and Republican Sens. Tom Cotton (Ark.) and Katie Britt (Ala.) introduced a bill that would prohibit children under the age of 13 from joining social media platforms and would require tech companies to get parental consent before creating accounts for users under the age of 18. The legislation, known as the Protecting Kids on Social Media Act, would also prohibit tech firms from using personal information to serve targeted content or advertising to teenagers.

Other news

The Biden administration’s goal of closing the digital divide and providing broadband internet access to the millions of U.S. households that are currently without it by 2030 is being hamstrung by a fiber technician worker shortage. The Fiber Broadband Association said an additional 205,000 workers will need to be hired by 2026, and the U.S. Government Accountability Office estimated that around 34,000 additional workers could be needed this year alone to meet the goals of the broadband expansion program, which is supported by a $42.5 billion spending package.
Some of the tech industry’s richest figures, including OpenAI CEO Sam Altman, Jeff Bezos, Peter Thiel, Bill Gates and Marc Benioff, have invested in a number of companies pursuing nuclear fusion, a potential clean-energy alternative that, in theory, could create massive amounts of energy with no carbon emissions and limited radioactivity. Atlman alone has put $375 million into fusion startup Helion Energy Inc., and nearly $5 billion in private funding has poured into fusion efforts — most of which has come since 2021 when a U.S. lab came close to achieving nuclear fusion.
YouTube Music contractors officially joined the Alphabet Workers Union-CWA following a vote through the National Labor Relations Board that saw 41 out of 49 eligible workers vote in favor of unionizing. Google must now bargain with the unionized workers, and if a contract is ratified, they will become the first officially recognized union of tech workers at Google.