FTI Consulting News Bytes – 11 October 2024

FTI Consulting News Bytes

First off this week we kick off not with London’s capital market reforms but Spain’s new proposal to break the EU capital markets stalemate. Next we turn to the latest AI tools launched by Meta to automatically generate video and augment it with audio, as companies race to develop similar capabilities. As November looms closer, everyone seems to be asking the same question – to COP or not to COP this year? Where will you be? It seems many are skipping COP29 this year with all eyes on Brazil 2025. With more will they won’t they, we note reports Ubisoft may be eyeing a take private. Rounding out the week, we turn to the future as Tesla bets on self-driving robotaxis  – next time you’re in California look out for ‘the Cybercab’.

This week’s news

Spain seeks to revamp capital markets

Spain is spearheading efforts for a new mechanism that would allow a vanguard of three or more countries to proceed on joint initiatives to create a pan-European harmonised credit rating system, making it easier for small and medium sized businesses to raise finance. The Financial Times contextualises that for decades the EU has sought to tear down national barriers in capital markets to help companies raise funds but efforts have frequently been scuppered from several capitals. The catalyst for Spain’s initiative, they say, is Mario Draghi’s report which, amongst other things, argued the bloc risked economic decline if it didn’t turn its private savings into productive investments. More broadly, Carlos Cuerpo, the Spanish economy minister who will present the initiative states a “competitiveness lab” where three or more EU member states could test ideas for co-operation. He suggests it could help avoid “the potential danger of frustration” that can result from the EU’s slow decision making adding that the average bloc legislation takes 19 months to pass.

Meta Movie Gen!

Meta has unveiled a set of AI tools, called Meta Movie Gen, for automatically generating videos, instantly editing and synchronising them with AI-generated sound effects, ambient noise and background music. “Video is nothing without audio,” said Ahmad Al-Dahle, Meta’s vice president of generative AI. The New York Times suggests that there is a race to release such tools, with OpenAI through Sora an obvious competitor. Whilst “OpenAI and other companies have been reluctant to release some AI technologies amid concerns about disinformation and other potential risks”, Meta “has been quicker to share them freely, arguing that the risks are not as great as they may seem.” Al-Dahle assuaged fears by suggesting the company was still testing the technology to better understand what the risks might be and how they could be mitigated.

To COP or not to COP? 

That is the question many are asking. Recent momentum suggests the latter is the approach many companies are taking. Bank of America, BlackRock, Standard Chartered and Deutsche Bank are among prominent financiers who are expected to skip COP29 this year, as the Financial Times notes business expectations are “lowered”. This is despite the fact that the summit this year has been billed by its organisers as the “finance COP” where discussions are expected to centre on a new financial target to help support developing countries suffering the effects of climate change.  Finance executives cited “difficult logistics” and fewer client networking opportunities versus COP28 in Dubai. Some, instead, have indicated COP30 in Brazil next year is of greater interest than this year’s “more technical” version. 

Game over for Ubisoft’s public listing? 

Ubisoft, the video games studio behind the Assassin’s Creed franchise, is “reviewing its strategic options” following reports it could be taken private. According to The Times, Guillemot Brothers, a holding company run by some of Ubisoft’s founding family, has been holding talks with its co-shareholder Tencent, in an effort to stabilise operations and boost Ubisoft’s stock price, which could result in them buying out the publisher and taking it private. Ubisoft’s share price rose 30% last Friday, after a Bloomberg report revealed that Guillemot Brothers and Tencent had spoken to advisors about potential routes forward for the company. In response to the speculation, Ubisoft issued a statement confirming that it “regularly reviews all its strategic options in the interest of its stakeholders and will inform the market if and when appropriate”, and reiterated that management is focused on executing its strategy. 

Tesla bets on self-driving robotaxis

Tesla boss Elon Musk unveiled a prototype of the firm’s long-awaited robotaxi, ‘the Cybercab’, in California on Thursday, the BBC reports. As Musk bets on the self-driving taxi, he hinted that Tesla owners could eventually have the option to rent their vehicles out on Tesla’s network when they are not driving them. The project, originally due for release in August, has been criticised by some analysts who found the Cybercab to be “a distraction for a company that should be focussing on releasing a lower cost electric vehicle”. Whilst Tesla’s strategy is argued to be simpler, and much cheaper, than its competitors, it has two critical weaknesses, industry executives, autonomous-vehicle experts and a Tesla engineer told Reuters. Without the layered technologies used by its peers, Tesla’s system struggles more with so-called “edge cases” — rare driving scenarios that self-driving systems and their human engineers struggle to anticipate.

Top Tweets of the Week 

• Bloomberg Technology tweets: “Nvidia CEO Jensen Huang says that the future of AI will be services that can “reason,” but such a stage requires the cost of computing to come down first.”
• Benoît Berthelot, Technology Reporter at Bloomberg tweets: “Emmanuel Macron told @Variety he would prefer French media companies be traded in Paris rather than elsewhere, as Vivendi says it’s leaning toward listing Canal+ in London.”
• Madhumita Murgia, Artificial Intelligence Editor at the Financial Times, retweets an extract from an article in The New Yorker: “Now that the tech industry has quietly become one of the most powerful lobbying forces in American politics, it is wielding that power as previous corporate special interests have: to bully, cajole, and remake the nation as it sees fit.”

Number of the week

2x -Research from the City St George’s, University of London reveals that double the number of expert men appear on air in flagship broadcast news programmes compared to expert women.