FTI Consulting News Bytes – 14th April 2022
As Russia bans its internet users from accessing Facebook and Instagram, new app Rossgram has been revealed as the local substitute on offer. Still yet to launch, how will it fare against Western incumbents? Talking of tech titans in the West, this week Apple’s CEO reiterated that privacy is “a fundamental human right” amid looming competition reforms. Elsewhere, the tables were turned on ransomware group Conti in an invasion of privacy as internal documents were leaked, revealing the secret inner workings of the Russian “company.” And for some positive news… PitchBook data suggests a healthy private market for tech, with VC fundraising surpassing $70bn in commitments so far this year, while Stripe teams up with other tech giants to launch a new carbon capture initiative.
This week’s news
Russia’s new Internet
Days after Russia banned Instagram and Facebook for its users, designating Meta an extremist organisation, Rossgram was unveiled as the local alternative to global social media networks. While the app is yet to launch, Rossgram is not the only ‘DIY’ substitute emerging as a result of the government’s decisions. The Telegraph notes, however, that existing replicas of popular Western software programmes and tools have not been particularly successful, and those that have – such as the Russian social network VKontakte – have been losing ground to Western competitors recently. James Titcomb points out that Russia’s quest for high quality homegrown software has been complicated as a result of sanctions and an exodus of software developers following the Ukraine invasion. It remains to be seen whether Russia’s new string of incentives will encourage engineers to stay.
Doubling down on privacy demands
Tim Cook used his speech at the IAAP Global Privacy Summit in Washington to frame looming competition reforms, which could force Apple to allow sideloading of apps, as a threat to privacy and security. Apple has faced pressure from competition authorities in the US and Europe to open up their services to greater competition, but unlike Android, it insists on checking all software before it appears on the App Store. The CEO commented on Apple’s ongoing commitment to privacy, reinforcing the message that privacy is “a fundamental human right”. Cook ended his speech by characterising regulatory shifts in competition policy as “a pivotal moment in the battle for privacy.”
Conti gets a taste of its own medicine
The tables have turned on prolific Russian ransomware group Conti with the leak of a series of internal documents. Presumed to be a result of the group’s pro-Russia stance, the leaked documents reveal Conti’s size (roughly 350 members), leadership, and how it operates much like a regular company with RND, HR, Finance and Business Development departments. According to the files, CNBC reports that Conti has paid workers, bonuses, performance reviews and even “employees of the month”. Disturbingly, experts believe that some employees think they work for an ad agency and are unaware of the true identity of their employer.
VCs steal a march on tech investment
The Financial Times writes that despite shrinking shares in public tech companies and declining venture capital deal valuations, early stage investment looks promising. PitchBook data suggests that early equity investments in start-ups soared in Q1 2022, with a total of 1,100 early-stage deals closed. It is estimated that venture capital fundraising has surpassed $70bn in commitments so far this year. It is too early to confirm whether the trend will last. While this year may not match record funding in 2021, the volume of newly raised funds indicates there is certainly room for another big year for venture investment.
Stripe’s new Frontier
Online payments platform Stripe has launched a new initiative called Frontier alongside big hitters in tech and consulting – Alphabet, Meta, Shopify and McKinsey. Together, they have invested $925 million as part of a commitment to purchase captured carbon until 2030. Wholly owned by Stripe, Frontier aims to scale up deployment of carbon removal technologies, making it cheaper for companies who are looking to purchase captured carbon as a means of offsetting their pollution. Technologies that can filter CO2 out of the air do currently exist but their capacity is miniscule in comparison to what is needed, and they are “prohibitively expensive”, The Verge writes. Contributions from Stripe customers, who have the option to give a portion of each sale to carbon removal projects, will be directed into the Frontier project.
Top Tweets of the Week
- Twitter’s Parag Agrawal shared a brief note to the company, commenting on Elon Musk’s decision not to join the Board of Directors.
- WIRED notes that tech firms are offering perks and pay people to sit down for job interviews amid rising competition for talent who turn to employers that care about their well-being.
Number of the Week
$280 – The highest bid for the NFT of Jack Dorsey’s first tweet which the collector originally bought for $2.9 million last year.
What’s happening this week?
- 18 April – Easter Monday
- 19 April – Netflix Q1, IBM Q1
- 20 April – Tesla Q1, G20 Finance Ministers and Central Bank Governors Meeting
- 21 April – Snap Q1, The Queen celebrates 96th birthday
- 22 April – Earth Day, 6th Anniversary of Paris Agreement signed
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