FTI Consulting News Bytes – 20th May
In this week’s news, we first look at the decision by Google’s Russian subsidiary to file for bankruptcy following pressure from local authorities. We then turn to Microsoft’s decision to simplify the business terms for its cloud offering as Azure service provider comes under scrutiny from rivals and regulators. We also take a closer look at Netflix as the company’s shrinking subscriber base leads to further staff layoffs. We then turn to the new report by the Irish Council for Civil Liberties which examines the use of online data for advertising purposes, and finish with astonishing new discoveries on the Sun’s surface.
This week’s news
Google declares bankruptcy in Russia
Google’s Russian subsidiary plans to file for bankruptcy after authorities in the country seized its bank account, in an escalation of tensions, in which the US search engine ended almost all operations in Russia. A spokesperson for Google told the Financial Times that the seizure had made it “untenable” for their Russian offices to function affecting the employing and paying of employees, the paying of suppliers and vendors and meeting other financial obligations. Google confirmed it would continue to provide its free services including Search, YouTube, Gmail, Maps, Android and Play to users in Russia.
Microsoft relaxes cloud terms
In an attempt to avoid a full antitrust probe in Brussels, Microsoft is relaxing business terms for its cloud computing service. Microsoft Azure has been criticised in the past for using anti-competitive practices to draw customers to its cloud computing platform and away from their competitors. Brad Smith, Microsoft’s President has said after hearing some “compelling feedback” that the company is taking measures to mitigate and address the concerns from both regulators and competitors. Smith attributed the reason for the change being the customers, and noted that in Microsoft’s rivalry with AWS they had overlooked the effects of some of the business terms on the cloud providers.
Netflix cuts staff amid subscriber dip
Netflix announced on Tuesday that 2% of their North American workforce amounting to 150 people will be made redundant. They have attributed the company’s revenue as the cause for the job losses. Netflix’s Q1 results revealed that it had lost 200,000 global subscribers in the first three months of 2022. There has been a wave of layoffs at tech companies in recent months, companies such as Cameo and Caravan have cut jobs, too. This phenomenon has not been limited to start-ups, even larger companies such as Meta, Uber and Google have frozen hiring for engineering positions for the rest of the year. Many have attributed job cuts to slower growth post-pandemic at tech companies that had faced a surge in demand and hired aggressively as a result.
Putting GDPR to a test
The new study, by the Irish Council for Civil Liberties (ICCL), found that data about every internet user is shared hundreds of times each day as companies bid for online advertising slots. According to the report, the average European user’s data is shared 376 times per day, and 747 times daily for US-based users. The BBC reports that personally-identifying information is not included, but campaigners argue that the volume of the data is still a violation of privacy. The ICCL is reportedly engaged in legal action with the digital ad industry and the Data Protection Commission against what it describes as “an epic data breach”, noting that nobody has consented to this practice.
The solar hedgehog
In a joint collaboration by the European Space Agency, NASA and the UK Space Agency, the teams have used the Solar Orbiter, a spacecraft, to obtain never before seen images of the Sun. The Solar Orbiter flew past the Sun on March 26 and returned a trove of new images, such as the south pole of the Sun and a solar hedgehog. The spacecraft obtained these images after coming within one-third the distance from the Sun to the Earth. Caroline Harper, Head of Space Science at the UK Space Agency told Sky News the footage is the “closest we’ve ever seen of the Sun”. Despite the Solar Orbiter heat shield reaching 500 degrees Celsius, the shield functioned as expected.
Top Tweets of the Week
- Forbes writes that Tesla has been cut from S&P’s index for environmentally conscious investors due to flaws in its business conduct and, ironically, low-carbon strategy.
- Ben Pershing, Politics Editor at the Wall Street Journal, reposted the publication’s account of Elon Musk’s statement, who said that Twitter “deal cannot move forward” until the platform shows public proof regarding fake and spam accounts.
Number of the Week
$3tn. – The amount that the metaverse could contribute to the global GDP within a decade, according to Analysis Group.
What’s happening next week?
- 22 May: F1 Spanish Grand Prix
- 22 May – 26 May: World Economic Forum Annual Meeting commences in Davos
- 23 May: Zoom Q1 results
- 25 May: M&S FY results
- 25 May: Twitter AGM
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