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| Welcome to today's Tech newsletter! Here are the top stories: - Goldman Sachs could exit consumer lending, potentially impacting its Apple partnership.
- Bandcamp has laid off half of its employees.
- The U.S. government has further restricted exports of AI chips to China.
Venture capitalists pitch to founders in our live-stream reverse demo day event, "Meet Our Fund 5" happening today. Check it out! Beth
p/beth-duckett | |
| 1 | | Goldman Sachs is considering exiting the consumer lending business, potentially affecting its partnership with Apple, according to The Wall Street Journal. The collaboration has produced several consumer products and services, including an Apple credit card, a high-yield savings account, and a buy-now, pay-later (BNPL) service. More: - Goldman Sachs is facing pressure to cut losses as it deals with expected lower quarterly profits, which could put Apple's products at risk, according to the Journal.
- Initially, the Apple savings account drew attention with a 4.15% APY, but it has since lost favor among Goldman executives, who view it as a distraction from the bank's core business.
- Partners blame CEO David Solomon for Goldman's unprofitable expansion into consumer lending, which has resulted in major losses and the departure of some top executives from the division.
- The products could be transferred to another bank, possibly American Express. Another possibility involves granting Apple a bigger stake in the partnership.
Zoom out: - Earlier this year, Apple revealed that customers had collectively deposited over $10B into their Goldman-backed savings accounts.
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| 2 | | Half of the employees at Bandcamp, the music distribution platform, were laid off this week shortly after the company's acquisition by Songtradr. Amid a turbulent year for the tech sector, layoffs have spiked. More than 1,060 tech companies have laid off 243,778 employees, exceeding the 164,769 during all of 2022, although there has been a notable decline since layoffs peaked in January. 
Details: Epic Games acquired Bandcamp, an indie music platform, in 2022 for an undisclosed sum and then sold it to Songtradr a year later. Songtradr, a music licensing company, has now extended job offers to only 60 out of 118 Bandcamp workers. In an email to remaining employees, Songtradr CEO Paul Wiltshire revealed financial challenges, citing rising operating costs that make Bandcamp's business model unsustainable. The bigger picture: Despite hopes that the tech layoffs of late 2022 and early 2023 were ending, several major tech companies have announced job cuts this month. Qualcomm, the semiconductor and wireless technology giant, is letting go of approximately 1,258 employees as part of restructuring efforts, while LinkedIn is undergoing its third round of layoffs in 2023, eliminating 668 jobs. | | | |
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| 3 | | The U.S. Commerce Department is once again tightening restrictions on the export of advanced artificial intelligence chips to China. The new rules are part of efforts to prevent Beijing from acquiring advanced semiconductors and developing cutting-edge AI and other technology, particularly for its military. More: - The new rules are expected to limit exports of Nvidia's A800 and H800 chips and could also affect Intel and AMD chips.
- According to the U.S. government, the move aims to address loopholes in its AI chip export restrictions to China announced last year.
- The rules will also limit the sale and export of semiconductor manufacturing equipment, including from companies like Applied Materials.
Zoom out: - The measures against China will also affect Iran, Russia, and other countries.
- The new controls are designed "to protect technologies that have clear national security or human rights implications," said Commerce Secretary Gina Raimondo.
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| 4 | | Apple today unveiled a more budget-friendly Apple Pencil with a hidden USB-C port. The stylus pen will launch in November at a price point of $79. More: - The new Apple Pencil charges and pairs via a USB-C cable and is compatible with all iPads featuring a USB-C port.
- The third-generation model, designed with a matte finish, magnetically attaches to iPads, triggering a sleep mode to conserve battery life.
- While it features low latency and tilt sensitivity, the pen lacks wireless charging, found in the $129 second-generation model, and pressure sensitivity found in the $99 oldest version.
Zoom out: - The release is part of Apple's shift away from the Lightning port to USB-C to comply with new EU regulations.
Q: What's your take on Apple's switch to USB-C? Do you think it's good for consumers? Join the conversation here. | | | |
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| 5 | | Netflix plans to broaden its mobile gaming catalog by launching titles inspired by popular shows such as "Squid Game" and "Wednesday," per the WSJ. In addition, Netflix has held talks about a licensing deal to release a game within the "Grand Theft Auto" series from Take-Two Interactive Software. More: - Netflix is also exploring games based on "Extraction," its Sherlock Holmes series, and its "Black Mirror" series, as reported by insiders.
- According to the Journal, Netflix's current focus is on mobile games, but the company is looking into expanding into higher-end games that can also be streamed from TVs or PCs.
- The move follows Netflix's initial foray into mobile gaming in November 2021. Since then, the streamer has acquired game developers like Spry Fox, Next Games, and Night School Studio.
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| 6 | | Gary Gensler, the chairman of the SEC, warns that AI could trigger a future financial crisis without adequate regulation. In an interview with the Financial Times, Gensler expressed concerns that a crisis could emerge in the late 2020s or early 2030s, driven by the centralization of AI models and cloud service providers. More: - Gensler is concerned that institutions will become too reliant on the same AI models, which could lead to herd behavior in financial markets.
- He called for regulation to address both AI model development and its use by Wall Street banks, recognizing the complexity of the "cross-regulatory challenge."
- The SEC recently proposed a new rule to curb the use of AI by broker-dealers and investment advisers, though the policy has faced opposition from Republican lawmakers and industry groups.
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- The iPhone 15 Pro Max significantly outperformed the iPhone 14 Pro Max in mobile performance, achieving a nearly 100% faster median download speed, according to Ookla.
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INSIDE TECH LEADERBOARD (7 DAYS) |
 | AI and technology writer | | Beth is an editor and writer of Inside's AI and Tech newsletters, with a career spanning journalism since 2007. She has written for publications including The Arizona Republic and USA Today and authored a book on the solar industry in 2016. Reach her at Beth.Duckett@yahoo.com. | | This newsletter was edited by Eduardo Garcia | |
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