Plus: ByteDance denies report it could sell TikTok without algorithm
| For April 25, 2024 |  |
| Here’s a look at today's tech briefing: - FCC restores net neutrality rules.
- ByteDance denies report to sell TikTok without algorithm.
- Meta reports delayed returns on AI investments.
- U.S. to award Micron with up to $13.6B in grants, loans.
- Rubrik shares jump 20% in NYSE debut.
Beth
p/beth-duckett | |
| 1 | | The FCC voted 3-2 to restore net neutrality rules, barring internet providers from discriminating against online content by blocking, throttling, or prioritizing traffic. The Obama-era rules were passed in 2015 but repealed two years later under a Trump-appointed FCC chair. More: - In 2021, President Biden signed an order to reinstate the rules, but FCC action was stalled by a deadlock until Democratic commissioner Anna Gomez joined in September.
- Thursday's vote was split along party lines, with three Democrats in favor and two Republicans opposed.
- The vote reclassifies ISPs as common carriers under Title II of the Communications Act, giving the FCC more regulatory authority, similar to utilities like water and power.
- The rules prevent providers like Comcast and AT&T from blocking or throttling internet content and ban "fast lanes" favoring certain sites.
Zoom out: - Legal challenges are expected from the telecom industry.
- Opponents argue that treating broadband providers as utilities could stifle an open internet and telecommunications industry growth.
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| 2 | | ByteDance denied any plans to sell TikTok, despite a report that it could divest its stake without the app's algorithm. The report followed President Biden's signing of a law that bans TikTok in the U.S. unless ByteDance sells it within the next 9 to 12 months. More: - TikTok CEO Shou Zi Chew says the company will challenge the law in federal court, citing First Amendment violations.
- ByteDance, TikTok's Chinese owner, would prefer to shut down the app than sell it if it exhausts all legal options, according to Reuters.
- Another report, by The Information, states ByteDance is weighing options to sell its majority stake in TikTok but not its algorithm, a core part of TikTok's value.
- The report suggests the company wants to sell to a buyer outside the tech industry.
Zoom out: - China indicates it will not sell TikTok's algorithm, potentially devaluing the app.
- If TikTok is banned, users might switch to Instagram Reels and YouTube.
- As of 2023, TikTok remained the top most-viewed app of the three platforms among teens.
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| 3 | | Meta's shares fell up to 15% Thursday after the company forecasted delayed revenue returns on its AI investments. The selloff occurred after Meta reported its Q1 earnings and weak revenue guidance. More: - Q1 profit more than doubled and revenue rose 27% year-on-year.
- Meta reported $4.71 earnings per share and $36.46B in revenue, exceeding forecasts of $4.32 per share and $36.16B.
- The company forecasts Q2 revenue of $36.5B to $39B, with the midpoint falling below analysts' estimates.
- Meta has also raised its full-year capital spending forecast to $35B-40B to speed up AI infrastructure investments.
AI investments: - Meta's AI investments will grow "meaningfully" over years before it earns "much revenue" from AI products, CEO Mark Zuckerberg said.
- He said Meta wants to become the top AI company globally and will "invest significantly" to develop more advanced AI models.
- "On the upside, once our new AI services reach scale, we have a strong track record of monetizing them effectively," he said.
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| 4 | | U.S. chipmaker Micron Technology will receive up to $13.6B in federal grants and loans to help build factories in New York and Idaho. The preliminary deal grants Micron $6.1B in direct funding and up to $7.5B in loans via the 2022 Chips Act. More: - President Biden will visit Syracuse, New York, today to tout the agreement and his Investing in America agenda.
- Under the deal, Micron will invest up to $125B in both states over the next 20 years, bolstered by the federal funding.
- The money will support two new Micron fabs near Syracuse and one in Boise, Idaho, all producing DRAM chips.
- The Boise plant will come online in 2026, followed by the New York factories in 2028 and 2029.
Zoom out: - The 2022 Chips and Science Act allocates $39B in grants and $75B in loans to strengthen U.S. chipmaking and reduce dependence on Asia.
- Intel, TSMC, and Samsung were awarded grants of $8.5B, $6.6B, and $6.4B, respectively.
- The U.S. will award the funding in stages linked to construction and production milestones.
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| 5 | | Rubrik's shares rose 20% in their New York Stock Exchange debut Thursday, valuing the cybersecurity firm at nearly $6.8B. Rubrik's IPO marks the fourth venture-backed tech company to go public recently, after Ibotta, Reddit, and Astera Labs. More: - Rubrik priced its IPO at $32 per share, above the expected range of $28 to $31.
- The Microsoft-backed firm raised $752M by selling 23.5 million shares, setting an initial valuation of $5.6B.
- Its shares are trading under the ticker "RBRK."
Zoom out: - Rubrik offers data security solutions to over 6,000 clients like Whirlpool, PepsiCo, and Goldman Sachs, competing with firms such as Cohesity, IBM, and Dell EMC.
- Its major venture backers include Greylock Partners and Lightspeed Venture Partners, where co-founder CEO Bipul Sinha is a venture partner.
- Rubrik, which took in over $550M as a private firm, is growing but still operates at a loss.
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| 6 | | Nvidia will acquire Israeli software company Run:ai for a reported $700M. Run:ai helps companies manage and optimize their AI hardware infrastructure. The Tel Aviv firm has partnered with Nvidia since 2020. More: - Run.ai offers Kubernetes-based management and orchestration software for AI workloads.
- Large enterprises use Run:ai's platform to manage GPU clusters in data centers.
- The platform pools and allocates computing power, from fractions to multiple GPUs, for AI tasks in the cloud.
- Using Run:ai, Nvidia customers can use multiple GPUs simultaneously for different AI applications.
Zoom out: - It is Nvidia's largest deal since buying chip producer Mellanox for $7B in 2020.
- Nvidia may also acquire Deci, a platform to develop and deploy AI models.
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 | AI and technology writer | | Beth is a contributing editor and writer of Inside's AI and Tech newsletters. She has written for publications including USA Today, the Arizona Business Gazette, and The Arizona Republic, where she received recognition with a Pulitzer Prize nomination and a First Amendment Award for collaborative reporting on state pension cost increases. You can reach her at Beth.Duckett@yahoo.com. | | This newsletter was edited by Beth Duckett | |
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