Policy Wrap: Microsoft Activision deal may be abandoned, Gannet sues Google due to its monopoly in the online ad domain, EU takes Twitter's ‘stress test’ to gauge its readiness to tackle DSA, and more

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ANTITRUST

Microsoft Activision deal may be cast aside if the injunction causes more delay

The opening day of a seven-day hearing that could decide whether Microsoft gets to buy out gaming behemoth Activision Blizzard for $70 billion began on Thursday with a pledge from the company that Microsoft may decide not to proceed with the transaction at all if a federal judge issues an injunction that delays the close.

The FTC is requesting a preliminary injunction from Judge Jacqueline Scott Corley, which would prevent Microsoft from finalising the transaction before the FTC had the opportunity to present its case in its internal court.

The conflict is viewed by many as a test of whether recent initiatives to more aggressively restrain the influence of digital firms globally would be successful. The FTC's chair, Lina Khan, has stated that major tech firms have significant sway over online trade and communication, giving them the ability to manipulate markets.

According to the FTC, if this merger goes through, the merged business will likely have the capacity to hurt competition in a number of industries relating to consoles, subscription services, and cloud computing.

The FTC is also anticipated to make the case that adding Activision's games to Microsoft's library would give that company an unfair advantage in the embryonic cloud gaming business.

Google sued by Gannet due to the former’s monopoly in the online ad business

The largest US newspaper chain, Gannett Co Inc., filed a lawsuit against Google on Tuesday, alleging that the social media corporation tried to monopolise the online advertising industry in violation of federal antitrust law.

In a lawsuit filed in federal court in Manhattan by the publisher of USA Today and more than 200 daily newspapers, it was claimed that the media is suffering because Google and its parent company Alphabet Inc. have monopolised the tools for buying and selling internet advertisements.

Gannett, situated in McLean, Virginia, has struggled in recent years due to declining ad revenue and an increase in the number of people who acquire their news online, like many newspaper publishers.

Gannett reported that print circulation at its newspapers declined by over 20% in 2020 and 2021, and that after its merger with GateHouse Media in 2019, more than 170 properties had been shut down.

The complaint claims that while online digital advertising in the United States has increased by about eight times since 2009 to become a $200 billion industry, newspaper ad income has decreased by almost 70% during that same period.

Twitter faces ‘stress test’ of its readiness to tackle the DSA which comes into effect in two months

A key European Union official, European Commissioner Thierry Breton, was in Silicon Valley to assess Twitter's readiness to adhere to the bloc's stringent new digital rules, a set new requirements that the largest online platforms around the world must all follow in about two months.

The Digital Services Act (DSA) will compel businesses to take action against harmful content on their websites, including hate speech and disinformation. Big tech platform users in Europe will find it simpler to report unlawful content, such as hate speech, and they will learn more about why specific content has been recommended to them. On August 25, it becomes effective for the largest platforms.

The law has established Brussels as a leader in the expanding worldwide drive to rein in Big Tech, along with additional restrictions for data and Artificial Intelligence that are in the works.

This mock exercise, hailed by Breton as a ‘stress test’, evaluated Twitter's capacity to meet the DSA's requirements, which include safeguarding children online and identifying and reducing dangers like disinformation in both common and unusual circumstances.

The DSA is a component of a comprehensive revision to the EU's digital rules aimed at requiring tech businesses to improve user protection online and clean up their platforms.

Meta stops access to Facebook and Instagram news for Canadian users following onset of Online News Act

Following the passage of legislation requiring the internet's largest companies to pay publishers for news, Meta Platforms Inc. announced on Thursday that it will stop allowing all Canadian users access to Facebook and Instagram news.

The Senate's upper chamber gave the Online News Act its approval earlier on Thursday, and it is soon to be officially adopted.

Similar to a ground-breaking law passed in Australia in 2021, the act lays out regulations to compel platforms like Facebook and Alphabet's Google to strike business relationships and compensate news publishers for their material.

The government "will engage in a regulatory and implementation process" after the law is put into effect, according to Pablo Rodriguez, the heritage minister who proposed the bill last year.

The measure was put up in response to objections made by the Canadian media sector, which seeks more stringent regulation of digital firms to stop them from driving news organisations out of the online advertising market.

EU antitrust regulators may play spoilsport in Adobe’s $20 billion acquisition plans of Figma

Later this year, European antitrust officials intend to open a formal inquiry into the $20 billion acquisition of cloud-based designer platform Figma by software giant Adobe.

Due to anti-competition concerns, EU regulators intend to move on with a thorough investigation, which may take months and eventually cause the merger to fall through.

The news follows the announcement last month by Britain's competition watchdog that it was looking into the Adobe-Figma merger and a February report by Bloomberg that the US Justice Department was planning an antitrust case to prevent the merger.

These actions highlight the concerns of international regulators that the acquisition of smaller, innovative rivals by major digital firms may stifle competition.

ECONOMY

India looks to take big strides in the semi-conductor industry in the coming years, gets Micron to establish a testing facility

According to Ashwini Vaishnaw, Union Minister for Electronics and Information Technology, the Federal Government intends to entice investments from four to six semiconductor fabrication, packaging, and testing companies over the course of the following 12 months, similar to what was done with the Micron unit.

These businesses are engaged in discussions with the Centre at various levels and are encouraged by its emphasis on creating a full ecosystem for semiconductor production rather than just bringing semiconductor fabrication units to India. The semiconductor unit itself, design, procuring chemical, gas, and other compound providers, equipment makers, and talent are all part of a complete ecosystem.

The fifth-largest semiconductor manufacturer in the world, Micron, will establish a facility to test and package memory chips that are likely to be used in electric vehicles, laptops, servers, mobile devices, and telecom equipment.

The company is prepared with a construction design blueprint and has already gained approval for its land allotment. Micron Applied Materials, one of the largest manufacturers of precision equipment in the world, has recently declared its intention to invest more than $400 million to establish a collaborative engineering centre in Bangalore. A construction agency is also likely to be picked and announced soon. In addition to cultivating talent for the semiconductor industry, the company intends to develop sub-systems and components for semiconductor manufacturing.

Government aims to have technology contribute 20-25% of the country’s GDP by 2025-26

Rajeev Chandrasekhar, India's Minister of Information Technology, stated that the Government has set a goal for technology to account for 20–25% of the GDP by 2025.

The digital economy has grown and diversified over the past nine years, and at the moment, Indian startups and entrepreneurs are present in every area of the technology industry, including semiconductors, microelectronics, artificial intelligence (AI), the blockchain, the web, three high-performance computing languages, and consumer internet.

The presence and momentum of Indian startups, Indian businesses, and Indian inventors can be seen in every area of technology today. The Indian innovation economy has increased during the last five years, particularly during and after COVID-19, from 4% to 10% in 2014.

By 2025–2026, the goal is for technology and the digital economy to account for 20% of the overall GDP, which is also expected to expand at a rate of roughly 8%–7.5% annually. The target that is being strived towards is a $1 trillion, or 20% of the country’s, GDP, which will be approximately $5 trillion, according to Shri Chandrashekhar.

The minister referred to AI as a kinetic enabler of the digital economy and said it is a very significant and beneficial layer on the advancements startups and the innovation ecosystem have made over the past several years in relation to the consumer internet and the data economy.