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Tag: iab-business and finance

  • ‘Serious concerns’: Top companies raise alarm over Europe’s proposed AI law | CNN Business

    ‘Serious concerns’: Top companies raise alarm over Europe’s proposed AI law | CNN Business

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    Dortmund, Germany
    CNN
     — 

    Dozens of Europe’s top business leaders have pushed back on the European Union’s proposed legislation on artificial intelligence, warning that it could hurt the bloc’s competitiveness and spur an exodus of investment.

    In an open letter sent to EU lawmakers Friday, C-suite executives from companies including Siemens

    (SIEGY)    , Carrefour

    (CRERF)    , Renault

    (RNLSY)     and Airbus

    (EADSF)     raised “serious concerns” about the EU AI Act, the world’s first comprehensive AI rules.

    Other prominent signatories include big names in tech, such as Yann LeCun, chief AI scientist of Meta

    (FB)    , and Hermann Hauser, founder of British chipmaker ARM.

    “In our assessment, the draft legislation would jeopardize Europe’s competitiveness and technological sovereignty without effectively tackling the challenges we are and will be facing,” the group of more than 160 executives said in the letter.

    They argue that the draft rules go too far, especially in regulating generative AI and foundation models, the technology behind popular platforms such as ChatGPT.

    Since the craze over generative AI began this year, technologists have warned of the potential dark side of systems that allow people to use machines to write college essays, take academic tests and build websites. Last month, hundreds of top experts warned about the risk of human extinction from AI, saying mitigating that possibility “should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.”

    The EU proposal applies a broad brush to such software “regardless of [its] use cases,” and could push innovative companies and investors out of Europe because they would face high compliance costs and “disproportionate liability risks,” according to the executives.

    “Such regulation could lead to highly innovative companies moving their activities abroad” and investors withdrawing their capital from European AI, the group wrote.

    “The result would be a critical productivity gap between the two sides of the Atlantic.”

    The executives are calling for policymakers to revise the terms of the bill, which was agreed upon by European Parliament lawmakers earlier this month and is now being negotiated with EU member states.

    “In a context where we know very little about the real risks, the business model, or the applications of generative AI, European law should confine itself to stating broad principles in a risk-based approach,” the group wrote.

    The business leaders called for a regulatory board of experts to oversee these principles and ensure they can be continuously adapted to changes in the fast-moving technology.

    The group also urged lawmakers to work with their US counterparts, noting that regulatory proposals had also been made in the United States. EU lawmakers should try to “create a legally binding level playing field,” the executives wrote.

    If such action isn’t taken and Europe is constrained by regulatory demands, it could hurt the region’s international standing, the group suggested.

    “Like the invention of the Internet or the breakthrough of silicon chips, generative AI is the kind of technology that will be decisive for the performance capacity and therefore the significance of different regions,” it said.

    Tech experts have increasingly called for greater regulation of AI as it becomes more widely used. In recent months, the United States and China have also laid out plans to regulate the technology. Sam Altman, CEO of ChatGPT maker OpenAI, has used high-profile trips around the world in recent weeks to call for co-ordinated international regulation of AI.

    The EU rules are the world’s “first ever attempt to enact” legally binding rules that apply to different areas of AI, according to the European Parliament.

    Negotiators of the AI Act hope to reach an agreement before the end of the year, and once the final rules are adopted by the European Parliament and EU member states, the act will become law.

    As they stand now, the rules would ban AI systems deemed to be harmful, including real-time facial recognition systems in public spaces, predictive policing tools and social scoring systems, such as those in China.

    The Act also outlines transparency requirements for AI systems. For instance, systems such as ChatGPT would have to disclose that their content was AI-generated and provide safeguards against the generation of illegal content.

    Engaging in prohibited AI practices could lead to hefty fines: up to €40 million ($43 million) or an amount equal to up to 7% of a company’s worldwide annual turnover, whichever is higher.

    But penalties would be “proportionate” and consider the market position of small-scale providers, suggesting there could be some leniency for startups.

    Not everyone has pushed back on the legislation so far. Earlier this month, Digital Europe, a trade association that counts SAP

    (SAP)     and Ericsson

    (ERIC)     among its members, called the rules “a text we can work with.”

    “However, there remain some areas which can be improved to ensure Europe becomes a competitive hub for AI innovation,” the group said in a statement.

    Dragos Tudorache, a Romanian member of parliament who led the bill’s drafting, said he was convinced that those who signed the new letter “have not read the text but have rather reacted on the stimulus of a few.”

    “The only concrete suggestions made are in fact what the [draft] text now contains: an industry-led process for defining standards, governance with industry at the table, and a light regulatory regime that asks for transparency. Nothing else,” he said in a statement.

    “It is a pity that the aggressive lobby of a few is capturing other serious companies in the net, which unfortunately undermines the undeniable lead that Europe has taken.”

    Brando Benifei, an Italian member of parliament who also led the drafting of the legislation, told CNN “we will listen to all concerns and stakeholders when dealing with AI regulation, but we have a firm commitment to deliver clear and enforceable rules.”

    “Our work could positively affect the global conversation and direction when dealing with artificial intelligence and its impact on fundamental rights, without hindering the necessary pursuit of innovation,” he said.

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  • Bill Gates says AI risks are real but nothing we can’t handle | CNN Business

    Bill Gates says AI risks are real but nothing we can’t handle | CNN Business

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    CNN
     — 

    Bill Gates sounds less worried than some other executives in Silicon Valley about the risks of artificial intelligence.

    In a blog post on Tuesday, the Microsoft co-founder outlined some of the biggest areas of concern with artificial intelligence, including the potential for spreading misinformation and displacing jobs. But he stressed that these risks are “manageable.”

    “This is not the first time a major innovation has introduced new threats that had to be controlled,” Gates wrote. “We’ve done it before.”

    Gates likened AI to previous “transformative” changes in society, such as the introduction of the car, which then required the public to adopt seat belts, speed limits, driver’s licenses and other safety standards. Innovation, he said, can create “a lot of turbulence” in the beginning, but society can “come out better off in the end.”

    Microsoft is one of the leaders in the race to develop and deploy a new crop of generative AI tools into popular products with the promise of helping people be more productive and creative. But a number of prominent figures in the industry have also publicly raised doomsday scenarios about the rapidly evolving technology.

    In late May, tech leaders including Microsoft’s CTO Kevin Scott joined dozens of AI researchers and some celebrities in signing a one-sentence letter stating: “Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.”

    Gates has previously said people should not “panic” about apocalyptic AI scenarios. In a blog post earlier this year, Gates wrote: “Could a machine decide that humans are a threat, conclude that its interests are different from ours, or simply stop caring about us? Possibly, but this problem is no more urgent today than it was before the AI developments of the past few months.”

    In his blog post this week, Gates said he believes one of the biggest areas of concern for AI is the potential for deepfakes and AI-generated misinformation to undermine elections and democracy. Gates said he is “hopeful” that “AI can help identify deepfakes as well as create them.” He also said laws needs to be clear about deepfake usage and labeling “so everyone understands when something they’re seeing or hearing is not genuine.”

    Gates also expressed concern over how AI could make it easier for hackers and even countries to launch cyberattacks on people and governments. Gates urged the development of related cybersecurity measures and for governments to consider creating a global body for AI similar to the International Atomic Energy Agency.

    Gates ticked through other concerns, too, including how AI could take away people’s jobs,perpetuate biases baked into the data on which it’s trained, and even disrupt the way kids learn to write.

    “It reminds me of the time when electronic calculators became widespread in the 1970s and 1980s,” Gates wrote. “Some math teachers worried that students would stop learning how to do basic arithmetic, but others embraced the new technology and focused on the thinking skills behind the arithmetic.”

    Gates said “it’s natural to feel unsettled” during a transition period, but added he is optimistic about the future and how “history shows that it’s possible to solve the challenges created by new technologies.”

    “It’s the most transformative innovation any of us will see in our lifetimes,” he wrote, “and a healthy public debate will depend on everyone being knowledgeable about the technology, its benefits, and its risks.”

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  • OpenAI’s head of trust and safety is stepping down | CNN Business

    OpenAI’s head of trust and safety is stepping down | CNN Business

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    New York
    CNN
     — 

    OpenAI’s head of trust and safety announced on Thursday plans to step down from the job.

    Dave Willner, who has led the artificial intelligence firm’s trust and safety team since February 2022, said in a LinkedIn post that he is “leaving OpenAI as an employee and transitioning into an advisory role” to spend more time with his family.

    Willner’s exit comes at a crucial moment for OpenAI. Since the viral success of the company’s AI chatbot ChatGPT late last year, OpenAI has faced growing scrutiny from lawmakers, regulators and the public over the safety of its products and their potential implications for society.

    OpenAI CEO Sam Altman called for AI regulation during a Senate panel hearing in March. He told lawmakers that the potential for AI to be used to manipulate voters and target disinformation are among “my areas of greatest concern,” especially because “we’re going to face an election next year and these models are getting better.”

    In his Thursday post, Willner — whose resume includes stops at Facebook and Airbnb — noted that “OpenAI is going through a high-intensity phase in its development” and that his role had “grown dramatically in its scope and scale since I first joined.”

    A statement from OpenAI about Willner’s exit said that “his work has been foundational in operationalizing our commitment to the safe and responsible use of our technology, and has paved the way for future progress in this field.” OpenAI’s Chief Technology Officer Mira Murati will become the trust and safety team’s interim manager and Willner will advise the team through the end of this year, according to the company.

    “We are seeking a technically-skilled lead to advance our mission, focusing on the design, development, and implementation of systems that ensure the safe use and scalable growth of our technology,” the company said in the statement.

    Willner’s exit comes as OpenAI continues to work with regulators in the United States and elsewhere to develop guardrails around fast-advancing AI technology. OpenAI was among seven leading AI companies that on Friday made voluntary commitments agreed to by the White House meant to make AI systems and products safer and more trustworthy. As part of the pledge, the companies agreed to put new AI systems through outside testing before they are publicly released, and to clearly label AI-generated content, the White House announced.

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  • OpenAI’s Sam Altman launches Worldcoin crypto project | CNN Business

    OpenAI’s Sam Altman launches Worldcoin crypto project | CNN Business

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    Worldcoin, a cryptocurrency project founded by OpenAI CEO Sam Altman, launched on Monday.

    The project’s core offering is its World ID, which the company describes as a “digital passport” to prove that its holder is a real human, not an AI bot. To get a World ID, a customer signs up to do an in-person iris scan using Worldcoin’s ‘orb’, a silver ball approximately the size of a bowling ball. Once the orb’s iris scan verifies the person is a real human, it creates a World ID.

    The company behind Worldcoin is San Francisco and Berlin-based Tools for Humanity.

    The project has 2 million users from its beta period, and with Monday’s launch, Worldcoin is scaling up “orbing” operations to 35 cities in 20 countries. As an enticement, those who sign up in certain countries will receive Worldcoin’s cryptocurrency token WLD.

    WLD’s price rose in early trading on Monday. On the world’s largest exchange, Binance, it hit a peak of $5.29 and at 1000 GMT was at $2.49 from a starting price of $0.15, having seen $25.1 million of trading volume, according to Binance’s website.

    Blockchains can store the World IDs in a way that preserves privacy and can’t be controlled or shut down by any single entity, co-founder Alex Blania told Reuters.

    The project says World IDs will be necessary in the age of generative AI chatbots like ChatGPT, which produce remarkably humanlike language. World IDs could be used to tell the difference between real people and AI bots online.

    Altman told Reuters Worldcoin also can help address how the economy will be reshaped by generative AI.

    “People will be supercharged by AI, which will have massive economic implications,” he said.

    One example Altman likes is universal basic income, or UBI, a social benefits program usually run by governments where every individual is entitled to payments. Because AI “will do more and more of the work that people now do,” Altman believes UBI can help to combat income inequality. Since only real people can have World IDs, it could be used to reduce fraud when deploying UBI.

    Altman said he thought a world with UBI would be “very far in the future” and he did not have a clear idea of what entity could dole out money, but that Worldcoin lays groundwork for it to become a reality.

    “We think that we need to start experimenting with things so we can figure out what to do,” he said.

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  • Social Security will not be able to pay full benefits in 2034 if Congress doesn’t act | CNN Politics

    Social Security will not be able to pay full benefits in 2034 if Congress doesn’t act | CNN Politics

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    CNN
     — 

    Americans’ Social Security checks will get a lot smaller in 2034 if lawmakers don’t act to address the pending shortfall, according to an annual report released Friday by the Social Security trustees.

    That’s because the combined Social Security trust funds – which help support payouts for the elderly, survivors and disabled – are projected to run dry that year. At that time, the funds’ reserves will be depleted, and the program’s continuing income will only cover 80% of benefits owed.

    The estimate is one year earlier than the trustees projected last year. About 66 million Americans received Social Security benefits in 2022.

    Medicare, meanwhile, is in a more critical financial condition. Its hospital insurance trust fund, known as Medicare Part A, will only be able to pay scheduled benefits in full until 2031, according to its trustees’ annual report, which was also released Friday.

    At that time, Medicare, which covered 65 million senior citizens and people with disabilities in 2022, will only be able to cover 89% of total scheduled benefits. Last year, Medicare’s trustees projected that the hospital trust fund’s reserves would be depleted in 2028.

    Immensely popular but long troubled, Social Security and Medicare are on shaky financial ground in large part because of the aging of the American population. Fewer workers are paying into the program and supporting the ballooning number of beneficiaries, who are also living longer. Also, health care is becoming increasingly expensive.

    Social Security has two trust funds – one for retirees and survivors and another for Americans with disabilities.

    Looking at them separately, the Old-Age and Survivors Insurance Trust Fund is projected to run dry in 2033, at which time Social Security could pay only 77% of benefits, primarily using income from payroll taxes. The date is one year earlier than estimated last year.

    The Disability Insurance Trust Fund is expected to be able to pay full benefits through at least 2097, the last year of the trustees’ projection period.

    Merging the two trust funds would require Congress to act, but the combined projection is often used to show the overall status of the entitlement.

    Social Security’s projected long-term health worsened over the past year because the trustees revised downward their expectations for the economy and labor productivity, taking into account updated data on inflation and economic output.

    However, the long-term projection for Medicare’s hospital trust fund’s finances improved, mainly due to lowered estimates for health care spending after the height of the Covid-19 pandemic. Also, the program is projected to take in more income because the trustees estimate the number of covered workers and average wages will be higher.

    Regardless, the bottom line remains that Medicare is not bringing in enough money to pay the costs it is expected to incur, said Cori Uccello, senior health fellow at the American Academy of Actuaries.

    “It’s still not a time to become complacent,” she said. Insolvency “is still less than a decade away.”

    The trustees’ reports are the latest warnings to Congress that they will have to deal with the massive entitlement programs’ fiscal problems at some point soon. But addressing their issues is politically challenging. Elected officials are hesitant to suggest any changes that could lead to benefit cuts, even though that could reduce their options in the future.

    “With each year that lawmakers do not act, the public has less time to prepare for the changes,” the trustees warned in a fact sheet.

    The programs’ shortfalls are back in the spotlight this year as President Joe Biden and House Republicans battle over how to address the nation’s debt ceiling drama and mounting budget deficits. GOP lawmakers want to cut spending in exchange for resolving the borrowing limit, while the White House has said it will not negotiate.

    In a memorable moment in his State of the Union address in February, Biden garnered public acknowledgment from congressional Republicans about keeping Social Security and Medicare out of the debt discussions.

    But “not touching” Social Security means a hefty cut in benefits within a decade or so.

    “Change is inevitable because without changes to current law, both Social Security and Medicare Hospital Insurance would go insolvent, subjecting program participants to sudden and severe payment cuts,” said Charles Blahous, senior research strategist at the Mercatus Center at George Mason University and former Social Security and Medicare trustee. “The outstanding question is whether change will be tolerably gradual, or instead highly damaging because it is too long delayed.”

    Though Biden has repeatedly vowed to protect Social Security, his latest budget proposal did not include a plan to stabilize its finances.

    However, his proposal did call for extending Medicare’s solvency by 25 years or more by raising taxes on those earning more than $400,000 a year and by allowing the program to negotiate prices for even more drugs.

    Spending on the entitlement programs is also projected to soar and exert increased pressure on the federal budget in coming years.

    Mandatory spending – driven by Social Security and Medicare – and interest costs are expected to outpace the growth of revenue and the economy, according to a Congressional Budget Office outlook released in mid-February.

    This story has been updated with additional information.

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  • TikTok banned from school-owned devices at all Florida state universities | CNN Business

    TikTok banned from school-owned devices at all Florida state universities | CNN Business

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    New York
    CNN
     — 

    The State University System of Florida Board of Governors has banned the social media app TikTok, along with some other software, applications, and developers, from use on university-owned devices “due to the continued and increasing landscape of cyber threats.”

    In a memo sent to state university system presidents on Wednesday, Chancellor Ray Rodrigues said, “This regulation requires institutions to remove technologies published in the State University System (SUS) Prohibited Technologies List from any university-owned device and to block network traffic associated with these technologies.”

    The ban is effective immediately, the memo said.

    “Data privacy, particularly concerning student data and faculty research, is a critical priority for the State University System of Florida,” the Board of Governors said in a statement to CNN.

    “Therefore, at a March 29 meeting of the Florida Board of Governors, the Board unanimously approved an emergency regulation prohibiting the use of TikTok and other foreign actors identified as an immediate national security risk, across our 12 public university campuses,” according to the Board of Governors.

    In addition to TikTok, the prohibited technologies include Kaspersky, VKontakte, Tencent QQ, WeChat and any subsidiary or affiliate.

    CNN reached out to them for comment.

    TikTok spokesperson Hilary McQuaide said “TikTok has taken unprecedented actions to address national security concerns by securing U.S. user data on U.S. soil. The best way to address concerns about national security is with the transparent, U.S.-based protection of U.S. user data and systems, with robust third-party monitoring, vetting, and verification, which we are already implementing.”

    McQuaide added “TikTok is enjoyed by more than 150 million Americans including university and college students and teachers to engage in the classroom.”

    Bans and regulations of TikTok in particular, and of social media sites in general, have been increasing in the US and Europe as concerns over privacy, national security and child safety mount.

    Late last month, the governor of Utah signed a bill which requires teens to get parental approval to use social media. Earlier this week, the United Kingdom’s Information Commissioner’s Office, which regulates data, fined TikTok for a number of breaches of data protection law. Italy is investigating TikTok for “dangerous content.”

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  • FBI warns consumers not to use public phone charging stations | CNN Business

    FBI warns consumers not to use public phone charging stations | CNN Business

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    New York
    CNN
     — 

    The FBI is warning consumers against using public phone charging stations in order to avoid exposing their devices to malicious software.

    Public USB stations like the kind found at malls and airports are being used by bad actors to spread malware and monitoring software, according to a tweet last week from the FBI’s Denver branch. The agency did not provide any specific examples.

    “Carry your own charger and USB cord and use an electrical outlet instead,” the agency advised in the tweet.

    While public charging stations are attractive to many when devices are running critically low on battery, security experts have for years raised concerns about the risk. In 2011, researchers coined the term “juice jacking” to describe the problem.

    “Just by plugging your phone into a [compromised] power strip or charger, your device is now infected, and that compromises all your data,” Drew Paik, formerly of security firm Authentic8, explained to CNN in 2017.

    The cord you use to charge your phone is also used to send data from your phone to other devices. For instance, when you plug your iPhone into your Mac with the charging cord, you can download photos from your phone to your computer.

    If a port is compromised, there’s no limit to what information a hacker could take, Paik previously explained to CNN. That includes your email, text messages, photos and contacts.

    “The FBI regularly provides reminders and public service announcements in conjunction with our partners,” Vikki Migoya, public affairs officer at the FBI’s Denver branch, told CNN. “This was a general reminder for the American public to stay safe and diligent, especially while traveling.”

    The Federal Communications Commission also updated a blog post on Tuesday warning that a corrupted charging port can allow a malicious actor to lock a device or extract personal data and passwords.

    “In some cases, criminals may have intentionally left cables plugged in at charging stations,” according to the FCC blog post. “There have even been reports of infected cables being given away as promotional gifts.”

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  • Universal Music Group calls AI music a ‘fraud,’ wants it banned from streaming platforms. Experts say it’s not that easy | CNN Business

    Universal Music Group calls AI music a ‘fraud,’ wants it banned from streaming platforms. Experts say it’s not that easy | CNN Business

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    New York
    CNN
     — 

    Universal Music Group — the music company representing superstars including Sting, The Weeknd, Nicki Minaj and Ariana Grande — has a new Goliath to contend with: artificial intelligence.

    The music group sent urgent letters in April to streaming platforms, including Spotify

    (SPOT)     and Apple Music, asking them to block artificial intelligence platforms from training on the melodies and lyrics of their copywritten songs.

    The company has “a moral and commercial responsibility to our artists to work to prevent the unauthorized use of their music and to stop platforms from ingesting content that violates the rights of artists and other creators,” a spokesperson from Universal Music Group, or UMG, told CNN. “We expect our platform partners will want to prevent their services from being used in ways that harm artists.”

    The move by UMG, first reported by the Financial Times, aims to stop artificial intelligence from creating an existential threat to the industry.

    Artificial intelligence, and specifically AI music, learns by either training on existing works on the internet or through a library of music given to the AI by humans.

    UMG says it is not against the technology itself, but rather AI that is so advanced it can recreate melodies and even musicians’ voices in seconds. That could possibly threaten UMG’s deep library of music and artists that generate billions of dollars in revenue.

    “UMG’s success has been, in part, due to embracing new technology and putting it to work for our artists — as we have been doing with our own innovation around AI for some time already,” UMG said in a statement Monday. “However, the training of generative AI using our artists’ music … begs the question as to which side of history all stakeholders in the music ecosystem want to be on.”

    The company said AI that uses artists’ music violates UMG’s agreements and copyright law. UMG has been sending requests to streamers asking them to take down AI-generated songs.

    “I understand the intent behind the move, but I’m not sure how effective this will be as AI services will likely still be able to access the copyrighted material one way or another,” said Karl Fowlkes, an entertainment and business attorney at The Fowlkes Firm.

    No regulations exist that dictate on what AI can and cannot train. But last month, in response to individuals looking to seek copyright for AI-generated works, the US Copyright Office released new guidance around how to register literary, musical, and artistic works made with AI.

    “In the case of works containing AI-generated material, the Office will consider whether the AI contributions are the result of ‘mechanical reproduction’ or instead of an author’s ‘own original mental conception, to which [the author] gave visible form,’” the new guidance says.

    The copyright will be determined on a case-by-case basis, the guidance continued, based on how the AI tool operates and how it was used to create the final piece or work.

    The US Copyright Office announced it will also be seeking public input on how the law should apply to copywritten works the AI trains on, and how the office should treat those works.

    “AI companies using copyrighted works to train their models to create similar works is exactly the type of behavior the copyright office and courts should explicitly ban. Original art is meant to be protected by law, not works created by machines that used the original art to create new work,” said Fowlkes.

    But according to AI experts, it’s not that simple.

    “You can flag your site not to be searched. But that’s a request — you can’t prevent it. You can just request that someone not do it,” said Shelly Palmer, Professor of Advanced Media at Syracuse University.

    For example, a website can apply a robots.txt file that works like a guardrail to control which URL’s “search engine crawlers” can access a given site, according to Google. But it is not a full stop, keep-out option.

    Grammy-winning DJ and producer David Guetta proved in February just how easy it is to create new music using AI. Using ChatGPT for lyrics and Uberduck for vocals, Guetta was able to create a new song in an hour.

    The result was a rap with a voice that sounded exactly like Eminem. He played the song at one of his shows in February, but said he would never release it commercially.

    “What I think is very interesting about AI is that it’s raising a question of what is it to be an artist,” Guetta told CNN last month.

    Guetta believes AI is going to have a significant impact on the music industry, so he’s embracing it instead of fighting it. But he admits there are still questions about copyright.

    “That is an ethical problem that needs to be addressed because it sounds crazy to me that today I can type lyrics and it’s going to sound like Drake is rapping it, or Eminem,” he said.

    And that is exactly what UMG wants to avoid. The music group likens AI music to “deep fakes, fraud, and denying artists their due compensation.”

    “These instances demonstrate why platforms have a fundamental legal and ethical responsibility to prevent the use of their services in ways that harm artists,” the UMG statement said.

    Music streamers Spotify, Apple Music and Pandora did not return request for comment.

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  • Pentagon leak spotlights surprising interplay between gaming and military secrets | CNN Politics

    Pentagon leak spotlights surprising interplay between gaming and military secrets | CNN Politics

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    CNN
     — 

    The recent leak of classified US documents on social media platform Discord seemingly caught many at the Pentagon by surprise. But it wasn’t the first time that a forum popular with online gamers had hosted military secrets, underlining a major challenge for the US national security establishment and platforms alike.

    As recently as January 2023, someone on a forum for fans of the video game War Thunder reportedly published confidential information on an F-16 fighter jet. That followed reports of at least three other occasions since 2021 when War Thunder fans posted documents on British, French and Chinese tanks. These cases – which Axios also reported on in the context of the Discord leaks – typically involved users boasting of their inside knowledge of military equipment and claiming to want to make the game more realistic.

    Gaijin Entertainment, the company that produces War Thunder, took the posts down after forum moderators flagged them.

    The recent leaks on Discord exposed a shortcoming in how the US government alerts platforms that they are hosting sensitive or classified information, according to Discord’s top lawyer.

    There is currently “no structured process,” for the government to communicate whether documents posted on social media are classified or even authentic, Clint Smith, Discord’s chief legal officer, said in an April 14 statement that described classified military documents as a “significant, complex challenge” for Discord and other platforms.

    The episodes point to vexing challenges for social media platforms like Discord – where 21-year Air National Guardsman Jack Teixeira allegedly began posting classified information in December – and the US military, which has used Discord for recruiting.

    Discord and other platforms face a difficult balancing act in giving young gamers the space to be themselves while also detecting when they post illegal content.

    “A lot of these guys find their social circles in these online gaming spaces, and that can be great,” said Jennifer Golbeck, a professor at the University of Maryland’s College of Information Studies. “But if the culture of the platform shifts to rewarding things that you shouldn’t be doing, it can hard if you’re really invested in that that social group to give that up.”

    Teixeira allegedly posted the documents – which included sensitive US intelligence on the war in Ukraine – to a private Discord chat in an attempt to look after his online friends and keep them informed, one member of the chatroom has claimed.

    The Pentagon is trying to tap into online youth culture without it backfiring spectacularly, as it allegedly did with Teixeira.

    An Air Force Gaming program that allows service members to compete in video game leagues to, according to a Pentagon press release, “build morale and mental health resiliency,” has more than 28,000 members. The top of the Air Force Gaming website includes a link to join the program’s Discord channel.

    There were signs that Pentagon officials were growing wary of information young service members might share on Discord even before news of Teixeira’s alleged leak broke.

    “Don’t post anything in Discord that you wouldn’t want seen by the general public,” reads a pamphlet published by US Army Special Operations Command in March.

    That the warning came as classified documents allegedly shared by Teixeira sat on Discord appears to be entirely a coincidence; many US officials appeared unaware of the leak until news of it broke on April 6.

    “Past incidents show how hard it is to stop these leaks,” said Casey Brooks, an Army veteran and video game fan.

    “This is about maturity and how certain people seek value from interpersonal relationships and approval from peers and the competitive nature that gaming group members bond over,” Brooks told CNN.

    Classified or sensitive documents are also a unique problem for content moderators on social media sites.

    “With porn, you can at least have some kind of AI that will give a rough flag at the beginning that this looks vaguely like porn,” said Golbeck, the University of Maryland professor. “But what looks like a classified document? They’re just documents.”

    As social media platforms like Discord grapple with the challenges of detecting sensitive intelligence leaks online, current and former US officials worry that US adversaries like Russia may see an intelligence gathering opportunity.

    “If it’s not already happening, my guess would be the Russians have assessed that digging around in some of these obscure online forums … could bear fruit,” Holden Triplett, a former FBI official who worked at the US embassy in Moscow, told CNN.

    Though there is no evidence that Teixeira was approached by foreign agents, Triplett said a young generation of online gamers might be a ripe target for recruitment.

    “Ego and excitement have always been strong motivations to spy,” said Triplett, who is founder of security consultancy Trenchcoat Advisors. But the group of Discord users that included Teixeira “seemed particularly indifferent to national security concerns,” which is a vulnerability for the US government, Triplett said.

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  • Federal appeals court tosses state antitrust suit seeking to break up Meta | CNN Business

    Federal appeals court tosses state antitrust suit seeking to break up Meta | CNN Business

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    CNN
     — 

    A group of states that sued to break up Facebook-parent Meta in 2020 were years too late to file their challenge and failed to make a persuasive case that the company’s data policies harmed competition, a federal appeals court ruled Thursday in a sweeping victory for the tech giant.

    In siding with Meta, the decision by a three-judge panel of the US Court of Appeals for the DC Circuit upheld a lower-court decision tossing out the suit initially filed by New York and dozens of other states.

    The decision is a blow to regulators who have cited Meta as a prime example of the way tech giants have allegedly abused their dominance. And it casts a shadow over a parallel antitrust case against Meta that was brought by the Federal Trade Commission at around the same time.

    The states’ original complaint had sought to unwind Meta’s past acquisitions of Instagram and WhatsApp, accusing the company of a “buy-or-bury” approach that violated antitrust laws.

    In 2021, a federal judge dismissed the complaint, saying that the lawsuit came long after the acquisitions had been completed in 2012 and 2014. Thursday’s appellate decision agreed.

    “An injunction breaking up Facebook, ordering it to divest itself of Instagram and WhatsApp under court supervision, would have severe consequences, consequences that would not have existed if the States had timely brought their suit and prevailed,” wrote Senior Circuit Judge Raymond Randolph.

    In addition, Randolph wrote, state allegations claiming that Meta’s — then Facebook’s — policies placing restrictions on app developers were anticompetitive didn’t hold up.

    The policies in question, Randolph wrote, simply told app developers they could not use Facebook’s platform “to duplicate Facebook’s core products,” and did not rise to the level of an antitrust violation under federal law.

    Although the states argued that Facebook’s policies at the time — which have since been removed — discouraged innovation by the company’s rivals, the complaint failed to establish how widely the policies affected Facebook’s third-party developers.

    “The States thus have not adequately alleged that this policy substantially foreclosed Facebook’s competitors, giving us an additional reason to reject their exclusive dealing theory,” the court held.

    A spokesperson for New York Attorney General Letitia James didn’t immediately respond to a request for comment.

    In a statement, Meta said the state’s case reflected a mischaracterization of “the vibrant competitive ecosystem in which we operate.”

    “In affirming the dismissal of this case, the court noted that this enforcement action was ‘odd’ because we compete in an industry that is experiencing ‘rapid growth and innovation with no end in sight,’ Meta said. “Moving forward, Meta will defend itself vigorously against the FTC’s distortion of antitrust laws and attacks on an American success story that are contrary to the interests of people and businesses who value our services.”

    In spite of Thursday’s decision, Meta must still face a similar lawsuit by the FTC, which also seeks to break up the company in connection with its Instagram and WhatsApp acquisitions.

    Last year, the same federal judge who dismissed the state suit, James Boasberg, allowed the federal suit to proceed. Boasberg had tossed out the FTC suit as well in 2021, saying the agency had failed to make an initial showing that Meta holds a monopoly in personal social networking. But he permitted the FTC to re-file its complaint with changes.

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  • FTC says Meta should be barred from monetizing data from younger users | CNN Business

    FTC says Meta should be barred from monetizing data from younger users | CNN Business

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    CNN
     — 

    The Federal Trade Commission on Wednesday accused Facebook-parent Meta of violating its landmark $5 billion privacy settlement and called for toughening up restrictions on the company, after alleging Meta has improperly shared user data with third parties and failed to protect children as it has promised.

    The proposal to update the binding 2020 settlement with Meta marks a new front in the FTC’s long-running battle with the social media company, which has included multiple lawsuits aimed at breaking up the tech giant or preventing it from growing larger.

    The FTC said Meta should be banned from monetizing data it collects from younger users. It added that the company should be barred from releasing any new features or products until a third-party auditor determines the company’s privacy policies do enough to protect users. It also called for new limitations on how Meta can use facial recognition technology.

    If approved, the sweeping proposal could threaten the future of Meta’s business, including its expansion into virtual reality.

    In a statement on Wednesday, Meta spokesman Andy Stone called the FTC proposal “a political stunt” and vowed to contest the effort.

    “Despite three years of continual engagement with the FTC around our agreement, they provided no opportunity to discuss this new, totally unprecedented theory,” Stone said. “FTC Chair Lina Khan’s insistence on using any measure – however baseless – to antagonize American business has reached a new low.”

    The FTC proposal comes as policymakers at all levels of government have increasingly blamed social media for furthering a mental health crisis among young people, prompting calls for strict regulations on how tech platforms can use the personal information of users under 18, target them with automated recommendations or seek to boost their engagement in other ways. Many of those proposals have taken the form of broad-based legislation, but the FTC proposal would represent a novel approach by amending a past consent order in connection with a single company that influences more than a billion users.

    As part of the FTC’s call for changes, the agency said Meta had misled the public about its compliance with the historic settlement that resolved allegations surrounding the Cambridge Analytica data fiasco, as well as prior agreements with the agency.

    Meta had allowed personal information to leak to apps that users of the platform were no longer using, the FTC alleged. That data sharing, the FTC claimed, contrasted with Meta’s public statements about how it cuts off a third-party app’s access to Facebook users’ information if the users stop using the third-party app for 90 days.

    The FTC also alleged that multiple coding errors in a messaging app marketed to children, Messenger Kids, allowed users to connect to “unapproved contacts” in group video calls, and that the flaws went unresolved for weeks.

    Those flaws meant parents could not control who their kids were speaking to on the app, in contrast to claims by Meta that they could, according to the FTC.

    In addition to being a breach of Meta’s prior settlements, the alleged violations surrounding Messenger Kids also ran afoul of a federal children’s privacy law known as COPPA, the FTC said, because parents were not provided an opportunity to give Meta their consent before the company collected information on their kids.

    Meta will have 30 days to respond to the proposed findings and changes, the FTC said, before the commission votes to finalize them. The FTC can unilaterally approve updates to the settlement, but Meta would have the opportunity to appeal that move in federal court, according to an agency fact sheet.

    The FTC voted 3-0 to issue the proposed findings and changes, but one commissioner, Alvaro Bedoya, questioned whether the agency has the authority to impose such sweeping restrictions on Meta in light of the alleged violations.

    In a statement, Bedoya said he was skeptical whether there was enough of a connection between Meta’s alleged harms and the proposed remedies to legally sustain a complete ban on monetizing the data of young users.

    “I look forward to hearing additional information and arguments and will consider these issues with an open mind,” Bedoya said.

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  • Lyft stock plunges nearly 15% on weaker than expected revenue forecast | CNN Business

    Lyft stock plunges nearly 15% on weaker than expected revenue forecast | CNN Business

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    CNN
     — 

    Lyft may have a bumpy road ahead to recovery.

    The ride-hailing company reported revenue of $1 billion for the quarter ending in March, marking a 14% year-over-year increase and beating Wall Street estimate’s. But the company forecast weaker-than-expected revenue for the current quarter, which was enough to jitter investors.

    Shares of Lyft plunged nearly 15% in after-hours trading Thursday following the earnings results.

    The latest earnings report comes on the heels of Lyft shaking up its the C-suite and announcing plans to cut 26% of its employees as it fights for market share and profitability.

    David Risher, who previously worked at Amazon and Microsoft, recently took over as CEO of Lyft and the company’s two co-founders stepped down from their management positions at the company. Risher has been a member of the Lyft board since 2021.

    On a conference call with analysts on Thursday to discuss the results, Risher said Lyft is currently at “an inflection point” as people return to pre-pandemic social habits.

    “I am very aware of our current levels of growth and profitability are not acceptable,” Risher said on the call, his first as CEO. “I am committed to growing Lyft into a large, durable, profitable business, that our riders, drivers and shareholders love, and I look forward to keeping you informed on our progress.”

    Compared to its chief rival Uber, Lyft has so far struggled to bounce back from the pandemic’s hit to its business. While Uber diversified its business beyond ride-hailing by delivering meals and grocery items during the health crises, Lyft never did. Uber also was able to attract drivers back to the platform better than Lyft as pandemic restrictions eased in the U.S.

    Earlier this week, Uber said in its quarterly earnings report that revenue was up 29%, as demand for its rideshare and delivery services held firm despite lingering recession fears.

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  • Chinese police detain man for allegedly using ChatGPT to spread rumors online | CNN Business

    Chinese police detain man for allegedly using ChatGPT to spread rumors online | CNN Business

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    Hong Kong
    CNN
     — 

    Police in China have detained a man they say used ChatGPT to create fake news and spread it online, in what state media has called the country’s first criminal case related to the AI chatbot.

    According to a statement from police in the northwest province of Gansu, the suspect allegedly used ChatGPT to generate a bogus report about a train crash, which he then posted online for profit. The article received about 15,000 views, the police said in Sunday’s statement.

    ChatGPT, developed by Microsoft

    (MSFT)    -backed OpenAI, is banned in China, though internet users can use virtual private networks (VPN) to access it.

    Train crashes have been a sensitive issue in China since 2011, when authorities faced pressure to explain why state media had failed to provide timely updates on a bullet train collision in the city of Wenzhou that resulted in 40 deaths.

    Gansu authorities said the suspect, surnamed Hong, was questioned in the city of Dongguan in southern Guangdong province on May 5.

    “Hong used modern technology to fabricate false information, spreading it on the internet, which was widely disseminated,” the Gansu police said in the statement.

    “His behavior amounted to picking quarrels and provoking trouble,” they added, explaining the offense that Hong was accused of committing.

    Police said the arrest was the first in Gansu since China’s Cyberspace Administration enacted new regulations in January to rein in the use of deep fakes. State broadcaster CGTN says it was the country’s first arrest of a person accused of using ChatGPT to fabricate and spread fake news.

    Formally known as deep synthesis, deep fake refers to highly realistic textual and visual content generated by artificial intelligence.

    The new legislation bars users from generating deep fake content on topics already prohibited by existing laws on China’s heavily censored internet. It also outlines take down procedures for content considered false or harmful.

    The arrest also came amid a 100-day campaign launched by the internet branch of the Ministry of Public Security in March to crack down on the spread of internet rumors.

    Since the beginning of the year, Chinese internet giants such as Baidu

    (BIDU)     and Alibaba

    (BABA)    have sought to catch up with OpenAI, launching their own versions of the ChatGPT service.

    Baidu unveiled “Wenxin Yiyan” or “ERNIE Bot” in March. Two months later, Alibaba launched “Tongyi Qianwen,” which roughly translates as seeking truth by asking a thousand questions.

    In draft guidelines issued last month to solicit public feedback, China’s cyberspace regulator said generative AI services would be required to undergo security reviews before they can operate.

    Service providers will also be required to verify users’ real identities, as well as providing details about the scale and type of data they use, their basic algorithms and other technical information.

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  • Vodafone plans 11,000 job cuts | CNN Business

    Vodafone plans 11,000 job cuts | CNN Business

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    London
    CNN
     — 

    Vodafone said Tuesday it would cut 11,000 jobs over three years, as the telecom company unveiled a turnaround plan to revive its fortunes following years of poor performance.

    The job cuts would affect the firm’s UK headquarters and operations in other countries, Vodafone

    (VOD)     added in a statement. Shares slid more than 4% in London.

    “Our performance has not been good enough,” CEO Margherita Della Valle said. “We will simplify our organization, cutting out complexity to regain our competitiveness.”

    Two decades ago, Vodafone was the world’s biggest mobile telecom group, having bought Germany’s Mannesmann in 2000 in the largest takeover in history. The deal was valued above $190 billion.

    But the company, which has businesses in 21 countries and partnership agreements with local operators in another 46 locations, has struggled to retain market share.

    Vodafone employs 104,000 people worldwide, according to its latest annual report. Apart from the United Kingdom, it is a major provider of mobile networks in Germany, Spain, Italy and parts of Africa.

    Della Valle, who was appointed to the role three weeks ago after almost 30 years with the company, said her priorities were “customers, simplicity and growth.”

    European telecoms companies have fared particularly poorly over the past decade, delivering lower returns to shareholders than in the United States, according to McKinsey.

    Within a challenging sector, Vodafone’s performance relative to peers had “worsened over time,” Della Valle said in a video posted to the company’s website.

    “Our performance relative to our major competitors in our largest markets has not been good enough, and we know that this is strongly connected to the experience of our customers not being good enough,” she added. Shares in Vodafone have fallen 28% over the past year.

    Under its turnaround plan, Vodafone would invest more in its customer experience and also direct more resources towards Vodafone Business, serving corporate clients, which was growing in nearly all the company’s European markets.

    The strategic overhaul comes as Vodafone’s results showed revenue for the year to March grew by just 0.3% to €45.7 billion ($49.8 billion). Adjusted earnings declined to €14.7 billion ($16 billion), below the company’s own guidance, because of high energy prices and a weak performance in Germany, its biggest market.

    Vodafone said it would generate free cash flow of around €3.3 billion ($3.6 billion) for this financial year, compared to €4.8 billion ($5.2 billion) for the year to end March.

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  • China imposes sales restrictions on Micron as it escalates tech battle with Washington | CNN Business

    China imposes sales restrictions on Micron as it escalates tech battle with Washington | CNN Business

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    Hong Kong
    CNN
     — 

    China has banned US chip maker Micron from selling to Chinese companies working on key infrastructure projects, in a major escalation of an ongoing battle between the world’s top two economies over access to crucial technology.

    The Cyberspace Administration of China (CAC) announced the decision on Sunday, saying the US chip maker had failed to pass a cybersecurity review. The news came shortly after the close of the Group of Seven (G7) summit in Hiroshima, Japan, where leaders of major democracies spoke in one voice on their growing concerns over China.

    “The review found that Micron’s products have relatively serious cybersecurity risks, which pose significant security risks to China’s critical information infrastructure supply chain and would affect national security,” the Chinese regulator said in a statement.

    As a result, operators involved in domestic critical information infrastructure projects should stop purchasing products from Micron, it said.

    Shares of Micron Technology

    (MU)     sank about 3% Monday. Its Asian rivals had finished the day higher. Shares of Chinese memory chip maker Ingenic Semiconductor jumped 2.8%. Shenzhen Techwinsemi Technology surged 6.3%. Toyou Feiji Electronics soared 14%. In Seoul, SK Hynix, one of the world’s largest memory chip makers, gained 0.9%, outperforming the South Korean market.

    The Chinese regulator’s decision came seven weeks after it kicked off a cybersecurity review of Micron’s products, in apparent retaliation against sanctions imposed by Washington and its allies on China’s chip sector.

    Micron is one of the largest memory chip makers in the United States. It derives more than 10% of its revenue from mainland China.

    The company told CNN that it had received the regulator’s notice and was assessing its next steps.

    “We look forward to continuing to engage in discussions with Chinese authorities,” it said in a statement.

    Micron’s chief financial officer, Mark Murphy, said separately on Monday that the company was unclear what security concerns Beijing had. He said the company is evaluating what portion of its sales could be impacted.

    “We are currently estimating a range of impact in the low single digits percent of our company total revenue at the low end and high single-digit percentage of total company revenue at the high end,” he said at a conference.

    The US Commerce Department said it firmly opposed the restrictions that “have no basis in fact,” according to Reuters.

    “This action, along with recent raids and targeting of other American firms, is inconsistent with [China’s] assertions that it is opening its markets and committed to a transparent regulatory framework,” it was quoted as saying.

    The US State Department similarly said it has “very serious concerns” about the ban.

    “The Department of Commerce is engaging directly with the PRC to make our view clear, and broadly, this action appears inconsistent with the PRC’s assertions that it is open for business and committed to a transparent regulatory framework,” US State Department spokesperson Matthew Miller said Monday.

    On Sunday, China’s Foreign Ministry accused G7 leaders of “hindering international peace” and said the group needed to “reflect on its behavior and change course.”

    In a landmark joint communique Saturday, G7 member countries had made the group’s most detailed articulation of a shared position on China to date — stressing the need to cooperate with the world’s second-largest economy, but also to counter its “malign practices” and “coercion.” in a landmark joint communique Saturday.

    Since October 2022, Washington has imposed sweeping export curbs on advanced chips and chip-making equipment to China, in an attempt to cut off China’s access to critical technology for military purposes.

    In March, Japan and the Netherlands, both key US allies, also announced restrictions on overseas sales of chip-making technology to countries including China. China has strongly criticized the restrictions, labeling them “discriminatory containment” directed at the country.

    Chips are at the center of Beijing’s bid to become a tech superpower. China has its own chip manufacturers, but they supply mostly low- to mid-end processors used in home appliances and electric vehicles.

    The semiconductor battle is part of a growing divide between the United States and China. In recent years, relations between the two have reached their lowest level in decades.

    Tensions escalated this year after a suspected Chinese spy balloon was shot down by US fighter jets in February and Beijing continued to deepen its ties with Russia despite its continued invasion of Ukraine.

    However, US President Joe Biden said on Sunday that he expected ties between the two countries to improve soon.

    “I think you are gonna see that begin to thaw very shortly,” Biden told a news conference at the end of the Group of Seven summit in Japan.

    He said he had agreed with Chinese President Xi Jinping in November to keep communications open, but that everything changed after a “silly balloon that was carrying two freight cars worth of spying equipment” was shot down.

    “We are not looking to decouple from China,” he said. “We are looking to de-risk and diversify our relationship with China.”

    — CNN’s Simone McCarthy, Jennifer Hansler and Saba Haroon contributed to this report

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  • Adobe is adding an AI-powered image generator to Photoshop | CNN Business

    Adobe is adding an AI-powered image generator to Photoshop | CNN Business

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    New York
    CNN
     — 

    Photoshop is about to look a little different.

    Adobe on Tuesday said it’s incorporating an AI-powered image generator into Photoshop, with the goal of “dramatically accelerating” how users edit their photos.

    The tool, called Firefly, allows users to add or delete elements from images with just a text prompt, according to Adobe. It can also match the lighting and style of the existing images automatically, the company said.

    It’s currently available in a new Photoshop beta app. The company plans to roll the product out to all Photoshop customers by the end of the year.

    Adobe’s move comes after a recent crop of AI tools have launched that can generate compelling written work and images in response to user prompts, with the potential to change how people work, create and communicate with each other.

    “[N]ow that we are entering a new era of AI, the advent of generative models presents a new opportunity to take our imaging capabilities to another level,” Pam Clark, vice president of Photoshop product management and product strategy, wrote in a blog post. “Over the last few months, we have integrated this exciting new technology into Photoshop in a major step toward a more natural, intuitive, and fun way to work.”

    Firefly was launched in March at the Adobe Summit as a web-only beta. It was trained on Adobe’s own collection of stock images, as well as publicly available assets. Adobe has called the tool one of its most successful beta launches ever, with more than 70 million images created in the first month.

    By relying on its own image collection and media available for public use, Adobe may be able to avoid the backlash that some other AI image generator tools have faced for using a vast trove of online content as training.

    In January, Getty Images sued Stability AI, the company behind popular AI art tool Stable Diffusion, alleging the tech company committed copyright infringement. Getty said Stability AI copied and processed millions of its images without obtaining the proper licensing.

    Stability filed a motion earlier this month to dismiss the suit.

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  • AI industry and researchers sign statement warning of ‘extinction’ risk | CNN Business

    AI industry and researchers sign statement warning of ‘extinction’ risk | CNN Business

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    Washington
    CNN
     — 

    Dozens of AI industry leaders, academics and even some celebrities on Tuesday called for reducing the risk of global annihilation due to artificial intelligence, arguing in a brief statement that the threat of an AI extinction event should be a top global priority.

    “Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war,” read the statement published by the Center for AI Safety.

    The statement was signed by leading industry officials including OpenAI CEO Sam Altman; the so-called “godfather” of AI, Geoffrey Hinton; top executives and researchers from Google DeepMind and Anthropic; Kevin Scott, Microsoft’s chief technology officer; Bruce Schneier, the internet security and cryptography pioneer; climate advocate Bill McKibben; and the musician Grimes, among others.

    The statement highlights wide-ranging concerns about the ultimate danger of unchecked artificial intelligence. AI experts have said society is still a long way from developing the kind of artificial general intelligence that is the stuff of science fiction; today’s cutting-edge chatbots largely reproduce patterns based on training data they’ve been fed and do not think for themselves.

    Still, the flood of hype and investment into the AI industry has led to calls for regulation at the outset of the AI age, before any major mishaps occur.

    The statement follows the viral success of OpenAI’s ChatGPT, which has helped heighten an arms race in the tech industry over artificial intelligence. In response, a growing number of lawmakers, advocacy groups and tech insiders have raised alarms about the potential for a new crop of AI-powered chatbots to spread misinformation and displace jobs.

    Hinton, whose pioneering work helped shape today’s AI systems, previously told CNN he decided to leave his role at Google and “blow the whistle” on the technology after “suddenly” realizing “that these things are getting smarter than us.”

    Dan Hendrycks, director of the Center for AI Safety, said in a tweet Tuesday that the statement first proposed by David Kreuger, an AI professor at the University of Cambridge, does not preclude society from addressing other types of AI risk, such as algorithmic bias or misinformation.

    Hendrycks compared Tuesday’s statement to warnings by atomic scientists “issuing warnings about the very technologies they’ve created.”

    “Societies can manage multiple risks at once; it’s not ‘either/or’ but ‘yes/and,’” Hendrycks tweeted. “From a risk management perspective, just as it would be reckless to exclusively prioritize present harms, it would also be reckless to ignore them as well.”

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  • China’s answer to Boeing and Airbus isn’t as ‘homegrown’ as it seems. Here’s why | CNN Business

    China’s answer to Boeing and Airbus isn’t as ‘homegrown’ as it seems. Here’s why | CNN Business

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    Hong Kong
    CNN
     — 

    China is claiming a historic win this week after its answer to Boeing and Airbus, the C919, took to the skies for its first commercial flight.

    Beijing calls the aircraft its first large homegrown passenger jet. It’s a prominent symbol of Beijing’s broader “Made in China” strategy, a campaign to reduce national reliance on foreign manufacturers.

    But instead of boosting China’s global stature in technology innovation, experts say the C919 is a symbol of its continued reliance on the West.

    That’s because a large chunk of the plane’s parts come from foreign suppliers, predominantly in North America and Europe. Chinese state media has said about 40% of the model’s components are imported, though experts say the real proportion is much higher.

    While it is normal for manufacturers to source equipment for their planes from around the world, “the C919 is unique in that almost nothing that keeps it in the air is from China,” said Scott Kennedy, who spent two years leading a team that researched China’s decades-long efforts to develop its own commercial aircraft.

    Their conclusion? “The C919 is primarily a non-Chinese airplane with Chinese paint on it,” said Scott, trustee chair in Chinese business and economics at the Center for Strategic and International Studies (CSIS) in Washington.

    The C919 was built by the Commercial Aircraft Corporation of China (COMAC), a state-owned enterprise based in Shanghai, with the stated goal of letting “China-made large aircraft fly in the blue sky.”

    One cannot overstate how difficult that is, according to Shukor Yusof, founder of Endau Analytics, which tracks the aviation industry.

    Currently, only a handful of countries in the world make their own planes — and for good reason, he said, citing extremely high obstacles, such as serious technical expertise, rigorous regulatory requirements and eye-popping amounts of time and resources.

    The C919, for instance, has already cost an estimated $49 billion, according to CSIS, though it says pinning down precisely how much is an almost impossible task because COMAC’s finances are opaque.

    While it’s not COMAC’s first homegrown plane, more attention has been directed to this model because of its size.

    The C919 can seat up to 192 passengers and fly up to 5,550 kilometers (about 3,500 miles).

    COMAC’s first commercial plane, by comparison, is a much smaller regional jet called the ARJ21, which can only fly up to 3,700 kilometers (2,300 miles) and accommodate up to 97 passengers.

    COMAC is also working on a long-range, widebody plane called the CR929. But the project, a joint effort by China and Russia, has likely stalled since Russia’s full-scale invasion of Ukraine last year, said Kennedy.

    “That plane will probably never be more than a photo, never be more than a drawing,” he told CNN. “No one is going to be supplying technology to a Chinese-Russian joint venture.”

    The C919’s maiden commercial flight took place Sunday, flying passengers from Shanghai to Beijing for China Eastern Airlines

    (CEA)    .

    China hopes the C919 will become its alternative to Boeing’s 737 and Airbus’s A320 and cement its status as a high-tech superpower, says Kennedy.

    But because the government has touted the aircraft as a homemade success, analysts have been quick to point out just how much is made outside China.

    In a 2020 analysis, CSIS estimated that approximately 90% of the C919’s main or large-scale component suppliers were from North America and Europe, with only 10% coming from China and other countries in Asia. Yusof cited a similar estimate.

    Kennedy said while it was possible the proportion had changed since the 2020 report, he thought it was unlikely given how tough it would be to change suppliers during the aviation certification process.

    The C919 got the green light for commercial service and mass production in mainland China late last year, after years of delays.

    The C919 passenger jet being welcomed on landing in Beijing on Sunday.

    China has acknowledged the criticism. “Some people have been questioning whether the C919 can be called a domestically-manufactured aircraft when it relies on imports,” Chinese state-run tabloid Global Times said in an editorial Monday.

    “It is true that there is a long list of foreign suppliers for the C919.”

    The aircraft contains “Honeywell’s

    (HON)     electricity system and landing gear, GE’s

    (GE)     flight recorder, CFM Leap’s engine, Parker Aerospace’s flight control system and fuel system, Rockwell Collins’ weather radar and simulate system, and Michelin’s

    (MGDDY)     tires,” the outlet noted. All are US or European companies.

    The government’s position is that other manufacturers often rely on imports, too.

    Boeing and Airbus also depend on “high-quality global suppliers,” state-run newspaper China Daily said in an editorial Wednesday.

    America’s Boeing

    (BA)     sources about 40% to 50% of components for planes such as its 787 Dreamliner from outside the United States, according to Yusof. Airbus

    (EADSF)    , a European plane maker, also sources from countries such as Malaysia, he said.

    China has made no secret of its ambition for COMAC to eventually compete against Airbus and Boeing, which currently command virtually the entire market.

    Yusof said this was unlikely to happen anytime soon.

    For one, COMAC hasn’t distinguished its planes enough to convince carriers to make the switch. Its technology is “already available in the Airbus and in the Boeing planes,” he said.

    It could also take many years for its planes to be certified by US and European aviation regulators.

    But once production ramps up, it’s expected to win more orders at home, or in developing countries where carriers may not be able to afford the current market leaders’ prices. In Indonesia, domestic airline TransNusa became COMAC’s first overseas customer last year.

    “It should be greatly appreciated that another country apart from the Europeans and the Americans are providing an alternative aircraft in the commercial market,” said Yusof.

    But even if China were to price its planes more aggressively, it will take a long time to win people over, he added.

    “Airlines in the world will not be easily persuaded to buy one, because there’s always a stigma [with new players] whether you like it or not,” Yusof said.

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  • Timeline: The special counsel inquiry into Trump’s handling of classified documents | CNN Politics

    Timeline: The special counsel inquiry into Trump’s handling of classified documents | CNN Politics

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    Washington
    CNN
     — 

    The federal criminal investigation into former President Donald Trump’s potential mishandling of classified documents escalated in stunning fashion this week with Trump’s indictment.

    The indictment hasn’t been unsealed yet, so details of the charges aren’t publicly available. But the investigation – led by Justice Department special counsel Jack Smith – revolves around sensitive government papers that Trump held onto after his White House term ended in January 2021. The special counsel has also examined whether Trump or his aides obstructed the investigation.

    Federal authorities have recovered more than 325 classified documents from Trump. He has voluntarily given back some materials, his lawyers turned over additional files after a subpoena, and the FBI found dozens of classified records during a court-approved search of his Mar-a-Lago home last summer.

    Trump has denied all wrongdoing and claims the investigation is a politically motivated sham, intended to derail his ongoing campaign to win the Republican 2024 nomination and return to the White House.

    Here’s a timeline of the important developments in the blockbuster investigation.

    An official from the National Archives and Records Administration contacts Trump’s team after realizing that several important documents weren’t handed over before Trump left the White House. In hopes of locating the missing items, NARA lawyer Gary Stern reaches out to someone who served in the White House counsel’s office under Trump, who was the point of contact for recordkeeping matters. The missing documents include some of Trump’s correspondence with North Korean leader Kim Jong Un, as well as the map of Hurricane Dorian that Trump infamously altered with a sharpie pen.

    In a taped conversation, Trump acknowledges that he still has a classified Pentagon document about a possible attack against Iran, according to CNN reporting. The recording, which was made at Trump’s golf club in New Jersey, indicates that Trump understood that he retained classified material after leaving the White House. The special counsel later obtained this audiotape, a key piece of evidence in his inquiry.

    NARA grows frustrated with the slow pace of document turnover after several months of conversations with the Trump team. Stern reaches out to another Trump attorney to intervene. The archivist asks about several boxes of records that were apparently taken to Mar-a-Lago during Trump’s relocation to Florida. NARA still doesn’t receive the White House documents they are searching for.

    After months of discussions with Trump’s team, NARA retrieves 15 boxes of Trump White House records from Mar-a-Lago. The boxes contained some materials that were part of “special access programs,” known as SAP, which is a classification that includes protocols to significantly limit who would have access to the information. NARA says in a statement that some of the records it received at the end of Trump’s administration were “torn up by former President Trump,” and that White House officials had to tape them back together. Not all the torn-up documents were reconstructed, NARA says.

    NARA asks the Justice Department to investigate Trump’s handling of White House records and whether he violated the Presidential Records Act and other laws related to classified information. The Presidential Records Act requires all records created by a sitting president to be turned over to the National Archives at the end of their administration.

    NARA informs the Justice Department that some of the documents retrieved from Mar-a-Lago included classified material. NARA also tells the department that, despite being warned it was illegal, Trump occasionally tore up government documents while he was president.

    On April 7, NARA publicly acknowledges for the first time that the Justice Department is involved, and news outlets report that prosecutors have launched a criminal probe into Trump’s mishandling of classified documents. Around this time, FBI agents quietly interview Trump aides at Mar-a-Lago about the handling of presidential records as part of their widening investigation.

    The FBI asks NARA for access to the 15 boxes it retrieved from Mar-a-Lago in January. The request was formally transmitted to NARA by President Joe Biden’s White House Counsel’s office, because the incumbent president controls presidential documents in NARA custody.

    The Justice Department sends a letter to Trump’s lawyers as part of its effort to access the 15 boxes, notifying them that more than 100 classified documents, totaling more than 700 pages, were found in the boxes. The letter says the FBI and US intelligence agencies need “immediate access” to these materials because of “important national security interests.” Also on this day, Trump lawyers ask NARA to delay its plans to give the FBI access to these materials. Trump’s lawyers say they want time to examine the materials to see if anything is privileged, and that they are making a “protective assertion of executive privilege” over all the documents.

    Trump’s lawyers write again to NARA, and ask again that NARA postpone its plans to give the FBI access to the materials retrieved from Mar-a-Lago.

    Debra Steidel Wall, the acting archivist of the United States, who runs NARA, informs Trump’s lawyers that she is rejecting their claims of “protective” executive privilege over all the materials taken from Mar-a-Lago and will therefore turn over the materials to the FBI and US intelligence agencies, in a four-page letter.

    The Justice Department subpoenas Trump, demanding all documents with classification markings that are still at Mar-a-Lago. At some point after receiving the subpoena, Trump asks his lawyer Evan Corcoran if there was any way to fight the subpoena, but Corcoran tells him he has to comply, according to notes Cochran took and later gave to investigators. Also after getting the subpoena, Trump aides are captured on surveillance footage moving document boxes into and out of a basement storage room – which has become a major element of the obstruction investigation.

    News outlets report that investigators subpoenaed NARA for access to the classified documents they retrieved from Mar-a-Lago. The subpoena is the first public indication of the Justice Department using a grand jury in its investigation.

    As part of the effort to comply with the subpoena, Corcoran searches a Mar-a-Lago storage room and finds 38 classified documents. According to a lawsuit that the former president later filed, Trump invites FBI officials to come to Mar-a-Lago to retrieve the subpoenaed materials.

    Federal investigators, including a top Justice Department counterintelligence official, visit Mar-a-Lago to deal with the subpoena for remaining classified documents. The investigators meet with Trump’s attorneys, including Corcoran, and look around the basement storage room where the documents were stored. Trump briefly stops by the meeting to say hello to the officials, but he does not answer any questions. Corcoran hands over the 38 classified documents that he found. Trump lawyer Christina Bobb signs a sworn affidavit inaccurately asserting that there aren’t any more classified documents at Mar-a-Lago.

    Trump’s attorneys receive a letter from federal investigators, asking them to further secure the room where documents are being stored. In response, Trump aides add a padlock to the room in the basement of Mar-a-Lago.

    Federal investigators serve a subpoena to the Trump Organization, demanding surveillance video from Mar-a-Lago. Trump’s company complies with the subpoena and turns over the footage. CNN has reported that this was part of an effort to gather information about who had access to areas at the club where government documents were stored.

    The FBI executes a court-approved search warrant at Mar-a-Lago – a major escalation of the investigation. The search focused on the area of the club where Trump’s offices and personal quarters are located. Federal agents found more than 100 additional classified documents at the property. The search was the first time in American history that a former president’s home was searched as part of a criminal investigation.

    Trump sends a message through one his lawyers to Attorney General Merrick Garland, saying he has “been hearing from people all over the country about the raid” who are “angry,” and that “whatever I can do to take the heat down, to bring the pressure down, just let us know,” according to a lawsuit he later filed. Hours later, after three days of silence, Garland makes a brief public statement about the investigation. He reveals that he personally approved the decision to seek a search warrant, and that the Justice Department will continue to apply the law “without fear or favor.” Garland also pushes back against what he called “unfounded attacks on the professionalism of the FBI and Justice Department.”

    Federal Magistrate Judge Bruce Reinhart approves the unsealing of the Mar-a-Lago search warrant and its property receipt, at the Justice Department’s request and after Trump’s lawyers agree to the release. The warrant reveals the Justice Department is looking into possible violations of the Espionage Act, obstruction of justice and criminal handling of government records, as part of its investigation.

    Trump files a federal lawsuit seeking the appointment of a third-party attorney known as a “special master” to independently review the materials that the FBI seized from Mar-a-Lago. In the lawsuit, Trump’s lawyers argue that the Justice Department can’t be trusted to do its own review for potentially privileged materials that should be siloed off from the criminal probe.

    In a major ruling in Trump’s favor, Federal District Judge Aileen Cannon, a Trump appointee, grants Trump’s request for a special master to review the seized materials from Mar-a-Lago. She says the special master will have the power to look for documents covered under attorney-client privilege and executive privilege.

    The Justice Department appeals Cannon’s decision in the special master case.

    Cannon appoints senior Judge Raymond Dearie to serve as the special master and sets a November 30 deadline for the Brooklyn-based federal judge to finish his review of the seized materials.

    A maintenance worker drains the swimming pool at Mar-a-Lago, which ends up flooding a room where there are computer severs that contain surveillance video logs, according to CNN reporting. It’s unclear if the flood was accidental or on purpose, and it’s possible that the IT equipment wasn’t damaged, but federal prosecutors found the incident to be suspicious.

    Former Trump administration official Kash Patel testifies before the federal grand jury in the classified documents investigation. A Trump loyalist, Patel had publicly claimed that Trump declassified all the materials that ended up at Mar-a-Lago, even though there is no evidence to back up those assertions.

    Garland announces that he is appointing special counsel Jack Smith to take over the investigation.

    A federal appeals court shuts down the special master review of the documents that the FBI seized from Mar-a-Lago. The appeals panel rebuked Cannon’s earlier decisions, writing that she essentially tried to “interfere” with the criminal probe and had created a “special exception” in the law to help Trump.

    Trump attorney Timothy Parlatore testifies before the special counsel’s grand jury, where he described how Trump’s lawyers scoured his properties for classified materials. He later left Trump’s legal team.

    Trump’s legal team searches four of his properties in Florida, New York and New Jersey for additional classified material. They find two more classified files in a Florida storage unit, and give them to the FBI. Around this time, Trump’s team also finds additional papers with classification markings at Mar-a-Lago, and they give those materials to the Justice Department. They also turn over a laptop belonging to a Trump aide who had copied those documents onto the computer, not realizing they were classified.

    A string of key witnesses testify before the special counsel’s grand jury in Washington, DC. This includes Trump administration officials Robert O’Brien and Ric Grenell, who handled national security and intelligence matters; Margo Martin, a communications aide who continued working for Trump after he left the White House; and Matthew Calamari Sr. and his son, Matthew Calamari Jr., longtime Trump employees who oversee security for the Trump Organization.

    In response to a new subpoena from the special counsel, Trump’s lawyers turn over some material related to a classified Pentagon document that he discussed at a recorded meeting in 2021. However, Trump’s team wasn’t able to find the specific document – about a potential US attack on Iran – that prosecutors were looking for.

    Corcoran, the lead Trump attorney, testifies before the grand jury in Washington, DC. This occurred after a federal judge ordered him to answer prosecutors’ questions, ruling that attorney-client privilege did not shield his discussion with Trump because Trump might been trying to commit a crime through his attorneys. Corcoran later recused himself from handling the Mar-a-Lago matter.

    The first public indications emerge that the special counsel is using a second grand jury in Miami to gather evidence. Multiple witnesses testify in front of the Miami-based panel, CNN reported.

    Trump lawyers meet with senior Justice Department officials – including special counsel Smith – to discuss the Mar-a-Lago investigation. The sitdown lasted about 90 minutes, and Trump’s team raised concerns about the probe, which they have called an “unlawful” and “outrageous” abuse of the legal system.

    News outlets report that the Justice Department recently sent a “target letter” to Trump, formally notifying him that he’s a target of the investigation into potential mishandling of classified documents.

    News outlets report that Trump has been indicted in connection with the classified documents investigation. Trump also says in a social media post that the Justice Department informed his attorneys that he was indicted – and called the case a “hoax.”

    This story has been updated with additional developments.

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  • Japan’s largest port hit with ransomware attack | CNN Business

    Japan’s largest port hit with ransomware attack | CNN Business

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    New York
    CNN
     — 

    Japan’s busiest shipping port said Thursday it would resume operations after a ransomware attack prevented the port from receiving shipping containers for two days.

    The expected restoration of the Port of Nagoya, a hub for car exports and an engine of the Japanese economy, will ease concerns about any wider economic fallout from the ransomware attack.

    The hacking incident began Tuesday when the computer system that handles shipping containers was knocked offline, according to a statement from the Nagoya Harbor Transportation Association. The hack forced the port to stop handling shipping containers that came to the terminal by trailer, the association said.

    Ransomware is a type of malicious software that typically locks the computers of a victim organization so that hackers can demand payment.

    This is the first reported ransomware attack on a Japanese port, and the incident has “created great concerns over the impact on the local economy and supply chain including the auto industry,” Mihoko Matsubara, chief cybersecurity strategist at NTT Corporation, a Japanese telecom firm, told CNN.

    Japanese media reported that LockBit, a type of ransomware linked with Russian-speaking hackers, was used in the hack.

    The LockBit cybercriminal group has been prolific in recent weeks, claiming Taiwanese semiconductor giant TSMC as a victim last week (TSMC said one of its hardware suppliers was hacked but the incident had no impact on TSMC’s business operations.)

    As of midday Thursday in Japan, there was no claim of responsibility for the Port of Nagoya ransomware attack from the LockBit group on their dark-web site.

    It was unclear if the Port of Nagoya received a ransom demand. CNN was unable to reach a spokesperson for the port association.

    Japanese critical infrastructure operators should drill for cyberattacks on their supply chains and have a response plan in place, given threats from both cybercriminals and state-backed hackers, Matsubara told CNN.

    Though this may be a first for Japan, ransomware and related hacks have hit ports in other countries.

    In 2017, malicious software allegedly unleashed by the Russian military on Ukraine spread around the world and disrupted operations at shipping giant Maersk, coasting the company an estimated $300 million.

    — CNN’s Mayumi Maruyama contributed to this report

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