Tag: iab-technology & computing

Dutch to restrict semiconductor tech exports to China, joining US effort | CNN Business

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Amsterdam/Washington
Reuters
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The Netherlands’ government on Wednesday said it plans new restrictions on exports of semiconductor technology to protect national security, joining the US effort to curb chip exports to China.

The announcement marked the first concrete move by the Dutch, who oversee essential chipmaking technology, toward adopting rules urged by Washington to hobble China’s chipmaking industry and slow its military advances.

The US in October imposed sweeping export restrictions on shipments of American chipmaking tools to China, but for the restrictions to be effective it needs other key suppliers in the Netherlands and Japan, who produce key chipmaking technology, to agree. The allied countries have been in talks on the matter for months.

Dutch Trade Minister Liesje Schreinemacher announced the decision in a letter to parliament, saying the restrictions will be introduced before the summer.

Her letter did not name China, a key Dutch trading partner, nor did it name ASML Holding

(ASML), Europe’s largest tech firm and a major supplier to semiconductor manufacturers, but both will be affected. It specified one technology that will be impacted is “DUV” lithography systems, the second-most advanced machines that ASML sells to computer chip manufacturers.

“Because the Netherlands considers it necessary on national security grounds to get this technology into oversight with the greatest of speed, the Cabinet will introduce a national control list,” the letter said.

A White House representative did not immediately respond to a request for comment.

ASML said in a response it expects to have to apply for licenses to export the most advanced segment among its DUV machines, but that would not impact its 2023 financial guidance.

ASML dominates the market for lithography systems, multimillion dollar machines that use powerful lasers to create the minute circuitry of computer chips.

The company expects sales in China to remain about flat at 2.2 billion euros in 2023, implying relative shrinkage as the company expects overall sales to grow by 25%. Major ASML customers such as TSMC and Intel

(INTC) are engaged in capacity expansions.

ASML has never sold its most advanced “EUV” machines to customers in China, and the bulk of its “DUV” sales in China go to relatively less advanced chipmakers. Its biggest South Korean customers, Samsung

(SSNLF) and SK Hynix both have significant manufacturing capacity in China.

The Dutch announcement leaves major questions unanswered, including whether ASML will be able to service the more than 8 billion euros worth of DUV machines it has sold to customers in China since 2014.

Schreinemacher said the Dutch government had decided on measures “as carefully and precisely as possible … to avoid unnecessary disruption of value chains.”

“It is for companies of importance to know what they are facing and to have time to adjust to new rules,” she wrote.

Japan is expected to issue an update on its chip equipment export policies as soon as this week.

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March 15, 2023
What metaverse? Meta says its single largest investment is now in ‘advancing AI’ | CNN Business

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CNN
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Roughly a year-and-a-half after Facebook renamed itself “Meta” and said it would go all-in on building a future version of the internet dubbed the metaverse, the tech giant now says its top investment priority will be advancing artificial intelligence.

In a letter to staff Tuesday, CEO Mark Zuckerberg announced plans to lay off another 10,000 employees in the coming months, and doubled down on his new focus of “efficiency” for the company. The pivot to efficiency, first announced last month in Meta’s quarterly earnings call, comes after years of investing heavily in growth, including in areas with unproven potential like virtual reality.

Now, Zuckerberg says the company will focus mostly on cutting costs and streamlining projects. Building the metaverse “remains central to defining the future of social connection,” Zuckerberg wrote, but that isn’t where Meta will be putting most of its capital.

“Our single largest investment is in advancing AI and building it into every one of our products,” Zuckerberg said Tuesday. He nodded to how AI tools can help users of its apps express themselves and “discover new content,” but also said that new AI tools can be used to increase efficiencies internally by helping “engineers write better code faster.”

The comments come after what the CEO described as a “humbling wake-up call” last year, as the “world economy changed, competitive pressures grew, and our growth slowed considerably.”

Meta and its predecessor Facebook have been involved in AI research for years, but the remarks come amid a heightened AI frenzy in the tech world, kicked off in late November when Microsoft-backed OpenAI publicly released ChatGPT. The technology quickly went viral for its ability to generate compelling, human-sounding responses to user prompts and then kicked off an apparent AI arms race among tech companies. Microsoft announced in early February that it was incorporating the tech behind ChatGPT into its search engine, Bing. A day before Microsoft’s announcement, Google unveiled its own AI-powered tool called Bard. And not to be left behind, Meta announced late last month that it was forming a “top-level product group” to “turbocharge” the company’s work on AI tools.

“I do think it is a good thing to focus on AI,” Ali Mogharabi, a senior equity analyst at Morningstar, told CNN of Zuckerberg’s comments. Mogharabi said Meta’s investments in AI “has benefits on both ends” because it can improve efficiency for engineers creating products, and because incorporating AI features into Meta’s lineup of apps will potentially create more engagement time for users, which can then drive advertising revenue.

And in the long run, Mogharabi said, “A lot of the investments in AI, and a lot of enhancements that come from those investments in AI, could actually be applicable to the entire metaverse project.”

But Zuckerberg’s emphasis on investing in AI, and using the buzzy technology’s tools to make the company more efficient and boost its bottom line, is also “what the shareholders and the market want to hear,” Mogharabi said. Many investors had previously griped at the company’s metaverse ambitions and spending. In 2022, Meta lost more than $13.7 billion in its “Reality Labs” unit, which houses its metaverse efforts.

And investors appear to welcome Zuckerberg’s shift in focus from the metaverse to efficiency. After taking a beating in 2022, shares for Meta have surged more than 50% since the start of the year.

Angelo Zino, a senior equity analyst at CFRA Research, said on Tuesday that the second round of layoffs at Meta “officially make us convinced that Mark Zuckerberg has completely switched gears, altering the narrative of the company to one focused on efficiencies rather than looking to grow the metaverse at any cost.”

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March 15, 2023
South Korea to build ‘world’s largest’ chip center in greater Seoul with $230 billion investment | CNN Business

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Hong Kong/Seoul
CNN
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South Korea says it will build an enormous facility to make computer chips in greater Seoul, with about $230 billion in investment from private companies.

“We will build the world’s largest new ‘high-tech system semiconductor cluster’ in the Seoul Metropolitan area based on large-scale private investment of almost 300 trillion Korean won,” President Yoon Suk Yeol said on Wednesday. “In addition, we will grow the ‘semiconductor mega cluster’ to the world’s largest in connection with the existing memory semiconductor manufacturing complexes.”

The Seoul Metropolitan area includes the capital Seoul, neighboring city of Incheon and surrounding Gyeonggi province.

This is a developing story. More to come.

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March 15, 2023
A New York man was arrested after allegedly threatening a shooting at Tops Friendly Markets in a social media post | CNN

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CNN
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A 20-year-old man from Upstate New York has been charged with making a terroristic threat after threatening to carry out a shooting at the Tops Friendly Markets in Manlius, New York, in a Discord post, according to court documents and local police.

Police responded to a call Saturday from the manager of the Tops in Manlius – a village in Onondaga County – who said that the store got phone calls from two different people expressing their concern over statements made by a Discord user saying he was going to harm shoppers at their supermarket, according to court documents obtained by CNN affiliate WSTM.

The two witnesses who called the supermarket reported that the threatening remarks on Discord – which included a racist reference – came from a 20-year-old man named Zachary who lives in the Manlius area and whose father recently died, according to the documents.

Police investigated the posts and identified the user as Zachary Mullen of Jamesville, according to a statement from the Town of Manlius Police Department.

Law enforcement arrested Mullen on Saturday for making a terroristic threat and, when conducting a search of his home afterward, found guns and ammunition, according to the police statement.

A judge also issued an Extreme Risk Protection Order against Mullen on Sunday, which allowed authorities to seize at least two firearms from his home.

CNN was unable to identify an attorney for Mullen.

“There were some racist overtones to the posts made by Mr. Mullen and as of this moment we’re still trying to connect the dots as to why he picked the Tops in Manlius, but certainly the location of the store, the name of the store, the racist natures of the post, would cause anyone pause, that this may have been far more dastardly than it even looks on the surface,” Onondaga County District Attorney Bill Fitzpatrick told WSTM.

Discord is the same social media site that a convicted mass shooter posted on before killing 10 people at a Tops Friendly Markets in Buffalo.

Law enforcement officials verified that Mullen’s father, who they say was an avid hunter, had died a few days prior to Mullen’s posts on Discord and that he was grieving, according to the affidavit.

Mullen, who lives with his mother, is not currently in jail, according to the county district attorney.

“Unfortunately, he’s out on what’s known as pre-trial release because we live in New York and that’s the nature of Bail reform in New York. Incredibly enough he is out so if he has secret access to a gun, God forbid, that’s something we just don’t know but we’ll certainly be monitoring him as much as we can,” Fitzpatrick said in a statement to WSTM.

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March 14, 2023
The technology behind ChatGPT is about to get even more powerful | CNN Business

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CNN
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Nearly four months after OpenAI stunned the tech industry with ChatGPT, the company is releasing its next-generation version of the technology that powers the viral chatbot tool.

In a blog post on Tuesday, OpenAI unveiled GPT-4, which the company says is capable of performing well on a range of standardized tests and is also less likely to “go off the guardrails” with its responses, as some users have previously experienced.

OpenAI said the updated technology passed a simulated law school bar exam with a score around the top 10% of test takers; by contrast, the prior version, GPT-3.5, scored around the bottom 10%. GPT-4 can also read, analyze or generate up to 25,000 words of text, and write code in all major programming languages, according to the company.

OpenAI described the update as the “latest milestone” for the company. Although it is still “less capable” than humans in many real-world scenarios, it exhibits “human-level performance on various professional and academic benchmarks,” according to the company.

GPT-4 is the latest version of OpenAI’s large language model, which is trained on vast amounts of online data to generate compelling responses to user prompts. The updated version, which is now available via a waitlist, is already making its way into some third-party products, including Microsoft’s AI-powered Bing.

“We are happy to confirm that the new Bing is running on GPT-4, which we’ve customized for search,” Microsoft said on Tuesday. “If you’ve used the new Bing preview at any time in the last five weeks, you’ve already experienced an early version of this powerful model.”

While ChatGPT has impressed many users with its ability to generate original essays, stories and song lyrics in response to user prompts since its November 2022 launch, it has also raised some concerns. AI chatbots, including tools from Microsoft and Google, have been called out in recent weeks for being emotionally reactive, making factual errors and engaging in outright “hallucinations,” as the industry calls it.

GPT-4 has similar limitations as earlier GPT models. “It is still flawed, still limited, and it still seems more impressive on first use than it does after you spend more time with it,” Sam Altman, CEO of OpenAI, wrote in a series of tweets Tuesday announcing the update.

But there are noticeable improvements, he said. “It is more creative than previous models, it hallucinates significantly less, and it is less biased,” he wrote.

Still, the company said, “great care should be taken when using language model outputs, particularly in high-stakes contexts.”

The news comes two weeks after OpenAI announced it is opening up access to its ChatGPT tool to third-party businesses, paving the way for the chatbot to be integrated into numerous apps and services.

Instacart, Snap and tutor app Quizlet are among the early partners experimenting with the tool. In January, Microsoft confirmed it is making a “multibillion dollar” investment in OpenAI and has since rolled out the technology to some of its products, including its search engine Bing.

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March 14, 2023
Facebook-parent Meta plans to lay off another 10,000 employees | CNN Business

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CNN
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Facebook-parent Meta plans to lay off another 10,000 workers, marking the second round of significant job cuts announced by the tech giant in four months.

The latest layoffs, announced on Tuesday, come after Meta said in November that it was eliminating approximately 13% of its workforce, or 11,000 jobs, in the single largest round of cuts in the company’s history.

In a Facebook post Tuesday, CEO Mark Zuckerberg said the job cuts will take place “over the next couple of months.”

“We expect to announce restructurings and layoffs in our tech groups in late April, and then our business groups in late May,” he wrote. In a “small number of cases, it may take through the end of the year to complete these changes.”

“Overall, we expect to reduce our team size by around 10,000 people and to close around 5,000 additional open roles that we haven’t yet hired,” Zuckerberg said.

As of September 2022, Meta reported a headcount of 87,314, per a securities filings. With 11,000 job cuts announced in November and the 10,000 announced Tuesday, that would bring Meta’s headcount down to around 66,000.

Meta is far from the only Big Tech company to undergo layoffs amid higher inflation, recession fears and a whiplash in pandemic-induced demand. In the first months of this year, Amazon, Google-parent Alphabet and Microsoft have all confirmed major job cuts impacting tens of thousands of tech workers.

Shares of Meta rose more than 4% in early trading Tuesday following the announcement.

When the first round of job cuts was announced in November, Zuckerberg blamed himself at the time for the company’s over-hiring earlier in the pandemic. Meta  nearly doubled its headcount between March 2020 and September of last year, as the Covid-19 crisis led to a surge in demand for digital services.

But the situation changed radically for the social media giant and other tech companies last year as pandemic restrictions eased and people returned to their offline lives. Meta’s core business was also hit by privacy changes implemented by Apple and advertisers tightening budgets amid recession fears.

In its most-recent quarterly earnings report, Meta posted a sharp drop in profits and reported its third straight quarterly decline in revenue. But during the earnings call, Zuckerberg promised investors that 2023 would be the “year of efficiency” for the company, following years of heavy investment in growth and a more immersive version of the internet called the metaverse.

On that call, Zuckerberg also suggested that more job cuts could be coming.

“We closed last year with some difficult layoffs and restructuring some teams. When we did this, I said clearly that this was the beginning of our focus on efficiency and not the end,” Zuckerberg said during the earnings call in early February. He added that the company would be focused on “flattening” its org structure and “removing some layers of middle management to make decisions faster.”

“As part of this, we’re going to be more proactive about cutting projects that aren’t performing or may no longer be as crucial, but my main focus is on increasing the efficiency of how we execute our top priorities,” Zuckerberg said.

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March 14, 2023
Senators warn Big Tech on Section 230: ‘Reform is coming’ | CNN Business

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Washington
CNN
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US senators said Wednesday that bipartisan support is growing for revising a federal immunity law for tech platforms and websites known as Section 230 of the Communications Decency Act, a warning aimed squarely at large social media platforms.

“Here’s a message to Big Tech: Reform is coming,” said Sen. Richard Blumenthal, who chaired a technology subcommittee hearing to consider changes to the law.

“I can’t predict it’ll be in the next couple of weeks, or the next couple of months,” Blumenthal said. “But if you listen, you will hear a mounting consensus and a demand from the American public that we need to act in a bipartisan way.”

Wednesday marked the second hearing in a month by members of the Senate Judiciary Committee who have vowed to expand the number and kinds of lawsuits tech platforms may have to face.

Lawmakers from both parties praised the Supreme Court for considering Section 230 when it heard Gonzalez v. Google, a case about whether YouTube can be sued for algorithmically suggesting terrorist-created videos to users. The case could have major repercussions for how social media sites rank, present and promote content online.

But the senators said that however the Court rules, it is up to Congress to rewrite the law so that members of the public can take platforms to court and hold them accountable.

Missouri Republican Sen. Josh Hawley, a vocal tech industry critic, acknowledged that the effort to revise Section 230 has been “very slow.”

“As a Republican, I would love to blame that on my Democrat colleagues,” Hawley said. “But the sad fact of the matter is, Republicans are just as much to blame, if not more.”

Republicans and Democrats have generally agreed that changing Section 230 should be a legislative priority, but they have disagreed about why and how the law should be updated. Where Republicans have attacked Section 230 for allegedly giving tech platforms a free pass to remove conservative content, Democrats have said the problem with the law is that it immunizes platforms despite their failure to remove misinformation and hate speech.

“My own side of the aisle, when it comes to vindicating the rights of citizens to get into court, to have their day in court, is often very, very slow to endorse that approach and very, very wary,” Hawley said. “But I think the time has come to say we must give individuals, we must give parents, we must give kids and victims that most basic right.”

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March 13, 2023
CNBC’s Andrew Ross Sorkin says covering the SVB meltdown is like ‘walking a tight rope’ | CNN Business

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New York
CNN
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Andrew Ross Sorkin woke up early Monday morning, long before the crack of dawn, after managing to sneak in a handful of hours of sleep.

The New York Times columnist had been up late into the night working on his DealBook newsletter. And now he needed to rise for a special edition of “Squawk Box,” the CNBC program he has co-hosted since 2011.

The special 5am edition of “Squawk” had been tasked with covering the continuing fallout stemming from the sudden collapse of Silicon Valley Bank, a massive financial news story that has drawn some eerie comparisons to the beginnings of the 2008 financial disaster.

A version of this article first appeared in the “Reliable Sources” newsletter. Sign up for the daily digest chronicling the evolving media landscape here.

It is a story Sorkin described covering as “a balancing act, a little bit like walking a tight rope.” On one hand, he said, journalists must avoid sparking panic and causing a catastrophic run on the banks. But, on the other hand, journalists also owe it to their audiences to deliver them a clear-eyed assessment of the state of affairs.

“Our job as journalists is to tell the public what is happening — and if you believe in transparency, we should all want that,” Sorkin said. “The downside of transparency in real-time is sometimes news that may not be positive can pile on itself in a way. And so I think it is really just about trying to contextualize what we’re seeing.”

“You don’t want to cause a run on a bank,” Sorkin added, “but then at the same time, if everyone is running and they have reason to run, I think it’s important that the public understands what’s happening.”

The approach to delivering the news and covering the implosion of SVB that Sorkin described stands in stark contrast to some of the commentary saturating the internet and at other media outlets.

Over the weekend, some venture capital influencers amplified fear and suggested the entire US banking system was on the verge of collapse. The investor Jason Calacanis, who hosts a podcast and commands a Twitter audience of nearly 700,000 followers, tweeted, “YOU SHOULD BE ABSOLUTELY TERRIFIED RIGHT NOW.” On the right-wing talk channel Fox News Monday morning, “Fox & Friends” co-host Ainsley Earhardt suggested Americans needed “to go to our banks and take our money out.”

Unprecedented in its sheer speed and volume, SVB’s collapse is “fascinating,” Sorkin said, causing a meltdown only now possible in the “true age of social media, as well as what might be described as digital banking.”

“The ability for information to spread rapidly, both good information and bad, and for people to act on that information and then going to a bank app and transferring funds from one place to another, makes the responsibility [for journalists] even greater,” Sorkin said.

Sorkin said banking is ultimately a “confidence game,” explaining that it is “genuinely about whether people have confidence in leaving their money in a particular institution.” And in this current environment where social media influencers and other irresponsible voices thrive, Sorkin said it “inherently makes things less stable.”

“You have a lot of people who are on social media who don’t necessarily feel the same responsibilities to contextualize the news in the same way I might try,” Sorkin said. He suggested that in the case of SVB, there may have been “a little smoke in the corner of the theater” that could have been addressed before a fire burst out and prompted danger.

“If you scream ‘fire,’ everyone runs out of the theater,” Sorkin said. “Could the smoke have been put out before everyone ran out of the theater? Maybe.”

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March 13, 2023
Chinese companies and founders rush to calm investors after SVB collapse | CNN Business

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Hong Kong
CNN
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The collapse of Silicon Valley Bank (SVB), which courted Chinese start-ups, has caused widespread concern in China, where a string of founders and companies rushed to appease investors by saying their exposure was insignificant or nonexistent.

SVB, which worked with nearly half of all venture-backed tech and healthcare companies in the United States before it was taken over by the government, has a Chinese joint venture, which was set up in 2012 and targeted the country’s tech elite.

The SPD Silicon Valley Bank, which was owned 50-50 owned by SVB and local partner Shanghai Pudong Development Bank, said Saturday that its operations were “sound.”

“The bank has a standardized corporate governance structure and an independent balance sheet,” it said in a statement. “As China’s first technology bank, SPD Silicon Valley Bank is committed to serving Chinese science and technology companies, and has always had sound operations in accordance with Chinese laws and regulations.”

It’s unclear what will happen to SVB’s ownership of the joint venture.

SVB Financial Group, the parent company of SVB, also has two business consulting firms and one financial services firm in mainland China, according to corporate database Tianyancha.

Concerns about the failure of SVB have spread around the world, as investors fretted about the broader risks to the global banking sector and any potential spillover effect.

In an extraordinary move to restore confidence in America’s banking system, the Biden administration on Sunday guaranteed that customers of SVB and Signature Bank, which was closed by regulators, will have access to all their money.

That action appears to have appeased global markets, with US futures rallying in response and some Asian markets paring earlier losses.

In China, at least a dozen firms have issued statements since SVB collapsed trying to pacify investors or clients, saying that their exposure to the lender was limited. Most were biotech companies.

BeiGene, one of China’s largest cancer-focused drug companies, said Monday it had more than $175 million uninsured cash deposits at SVB, which represents approximately 3.9% of its cash, cash equivalents and short-term investments.

“The company does not expect the recent developments with SVB to significantly impact its operations,” it said.

Zai Lab, a pharmaceutical firm, announced that its cash deposits at SVB were “immaterial” at about $23 million.

The closure of SVB “will not have an impact” on the company’s ability to meet its operating expenses and capital expenditure requirements, including payroll, it said.

Other companies that publicly assured investors included Andon Health, Sirnaomics, Everest Medicines, Broncus Medical, Jacobio Pharmaceuticals, Brii Biosciences, CStone Pharmaceuticals, Genor Biopharma and CANbridge Pharmaceuticals.

Mobile ad tech firm Mobvista and wealth management firm Noah Holdings said their cash holdings at SVB were “minimal” or “immaterial.”

Popular selfie app Meitu said it hadn’t held any bank accounts at SVB since 2020. It issued a statement “to avoid any potential public misunderstanding.”

Ascletis Pharma, MicroPort NeuroTech, Antengene Corp, and Suzhou Basecare Medical Corporation also denied they had any deposits or business dealings with SVB.

Pan Shiyi, co-founder and former chairman of Soho China, a major Beijing-based property developer, denied he had any money at SVB after reports went viral on social media that he had lost billions of yuan.

“We never opened an account with Silicon Valley Bank, nor placed a deposit,” he said late Sunday on his Weibo account.

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March 13, 2023
FBI says $10 billion lost to online fraud in 2022 as crypto investment scams surged | CNN Politics

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CNN
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More than $10 billion in losses from online scams were reported to the FBI in 2022, the highest annual loss in the last five years, according to a new report from the bureau.

The more than $3 billion jump in reports of online fraud from 2021 to 2022 was driven by a near-tripling in reports of cryptocurrency investment fraud, the FBI said in its annual Internet Crime Report.

The report tallies a wide variety of fraud complaints – from marketing scams to ransomware – and is a metric for US policymakers in measuring how much hacking and other schemes are costing the American economy.

While people in their 30s filed the most fraud complaints last year, the burden of many digital scams fell on the elderly. People over 60 accounted for $724 million, or more than two-thirds of the reported losses from “call center fraud,” according to the FBI. Such fraud occurs when scammers call someone impersonating tech support or government agencies.

Ransomware, which locks computers until hackers are paid off, accounted for about $34 million in adjusted losses reported to the FBI last year. The relatively modest figure compared to other forms of fraud could be due to the fact that many victim organizations still do not report ransomware attacks to the FBI.

A popular type of ransomware called Hive was used in 87 attacks last year, according to the FBI. The bureau seized Hive operatives’ computer infrastructure earlier this year, but not before hackers affiliated with the ransomware extorted more than $100 million from hospitals, schools and other victims around the world.

While ransomware tends to get the headlines, a different hacking scheme known as business email compromise (BEC) leads to far more money stolen from victims in aggregate. A BEC scheme typically involves someone tricking a victim into wiring them money, often by impersonating a customer or a relative.

One of the more high-profile examples of BEC fraud last year cost the city of Lexington, Kentucky, about $4 million in federal funding for housing assistance.

BEC scams accounted for about $2.7 billion in adjusted losses in 2022, compared to about $2.4 billion in 2021, according to FBI data.

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March 13, 2023
The tech industry avoided an ‘extinction-level event,’ but it’s not unscathed | CNN Business

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CNN
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For much of the weekend, Silicon Valley scrambled to find a way through what one prominent tech investor described as an “extinction-level event for startups” after the collapse of a top lender in the industry.

Startups raced to line up loans from venture funds and fintech firms to make payroll. Venture-backed retailers hosted last-minute sales to boost their cash reserves. And at least one prominent startup accelerator convinced thousands of CEOs and founders to sign an “urgent” petition calling for Treasury Secretary Janet Yellen and others to offer “relief.”

Then, late Sunday, federal officials stepped in to guarantee that all customers of the failed Silicon Valley Bank would have access to their full deposits on Monday. The sense of relief was palpable throughout the tech sector.

“Obviously, I’m quite relieved,” said Stefan Kalb, co-founder and CEO of Seattle-based startup Shelf Engine, who told CNN that his company would have had to shut down by the end of the week without the government intervention. “It was a very stressful weekend and I’m quite relieved with the news.”

Parker Conrad, the CEO of HR platform Rippling, who had previously said some customers’ payrolls were being delayed by the bank failure, tweeted Sunday: “Anyone else breathing a sigh of relief and looking forward to a good night’s sleep tonight?”

And Garry Tan, the CEO of tech startup accelerator Y Combinator who authored the petition to Yellen, praised the federal government for “decisive action.” Tan, the investor who had previously warned of “an *extinction level event* for startups” that would “set startups and innovation back by 10 years or more,” added his appreciation on Sunday for “everyone who helped us through a very very intense time.”

But even as the tech industry enjoys a respite from a fearful weekend, unknowns remain. “You can feel the collective *sigh*,” Ryan Hoover, a tech founder and investor wrote on Twitter Sunday. “I’m still nervous,” he added. “Hard to predict the collateral effects.”

It’s unclear how the aftershocks of the bank’s collapse will add to the startup industry’s growing challenges accessing capital. SVB’s collapse also risks changing how the world, and prospective recruits, think of Silicon Valley.

For years, the term itself conjured an image of an enclave of bright, contrarian, libertarian engineers and thinkers who could see around corners and make big bets on the future. Now, that same industry is relying on the federal government to survive after failing to see the risk, or worse, contributing to it through a shared hysteria.

In the chaotic days leading up to the bank’s collapse on Friday, some venture firms reportedly urged their portfolio companies to withdraw their money, which may have contributed to the bank failing.

Then, over the weekend, many venture capitalists and tech founders banded together to try and lobby government and public goodwill towards saving the companies impacted by Silicon Valley Bank’s sudden collapse.

While some VCs appeared to embrace fear-mongering on Twitter, much of the public messaging focused on the small businesses with exposure to Silicon Valley Bank that might be not be able to continue operating after losing access to the money in their bank account.

“We are not asking for a bailout for the bank equity holders or its management; we are asking you to save innovation in the American economy,” the Y Combinator petition stated. “We ask for relief and attention to an immediate critical impact on small businesses, startups, and their employees who are depositors at the bank.”

A separate coalition of more than a dozen venture capital firms, including Lightspeed Venture Partners and Upfront Ventures, released a joint statement late Friday supporting Silicon Valley Bank, given its unique and vital role in the startup economy. The bank worked with nearly half of all venture-backed tech and healthcare companies in the United States.

“For forty years, it has been an important platform that played a pivotal role in serving the startup community and supporting the innovation economy in the US,” the statement read. “In the event that SVB were to be purchased and appropriately capitalized, we would be strongly supportive and encourage our portfolio companies to resume their banking relationship with them.”

Even before the bank’s collapse, the startup industry was in a tough moment. Venture capital funding had dwindled amid rising interest rates and broader macroeconomic uncertainty; tech companies were cutting staff and ambitious projects; and some of the biggest private companies were reportedly slashing their valuations.

The instability at a top tech lender, and the lingering questions about its impact on other regional banks and the broader financial system, risk making it even harder for money-losing startups to access the capital they need to survive.

President Joe Biden emphasized in remarks Monday that “no losses will be borne by the taxpayers” related to the government’s intervention for Silicon Valley Bank. But some are already skeptical of that statement, including Democratic Sen. Elizabeth Warren of Massachusetts, who wrote in an op-ed Monday morning, “We’ll see if that’s true.”

More immediately, there’s uncertainty around how long it will take for companies to get their money out of the bank.

As of Monday, Kalb said the money in his Silicon Valley Bank account has not been transferred yet to the new JPMorgan Chase account he set up for Shelf Engine on Thursday. “I’ve been obsessively checking my email,” he said. “Hopefully the money will be able to be transferred shortly.”

Ben Kaufman, the co-founder of venture-backed toy store and online retailer Camp, told CNN’s Poppy Harlow in an interview Monday morning that he and his team spent the weekend trying to “fight for survival,” including holding a last-minute 40% off sale, using the code “BANKRUN,” to raise capital over the weekend.

“We did not know how long it was going to take for us to get our cash out … we still kind of don’t, they say today, we’ll see what happens,” he said, noting the bank held 85% of his company’s assets. “We hope we can, and we’re so grateful that the Fed stepped in, and the way they did.”

When asked if the past week’s events would change how and where he stores his money, Kaufman said that is “going to have to be a consideration moving forward.”

“I don’t want to do this again,” he said.

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March 13, 2023
Why Silicon Valley Bank collapsed and what it could mean | CNN Business

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London
CNN
—

Silicon Valley Bank collapsed with astounding speed on Friday. Investors are now on edge about whether its demise could spark a broader banking meltdown.

The US federal government has stepped in to guarantee customer deposits, but SVB’s downfall continues to reverberate across global financial markets. The government has also shut down Signature Bank, a regional bank that was teetering on the brink of collapse, and guaranteed its deposits.

In a sign of how seriously officials are taking the SVB failure, US President Joe Biden told Americans Monday that they “can rest assured that our banking system is safe,” adding: “We will do whatever is needed on top of all this.”

Here’s what you need to know about the biggest US bank failure since the global financial crisis.

Established in 1983, Silicon Valley Bank was, just before collapsing, America’s 16th largest commercial bank. It provided banking services to nearly half of all US venture-backed technology and life science companies.

It also has operations in Canada, China, Denmark, Germany, Ireland, Israel, Sweden and the United Kingdom.

SVB benefited hugely from the tech sector’s explosive growth in recent years, fueled by ultra-low borrowing costs and a pandemic-induced boom in demand for digital services.

The bank’s assets, which include loans, more than tripled from $71 billion at the end of 2019 to a peak of $220 billion at the end of March 2022, according to financial statements. Deposits ballooned from $62 billion to $198 billion over that period, as thousands of tech startups parked their cash at the lender. Its global headcount more than doubled.

SVB’s collapse came suddenly, following a frenetic 48 hours during which customers yanked deposits from the lender in a classic run on the bank.

But the root of its demise goes back several years. Like many other banks, SVB ploughed billions into US government bonds during the era of near-zero interest rates.

What seemed like a safe bet quickly came unstuck, as the Federal Reserve hiked interest rates aggressively to tame inflation.

When interest rates rise, bond prices fall, so the jump in rates eroded the value of SVB’s bond portfolio. The portfolio was yielding an average 1.79% return last week, far below the 10-year Treasury yield of around 3.9%, Reuters reported.

At the same time, the Fed’s hiking spree sent borrowing costs higher, meaning tech startups had to channel more cash towards repaying debt. At the same time, they were struggling to raise new venture capital funding.

That forced companies to draw down on deposits held by SVB to fund their operations and growth.

While SVB’s problems can be traced back to its earlier investment decisions, the run on the bank was triggered Wednesday when the lender announced that it had sold a bunch of securities at a loss and would sell $2.25 billion in new shares to plug the hole in its finances.

That set off panic among customers, who withdrew their money in large numbers.

The bank’s stock plummeted 60% Thursday and dragged other bank shares down with it as investors began to fear a repeat of the global financial crisis a decade and a half ago.

By Friday morning, trading in SVB shares was halted and it had abandoned efforts to raise capital or find a buyer. California regulators intervened, shutting the bank down and placing it in receivership under the Federal Deposit Insurance Corporation, which typically means liquidating the bank’s assets to pay back depositors and creditors.

US regulators said Sunday that they would guarantee all SVB customers’ deposits. The move is aimed at preventing more bank runs and helping tech companies to continue paying staff and funding their operations.

The intervention does not amount to a 2008-style bailout, however, which means investors in the company’s stock and bonds will not be protected.

“Let me be clear that during the financial crisis, there were investors and owners of systemic large banks that were bailed out … and the reforms that have been put in place mean that we’re not going to do that again,” Treasury Secretary Janet Yellen told CBS in an interview Sunday.

“But we are concerned about depositors and are focused on trying to meet their needs.”

There are already some signs of stress at other banks. Trading in First Republic Bank

(FRC) and PacWest Bancorp

(PACW) was temporarily halted Monday after the shares plunged 65% and 52% respectively. Charles Schwab

(SCHW) stock was down 7% at 11.30 a.m. ET Monday.

In Europe, the benchmark Stoxx Europe 600 Banks index, which tracks 42 big EU and UK banks, fell 5.6% in morning trade — notching its biggest fall since last March. Shares in embattled Swiss banking giant Credit Suisse were down 9%.

SVB isn’t the only financial institution whose investments into government bonds and other assets have fallen dramatically in value.

At the end of 2022, US banks were sitting on $620 billion in unrealized losses — assets that have decreased in price but haven’t been sold yet, according to the FDIC.

In a sign that regulators have concerns about wider financial chaos, the Fed said Sunday that it would make additional funding available for eligible financial institutions to prevent the next SVB from collapsing.

Most analysts point out that US and European banks have much stronger financial buffers now than during the global financial crisis. They also highlight that SVB had very heavy exposure to the tech sector, which has been particularly hard hit by rising interest rates.

“While SVB is a major failure, [it] and other niche players like Signature are quite unique in the broader banking world,” research analysts David Covey, Adrian Cighi and Jaimin Shah at M&G Investments commented in a blog post on Monday. “So unique, in our view, that it is unlikely to create material problems for any of the large diversified banks in the US or Europe from a credit point of view.”

HSBC stepped in Monday to buy SVB UK for £1 ($1.2), securing the deposits of thousands of British tech companies that hold money at the lender.

Had a buyer not been found, SVB UK would have been placed into insolvency by the Bank of England, leaving customers with only deposits worth up to £85,000 ($100,000) — or £170,000 ($200,000) for joint accounts — guaranteed.

The HSBC rescue is “fantastic news” for the UK startup ecosystem, said Piotr Pisarz, the CEO of Uncapped, a financial tech startup that lends to other startups. “I think we can all relax a bit today,” he told CNN.

In a statement, HSBC CEO Noel Quinn said the acquisition “strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms, including in the technology and life science sectors, in the UK and internationally.”

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March 13, 2023
China censors women modeling lingerie on livestream shopping — so men are doing it | CNN Business

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Hong Kong
CNN
—

Donning a sassy piece of silk lingerie, a male model grooves to the beat and forms a heart shape with his fingers during a livestreaming session on Douyin, one of China’s most popular video-sharing platforms.

His modeling performance is the latest illustration of the kind of entrepreneurial innovation sometimes needed to bypass China’s rigorous internet censorship, a dragnet that can ensnare seemingly innocuous activities – in this case retailers selling women’s underwear online.

China deploys one of the world’s most stringent censorship regimes, with a track record of blocking out not just politically sensitive information but images of women’s bodies deemed marginally racy.

Several businesses specializing in selling lingerie through livestreaming have had their sessions cut short after they featured a female model and their brush with internet censorship came to light in January.

Hence the use of men instead.

On one of the sales channels, a man is seen dressed in black lingerie, standing next to a mannequin showing a similar outfit, in what appears to be a screenshot of a livestream broadcast on Alibaba

(BABA)’s Taobao Live, a streaming platform for the e-commerce giant.

In another image, a different male model put on a pink slip dress and silky shawl, accessorized with cat ear headbands.

In one livestream clip, carried by multiple state media outlets, an owner of an online venture said he was simply trying to play it safe.

“This is not an attempt at sarcasm. Everyone is being very serious about complying with the rules,” the man, who identified himself as Mr Xu, said.

The emergence of male lingerie models has caused mixed views online in China, from merriment and annoyance to reluctant acceptance.

“So what should I do if I want to promote and showcase lingerie in the live broadcast session? It’s very simple, find a man to wear it,” read one comment on China’s microblogging site Weibo.

Livestreaming sales of products is a multibillion-dollar industry in mainland China, and was given a major boost during the three years of the country’s strict Covid lockdowns that battered many bricks and mortar businesses.

As of June last year, the number of livestreaming e-commerce users in mainland China is over 460 million, according to the Academy of China Council for the Promotion of International Trade, a body affiliated with Beijing’s commerce ministry.

A 2021 report by iResearch, a Beijing-based firm specializing in measuring audience growth online, predicted the livestream sector would be worth as much as $720 billion this year.

Male models are not the only workaround.

On Douyin, the Chinese domestic version of TikTok, other female models have circumvented the censorship by showcasing the latest style of lingerie on themselves on top of a t-shirt they are already wearing.

Others displayed the items on mannequins.

In 2015, China led a crackdown on television shows exposing actresses’ cleavage, forcing some of the most popular costume dramas to zoom in on their faces to avoid getting into trouble with the broadcast authorities.

Having male influencers promoting female-oriented products is not new in China, either.

One of the industry’s most successful livestream shopping influencers is Austin Li Jiaqi, who made his name as the “Lipstick King” after selling 15,000 lipsticks in just five minutes in 2018.

As one of China’s biggest internet celebrities, Li also peddles cosmetics, skincare products and fashion apparel, often applying products he’s selling to his own face.

Even outside of China, platforms such as Facebook and Instagram have faced criticism for restricting the sharing of images involving partial nudity, especially of women.

Facebook and Instagram’s parent company, Meta, restricts the sharing of breasts, although it says it intends “to allow images that are shared for medical or health purposes.” But even Meta’s own Oversight Board has called on the company to make its policy less confusing and more gender inclusive.

YouTube says it prohibits “the depiction of clothed or unclothed genitals, breasts, or buttocks that are meant for sexual gratification,” but it may age-restrict other images or videos involving nudity.

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March 13, 2023
The new normal on Twitter: watching it break | CNN Business

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Late last year, Dan Sinker found himself in a “Groundhog Day” situation. When he would check his notifications tab on Twitter, Sinker, who has tens of thousands of followers, often saw the platform recommend the same weeks-old tweet from another user. As Sinker described the situation in one tweet in early December, “we’re back to November 7 in my mentions again.”

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March 12, 2023
BBC’s flagship soccer show boycotted over Gary Lineker impartiality row | CNN

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CNN
—

The BBC’s weekend soccer coverage has been plunged into chaos following its announcement Gary Lineker would “step back” from presenting, after he became embroiled in an impartiality row when he criticized British government policy on Twitter.

The broadcaster now faces a boycott from pundits, presenters and even players of its flagship soccer show “Match of the Day,” while other soccer programs – Football Focus and Final Score – and some radio programming have been forced off-air as a result of the furore.

Lineker criticized the government’s controversial new asylum-seeker policy on Tuesday and was subsequently relieved of his presenting duties this week since the BBC said his tweets breached their guidelines, specifically its commitment to “due impartiality.”

The BBC’s decision has sparked controversy, leaving the organization under fire from opposition politicians, the Broadcasting Entertainment Communications and Theatre Union who represent BBC staff, and its former director general Greg Dyke.

“The BBC will only be able to bring limited sport programming this weekend and our schedules will be updated to reflect that,” a BBC spokesperson said in a statement Saturday.

“We are sorry for these changes which we recognize will be disappointing for BBC sport fans.

“We are working hard to resolve the situation and hope to do so soon.”

In an interview with BBC News on Saturday, the broadcaster’s Director General Tim Davie was asked if he should resign over the crisis. He said he would not.

“I honestly do not believe, despite a lot of the commentary, that this is about left or right,” Davie said. The BBC is a “fierce champion of democratic debate, free speech, but with that comes the need to create an impartial organization,” he added.

When asked if he was sorry about the way he handled the situation, he said: “We made decisions, and I made decisions based on a real passion about what the BBC is and it is difficult – it’s this balance between free speech and impartiality.”

On Tuesday, Lineker tweeted “Good heavens, this is beyond awful” to a video posted on Twitter by the British Home Office announcing the new proposed policy – an attempt to stop migrant boats crossing the English Channel from France which has been criticized by the United Nations and other global bodies.

He added: “There is no huge influx. We take far fewer refugees than other major European countries. This is just an immeasurably cruel policy directed at the most vulnerable people in language that is not dissimilar to that used by Germany in the 30s, and I’m out of order?”

As Britain’s public broadcaster, the BBC is bound by “due impartiality” – a much debated term which the organization defines as holding “power to account with consistency” while not “allowing ourselves to be used to campaign to change public policy.”

On Friday, the BBC announced Lineker would “step back from presenting Match of the Day until we’ve got an agreed and clear position on his use of social media,” adding it considered his recent social media activity to breach its guidelines.

In response, first pundits, then commentators, and then even Premier League teams announced their intention to boycott the show in support of Lineker.

BBC commentators Steve Wilson, Conor McNamara, Robyn Cowen and Steven Wyeth said in a joint statement issued late on Friday “in the circumstances, we do not feel it would be appropriate to take part in the programme.”

A shortened version of the program did eventually air on Saturday. It opened with a BBC continuity announcer issuing an apology, instead of the usual title sequence and theme tune.

It then showed highlights from Saturday’s English Premier League games with no commentary, only the background audio from the stadiums.

The show aired for 20 minutes, an hour less than the originally scheduled time.

Jermain Defoe, a former England striker, announced Saturday he would not appear as a pundit on the Sunday show.

“It’s always such a privilege to work with BBC MOTD. But tomorrow I have taken the decision to stand down from my punditry duties. @GaryLineker,” Defoe tweeted.

Defoe’s announcement appears to be the first sign the British broadcaster’s Sunday television programming will also be affected.

Meanwhile, the Professional Footballers’ Association announced on Saturday “players involved in today’s games will not be asked to participate in interviews with Match of the Day.”

“The PFA have been speaking to members who wanted to take a collective position and to be able to show their support for those who have chosen not to be part of tonight’s programme,” the statement added.

“During those conversations we made clear that, as their union, we would support all members who might face consequences for choosing not to complete their broadcast commitments. This is a common sense decision that ensures players won’t now be put in that position.”

Following his side’s 1-0 defeat against Bournemouth on Saturday, Liverpool manager Jurgen Klopp was asked about the BBC issue.

“I cannot see any reason why they would ask anyone to step back for saying that. I’m not sure if that’s a language issue or not,” the German told reporters.

“If I understand it right, then this is about an opinion about human rights and that should be possible to say.

“What I don’t understand is why everybody goes on Twitter and says something. I don’t understand the social media part of it but that’s probably [because] I’m too old for that.”

The BBC’s former director general Greg Dyke said the broadcaster has “undermined its own credibility” by suspending Lineker because it seemed like it had “bowed to government pressure.”

Keir Starmer, leader of the opposition Labour Party, said the BBC had got “this one badly wrong and now they’re very, very exposed.”

Scotland’s First Minister Nicola Sturgeon tweeted: “As a strong supporter of public service broadcasting, I want to be able to defend the BBC. But the decision to take Gary Lineker off air is indefensible. It is undermining free speech in the face of political pressure – & it does always seem to be rightwing pressure it caves to.”

Opposition Labour Party deputy leader Angela Rayner also lambasted the BBC’s decision in a tweet on Saturday.

“The BBC’s cowardly decision to take Gary Lineker off air is an assault on free speech in the face of political pressure from Tory politicians. They should rethink,” she tweeted.

Meanwhile Nadine Dorries, an MP with the governing Conservative party and former Culture Secretary, welcomed the BBC’s decision, tweeting: “News that Gary Lineker has been stood down for investigation is welcome and shows BBC are serious about impartiality.

“Gary is entitled to his views – free speech is paramount. Lots of non Public Service Broadcasters can accommodate him and his views and he would be better paid.”

For his part, British Prime Minister Rishi Sunak on Saturday issued a statement saying he hopes the situation between the BBC and its star soccer host can be resolved but it is not a matter for the UK government.

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March 12, 2023
Snap stock surges as Congress renews efforts to ban TikTok | CNN Business

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CNN
—

Investors are betting that Washington’s mounting scrutiny on TikTok could be good news for rival Snapchat.

Shares of Snapchat’s parent company surged nearly 10% on Monday and another 5% in early trading Tuesday following news that US senators are planning to introduce legislation that could make it easier to ban rival app TikTok.

Virginia Democratic Sen. Mark Warner is expected to unveil bipartisan legislation Tuesday afternoon that expands President Joe Biden’s authority to ban TikTok and other suspected information technology risks from the United States, a person familiar with the matter told CNN. The bill is expected to have nearly a dozen co-sponsors from both sides of the aisle.

The stock surge suggests some on Wall Street are taking the possibility of a TikTok ban more seriously, after years of chatter in the nation’s capital about cracking down on the short-form video app due to security concerns related to its Chinese parent company.

It also highlights how lawmakers’ efforts to address the perceived threat of TikTok could ultimately benefit large US tech platforms, including dominant companies that some in Washington also want to rein in for other reasons.

Angelo Zino, senior equity analyst CFRA Research, wrote in a note Monday that the “biggest beneficiaries of a TikTok ban” would be Snapchat, Facebook-parent Meta, and YouTube.

“TikTok’s emphasis on short-form videos has increased engagement/time spent by consumers and has upended the entire industry, creating a headwind for META/SNAP,” Zino wrote. “Given TikTok’s growing engagement/user growth, it has been taking an increasing portion of the digital ad dollars pie from other social media players.”

In recent years, TikTok’s popularity has led a number of major US apps to imitate some of its features, including the launch of Instagram’s Reels and YouTube’s Shorts.

Shares of YouTube’s parent company Alphabet were essentially flat on Tuesday. Meta, which is up 50% so far this year thanks to its commitment to “efficiency,” was up slightly in early trading Tuesday, likely because of a report claiming it’s planning more layoffs.

A TikTok ban, or the possibility of it, may just be one more positive for Meta’s stock this year.

– CNN’s Brian Fung contributed to this report.

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March 11, 2023
Camp toy store pleads for help after Silicon Valley Bank collapse | CNN Business

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New York
CNN
—

A toy company based in New York has gotten caught up in the collapse of Silicon Valley Bank and is pleading with customers for help keeping it afloat.

Camp, a venture-backed retailer, sent an email to customers Friday announcing it was slashing prices and would use sales to help fund its continued operations after much of its money was tied up in the bank failure.

“Unfortunately, we had most of our company’s cash assets at a bank which just collapsed. I’m sure you’ve heard the news,” co-founder Ben Kaufman said in an email to customers.

He urged customers to use the code “BANKRUN” to save 40% off all merchandise, in an apparent nod to the run on the bank that may have helped bring down the Silicon Valley lender. Camp also said customers could pay full price, which it said would be appreciated.

Kaufman said the company was “hopeful that this will be resolved soon.”

CNN has not confirmed if Camp had funds with Silicon Valley Bank when the bank collapsed.

Silicon Valley Bank was put under control of the US Federal Deposit Insurance Corporation on Friday, capping off a stunning 48 hour period during which fears of a liquidity crisis at the firm prompted some startups to weigh withdrawing funds.

The sudden collapse of the Silicon Valley lender has pushed tech investors and startups to scramble to figure out their financial exposure to the bank, with founders worrying about getting their money out, making payroll and covering operating expenses.

The rapidly unfolding fallout at Silicon Valley Bank comes at a challenging moment for startup and tech industries. Rising interest rates have eroded the easy access to capital that helped fuel soaring startup valuations and funded ambitious, money-losing projects.

Kaufman, a former BuzzFeed executive, founded Camp in 2018. It has nine stores in California, Connecticut, Massachusetts, New York, New Jersey and Texas.

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March 11, 2023
Chinese city proposes lockdowns for flu — and faces a backlash | CNN

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Hong Kong
CNN
—

A Chinese city has sparked a backlash on social media after saying it would consider the use of lockdowns in the event of an influenza outbreak.

The city of Xi’an – a tourism hotspot in Shaanxi province that is home to the famous terracotta warriors – revealed an emergency response plan this week that would enable it to shut schools, businesses and “other crowded places” in the event of a severe flu epidemic.

That prompted a mixture of anxiety and anger on China’s social media websites among many users who said the plan sounded uncomfortably similar to some of the strict zero-Covid measures China had implemented throughout the pandemic and which have only recently been abandoned.

“Vaccinate the public rather than using such time to create a sense of panic,” one user wrote on Weibo, China’s equivalent of Twitter.

“How will people not panic given that Xi’an’s proposal to suspend work and business activities were issued without clear instruction on the national level to classify the disease?” asked another.

While cases of Covid in China are falling, there has been a spike in flu cases across the country and some pharmacies are struggling to meet demand for flu remedies.

However, Xi’an’s emergency response plan will not necessarily be used. Rather, it outlines how the city of almost 13 million people would respond to any future outbreak based on four levels of severity.

At the first and highest level, it says, “the city can lock down infected areas, carry out traffic quarantines and suspend production and business activities. Shopping malls, theaters, libraries, museums, tourist attractions and other crowded places will also be closed.”

“At this emergency level, schools and nurseries at all levels would be shut down and be made responsible for tracking students’ and infants’ health conditions.”

The backlash comes as the central government in Beijing has emphasized the need to open the country back up following the removal of all Covid restrictions in January.

Throughout the pandemic, China had enforced some of the world’s most severe Covid restrictions, including lockdowns that stretched into months in some cities. It was also one of the last countries in the world to end measures such as mass testing and strict border quarantine periods, even amid growing evidence of the damage being done to its economy.

Xi’an itself was subject to a draconian lockdown between December 2021 and January 2022, with 13 million residents confined to their homes for weeks on end – and many left short of food and other essential supplies. Access to medical services was also affected. In an incident that shocked and angered the nation, a heavily pregnant woman was turned away from a hospital on New Year’s Day because she didn’t have a valid Covid-19 test, and suffered a miscarriage after she was finally admitted two hours later.

Shortly before China removed its pandemic era restrictions the country had been rocked by a series of demonstrations against its zero-Covid policy.

Memories of being confined to their homes and of panic buying that in some areas led to food shortages remain fresh in people’s minds and the idea of a return to Covid-style measures appears to have hit a nerve.

However, some voices called for calm.

Epidemiologist Ben Cowling, from the University of Hong Kong’s School of Public Health, said he saw the rationale of the move.

“I think it’s quite rational to make contingency plans. I wouldn’t expect a lockdown to be needed for flu, but presumably there are different response levels,” he said.

One user on Weibo expressed a similar sentiment: “It is merely the revelation of a proposal, not putting it in place. It is quite normal to take precautions given this wave of flu is coming at us very strong.”

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March 10, 2023
Mental health startup exposes the personal data of more than 3 million people | CNN Politics

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Washington
CNN
—

A mental health startup exposed the personal data of as many as 3.1 million people online. In some cases, possibly sensitive information on mental health treatment was leaked, according to a company statement and a Department of Health and Human services filing.

Cerebral, a California-based firm that connects people suffering from anxiety and depression with mental health professionals via video calls, said it discovered the “inadvertent” data exposure more than three years after it started using “pixels” – a common method that companies and advertisers use to track user behavior for marketing purposes.

The company determined in January that tracking pixels had been sharing client and user data to “third-party platforms” and “subcontractors” that it didn’t name, according to a privacy notice near the bottom of its website.

Cerebral said it was unaware of any misuse of the protected health information that was disclosed. But privacy advocates have for years warned that such data troves can be used to aggressively market products at consumers and infringe on their privacy.

Some of the data potentially exposed in the Cerebral breach includes answers to online “self-assessments” about mental health that Cerebral asks prospective clients to fill out. That can include questions on whether someone is experiencing panic attacks, abusing alcohol or has a personality disorder, CNN’s review of the online assessments found.

Cerebral said in a statement to CNN on Friday that it was “committed to correcting historical errors and leading the industry in privacy standards moving forward.”

Cerebral notified the Department of Health and Human Services (HHS), which said in a filing this month that the breach affects over 3.1 million users. The department investigates potential violations of the Health Insurance Portability and Accountability Act (HIPAA), a law that requires medical providers to safeguard patient data.

Rachel Seeger, a spokesperson for the HHS Office for Civil Rights, said the office typically “does not comment on open or potential investigations.”

Cerebral said in its public statement that it had disabled the tracking pixels on its platforms and stopped sharing data with subcontractors “not able to meet all HIPAA [Health Insurance Portability and Accountability Act] requirements.”

“It is important to note that Cerebral never impermissibly transmitted clinician generated notes or clinician communications,” the company told CNN.

Cerebral spokesperson Chris Savarese did not respond to emailed questions about which and how many platforms and contractors to which the company disclosed the client health information.

Some analysts argue that the broader market for data tracking tools is out of control. A group of conservative Catholics has spent millions of dollars to buy mobile data that identified priests who used gay dating and hookup apps, the Washington Post reported this week.

Andrea Downing, who has done extensive research on pixel tracking and privacy, said patients are often unaware of how much personal data health care startups collect and potentially transmit to other parties.

“What is in the fine print or the details of how data is being shared for advertising is not apparent to us when we’re going through the trauma of a diagnosis and seeking knowledge,” said Downing, who is co-founder of Light Collective, a digital rights nonprofit.

“The only thing that is incentivizing change right now is the threat of liability,” Downing told CNN.

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March 10, 2023
Rubio wants to block Ford from tax breaks for using Chinese battery technology | CNN Business

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US Senator Marco Rubio on Thursday introduced legislation that takes aim at Ford’s deal to use technology from Chinese battery company CATL as part of the automaker’s plan to spend $3.5 billion to build a battery plant in Michigan.

Rubio, the top Republican on the Intelligence Committee, introduced legislation that would block tax credits for electric vehicle batteries produced using Chinese technology, saying it would “significantly restrict the eligibility of IRA tax credits and prevent Chinese companies from benefiting.”

Ford said in response to Rubio that “making those batteries here at home is much better than continuing to rely exclusively on foreign imports, like other auto companies do. A wholly owned Ford subsidiary alone will build, own and operate this plant. No other entity will get US tax dollars for this project.”

Last month, Rubio asked the Biden administration to review Ford’s deal to use technology from CATL.

Rubio called for an immediate Committee on Foreign Investment in the United States (CFIUS) review of the licensing agreement between Ford and CATL.

Rubio said the deal “will only deepen US reliance on the Chinese Communist Party for battery tech, and is likely designed to make the factory eligible for Inflation Reduction Act (IRA) tax credits.”

CFIUS is a US Treasury-led interagency panel that reviews proposed transactions to ensure they do not harm national security.

Treasury declined to comment, but Energy Secretary Jennifer Granholm said last month the Ford deal will “bringing advanced manufacturing capabilities from overseas to the United States is key to our competitiveness, will stimulate our economy, and create good-paying American jobs.”

Ford has said the plant would create 2,500 jobs and begin producing lower cost and faster recharging lithium-iron-phosphate batteries in 2026.

The $430 billion IRA imposes restrictions on battery sourcing and is designed to wean the United States off the Chinese supply chain for electric vehicles (EVs). The IRA will eventually bar credits if any EV battery components were manufactured by a “foreign entity of concern,” in a provision aimed at China.

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March 10, 2023