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  • End of an era: Netflix DVD subscribers mourn the service’s imminent demise | CNN Business

    End of an era: Netflix DVD subscribers mourn the service’s imminent demise | CNN Business

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    CNN
     — 

    When Colin McEvoy, a father of two from Bethlehem, Pennsylvania and a self-described film fanatic, wants to watch a Bollywood film or an obscure independent movie, he often turns to Netflix – but not its popular streaming service.

    McEvoy, 39, said he’s been using Netflix’s DVD-by-mail service since 2001, just three years after it launched.

    “I remember I was in high school when I first signed up for it, and the concept was so novel, I had to really convince my dad that it was a legit service and not some sort of Internet scam,” said McEvoy, who uses an old Xbox 360 to play his Netflix DVDs. “Now I have friends who’ve seen my red Netflix envelopes arrive in the mail, and either didn’t remember what they were or couldn’t believe that I still got the DVDs in the mail.”

    Now, McEvoy is one of the DVD-by-mail holdouts mourning the service’s imminent demise. On Tuesday, Netflix announced it will send out its final red envelope on September 29, 2023. marking an end to 25 years of mailing DVDs to members. The company will continue to accept returns of customers’ remaining DVDs until October 27.

    “I’ll be sad to see the service go,” McEvoy said.

    Introduced in 1998 when Netflix first launched, the service promised an easier rental experience than having to drive to the nearest Blockbuster or Hollywood Video. The red envelopes, which have long been synonymous with Netflix itself, littered homes and dorm rooms across the country. But in 2007, Netflix began streaming content online, and gradually shifted the focus away from its original DVD business.

    Today, the idea of receiving a DVD in the mail may sound almost as outdated as receiving a dial up CD, but some longtime customers told CNN they continued to find value in the DVD option, including for its selection, pricing and added perks.

    Brandon Cordy, a 41-year-old graphic designer from Atlanta, said he stuck with DVDs because many digital rentals don’t come with special features or audio commentaries.

    There are other factors, too. Michael Inouye, an analyst at ABI Research, said some consumers may still not have access to reliable or fast enough broadband connections, or simply prefer physical media to digital, much in the way that some audio enthusiasts still purchase and collect CDs and records. Other households may also own cars that still have DVD players inside.

    For Netflix, however, the offering has made less sense in recent years. “Our goal has always been to provide the best service for our members, but as the DVD business continues to shrink, that’s going to become increasingly difficult,” co-CEO Ted Sarandos wrote in a blog post this week.

    Shutting down its DVD business could help Netflix better focus resources as it expands into new markets such as gaming as well as live and interactive content. Its DVD business has also declined significantly in recent years. In 2021, Netflix’s non-streaming revenue – mostly attributable to DVDs – amounted to 0.6% of its revenue, or just over $182 million.

    The cost to operate its DVD business may also be a factor, especially as Netflix rethinks expenses broadly amid heightened streaming competition and broader economic uncertainty. “Moving plastic discs around costs far more money than streaming digital bits,” said Eric Schmitt, senior director analyst at Gartner Research. “Removing and replacing damaged and lost inventory are also cost considerations.”

    Even before Netflix announced the news this week, some longtime subscribers said they could see the writing on the wall.

    “The inventory of available titles, while still vast, had been contracting some over the years with some movies that were once available no longer being so,” Cordy said. “Turnaround times to get a new movie or movies also started to take longer, so I knew it was only a matter of time. But I didn’t want it to end if I could help it.”

    Other DVD subscribers are hoping there may still be a happy ending.

    On Wednesday, Bill Rouhana, the CEO of Chicken Soup for the Soul Entertainment – which owns DVD rental service Redbox – told The Hollywood Reporter he hopes to purchase Netflix’s DVD business. “I’d like to buy it… I wish Netflix would sell me that business instead of shutting it down,” he said. Redbox remains popular despite the shift in streaming, but took a hit during the pandemic because of the lack of new movies and TV shows to fill the boxes.

    A Netflix spokesperson told CNN it has no plans to sell the DVD business and declined to share how it plans to dispose of the discs. But Nick Maggio, a 43-year-old elementary school teacher from Valley Stream, New York, said he hopes the company will sell their individual titles library. “I know there are several titles I’d like to get my hands on,” he said.

    For now, at least, some DVD subscribers plan to focus on watching as many DVDs as they can before the service goes away.

    McEvoy, who also subscribes to Disney+, Hulu, the Criterion channel and Mubi, said he’s determined to finish seeing every film listed in the book “1001 Movies You Must See Before You Die” with the help of Netflix.

    “I absolutely would not have been able to find all of those movies if not for the Netflix DVD service,” he said. “I only have four movies left to go.”

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  • Despite TikTok ban threat, influencers are flocking to a new app from its parent company | CNN Business

    Despite TikTok ban threat, influencers are flocking to a new app from its parent company | CNN Business

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    New York
    CNN
     — 

    In the days after TikTok’s CEO was grilled by Congress for the first time, many TikTok users began posting about an alternative platform called Lemon8, sometimes with eerily similar language.

    Multiple creators described the app as being like “if Pinterest and Instagram had a baby, with TikTok’s algorithm.” Some compared it to TikTok circa 2020 and encouraged other influencers to join the app before it grows. They also asked followers to share their Lemon8 usernames in the comments.

    As it turned out, the app wasn’t just a random alternative to TikTok. Lemon8 is a social media platform launched in the United States earlier this year by TikTok’s Chinese parent company ByteDance amid federal and state efforts to ban or restrict TikTok in the country over national security concerns.

    The similarities in the videos comparing the new service to Instagram and Pinterest, which were posted by both English and Spanish-speaking creators, raised questions about whether people were being paid to promote the new app on TikTok. But despite that speculation — and the mounting scrutiny on TikTok and ByteDance — a growing number of US users and influencers are now eagerly touting Lemon8, with its focus on photos and highly curated, informational or “aspirational” content.

    “We have to talk about TikTok’s new sister app,” a creator said in one such video.

    “I’ve seen a lot of bigger content creators that I love on it and promoting it on their Instagram stories, so I thought, ‘okay, it’s my time to hop on this bandwagon,’” said Melanie Cruz, who got her start creating content as a YouTube vlogger in high school around 2018. “I like that it’s something simple, it’s nothing too in your face … it’s not overwhelming.”

    Lemon8 has been downloaded just over one million times in the United States since it became available on US app stores in February, and had around half a million daily active US users last month, according to intelligence platform Apptopia.

    The early traction for Lemon8 hints at the whack-a-mole challenge lawmakers could face in reining in TikTok and other social media platforms. It also carries some hints of TikTok’s own rise, which was reportedly fueled in part by ByteDance spending heavily to advertise the service on rival platforms Facebook and Snapchat. This time, however, the best place to promote the next TikTok may be on TikTok itself.

    The New York Times reported last month that ByteDance had begun early marketing efforts for Lemon8 that included working with influencers. Now, some creators featured on Lemon8’s “for you” feed appear to be disclosing their work with the company using the hashtag #Lemon8Partner in their captions.

    A ByteDance company source said that Lemon8 is still in its early days and testing how to work with creators. They said ByteDance has not launched any formal marketing efforts for Lemon8, but in some cases has made deals to pay creators to post on the platform. However, they denied rumors that ByteDance had paid creators to promote the new app on TikTok.

    ByteDance has also recently listed open jobs for Lemon8 creator partnerships roles, according to postings viewed by CNN. “Lemon8 is a social media platform committed to building a diverse and inclusive community where people can discover new content and creators every day,” the job postings read.

    Lemon8’s photo-heavy focus marks a stark shift away from most of the major social apps that, following TikTok’s lead, have gone all-in on endlessly scrollable short-form videos in recent years.

    Lemon8’s homepage is a “for you” feed where users can scroll through content, similar to TikTok, but instead of videos, the feed is two columns of still images. When you click through to a post, it might be a single photo or a carousel of images. It’s also possible to post videos on the app, but they’re less popular.

    The app is heavily centered on beauty and lifestyle content — the “for you” page can be sorted into six categories including fashion, home and travel. Many of the posts feature lengthy captions, and users can also edit images to include text overlays. On top of similarities to Instagram and Pinterest, Lemon8 looks nearly identical to the Chinese app Xiaohongshu.

    Still, the app lacks some standard social platform features such as messaging and the option to tag other users in posts.

    A recent scroll through Lemon8’s “for you” page showed before-and-after photos of a botox treatment, a “no restrictions” day-long eating plan, book recommendations, black tie wedding attire tips and “10 recent girly Amazon buys I do NOT regret.”

    “It seems like people love it or hate it,” Madison Bravenec, a health coach and content creator, said of the app’s focus on aesthetics. But she added that the app’s targeted focus on certain types of content has made it easier to find a community that’s interested in the wellness content she likes to create, whereas the most popular posts on TikTok often have to appeal to a wider audience.

    Some creators say Lemon8 is filling a hole in the social media ecosystem that was left when Instagram moved to prioritize short-form video content in order to better compete with TikTok, frustrating many creators who joined the app for its original focus on photos.

    “We’re not videographers, we’re not the types of people who would like to change the ways we create content and communicate with others just because a platform is prioritizing one deliverable over the other,” said Can Ahtam, a professional photographer who joined Instagram more than a decade ago. “So all of us did feel the impact of reach being lower with the photos we were sharing [on Instagram].”

    Ahtam added: “If we were to compare them side-by-side right now, Lemon8 would have the upper hand in photos being shared.”

    Lemon8’s userbase remains a far cry from the 150 million users TikTok says it has in the United States.

    Still, in videos reviewing Lemon8, some creators have pondered whether the app could ultimately function as a replacement if TikTok were to get banned in the United States, preserving the content recommendation algorithm that helped make TikTok one of the country’s most popular apps and launched the careers of countless influencers.

    But if TikTok were to go down, Lemon8 would likely go with it, according to James Lewis, director of the strategic technologies program at the Center for Strategic and International Studies.

    “The concern is still the same, which is that ByteDance is a Chinese company subject to Chinese law,” Lewis said. “If it collects [users’ personal] information, then you’ve got the same problem.”

    TikTok, for its part, has said that its app does not pose a risk to US users, and that the Chinese government has never asked for US user data.

    The practical ramifications for creators of a TikTok (and, perhaps by extension, Lemon8) ban — if one were enacted — would still likely be months away, if not more. Lewis said he doesn’t expect any nationwide legislation to be passed before the end of this year, and it would almost certainly face legal challenges that could drag out its implementation if it did.

    By launching a new app even with TikTok in the spotlight, “ByteDance clearly doesn’t feel like they’re at risk,” Lewis said. And many creators say they’re not necessarily worried either.

    Even if TikTok and Lemon8 were banned, Cruz said, “I already have a following on all the other platforms.”

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  • Fertility app fined $200,000 for leaking customer’s health data | CNN Business

    Fertility app fined $200,000 for leaking customer’s health data | CNN Business

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    CNN
     — 

    The company behind a popular fertility app has agreed to pay $200,000 in federal and state fines after authorities alleged that it had shared users’ personal health information for years without their consent, including to Google and to two companies based in China.

    The app, known as Premom, will also be banned from sharing personal health information for advertising purposes and must ensure that the data it shared without users’ consent is deleted from third-party systems, according to the Federal Trade Commission, along with the attorneys general of Connecticut, the District of Columbia and Oregon.

    Wednesday’s proposed settlement targeting Premom highlights how regulators have stepped up their scrutiny of fertility trackers and health information in the wake of the US Supreme Court’s decision last year striking down federal protections for abortion.

    The sharing of personal data allegedly affected Premom’s hundreds of thousands of users from at least 2018 until 2020, and violated a federal regulation known as the Health Breach Notification Rule, according to an FTC complaint against Easy Healthcare, Premom’s parent company.

    Premom didn’t immediately respond to a request for comment.

    As part of the alleged violation, Premom collected and shared personally identifiable health information with Google and with a third-party marketing firm in violation of Premom’s own privacy policy, which had promised to share only “non-identifiable data” with others, according to the complaint.

    In addition, Premom allegedly shared location information and device identifiers — such as WiFi network names and hardware IDs — with two China-based data analytics companies, known as Jiguang and Umeng, according to the complaint. That information, the FTC alleged, “could be used to identify Premom’s users and disclose to third parties that these users were utilizing a fertility app,” according to an FTC complaint filed against Easy Healthcare, Premom’s parent company.

    Since the Supreme Court’s decision in Dobbs v. Jackson, a wave of anti-abortion legislation has raised the prospect that fertility apps, search engines and other technology platforms could be forced to hand over user data in potential prosecutions of abortion-seekers.

    “Now more than ever, with reproductive rights under attack across the country, it is essential that the privacy of healthcare decisions is vigorously protected,” said DC Attorney General Brian Schwalb in a statement. “My office will continue to make sure companies protect consumers’ personal information to protect against unlawful encroachment on access to effective reproductive healthcare.”

    Samuel Levine, director of the FTC’s consumer protection bureau, said the agency “will not tolerate health privacy abuses.”

    “Premom broke its promises and compromised consumers’ privacy,” Levine said in a statement. “We will vigorously enforce the Health Breach Notification Rule to defend consumer’s health data from exploitation.”

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  • This could be Apple’s biggest product launch since the Apple Watch | CNN Business

    This could be Apple’s biggest product launch since the Apple Watch | CNN Business

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    CNN
     — 

    Apple may be just one day away from unveiling its most ambitious new hardware product in years.

    At its Worldwide Developers Conference, which kicks off Monday at its Cupertino, California, campus, Apple

    (AAPL)     is widely expected to introduce a “mixed reality” headset that offers both virtual reality and augmented reality, a technology that overlays virtual images on live video of the real world.

    The highly anticipated release of an AR/VR headset would be Apple’s biggest hardware product launch since the debut of the Apple Watch in 2015. It could signal a new era for the company and potentially revolutionize how millions interact with computers and the world around them.

    But the headset is just one of many announcements expected at the developers event. Apple will also show off a long list of software updates that will shape how people use its most popular devices, including the iPhone and Apple Watch.

    Apple may also tease how it plans to incorporate AI into more of its products and services, and keep pace with a renewed arms race over the technology in Silicon Valley.

    The event will be livestreamed on Apple’s website and YouTube. It is set to start at 10:00 a.m. PT/1:00 p.m. ET.

    Here’s a closer look at what to expect:

    For years, Apple CEO Tim Cook has expressed interest in augmented reality. Now Apple finally appears ready to show off what it’s been working on.

    According to Bloomberg, the new headset, which could be called Reality One or Reality Pro, will have an iOS-like interface, display immersive video and include cameras and sensors to allow users to control it via their hands, eye movements and with Siri. The device is also rumored to have an outward-facing display that will show eye movements and facial expressions, allowing onlookers to interact with the person wearing the headset without feeling as though they’re talking to a robot.

    Apple’s new headset is expected to pack apps for gaming, fitness and meditation, and offer access to iOS apps such as Messages, FaceTime and Safari, according to Bloomberg. With the FaceTime option, for example, the headset will “render a user’s face and full body in virtual reality,” to create the feeling that both are “in the same room.”

    The decision to unveil it at WWDC suggests Apple wants to encourage developers to build apps and experiences for the product in order to make it more compelling for customers and worth the hefty price tag.

    The company is reportedly considering a $3,000 price tag for the device, far more than most of its products and testing potential buyers at a time of lingering uncertainty in the global economy. Other tech companies have struggled to find mainstream traction for headsets. And in the years that Apple has been rumored to be working on the product, the tech community has shifted its focus from VR to another buzzy technology: artificial intelligence.

    But if any company can prove skeptics wrong, it’s Apple. The company’s entry into the market combined with its vast customer base has the potential to breathe new life into the world of headsets.

    A mixed reality headset may not be the only piece of hardware to get stage time this year.

    Apple is expected to launch a new 15-inch MacBook Air packing the company’s M2 processor. The current size of the MacBook Air is 13 inches.

    Previously, users who wanted a larger-sized Apple laptop would need to buy a higher-end MacBook Pro.

    Considering WWDC is traditionally a software event, Apple executives will likely spend much of the time highlighting the changes and upgrades coming to its next-generation mobile operating systems, iOS 17 and iPadOS 17.

    While last year’s updates included a major design overhaul of the lock screen and iMessage, only minor changes are expected this year.

    With iOS 17, Apple is expected to double down on its efforts around health tracking by adding the ability to monitor everything from a user’s mood to keeping tabs on how their vision may change over time. According to the Wall Street Journal, Apple will also launch a journaling app not only as a way for users to log their thoughts but also activity levels, which can then be analyzed to reveal how much time someone spends at home or out of the house.

    The new iOS 17 is also said to get a lock screen refresh: When positioned in horizontal mode, the display will highlight widgets tied to the calendar, weather and other apps, serving as a digital hub. (iPadOS 17 is also expected to get some of the same lock screen capabilities and health features.)

    Other anticipated upgrades include an Apple Watch OS update that would focus on quick glances at widgets, and more details about its next-generation CarPlay platform, which it initially teased last year.

    While much of the focus of the event may be on VR, Apple may also attempt to show how it’s keeping pace with Silicon Valley’s current obsession: artificial intelligence.

    Apple reportedly plans to preview an AI-powered digital coaching service, which will encourage people to exercise and improve their sleeping and eating habits. It’s unclear how it could work, but the effort comes at a time when Big Tech companies are racing to introduce AI-powered technologies in the wake of ChatGPT’s viral success.

    Apple may also demo and expand on some of its recently teased accessibility tools for the iPhone and iPad, including a feature that promises to replicate a user’s voice for phone calls after only 15 minutes of training.

    Most of the other Big Tech companies have recently outlined their AI strategies. This event may be Apple’s chance to do the same.

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  • Forget about the AI apocalypse. The real dangers are already here | CNN Business

    Forget about the AI apocalypse. The real dangers are already here | CNN Business

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    CNN
     — 

    Two weeks after members of Congress questioned OpenAI CEO Sam Altman about the potential for artificial intelligence tools to spread misinformation, disrupt elections and displace jobs, he and others in the industry went public with a much more frightening possibility: an AI apocalypse.

    Altman, whose company is behind the viral chatbot tool ChatGPT, joined Google DeepMind CEO Demis Hassabis, Microsoft’s CTO Kevin Scott and dozens of other AI researchers and business leaders in signing a one-sentence letter last month stating: “Mitigating the risk of extinction from AI should be a global priority alongside other societal-scale risks such as pandemics and nuclear war.”

    The stark warning was widely covered in the press, with some suggesting it showed the need to take such apocalyptic scenarios more seriously. But it also highlights an important dynamic in Silicon Valley right now: Top executives at some of the biggest tech companies are simultaneously telling the public that AI has the potential to bring about human extinction while also racing to invest in and deploy this technology into products that reach billions of people.

    The dynamic has played out elsewhere recently, too. Tesla CEO Elon Musk, for example, said in a TV interview in April that AI could lead to “civilization destruction.” But he still remains deeply involved in the technology through investments across his sprawling business empire and has said he wants to create a rival to the AI offerings by Microsoft and Google.

    Some AI industry experts say that focusing attention on far-off scenarios may distract from the more immediate harms that a new generation of powerful AI tools can cause to people and communities, including spreading misinformation, perpetuating biases and enabling discrimination in various services.

    “Motives seemed to be mixed,” Gary Marcus, an AI researcher and New York University professor emeritus who testified before lawmakers alongside Altman last month, told CNN. Some of the execs are likely “genuinely worried about what they have unleashed,” he said, but others may be trying to focus attention on “abstract possibilities to detract from the more immediate possibilities.”

    Representatives for Google and OpenAI did not immediately respond to a request for comment. In a statement, a Microsoft spokesperson said: “We are optimistic about the future of AI, and we think AI advances will solve many more challenges than they present, but we have also been consistent in our belief that when you create technologies that can change the world, you must also ensure that the technology is used responsibly.”

    For Marcus, a self-described critic of AI hype, “the biggest immediate threat from AI is the threat to democracy from the wholesale production of compelling misinformation.”

    Generative AI tools like OpenAI’s ChatGPT and Dall-E are trained on vast troves of data online to create compelling written work and images in response to user prompts. With these tools, for example, one could quickly mimic the style or likeness of public figures in an attempt to create disinformation campaigns.

    In his testimony before Congress, Altman also said the potential for AI to be used to manipulate voters and target disinformation were among “my areas of greatest concern.”

    Even in more ordinary use cases, however, there are concerns. The same tools have been called out for offering wrong answers to user prompts, outright “hallucinating” responses and potentially perpetuating racial and gender biases.

    Gary Marcus, professor emeritus at New York University, right, listens to Sam Altman, chief executive officer and co-founder of OpenAI, speak during a Senate Judiciary Subcommittee hearing in Washington, DC, US, on Tuesday, May 16, 2023. Congress is debating the potential and pitfalls of artificial intelligence as products like ChatGPT raise questions about the future of creative industries and the ability to tell fact from fiction.

    Emily Bender, a professor at the University of Washington and director of its Computational Linguistics Laboratory, told CNN said some companies may want to divert attention from the bias baked into their data and also from concerning claims about how their systems are trained.

    Bender cited intellectual property concerns with some of the data these systems are trained on as well as allegations of companies outsourcing the work of going through some of the worst parts of the training data to low-paid workers abroad.

    “If the public and the regulators can be focused on these imaginary science fiction scenarios, then maybe these companies can get away with the data theft and exploitative practices for longer,” Bender told CNN.

    Regulators may be the real intended audience for the tech industry’s doomsday messaging.

    As Bender puts it, execs are essentially saying: “‘This stuff is very, very dangerous, and we’re the only ones who understand how to rein it in.’”

    Judging from Altman’s appearance before Congress, this strategy might work. Altman appeared to win over Washington by echoing lawmakers’ concerns about AI — a technology that many in Congress are still trying to understand — and offering suggestions for how to address it.

    This approach to regulation would be “hugely problematic,” Bender said. It could give the industry influence over the regulators tasked with holding it accountable and also leave out the voices and input of other people and communities experiencing negative impacts of this technology.

    “If the regulators kind of orient towards the people who are building and selling the technology as the only ones who could possibly understand this, and therefore can possibly inform how regulation should work, we’re really going to miss out,” Bender said.

    Bender said she tries, at every opportunity, to tell people “these things seem much smarter than they are.” As she put it, this is because “we are as smart as we are” and the way that we make sense of language, including responses from AI, “is actually by imagining a mind behind it.”

    Ultimately, Bender put forward a simple question for the tech industry on AI: “If they honestly believe that this could be bringing about human extinction, then why not just stop?”

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  • ‘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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  • Foxconn pulls out of $19 billion chipmaking project in India | CNN Business

    Foxconn pulls out of $19 billion chipmaking project in India | CNN Business

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    Hong Kong
    CNN
     — 

    Foxconn says it is exiting an ambitious project to help build one of India’s first chip factories.

    The world’s largest contract electronics maker will “no longer move forward” with its $19.4 billion joint venture with Vedanta

    (VEDL)    , an Indian metals and energy conglomerate, in Asia’s third largest economy, it said Monday.

    The news was seen as a blow to the Indian government’s plans to turn the country into a tech manufacturing powerhouse, even as officials have sought to counter that view.

    In a statement to CNN, Foxconn, a Taiwanese tech giant best known for being one of Apple

    (AAPL)    ’s top suppliers, said the decision was based on “mutual agreement” and allowed the company “to explore more diverse development opportunities.”

    The joint venture will now be wholly owned by Vedanta.

    In a followup statement Tuesday, Foxconn reaffirmed its commitment to invest in Indian chipmaking, saying it will apply for a government program that subsidizes the cost of setting up semiconductor or electronic display production facilities in the country.

    “Building fabs from scratch in a new geography is a challenge, but Foxconn is committed to invest in India,” the company said, referring to fabrication plants, the technical term for semiconductor factories.

    “There was recognition from both sides that the project was not moving fast enough, there were challenging gaps we were not able to smoothly overcome, as well as external issues unrelated to the project,” it said.

    Since announcing the deal in February 2022, Foxconn said it had worked with Vedanta on plans to set up a semiconductor plant in the country that would support a wider ecosystem for manufacturers.

    It did not provide an investment figure for the facility, but Indian Prime Minister Narendra Modi tweeted in September that the total investment would amount to 1.54 trillion rupees, which was then equivalent to $19.4 billion.

    Foxconn said last year it was actively scouting for locations for the plant and held discussions with “a few state governments.”

    Foxconn CEO Young Liu has in recent months courted Indian partners, having traveled there in February to seek new collaborators.

    The company, which already has factories in the Indian states of Andhra Pradesh and Tamil Nadu, is one of many global tech firms looking for opportunities in the country, particularly as multinationals seek to diversify their supply chains beyond China.

    On Monday, India’s electronics and information technology minister Ashwini Vaishnaw told Indian news outlet and CNN affiliate News18 that both Vedanta and Foxconn are “completely committed to India’s semiconductor mission.”

    Rajeev Chandrasekhar, the country’s minister of state for electronics and IT, also tweeted that the news “changes nothing about” India’s semiconductor manufacturing goals, adding that the decision would still allow “both companies to independently pursue their strategies” in India.

    The project had been hailed as a milestone in India’s campaign to attract more investment in manufacturing, a sector sorely needed to help ease unemployment.

    Prime Minister Modi had framed the project as a significant boost for the economy and jobs.

    Foxconn shares rose 1.3% in Taipei on Tuesday following its announcement, while Vedanta’s shares fell 1.4% in Mumbai. The latter has not responded to a request for comment.

    Other prominent tech companies have moved to expand production in India recently.

    Last month, US chipmaker Micron

    (MICR)     announced a new factory in the western state of Gujarat, calling it the country’s first semiconductor assembly and test manufacturing facility.

    The venture will see Micron invest up to $825 million, and create “up to 5,000 new direct Micron jobs and 15,000 community jobs over the next several years,” according to the company.

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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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  • Opinion: Utah’s startling new rules for kids and social media | CNN

    Opinion: Utah’s startling new rules for kids and social media | CNN

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    Editor’s Note: Kara Alaimo, an associate professor of communication at Fairleigh Dickinson University, writes about issues affecting women and social media. Her book, “Over the Influence: Why Social Media Is Toxic for Women and Girls — And How We Can Reclaim It,” will be published by Alcove Press in 2024. The opinions expressed in this commentary are her own. Read more opinion on CNN.



    CNN
     — 

    Utah’s Republican governor, Spencer Cox, recently signed two bills into law that sharply restrict children’s use of social media platforms. Under the legislation, which takes effect next year, social media companies have to verify the ages of all users in the state, and children under age 18 have to get permission from their parents to have accounts.

    Parents will also be able to access their kids’ accounts, apps won’t be allowed to show children ads, and accounts for kids won’t be able to be used between 10:30 p.m. and 6:30 a.m. without parental permission.

    It’s about time. Social networks in the United States have become potentially incredibly dangerous for children, and parents can no longer protect our kids without the tools and safeguards this law provides. While Cox is correct that these measures won’t be “foolproof,” and what implementing them actually looks like remains an open question, one thing is clear: Congress should follow Utah’s lead and enact a similar law to protect every child in this country.

    One of the most important parts of Utah’s law is the requirement for social networks to verify the ages of users. Right now, most apps ask users their ages without requiring proof. Children can lie and say they’re older to avoid some of the features social media companies have created to protect kids — like TikTok’s new setting that asks 13- to 17-year-olds to enter their passwords after they’ve been online for an hour, as a prompt for them to consider whether they want to spend so much time on the app.

    While critics argue that age verification allows tech companies to collect even more data about users, let’s be real: These companies already have a terrifying amount of intimate information about us. To solve this problem, we need a separate (and comprehensive) data privacy law. But until that happens, this concern shouldn’t stop us from protecting kids.

    One of the key components of this legislation is allowing parents access to their kids’ accounts. By doing this, the law begins to help address one of the biggest dangers kids face online: toxic content. I’m talking about things like the 2,100 pieces of content about suicide, self-harm and depression that 14-year-old Molly Russell in the UK saved, shared or liked in the six months before she killed herself last year.

    I’m also talking about things like the blackout challenge — also called the pass-out or choking challenge — that has gone around social networks. In 2021, four children 12 or younger in four different states all died after trying it.

    “Check out their phones,” urged the father of one of these young victims. “It’s not about privacy — this is their lives.”

    Of course, there are legitimate privacy concerns to worry about here, and just as kids’ use of social media can be deadly, social apps can also be used in healthy ways. LGBTQ children who aren’t accepted in their families or communities, for example, can turn online for support that is good for their mental health. Now, their parents will potentially be able to see this content on their accounts.

    I hope groups that serve children who are questioning their gender and sexual identities and those that work with other vulnerable youth will adapt their online presences to try to serve as resources for educating parents about inclusivity and tolerance, too. This is also a reminder that vulnerable children need better access to mental health services like therapy — they’re way too young to be left to their own devices to seek out the support they need online.

    But, despite these very real privacy concerns, it’s simply too dangerous for parents not to know what our kids are seeing on social media. Just as parents and caregivers supervise our children offline and don’t allow them to go to bars or strip clubs, we have to ensure they don’t end up in unsafe spaces on social media.

    The other huge challenge the Utah law helps parents overcome is the amount of time kids are spending on social media. A 2022 survey by Common Sense Media found that the average 8- to 12-year-old is on social media for 5 hours and 33 minutes per day, while the average 13- to 18 year-old spends 8 hours and 39 minutes every day. That’s more time than a full time-job.

    The American Academy of Pediatrics warns that lack of sleep is associated with serious harms in children — everything from injuries to depression, obesity and diabetes. So parents in the US need to have a way to make sure their kids aren’t up on TikTok all night (parents in China don’t have to worry about this because the Chinese version of TikTok doesn’t allow kids to stay on for more than 40 minutes and isn’t useable overnight).

    Of course, Utah isn’t an authoritarian state like China, so it can’t just turn off kids’ phones. That’s where this new law comes in requiring social networks to implement these settings. The tougher part of Utah’s law for tech companies to implement will be a provision requiring social apps to ensure they’re not designed to addict kids.

    Social networks are arguably addictive by nature, since they feed on our desires for connection and validation. But hopefully the threat of being sued by children who say they’ve been addicted or otherwise harmed by social networks — an outcome for which this law provides an avenue — will force tech companies to think carefully about how they build their algorithms and features like bottomless feeds that seem practically designed to keep users glued to their screens.

    TikTok and Snap didn’t respond to requests for comment from CNN about Utah’s law, while a representative for Meta, Facebook’s parent company, said the company shares the goal to keep Facebook safe for kids but also wants it to be accessible.

    Of course, if social networks had been more responsible, it probably wouldn’t have come to this. But in the US, tech companies have taken advantage of a lack of rules to build platforms that can be dangerous for our kids.

    States are finally saying no more. In addition to Utah’s measures, California passed a sweeping online safety law last year. Connecticut, Ohio and Arkansas are also considering laws to protect kids by regulating social media. A bill introduced in Texas wouldn’t allow kids to use social media at all.

    There’s nothing innocent about the experiences many kids are having on social media. This law will help Utah’s parents protect their kids. Parents in other states need the same support. Now, it’s time for the federal government to step up and ensure children throughout the country have the same protections as Utah kids.

    Suicide & Crisis Lifeline: Call or text 988. The Lifeline provides 24/7, free and confidential support for people in distress, prevention and crisis resources for you and your loved ones, and best practices for professionals in the United States. En Español: Linea de Prevencion del Suidio y Crisis: 1-888-628-9454.

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  • Man accused of killing Cash App founder Bob Lee intends to plead not guilty next week, his attorney says | CNN Business

    Man accused of killing Cash App founder Bob Lee intends to plead not guilty next week, his attorney says | CNN Business

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    CNN
     — 

    Nima Momeni, the man accused of killing Cash App founder Bob Lee in San Francisco, intends to plead not guilty next week, his attorney said.

    Momeni was to be arraigned on a murder charge Tuesday but that was put off until May 2 after defense attorney Paula Canny asked for more time to prepare.

    Canny told reporters after the hearing that her client also will deny the special allegation of using a knife in the crime.

    Lee, who cofounded the mobile payment service provider Cash App, was stabbed to death in the Rincon Hill neighborhood early on April 4.

    Authorities have said Momeni, 38, of Emeryville, California, and Lee knew each other and they were in a vehicle shortly before the stabbing.

    The district attorney’s office has indicated that the stabbing may have been premeditated.

    “This is a person who was in his vehicle with a kitchen knife,” San Francisco District Attorney Brooke Jenkins said earlier this month. “That’s not something most of us carry around at all times with us.”

    Canny said she believes she has evidence to support Momeni’s innocence.

    The attorney says she has seen surveillance videos in the case but is still awaiting police reports and the full autopsy report. “I don’t think you can see anything” in the video, Canny said.

    Jenkins said Tuesday autopsy reports typically take about 60 days and, in this case, the report is not yet ready.

    “We believe that we have sufficient evidence to prove beyond a reasonable doubt that Mr. Momeni murdered Bob Lee,” Jenkins said.

    Canny told station KNTV nearly two weeks ago that there is a “much greater back story” than what has been disclosed.

    California Secretary of State records indicate that Momeni has been the owner of an IT business. He has been held without bail since his arrest nearly two weeks ago.

    Canny said she believes her client is not a danger to the community or a flight risk and will push for bail to be set. Jenkins disagreed. “Certainly somebody that we believe committed murder is an extreme threat to public safety.”

    About 20 of Momeni’s family members, including his two teenage children, were in court for the hearing.

    Documents from the district attorney’s office have laid out what authorities say preceded the stabbing.

    A motion to detain document cites a witness interviewed by police and security camera footage, offering a detailed timeline of where Lee and Momeni were.

    A witness, described as a close friend of Lee’s, said he went over to an apartment after being invited by Lee on April 3, where Lee was drinking with a woman later identified as Momeni’s sister, the document states.

    The witness told police the woman was married but her “relationship was possibly in jeopardy,” and the witness was unsure whether the woman and Lee had an intimate relationship, according to the document. Lee later told the witness that they were going to go to his hotel room, where he invited the woman but she declined.

    While at the hotel room, the witness said Lee was having a conversation with Momeni, which involved Momeni saying he was picking up his sister from the apartment Lee and the witness were previously at, according to the document. Momeni asked Lee “whether his sister was doing drugs or anything inappropriate,” the document states. Lee had told Momeni nothing inappropriate happened, according to the document.

    After the conversation with Momeni, Lee and the witness went to Lee’s apartment until about 12:30 a.m. on April 4, when Lee left, the document says.

    Surveillance footage shows Momeni arriving at his sister’s apartment building in a white BMW around 8:30 p.m. on April 3, and later shows Lee entering the building around 12:39 a.m. on April 4. A little after 2 a.m., security footage shows Lee and Momeni entering an elevator together and getting into Momeni’s BMW. Additional footage from the area shows the two driving in the car together.

    Video then shows the BMW drive to a “dark and secluded area” on Main Street, just out of view for the video to see the interaction between the two men, per the document.

    Eventually, the two subjects, who are unidentifiable by their faces but seem to be wearing the same clothing, appear back in frame. After about five minutes, the subject wearing a white-colored top, consistent with what Momeni appeared to be wearing, “suddenly move(s) toward the other subject,” the document says. The two subjects then separate.

    The subject in dark-colored clothing, who authorities believe to be Lee, walks northbound, while the subject in the light-colored clothing walks south and stops along a fence, where a knife was ultimately recovered, the document says. The BMW then “leaves at a high rate of speed,” the document states.

    An autopsy later found Lee was “stabbed three separate times, once in the hip and twice in the chest,” according to the documents. One of the stab wounds “directly penetrated” Lee’s heart, causing his death.

    A kitchen knife was found near the scene, District Attorney Jenkins said in a news conference, adding the department had “proof beyond a reasonable doubt that (Momeni) committed murder.”

    On April 11, investigators found a text message from Momeni’s sister to Lee that showed the sister checking in on Lee, according to the motion to detain document. The text message, per the document, stated: “Just wanted to make sure your doing ok Cause I know nima came wayyyyyy down hard on you And thank you for being such a classy man handling it with class.”

    Meanwhile, additional details in an August 2022 incident involving a woman and Momeni were made available in a police report, the San Francisco Chronicle reported Monday.

    Police in Emeryville cited and released Momeni on a misdemeanor battery charge after a woman reported he attacked her, the newspaper reported, citing documents obtained in a public records request. CNN has requested the documents and reached out to Emeryville police.

    The woman, whose name was redacted from the report, and Momeni reportedly got into an argument the afternoon of August 1, 2022, according to the police report.

    Momeni denied the allegation when questioned by responding officers.

    The woman told police that Momeni was prone to behavior shifts, the Chronicle reported, telling them that “one minute he will be fine and the next he will go off for no reason.”

    In a statement to CNN on Monday, Momeni’s attorney Canny said, “It is only a police report.”

    “There was no arrest. There was no case filed – the Alameda County District Attorney refused to prosecute,” she said.

    The Alameda County District Attorney’s office confirmed to CNN last week it did not file charges but declined to say why or give more detail.

    In the police report, the woman said she met Momeni a week earlier and he allowed her to stay on his couch in exchange for cleaning the residence, the Chronicle says, adding she told officers that she and Momeni were not dating.

    The woman told police that earlier in the day, she had been in the loft’s kitchen when Momeni came downstairs and yelled for her to collect her belongings and leave, the Chronicle reports.

    “Momeni forcefully grabbed her right upper arm and her right side waist area,” Officer Johnson wrote in the report, according to the Chronicle. “He then pushed her against a counter.”

    He denied the allegation to police, according to the newspaper, and a roommate told police that he didn’t see violence and that the woman appeared to be the aggressor.

    Momeni told officers he wanted to pursue charges against the woman for pushing him the day before when they had also argued, the report says, according to the Chronicle.

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  • Microsoft opens up its AI-powered Bing to all users | CNN Business

    Microsoft opens up its AI-powered Bing to all users | CNN Business

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    CNN
     — 

    Microsoft is rolling out the new AI-powered version of its Bing search engine to anyone who wants to use it.

    Nearly three months after the company debuted a limited preview version of its new Bing, powered by the viral AI chatbot ChatGPT, Microsoft is opening it up to all users without a waitlist – as long as they’re signed into the search engine via Microsoft’s Edge browser.

    The move highlights Microsoft’s commitment to move forward with the product even as the AI technology behind it has sparked concerns around inaccuracies and tone. In some cases, people who baited the new Bing were subject to some emotionally reactive and aggressive responses.

    “We’re getting better at speed, we’re getting better at accuracy … but we are on a never-ending quest to make things better and better,” Yusuf Mehdi, a VP at Microsoft overseeing its AI initiatives, told CNN on Wednesday.

    Bing now gets more than 100 million daily active users each day, a significant uptick in the past few months, according to Mehdi. Google, which has long dominated the market, is also adding similar AI features to its search engine.

    In February, Microsoft showed off how its revamped search engine could write summaries of search results, chat with users to answer additional questions about a query and write emails or other compositions based on the results.

    At a press event in New York City on Wednesday, the company shared an early look at some updates, including the ability to ask questions with pictures, access chat history so the chatbot remembers its rapport with users, and export responses to Microsoft Word. Users can also personalize the tone and style of the chatbot’s responses, selecting from a lengthier, creative reply to something that’s shorter and to the point.

    The wave of attention in recent months around ChatGPT, developed by OpenAI with financial backing from Microsoft, helped renew an arms race among tech companies to deploy similar AI tools in their products. OpenAI, Microsoft and Google are at the forefront of this trend, but IBM, Amazon, Baidu and Tencent are working on similar technologies. A long list of startups are also developing AI writing assistants and image generators.

    Beyond adding AI features to search, Microsoft has said it plans to bring ChatGPT technology to its core productivity tools, including Word, Excel and Outlook, with the potential to change the way we work. The decision to add generative AI features to Bing could be particularly risky, however, given how much people rely on search engines for accurate and reliable information.

    Microsoft’s moves also come amid heightened scrutiny on the rapid pace of advancement in AI technology. In March, some of the biggest names in tech, including Elon Musk and Apple co-founder Steve Wozniak, called for artificial intelligence labs to stop the training of the most powerful AI systems for at least six months, citing “profound risks to society and humanity.”

    Mehdi said he doesn’t believe the AI industry is moving too fast and suggested the calls for a pause aren’t particularly helpful.

    “Some people think we should pause development for six months but I’m not sure that fixes anything or improves or moves things along,” he said. “But I understand where it’s coming from concern wise.”

    He added: “The only way to really build this technology well is to do it out in the open in the public so we can have conversations about it.”

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  • US senator introduces bill to create a federal agency to regulate AI | CNN Business

    US senator introduces bill to create a federal agency to regulate AI | CNN Business

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    Washington
    CNN
     — 

    Days after OpenAI CEO Sam Altman testified in front of Congress and proposed creating a new federal agency to regulate artificial intelligence, a US senator has introduced a bill to do just that.

    On Thursday, Colorado Democratic Sen. Michael Bennet unveiled an updated version of legislation he introduced last year that would establish a Federal Digital Platform Commission.

    The updated bill, which was reviewed by CNN, makes numerous changes to more explicitly cover AI products, including by amending the definition of a digital platform to include companies that offer “content primarily generated by algorithmic processes.”

    “There’s no reason that the biggest tech companies on Earth should face less regulation than Colorado’s small businesses – especially as we see technology corrode our democracy and harm our kids’ mental health with virtually no oversight,” Bennet said in a statement. “Technology is moving quicker than Congress could ever hope to keep up with. We need an expert federal agency that can stand up for the American people and ensure AI tools and digital platforms operate in the public interest.”

    The revised bill expands on the definition of an algorithmic process, clarifying that the proposed commission would have jurisdiction over the use of personal data to generate content or to make a decision — two key applications associated with generative AI, the technology behind popular tools such as OpenAI’s viral chatbot, ChatGPT.

    And for the most significant platforms — companies the bill calls “systemically important” — the bill would create requirements for algorithmic audits and public risk assessments of the harms their tools could cause.

    The bill retains existing language mandating that the commission ensure platform algorithms are “fair, transparent, and safe.” And under the bill, the commission would continue to have broad oversight authority over social media sites, search engines and other online platforms.

    But the added emphasis on AI highlights how Congress is rapidly gearing up for policymaking on a cutting-edge technology it is scrambling to understand. The debate over whether the US government should establish a separate federal agency to police AI tools may become a significant focus of those efforts following Altman’s testimony this week.

    Altman suggested in a Senate hearing on Tuesday that such an agency could restrict how AI is developed through licenses or credentialing for AI companies. Some lawmakers appeared receptive to the idea, with Louisiana Republican Sen. John Kennedy even asking Altman whether he would be open to serving as its chair.

    “I love my current job,” Altman demurred, to laughter from the audience.

    Thursday’s bill does not explicitly provide for such a licensing program, though it directs the would-be commission to design rules appropriate for overseeing the industry, according to a Bennet aide. Bennet’s office did not consult with OpenAI on either the original bill or Thursday’s revised version.

    But even as some lawmakers have embraced the concept of a specialized regulator for internet companies — which could conflict with existing cops on the beat at agencies including the Justice Department and the Federal Trade Commission — others have warned of the potential risks of creating a whole new bureaucracy.

    Gary Marcus, a New York University professor and self-described critic of AI “hype,” told lawmakers at Tuesday’s hearing that a separate agency could fall victim to “regulatory capture,” a term that describes when industries gain dominating influence over the government agencies created to hold them accountable.

    Connecticut Democratic Sen. Richard Blumenthal, a former state attorney general who has prosecuted consumer protection cases, said no agency can be effective without proper support.

    “I’ve been doing this stuff for a while,” Blumenthal said. “You can create 10 new agencies, but if you don’t give them the resources — and I’m not just talking about dollars, I’m talking about scientific expertise — [industry] will run circles around them.”

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  • I tried Apple’s new headset. Here’s what it’s like to use | CNN Business

    I tried Apple’s new headset. Here’s what it’s like to use | CNN Business

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    CNN
     — 

    It’s rare to find a new technology that feels groundbreaking. But last night, while sitting on a couch in a private demo room at Apple’s campus wearing its newly announced Vision Pro mixed reality headset, it felt like I’d seen the future — or at least an early and very pricey prototype of it.

    In the demo, which lasted 30 minutes, a virtual butterfly landed on my finger; a dinosaur with detailed scales tried to bite me; and I stood inches away from Alicia Keys’ piano as she serenaded me in a recording studio. When a small bear cub swam by me on a quiet lake during another immersive video, it felt so real that it reminded me of an experience with a loved one who recently passed away. I couldn’t wipe the tears inside my headset.

    Apple unveiled the headset, its most ambitious and riskiest new hardware offering in years, at a developer event earlier in the day. The headset blends both virtual reality and augmented reality, a technology that overlays virtual images on live video of the real world. At the event, Apple CEO Tim Cook touted the Vision Pro as a “revolutionary product,” with the potential to change how users interact with technology, each other and the world around them. He called it “the first product you look through, not at.”

    But it’s clearly a work in progress. The apps and experiences remain limited; users must stay tethered to a battery pack the size of an iPhone with just two hours of battery life; and the first minutes using the device can be off-putting. Apple also plans to charge $3,499 for the device when it goes on sale early next year – more than had been rumored and far more than other headsets on the market that have previously struggled to gain wide adoption.

    With its loyal following and impressive track record on hardware, Apple may be able to convince developers, early adopters and some enterprise customers to pay up for the device. But if it wants to attract a more mainstream audience, it will need a “killer app,” as the industry often refers to it -— or several.

    Based on my demo, Apple still has a long way to go, but it’s off to a compelling start.

    Hours after the keynote event, I arrived at a building on Apple’s sprawling Cupertino, California, campus specifically constructed to stage demos and briefings for the new headset.

    I was met by an Apple employee who scanned my face to help customize the fit of the headset. Then I entered a small room where an optometrist asked if I wore glasses or corrective lenses. I had gotten Lasik surgery years ago, but others around me had their glasses scanned so the headset could present their specific prescription. It’s an incredible feat that differentiates Apple from competitors and ensures no frames need to be squeezed into the headset. But it’s unclear how the company plans to handle this process at scale if millions buy the device.

    The initial setup process was somewhat unpleasant: I felt a little nauseous and claustrophobic as I adjusted to the device. It tracked my eyes, scanned my hands and mapped the room to better tailor the augmented reality experience.

    But Apple has also taken steps to reduce the motion sickness problem that has plagued other headsets. The headset uses an R1 processor, a custom chip that cuts down on the latency issue found in similar products that can result in nausea.

    As many viewers were quick to point out on Monday, the headset itself looks like a pair of designer ski goggles. It features a soft adjustable strap on the top, a “digital crown” on the back – a bigger version than what you’d find on an Apple Watch – and another digital crown on the top that serves as a kind of home button. There’s also a wire connecting to an external battery pack.

    The headset itself felt light enough in the beginning, but even with Apple’s considerable design chops, I never shook the idea that there was a computer on my face. Fortunately, unlike other computing products, the headset did remain cool on my face throughout the experience, thanks largely to a quiet fan and airflow running through the system

    Unlike other headsets, the new mixed reality headset also displays the eyes of its users on the outside, so “you’re never isolated from the people around you, you can see them and they can see you,” Alan Dye, vice president of human interface, said during the keynote.

    Sadly, I never got to see how my own eyes or anyone else’s looked through the headset during the demo.

    After putting on the device, I saw an iOS-like interface. I could easily hop in and out of apps, such as Messages, FaceTime, Safari and Photos, using just my eye movements and touching my thumb and pointer finger together to act as the “select” button. This was more intuitive than expected and worked even when my hands rested on my lap.

    Some app experiences were better than others, however. It was beautiful to see images in the Photos app presented before me in a larger than life manner, but it’s hard to imagine feeling the need to do this often on a couch back home. Vision Pro also offers a spatial photo option, which lets users view images and videos in 3D so you feel like you’re directly in the scene. Again, cool but unnecessary.

    During another demo, an Apple employee wearing a Vision Pro headset FaceTimed me from the other side of campus. Her “persona” – a digital representation which did not show her wearing the Vision Pro – appeared in front of me as we chatted about the event earlier in the day. She seemed real but it was clear she was not; she was a sort of pseudo-human. (Apple did not scan my face to create my own persona, which would otherwise be done through its OpticID security feature during the setup phase.)

    The Apple employee then shared a virtual whiteboard – dragging, dropping and highlighting interior design images. Cook has focused on AR’s potential to foster collaboration, and it’s clear how this tool could be used in meetings to fulfill that promise. What’s less clear is why most employers would spend $3,499 per device per employee to make this happen rather than simply use Zoom.

    Like so much else about the product unveiling, this pitch felt mistimed. Earlier in the pandemic, more people might have jumped at the chance to create these virtual experiences while we worked and socialized almost entirely from home. Now, with more employees back in the office and companies looking to cut costs amid broader economic uncertainty, the justification for this pricey device seemed less clear.

    The real magic of the Vision Pro, however, is in the immersive videos. Watching an underwater scene from Avatar 2 in 3D, for example, was surreal, seemingly placing me right in the ocean with these fictional creatures. It’s easy to imagine buy-in from Hollywood filmmakers to create experiences just for the headset.

    Apple is also uniquely positioned here to supercharge the device with these experiences. It has close relationships in the entertainment industry, including with former Apple board member and Disney CEO Bob Iger, who announced in a pre-recorded video during the event that Disney+ will be available on the headset at launch. Apple teased new National Geographic, Marvel and ESPN experiences for the headset, too.

    Almost every new Apple product, from the iPhone to the Apple Watch, promises to use screens of varying sizes to change how we live, work and interact with the world. The Vision Pro has the potential to do all of that in an even more striking way. But unlike the first time I picked up an iPhone or a smartatch, after 30 minutes of using Vision Pro, I was very content to put it down and return to the real world.

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  • Meta lowers the minimum age for its Quest headsets from 13 to 10 | CNN Business

    Meta lowers the minimum age for its Quest headsets from 13 to 10 | CNN Business

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    New York
    CNN
     — 

    Facebook-parent Meta plans to lower the minimum age for its virtual reality headsets from 13 years old to 10 years old, despite pressure from lawmakers not to market its VR services to younger users.

    Parents will be able to set up accounts for children as young as 10 years old on Meta’s Quest 2 and Quest 3 headsets starting later this year, the company said in a blog post Friday.

    Preteens will be required to get a parent’s approval to set up an account and download apps onto the device, according to the company. Meta said it will also use children’s ages to “provide age-appropriate experiences” such as recommending suitable apps.

    “There’s a vast array of engaging and educational apps, games, and more across our platform, the majority of which are rated for ages 10 and up,” Meta said in the post.

    The company’s push to lower the minimum age comes as Meta and other social media companies face growing scrutiny over their impact on young users, including their potential to harm teens’ mental health or lead them down harmful content rabbit holes.

    Parents and lawmakers have also specifically raised alarms about the use of VR — and the future version of the internet Meta calls the “metaverse” — by teens and children.

    Earlier this year, two Democratic senators urged Meta to suspend a plan to offer Horizon Worlds, the company’s flagship VR app, to teens between the ages of 13 and 17, arguing the technology could harm young users’ physical and mental health. The lawmakers, Massachusetts Sen. Ed Markey and Connecticut Sen. Richard Blumenthal, called Meta’s plan “unacceptable” in light of the company’s “record of failure to protect children and teens,” in a letter to CEO Mark Zuckerberg.

    But in April, Meta forged ahead with its plan to allow teens as young as 13 in the United States and Canada to use Horizon Worlds, prompting additional outcry from lawmakers and civil society groups.

    Parents told CNN last year about instances of discovering their children were viewing violent and disturbing content in VR and struggling to come up with ways to keep their kids safe.

    Meta is attempting to address some of parents’ concerns.

    In its Friday blog post, Meta said parents will be able to set time limits and enforce breaks for their preteens on the headsets. The accounts of users under 13 will be set to private and have their active status hidden on apps by default unless parents choose to change those settings. Meta also makes it possible to cast content from its VR headsets to a TV or phone screen, so parents can watch what their kids are seeing.

    Meta said it will not serve ads to users in this age group, and that parents can choose whether their child’s data can be used to improve the company’s services. Meta added on Friday that Horizon Worlds will remain restricted to users 13 and older in the United States and Canada (and 18 and older in Europe) when it allows preteens to create parent-manged accounts on the headsets later this year.

    Meta’s headset and Horizon Worlds represent Zuckerberg’s vision for a next-generation internet, where users can interact with each other in virtual spaces resembling real life. The company has so far struggled to attract a mainstream audience for these products.

    Update: This story has been updated to reflect Meta’s plan to continue restricting Horizon Worlds to users 13 and older.

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  • TSMC confirms supplier data breach following ransom demand by Russian-speaking cybercriminal group | CNN Business

    TSMC confirms supplier data breach following ransom demand by Russian-speaking cybercriminal group | CNN Business

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    CNN
     — 

    Taiwanese semiconductor giant TSMC confirmed Friday that one of its hardware suppliers was hacked and had data stolen from it, but said the incident had no impact on business operations.

    Confirmation of the breach came after Russian-speaking cybercriminals claimed TSMC as a victim on Thursday and demanded an extraordinary $70 million ransom from the semiconductor firm.

    There were no signs that TSMC or the hardware supplier, Taiwanese firm Kinmax, had any plans to pay the hackers (representatives from both companies didn’t respond to CNN’s questions about any ransom).

    TSMC — one of the world’s largest chipmakers and a key supplier to Apple

    (AAPL)     — was quick to assure investors and the public that the hack had no impact on its operations and that it did not compromise its customers’ data.

    “After the incident, TSMC has immediately terminated its data exchange with this concerned supplier in accordance with the Company’s security protocols and standard operating procedures,” TSMC said in a statement to CNN.

    The hackers accessed Kinmax’s internal “testing environment” for the technology it prepares to deliver to customers, Kinmax said in a statement distributed by TSMC.

    “The leaked content mainly consisted of system installation preparation that the Company provided to our customers as default configurations,” Kinmax said. The company apologized to customers whose names may show up in the leaked data.

    Ransomware groups are known to exaggerate the value of the data they steal and make outlandish demands that are never met.

    LockBit is the name of the group claiming responsibility for the hack of the TSMC supplier and the type of ransomware they use. LockBit ransomware was the most deployed ransomware around the world in 2022, according to US cybersecurity officials.

    Jon DiMaggio, an executive at security firm Analyst1 who has studied LockBit extensively, said the hackers will likely publish the stolen data or sell it if TSMC refuses to negotiate a ransom.

    For years, American officials and Taiwanese cybersecurity experts have looked to fortify the island’s infrastructure in the face of hacking threats.

    Taiwan’s chip industry is critical to the global hardware supply chain, making any potentially impactful cyberattacks on it a concern for government officials and business executives around the world.

    While the TSMC-related hacking incident doesn’t appear to have been impactful, a separate ransomware attack in 2020 on Taiwan’s state-run energy company temporarily disrupted some customers’ ability to pay for gas with company cards, according to local media reports at the time.

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  • Google hit with lawsuit alleging it stole data from millions of users to train its AI tools | CNN Business

    Google hit with lawsuit alleging it stole data from millions of users to train its AI tools | CNN Business

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    CNN
     — 

    Google was hit with a wide-ranging lawsuit on Tuesday alleging the tech giant scraped data from millions of users without their consent and violated copyright laws in order to train and develop its artificial intelligence products.

    The proposed class action suit against Google, its parent company Alphabet, and Google’s AI subsidiary DeepMind was filed in a federal court in California on Tuesday, and was brought by Clarkson Law Firm. The firm previously filed a similar suit against ChatGPT-maker OpenAI last month. (OpenAI did not previously respond to a request for comment on the suit.)

    The complaint alleges that Google “has been secretly stealing everything ever created and shared on the internet by hundreds of millions of Americans” and using this data to train its AI products, such as its chatbot Bard. The complaint also claims Google has taken “virtually the entirety of our digital footprint,” including “creative and copywritten works” to build its AI products.

    Halimah DeLaine Prado, Google’s general counsel, called the claims in the suit “baseless” in a statement to CNN. “We’ve been clear for years that we use data from public sources — like information published to the open web and public datasets — to train the AI models behind services like Google Translate, responsibly and in line with our AI Principles,” DeLaine Prado said.

    “American law supports using public information to create new beneficial uses, and we look forward to refuting these baseless claims,” the statement added.

    Alphabet and DeepMind did not immediately respond to a request for comment.

    The complaint points to a recent update to Google’s privacy policy that explicitly states the company may use publicly accessible information to train its AI models and tools such as Bard.

    In response to an earlier Verge report on the update, the company said its policy “has long been transparent” about this practice and “this latest update simply clarifies that newer services like Bard are also included.”

    The lawsuit comes as a new crop of AI tools have gained tremendous attention in recent months for their ability to generate written work and images in response to user prompts. The large language models underpinning this new technology are able to do this by training on vast troves of online data.

    In the process, however, companies are also drawing mounting legal scrutiny over copyright issues from works swept up in these data sets, as well as their apparent use of personal and possibly sensitive data from everyday users, including data from children, according to the Google lawsuit.

    “Google needs to understand that ‘publicly available’ has never meant free to use for any purpose,” Tim Giordano, one of the attorneys at Clarkson bringing the suit against Google, told CNN in an interview. “Our personal information and our data is our property, and it’s valuable, and nobody has the right to just take it and use it for any purpose.”

    The suit is seeking injunctive relief in the form of a temporary freeze on commercial access to and commercial development of Google’s generative AI tools like Bard. It is also seeking unspecified damages and payments as financial compensation to people whose data was allegedly misappropriated by Google. The firm says it has lined up eight plaintiffs, including a minor.

    Giordano contrasted the benefits and alleged harms of how Google typically indexes online data to support its core search engine with the new allegations of it scraping data to train AI tools.

    With its search engine, he said, Google can “serve up an attributed link to your work that can actually drive somebody to purchase it or engage with it.” Data scraping to train AI tools, however, is creating “an alternative version of the work that radically alters the incentives for anybody to need to purchase the work,” Giordano added.

    While some internet users may have grown accustomed to their digital data being collected and used for search results or targeted advertising, the same may not be true for AI training. “People could not have imagined their information would be used this way,” Giordano said.

    Ryan Clarkson, a partner at the law firm, said Google needs to “create an opportunity for folks to opt out” of having their data used for training AI while still maintaining their ability to use the internet for their everyday needs.

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  • Twitter’s rebrand is the next stage in Elon Musk’s vision for the company. But does anyone want it? | CNN Business

    Twitter’s rebrand is the next stage in Elon Musk’s vision for the company. But does anyone want it? | CNN Business

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    New York
    CNN
     — 

    Elon Musk’s move over the weekend to rebrand Twitter and replace its iconic bird logo with an X is just the latest step in his effort to make over the billionaire’s longtime favorite platform in his image.

    When Musk bought Twitter late last year, he laid out a vision for an “everything” app called X, where users could communicate, shop, consume entertainment and more. Last June — prior to his takeover — Musk told Twitter employees that the platform should be more like China’s WeChat, where he said users “basically live on” the app because “it’s so usable and helpful to daily life.”

    The vision for the rebrand may go all the way back to Musk’s creation of the original X.com in 1999, which Musk hoped would be an all-in-one financial platform and which eventually became PayPal.

    Despite Musk’s longstanding ambitions — and the heightened stakes since he shelled out $44 billion to purchase the social network — ditching Twitter’s branding in service of a future super app is a significant risk.

    Twitter still has a long way to go if Musk wants to build out the kind of services WeChat is known for — everything from ordering groceries and booking yoga classes to paying bills and chatting with friends. And that’s not to mention the financial and competitive challenges the company faces merely existing in its current form, let alone launching a massive expansion. It’s also not clear how much demand there is for such a super app outside of China, given that efforts by other platforms to simply sell users on added shopping features have been slow to take off.

    “While Musk’s vision is to turn ‘X’ into an ‘everything app,’ this takes time, money, and people -— three things that the company no longer has,” Mike Proulx, research director and vice president at Forrester, said in an investor note. By ditching Twitter’s name, Proulx added, Musk “will have singlehandedly wiped out over fifteen years of a brand name that has secured its place in our cultural lexicon,” leaving him to start fresh at a precarious time for the company.

    The X branding has already started taking over Twitter.

    Musk — who bought Twitter with a company called X Corp. — tweeted on Sunday that X.com now redirects to Twitter. (Musk reportedly bought the X.com domain back from PayPal in 2017.)

    On Sunday night, the new stylized X logo was projected onto the company’s headquarters. And by Monday, the bird logo had been replaced by an X on Twitter’s website. Musk even told followers that tweets should instead be called “x’s.”

    On Sunday, CEO Linda Yaccarino seemed to confirm Musk’s vision for the company. “X is the future state of unlimited interactivity — centered in audio, video, messaging, payments/banking — creating a global marketplace for ideas, goods, services, and opportunities,” Yaccarino said in a tweet.

    Walter Isaacson, the legendary tech journalist who has been shadowing Musk to write his biography, tweeted on Sunday that Musk told him even before the Twitter acquisition that he wanted to use the social platform to fulfill his original, decades-old vision for X.com. “I am very excited about finally implementing X.com as it should have been done, using Twitter as an accelerant!” Musk texted Isaacson at 3:30 a.m. one morning last October, just ahead of his takeover, according to the writer.

    On Monday, Musk explained the move in a tweet saying, “The Twitter name made sense when it was just 140 character messages going back and forth – like birds tweeting – but now you can post almost anything, including several hours of video.”

    “In the months to come, we will add comprehensive communications and the ability to conduct your entire financial world,” Musk said. “The Twitter name does not make sense in that context.”

    (The rebrand also seems to be a continuation of a sort of obsession with the letter “X,” which also features in the name of one of Tesla’s cars, the Model X; the name of his rocket company, SpaceX; the name of his new artificial intelligence firm, xAI; and the name of two of his children, X Æ A-Xii and Exa Dark Sideræl.)

    In recent weeks, Twitter has quietly begun its effort to build out a payments business called Twitter Payments — the company was granted money transmitter licenses in four US states since last month, including Arizona and Michigan. Musk has discussed his desire to promote longer videos on Twitter. And he’s tried to shift Twitter’s business model away from advertising by allowing users to pay for verification, a strategy that has resulted in some chaos but only a limited number of actual subscriptions.

    Still, Musk faces obvious hurdles to turning Twitter into a fully-developed super app. Since acquiring Twitter, Musk has fired around 80% of its staff, scared away many of the advertisers that made up its core user base and frustrated many of its users with controversial policy decisions. And now, Twitter faces steep competition from Meta’s rival app Threads, which launched to stunning success, although its usage has petered off slightly in recent days.

    Musk last week also said that Twitter still has negative cash flow because of a 50% decline in ad revenue.

    Even if Musk does add new features to Twitter, many US tech platforms have struggled to succeed in imitating WeChat. Deloitte said in a report published last year that Western markets are unlikely to see “a single, dominant super-app like WeChat in the near term” because the services such apps would aim to bundle together, such as digital payments and ride hailing, already “have too many well-established players.”

    A 2019 effort by the social media giant then known as Facebook to create its own digital currency and payments system that the company said would make it easier to buy things online officially flopped last year following intense regulatory scrutiny. And both TikTok and Instagram have reportedly scaled back their ambitions to incorporate e-commerce onto their platforms after their shopping features failed to gain significant traction with users.

    And until Musk rolls out significant changes to the platform, observers of the company say ditching Twitter’s well-known brand is a risky move.

    “To rebrand without significant new features seems like a desperate attempt for attention,” especially in the wake of Meta’s launch of Threads, said Joshua White, assistant professor of finance at Vanderbilt University. “This is akin to buying Coke and changing the bottle and name without changing the formula — likely a mistake.”

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  • Apple launches buy now, pay later service | CNN Business

    Apple launches buy now, pay later service | CNN Business

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    New York
    CNN
     — 

    Apple on Tuesday launched an option in its digital wallet allowing customers to pay for online purchases in installments, making it the latest company to embrace the buy now, pay later trend.

    The new feature, called Apple Pay Later, lets customers split payments for purchases into four installments over six weeks, with the first installment due at the time of purchase. Apple users can also apply for a loan within the Wallet app, ranging from $50 to $1000, with no interest or fees, to make online or in-app purchases.

    The payment option is rolling out to select users in the United States now, with plans to offer it to all eligible customers over the next several months, according to a company release. Apple first teased the feature last year.

    Apple’s move comes as a growing number of consumers have turned to buy now, pay later services to stretch their budgets at a time of high inflation and broader economic uncertainty. Other popular services that offer the same payment option include Affirm, Klarna and Afterpay.

    But some economists and consumer advocates have raised concerns that these services could cause shoppers to take on more debt.

    The installment process makes it seem like someone is paying practically nothing for the goods or service they’re acquiring, Terri R. Bradford, a research specialist in payment systems for the Kansas City Federal Reserve, previously told CNN. “So the possibility is that you could, in your mind, think of everything that you’re buying in those four installments and, as a result, take on more debt than you would if you had to pay for them in full each and every time.”

    But Apple says the new feature is “designed with users’ financial health in mind.”

    “There’s no one-size-fits-all approach when it comes to how people manage their finances,” said Jennifer Bailey, Apple’s vice president of Apple Pay and Apple Wallet, in Tuesday’s release. “Many people are looking for flexible payment options, which is why we’re excited to provide our users with Apple Pay Later.”

    Apple users will be able to track and manage upcoming loan payments in the Wallet app. Any loan application can also be done in the app with no impact on credit, according to the company.

    Apple’s Pay Later option is enabled through the Mastercard Installments program.

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  • UK blocks Microsoft takeover of Activision Blizzard | CNN Business

    UK blocks Microsoft takeover of Activision Blizzard | CNN Business

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    London
    CNN
     — 

    The UK antitrust regulator has blocked Microsoft’s $69 billion purchase of Activision Blizzard, thwarting one of the tech industry’s biggest deals over concerns it will stifle competition in cloud gaming.

    The Competition and Markets Authority said in a statement Wednesday that it was worried the deal would lead to “reduced innovation and less choice for UK gamers over the years to come.”

    The acquisition would make Microsoft

    (MSFT)     “even stronger” in cloud gaming, a market in which it already holds a 60%-70% share globally, the regulator added.

    Activision Blizzard is one of the world’s biggest video game developers, producing games such as “Call of Duty,” “World of Warcraft,” “Diablo” and “Overwatch.” Microsoft, which sells the Xbox gaming console, offers a video game subscription service called Xbox Game Pass, as well as a cloud-based video game streaming service.

    The deal to combine the businesses has been met with growing opposition by antitrust regulators worldwide. In December, the US Federal Trade Commission sued to block the takeover over similar competition concerns. A hearing is scheduled for August. The European Union is also evaluating the transaction

    Microsoft could seek to make Activision’s games exclusive to its own platforms and then increase the cost of a Game Pass subscription, the Competition and Markets Authority said.

    “The cloud allows UK gamers to avoid buying expensive gaming consoles and PCs and gives them much more flexibility and choice as to how they play. Allowing Microsoft to take such a strong position in the cloud gaming market just as it begins to grow rapidly would risk undermining the innovation that is crucial to the development of these opportunities,” it added.

    “The evidence available… indicates that, absent the merger, Activision would start providing games via cloud platforms in the foreseeable future.”

    Both companies plan to appeal the decision. “Alongside Microsoft, we can and will contest this decision, and we’ve already begun the work to appeal to the UK Competition Appeals Tribunal,” Activision Blizzard CEO Bobby Kotick said in a statement.

    Microsoft President Brad Smith added: “This decision appears to reflect a flawed understanding of the market and the way the relevant cloud technology actually works.”

    The Competition and Markets Authority, which launched an in-depth review of the blockbuster deal in September, said Microsoft’s proposed remedies to its concerns had “significant shortcomings.”

    “Their proposals… would have replaced competition with ineffective regulation in a new and dynamic market,” explained Martin Coleman, chair of the independent panel of experts conducting the investigation.

    “Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming, and this deal would strengthen that advantage, giving it the ability to undermine new and innovative competitors,” Coleman continued. “Cloud gaming needs a free, competitive market to drive innovation and choice.”

    The UK cloud gaming market is expected to be worth up to £1 billion ($1.2 billion) by 2026, around 9% of the global market, according to the Competition and Markets Authority.

    -— Josh du Lac and Brian Fung contributed reporting.

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  • How the CEO behind ChatGPT won over Congress | CNN Business

    How the CEO behind ChatGPT won over Congress | CNN Business

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    Washington
    CNN
     — 

    OpenAI CEO Sam Altman seems to have achieved in a matter of hours what other tech execs have been struggling to do for years: He charmed the socks off Congress.

    Despite wide-ranging concerns that artificial intelligence tools like OpenAI’s ChatGPT could disrupt democracy, national security, and the economy, Altman’s appearance Tuesday before a Senate subcommittee went so smoothly that viewers could have been forgiven for thinking the year was closer to 2013 than 2023.

    It was a pivotal moment for the AI industry. Altman’s testimony on Tuesday alongside Christina Montgomery, IBM’s chief privacy officer, promised to set the tone for how Washington regulates a technology that many fear could eliminate jobs or destabilize elections.

    But where lawmakers could have followed a familiar pattern, blasting the tech industry with hostile questioning and leveling withering allegations of reckless innovation, members of the Senate Judiciary Committee instead heaped praise on the companies — and often, on Altman in particular.

    The difference seemed to come down to OpenAI calling for proactive government regulation — and persuading lawmakers it was serious. Unlike the long list of social media hearings in recent years, this AI hearing came earlier in OpenAI’s lifecycle and, crucially, before the company or its technology had suffered any high-profile mishaps.

    Altman, more than any other figure in tech, has emerged as the face of a new crop of powerful and disruptive AI tools that can generate compelling written work and images in response to user prompts. Much of the federal government is now racing to figure out how to regulate the cutting-edge technology.

    But after his performance on Tuesday, the CEO whose company helped spark the new AI arms race may have maneuvered himself into a privileged position of influence over the rules that may soon govern the tools he’s developing.

    Altman’s easy-going, plain-spoken demeanor helped disarm skeptical lawmakers and appeared to win over Democrats and Republicans alike. His approach contrasted with the wooden, lawyerly performances that have afflicted some other tech CEOs in the past during their time in the hotseat.

    “I sense there is a willingness to participate here that is genuine and authentic,” said Connecticut Democratic Sen. Richard Blumenthal, who chairs the committee’s technology panel.

    New Jersey Democratic Sen. Cory Booker, adopting an unusual level of familiarity with a witness, found himself repeatedly addressing Altman as “Sam,” even as he referred to other panelists by their last names.

    Even Altman’s fellow witnesses couldn’t resist gushing about his style.

    “His sincerity in talking about those [AI] fears is very apparent, physically, in a way that just doesn’t communicate on the television screen,” Gary Marcus, a former New York University professor and a self-described critic of AI “hype,” told lawmakers.

    With a relaxed yet serious tone, Altman did not deflect or shy away from lawmakers’ concerns. He agreed that large-scale manipulation and deception using AI tools are among the technology’s biggest potential flaws. And he validated fears about AI’s impact on workers, acknowledging that it may “entirely automate away some jobs.”

    “If this technology goes wrong, it can go quite wrong, and we want to be vocal about that,” Altman said. “We want to work with the government to prevent that from happening.”

    Altman’s candor and openness has captivated many in Washington.

    On Monday evening, Altman spoke to a dinner audience of roughly 60 House lawmakers from both parties. One person in the room, speaking on condition of anonymity to discuss a closed-door meeting, described members of Congress as “riveted” by the conversation, which also saw Altman demonstrating ChatGPT’s capabilities “to much amusement” from the audience.

    Lawmakers have spent years railing against social media companies, attacking them for everything from their content moderation decisions to their economic dominance. On Tuesday, they seemed ready — or even relieved — to be dealing with another area of the technology industry.

    Whether this time is truly different remains unclear, though. The AI industry’s biggest players and aspirants include some of the same tech giants Congress has sharply criticized, including Google and Meta. OpenAI is receiving billions of dollars of investment from Microsoft in a multi-year partnership. And with his remarks on Tuesday, Altman appeared to draw from a familiar playbook for Silicon Valley: Referring to technology as merely a neutral tool, acknowledging his industry’s imperfections and inviting regulation.

    Some AI ethicists and experts questioned the value of asking a leading industry spokesperson how he would like to be regulated. Marcus, the New York University professor, cautioned that creating a new federal agency to police AI could lead to “regulatory capture” by the tech industry, but the warning could have applied just as easily to Congress itself.

    “It seems very very bad that ahead of a hearing meant to inform how this sector gets regulated, the CEO of one of the corporations that would be subject to that regulation gets to present a magic show to the regulators,” Emily Bender, a professor of computational linguistics at the University of Washington, said of Altman’s dinner with House lawmakers.

    She added: “Politicians, like journalists, must resist the urge to be impressed.”

    After years of fidgety evasiveness from other tech CEOs, however, lawmakers this week seemed easily wowed by Altman and his seemingly straight-shooting answers.

    Louisiana Republican Sen. John Kennedy, after expressing frustration with IBM’s Montgomery for providing a nuanced answer he couldn’t comprehend, visibly brightened when Altman quickly and smoothly outlined his regulatory proposals in a bulleted list. Kennedy began joking with Altman and even asked whether Altman might consider heading up a hypothetical federal agency charged with regulating the AI industry.

    “I love my current job,” Altman deadpanned, to audience laughter, before offering to send Kennedy’s office some potential candidates.

    Compounding lawmakers’ attraction to Altman is a belief on Capitol Hill that Congress erred in extending broad liability protections to online platforms at the dawn of the internet. That decision, which allowed for an explosion of blogs, e-commerce sites, streaming media and more, has become an object of regret for many lawmakers in the face of alleged mental health harms stemming from social media.

    “I don’t want to repeat that mistake again,” said Judiciary Committee Chairman Dick Durbin.

    Here too, Altman deftly seized an opportunity to curry favor with lawmakers by emphasizing distinctions between his industry and the social media industry.

    “We try to design systems that do not maximize for engagement,” Altman said, alluding to the common criticism that social media algorithms tend to prioritize outrage and negativity to boost usage. “We’re not an advertising-based model; we’re not trying to get people to use it more and more, and I think that’s a different shape than ad-supported social media.”

    In providing simple-sounding solutions with a smile, Altman is doing much more than shaping policy: He is offering members of Congress a shot at redemption, one they seem grateful to accept. Despite the many pitfalls of AI they identified on Tuesday, lawmakers appeared to thoroughly welcome Altman as a partner, not a potential adversary needing oversight and scrutiny.

    “We need to be mindful,” Blumenthal said, “of ways that rules can enable the big guys to get bigger and exclude innovation, and competition, and responsible good guys such as our representative in this industry right now.”

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