2019年2月12日 星期二

Facebook and Google brace for UK competition probe

5G trial, Autonomy's legal battle and Apple v publishers

Wednesday, February 13, 2019

Technology Intelligence 

Your daily dose of the best technology news and analysis straight from Silicon Valley

Breaking the grip

By James Titcomb in San Francisco

What do Google and Facebook fear? Is it users fleeing their services? Well, maybe, but there is no sign of that happening. Is it the rise of flashy new apps that make them look old? Usually, they can be bought.

No, what should worry the tech titans most is a strike at their moneymaker: their advertising businesses. Google and Facebook account for more than half of the digital advertising market between them, an effective duopoly that is often used as an argument for breaking them up.

So yesterday’s news that Culture Secretary Jeremy Wright has written to the UK’s Competition and Markets Authority urging an investigation into their hold on the digital ad market will not have been received well in Silicon Valley. Read our report here.

Google and Facebook


Wright’s intervention follows a review into the health of British journalism by Dame Francis Cairncross, which said that the stranglehold of Facebook and Google may be restricting competition in the digital ad market.

The Culture Secretary said the market was “largely opaque and extremely complex” and that governments should have a better view of how they work.

It is still early days: it remains unclear whether the CMA will proceed with a fully fledged investigation, let alone what it will find, but past signs are not particularly bright.

A House of Lords report last year found that Google had control “at all levels of the market” while a separate Australian inquiry was similarly unfavourable.


A lot of the focus on the potential threats to Facebook and Google in the last couple of years have focused on regulation: new laws and guidelines they should obey, and which opponents hope would cut them down to size.

But there’s an alternative theory that regulation would actually be good for the tech giants, entrenching their position and making it harder for small incumbents without armies of lawyers to compete on the same level. Some say this is why the companies have actually made moves to support regulation of their industries.

But scrutiny of their competitive power? Even a break-up. That is something different, and it’s why competitive scrutiny of Facebook and Google is a big deal.


Pick of the Day

As Russia considers a plan to temporarily disconnect from the global internet, we identify what life would be like if the same were to happen in Britain. Here’s our guide to the Splinternet.


This just in...


The story
The UK’s first live 5G industrial trial will take place in Worcester today in "a landmark step" towards the creation of smart factories in Britain. James Cook reports

Telegraph take
5G - the new generation of mobile data networks - will mean faster and more reliable downloads on your phone, but the more significant part might be allowing millions of individual devices to be able to talk to each other in factories and warehouses.
The idea is this will vastly improve safety and efficiency, and bring down costs for manufacturers. A lot has to happen for that to be the case, but this is a step towards that.

Further reading
2019 has been widely seen as the year that 5G starts to become a reality. Matthew Field tells you why.


The story
An English judge has denied an attempt by the US government to see legal documents related to Hewlett Packard’s lawsuit against Autonomy founder Mike Lynch. Here’s the full story

Telegraph take
The HP/Autonomy saga is long and complicated, but is now resulting in two parallel legal cases: a US criminal case against Lynch, and a civil action in the English courts. Yesterday’s development is a partial, if minor, setback to the US in its case against the Autonomy founder.
Lynch, who resides in the UK, is considering fighting extradition to the US. Should he proceed, that will become a much larger transatlantic legal battle.

Further reading
For the latest on the US criminal case, which had its latest hearing last week, check out our coverage here.


The story
Apple is meeting resistance from news publishers over a proposed 50pc cut for the tech giant’s new subscription service, reports the Wall Street Journal.

Telegraph take
Subscription-based all-you-can-eat services have revived the recorded music industry and led to a golden age of TV, but there is no such service for news.
Apple seems like one of the few companies that might make such a thing happen, but its suggested revenue split appears rather eyewatering. And the painful memories of partnering with Facebook will make many publishers a little reticent.

Further reading
Apple plans to host an event in March focused around media services, which may include the above news service, but could also be focused on its planned Netflix rival, according to BuzzFeed.


Start me up

How about a start-up with your start-up?

Connected cars are one of the hottest topics in tech, as shown by US giant General Motors taking a stake in Chester-based car data start-up Wejo. Sky News has the story.


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Talking point

Humans still hold the edge over machines when it comes to debating, but only just, as Olivia Feld reported yesterday. Here’s what you thought.

Harish Natarajan

“Even when rigged against the human, the human comes out on top. There's a long way to go yet for AI in this field.”


John James

“The machine is probably clever enough to know that if it keeps beating the humans it will get switched off and melted down.”


Andrew Stevenson

“I can think of quite a few humans that would come a poor second to my vacuum cleaner.”


Tony Newman

Have your say and join the debate


One more thing

If you think your kids are still playing Fortnite, get your head out of 2018. Ellie Zolfagharifard has your guide to TikTok, the video app sensation that has parents worried.


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