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China is set to become a major player in the “highly lucrative” satellite navigation market, as it seeks to compete with the U.S. government-owned Global Positioning System (GPS), an analyst said Monday.

But China’s homegrown Beidou system is not likely to overtake the GPS system for now, said Craig Singleton, adjunct fellow at the hawkish Foundation for Defense of Democracies.

“China has marked a major step in its race to increase market share in this highly lucrative sector,” Singleton told CNBC’s “Squawk Box Asia.”

“The completion of the system also reaffirms China’s status as a world power. It represents a major declaration about its technical independence from the West, which carries wide-ranging geopolitical implications,” said Singleton.

Flags of the U.S. and China fly along Pennsylvania Avenue in Washington, D.C., on Jan. 17, 2011.
Andrew Harrer | Bloomberg | Getty Images

More than 120 countries — including Pakistan and Thailand — are using China’s Beidou system for purposes such as monitoring traffic at ports or guiding rescue operations, the analyst said.

And Beijing is counting on its massive Belt and Road Initiative to “convince” more countries to use Beidou, he added.

The Beidou system was completed in June last year. Chinese state media Xinhua said last week that the value of Beidou-related industries will exceed 1 trillion yuan ($157.1 billion) by 2025.

‘Bifurcated world’

Singleton said Beidou’s completion has rekindled concerns among some in the West about the privacy and security of Chinese technology. He explained that some people fear Beijing could use its technology to track individuals, such as dissidents or democracy activists.

Such concerns have come as U.S.-China competition heats up in the technology space. The U.S. under former President Donald Trump introduced export controls on several Chinese tech companies, including telecommunications equipment maker Huawei and top chipmaker SMIC, or Semiconductor Manufacturing International Corp.

President Joe Biden has kept many Trump-era restrictions on Chinese companies. Biden is seeking to boost investments in U.S. research and development so that his country can build tech capabilities to compete with China.

For now, China’s Beidou system doesn’t appear to threaten the dominance of GPS, said Singleton.

“At this point, it doesn’t look as if Beidou is going to overcome GPS, but it’s certainly possible that we will see a bifurcated system, bifurcated world between GPS and Beidou in the future,” the analyst said.

— CNBC’s Arjun Kharpal contributed to this report.

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Drone startup Zipline hits 1 million deliveries, looks to restaurants as it continues to grow

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April 19, 2024

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Drone startup Zipline hits 1 million deliveries, looks to restaurants as it continues to grow

Autonomous delivery drone startup Zipline said Friday that it hit its 1 millionth delivery to customers and that it’s eyeing restaurant partnerships in its next phase of growth.

The San Francisco-based startup designs, builds and operates autonomous delivery drones, working with clients that range from more than 4,700 hospitals, including the Cleveland Clinic, to major brands such as Walmart and GNC. It’s raised more than $500 million so far from investors including Sequoia Capital, a16z and Google Ventures. Zipline is also a CNBC Disruptor 50 company.

The company said its zero-emission drones have now flown more than 70 million autonomous commercial miles across four continents and delivered more than 10 million products.

The milestone 1 millionth delivery carried two bags of IV fluid from a Zipline distribution center in Ghana to a local health facility.

As the company continues to expand, it will bring on Panera Bread in Seattle, Memorial Hermann Health System in Houston, and Jet’s Pizza in Detroit.

Zipline CEO Keller Rinaudo Cliffton told CNBC that 70% of the company’s deliveries have happened in the past two years and, in the future, the goal is to do 1 million deliveries a day.

“The three areas where the incentive really makes the most sense today are health care, quick commerce and food, and those are the three main markets that we focus on,” Rinaudo Cliffton said. “Our goal is to work with really the best brands or the best institutions in each of those markets.”

The push into restaurant partnerships marks an “obvious transition” he said, due to the continuing growth in interest in instant food delivery. Zipline already delivers food from Walmart to customers.

“We need to start using vehicles that are light, fast, autonomous and zero-emission,” Rinaudo Cliffton said. “Delivering in this way is 10 times as fast, it’s less expensive … and relative to the traditional delivery apps that most restaurants will be working with, we triple the service radius, which means you actually [get] 10 times the number of customers who are reachable via instant delivery.”

Zipline deliveries for some Panera locations in Seattle are expected to begin next year, the Panera franchisee’s Chief Operating Officer Ron Bellamy told CNBC. Delivery continues to grow for its business, even in an inflationary environment, he said. Costs with Zipline are anticipated to be on par with what third-party delivery is now, he added, with the hope of that cost lowering over time. 

“I’m encouraged about it, not just even in terms of what I can do for the business, but as a consumer, I think at the end of the day, if it is economical, and it delivers a better overall experience, then the consumer will speak,” Bellamy said.

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Super Micro plunges as investors rotate out of red-hot AI stock ahead of earnings later this month

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April 19, 2024

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Super Micro plunges as investors rotate out of red-hot AI stock ahead of earnings later this month

David Paul Morris | Bloomberg | Getty Images

Super Micro Computer shares plunged 18% on Friday as investors scaled back their holdings of one of the market’s hottest stocks ahead of earnings later this month.

Shares of Super Micro, which joined the S&P 500 in March, are still up about 168% this year after climbing 246% in 2023. The server and computer infrastructure company is a primary vendor for Nvidia, whose technology is the backbone for most of today’s powerful artificial intelligence models.

Super Micro said in a brief press release on Friday that it will report fiscal third-quarter results on April 30. The company broke from its pattern of providing preliminary results. In January, Super Micro increased its sales and earnings guidance 11 days before announcing second-quarter financials.

The stock is on pace for its steepest drop since Feb. 16, when it fell about 20%.

While Super Micro is getting a big boost from its ties to Nvidia, the market remains highly contested, with competitors including Dell and Hewlett Packard Enterprise planning to build systems using Nvidia’s latest generation of Blackwell graphics processing units.

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Dutch government says it may stop using Facebook over privacy concerns

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April 19, 2024

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Dutch government says it may stop using Facebook over privacy concerns

Morning traffic outside Meta headquarters, in Mountain View, California, U.S. November 9, 2022.

Peter Dasilva | Reuters

The Dutch government said Friday that it may be forced to stop using Facebook after a warning from the Netherlands’ privacy regulator about the Meta-owned social media platform’s privacy risks.

The Dutch Data Protection Authority (DPA) issued a statement advising the Dutch Interior Ministry not to rely on Facebook pages to communicate with citizens if it doesn’t have a clear idea of how Facebook uses the personal data of people who visit government pages.

The Interior Ministry had previously asked the DPA to advise on whether the government could use Facebook pages in a compliant way.

The government wants clarity from Meta “as soon as possible, at the latest before the summer recess, on how they are addressing our concerns,” Alexandra van Huffelen, the Dutch Minister for Digitalization, said in a statement.

“Otherwise, in line with the advice of the DPA, we will be forced to stop our activities on Facebook pages,” she added.

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The Dutch DPA’s chairman, Aleid Wolfsen, said in a statement that “people who visit a government page trust that their personal and sensitive information is in safe hands.”

“The fact that this can also involve information about children and young people makes this even more important. They are vulnerable online and need extra protection,” Wolfsen said in the statement, which was translated to English via Google Translate.

A Meta spokesperson told CNBC: “We fundamentally disagree with the assessment that underpins this advice, which is wrong on the facts and demonstrates a fundamental misunderstanding as to how our products work.”

“We review all Meta products to ensure they comply with laws in the regions in which we offer our services, and will continue to engage with the Government to ensure they can use social media to communicate with people,” the Meta spokesperson added.

The DPA advice serves as further evidence of “growing distrust between European regulators and Meta,” Matthew Holman, a tech, privacy, and AI partner at law firm Cripps, told CNBC via email.

Holman said that the Dutch regulator’s concern is likely to be that user data “is shared with government departments on Meta’s platform and could still be subject to security issues, monitoring or access by US federal agencies.”

– CNBC’s April Roach contributed to this report

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