Connect with us

Published

on

The offices of satellite operator Inmarsat in central London.

Leon Neal | AFP | Getty Images

The U.K.’s competition regulator launched an in-depth probe into American satellite internet company Viasat’s $7.3 billion deal to buy British rival Inmarsat.

The Competition and Markets Authority on Friday referred the takeover for a so-called “Phase 2” competition investigation, concerned it would make it harder for competitors such as Elon Musk’s SpaceX, U.K. firm OneWeb and Canadian operator Telesat to do business with the aviation sector.

Specifically, the CMA is worried the deal would lead to higher prices for onboard Wi-Fi on plane flights.

The watchdog has said Viasat and Inmarsat “compete closely in the aviation sector, particularly for the supply of onboard wifi for passenger use.” While these in-flight connectivity (IFC) services are only offered by a handful of players currently, the market “is expected to grow significantly in coming years,” the CMA says.

Such a move “could face higher prices and be offered lower quality connectivity solutions, ultimately affecting the cost, quality and availability of services for airline passengers,” it added.

The regulator said its initial investigation found it can be very difficult for airlines to switch satellite providers once they have installed network equipment. The merger of Viasat and Inmarsat could therefore “lock in a large part of the customer base” before rival suppliers emerge.

Combined, Intelsat and rival Panasonic represent more than 75% of the long-haul IFC market, the regulator stated.

“This is an evolving market, but the merging companies are currently 2 of the key players – and it remains uncertain whether the next generation of satellite operators will be able to compete against them effectively,” said Colin Raftery, senior director of the CMA.

Viasat inks $7.3 billion acquisition deal with Inmarsat

“Ultimately, airlines could be faced with a worse deal because of this merger, which could have knock-on effects for UK consumers as in-flight connectivity becomes more widespread.”

In a statement Friday, Viasat and Inmarsat said they were “confident that the transaction will increase the availability of more affordable, faster, and more reliable IFC [in-flight connectivity] globally to operators, airlines, and passengers.”

The two companies will “actively participate” in the CMA’s investigation and “determine and communicate any updated expectations for the deal closing as engagement with the CMA continues,” they said.

Viasat CEO and Executive Chairman Mark Dankberg said the deal would increase the availability of in-flight connectivity services globally. “Industry analysts anticipate that an already highly competitive IFC market will become even more competitive with the entrance of new, heavily financed LEO competitors,” he added.

Inmarsat “faces intense competition every day in providing in-flight connectivity,” said Rajeev Suri, CEO of Inmarsat.

“There is good reason to expect that intensity to increase given the power of well-funded new companies entering the sector. In the face of these changing market dynamics, the UK has much to gain by the presence of a strong satellite communications company, positioned to strengthen the country’s position in the critical space sector, while supporting its national defence and growing jobs and investment.”

A range of companies from Elon Musk’s SpaceX to Amazon, which owns the Kuiper satellite constellation, are racing to launch satellites into space to beam internet to people in rural and hard-to-reach areas to connect to the internet. It has become a key focus for the U.K. government, which is invested in domestic satellite firm OneWeb.

But it is hard for companies to succeed in the market as it requires lots of capital and manpower. In 2020, OneWeb collapsed into bankruptcy after burning through billions of dollars in investors including Japan’s SoftBank. The company was rescued later that year with the help of the U.K. government, which kicked in $500 million as part of a bailout package.

Britain and the European Union have also become more aggressive in seeking to defend their “digital sovereignty” — the idea that countries shouldn’t lose control of strategic technologies such as semiconductors, artificial intelligence and cloud computing. In the U.K., a bill known as the National Security and Investment Act allows governments to intervene in foreign takeovers if they feel their is a national security risk.

American chipmaker Nvidia’s attempt to take over U.K. chip designer Arm unraveled after a national security review from the government and a federal lawsuit from the FCC. Meanwhile, the sale of Welsh semiconductor firm Newport Wafer Fab to a Chinese-owned company is the subject of a U.K. security probe.

In Viasat and Inmarsat’s case, the deal has already been approved on national security grounds in the U.K. and U.S.

Continue Reading

Technology

EBay shares soar after Meta allows listings on Facebook Marketplace in U.S., Europe

Published

on

By

EBay shares soar after Meta allows listings on Facebook Marketplace in U.S., Europe

A sign is posted in front of the eBay headquarters in San Jose, California.

Justin Sullivan | Getty Images

Shares of eBay soared 8% Wednesday as Meta said it will allow some listings to show up on Facebook Marketplace, its popular platform connecting consumers for local item pickups and more.

EBay stock reached its highest level since November 2021.

The rollout will begin with a test in Germany, France and the United States, where buyers will be able to view listings directly on Marketplace and complete the rest of their transactions on eBay, Meta said in a release.

The partnership could provide a boost to eBay’s marketplace business, which has struggled to compete with e-commerce rivals like Amazon, Walmart, Temu and even Facebook’s own marketplace platform that lets users buy and sell items.

EBay has recently embraced niche categories like collectibles and luxury goods to try and keep buyers and sellers returning to its site. CEO Jamie Iannone told CNBC in an October interview that shoppers were coming to the site, known for its used and refurbished goods, as they sought out discounts amid a rocky macroeconomic environment.

Meta’s move is an attempt to appease the European Commission, the executive body of the European Union, after the regulator fined the company 797 million euros ($821 million) in November for tying its Marketplace product to the main Facebook app.

Read more CNBC tech news

At the time, the Commission said that Meta’s bundling of Marketplace with Facebook could mean competitors are effectively “foreclosed” given the distribution reach of the platform. Facebook counts more than 3 billion users globally.

The Commission also said that Meta imposes “unfair trading conditions” on other online classified ads service providers who advertise on its platforms, especially Facebook and Instagram. It added that these conditions allow Meta to use data generated from other advertisers to benefit Marketplace.

Meta appealed the ruling at the time, saying that it “ignores the realities of the thriving European market for online classified listing services.”

“While we disagree with and continue to appeal the European Commission’s decision on Facebook Marketplace, we are working quickly and constructively to build a solution which addresses the points raised,” the company said Wednesday.

EBay touted its integration with Facebook Marketplace as a way for the e-commerce site to “increase exposure to our sellers’ listings, on and off eBay, as part of our strategy to engage buyers and deepen customer loyalty.”

Facebook in 2023 announced a similar partnership with Amazon that lets users browse and purchase products without leaving the app.

WATCH: Will AI stocks push higher in 2025? Nvidia investor shares his outlook

CNBC Pro Talks: Will AI stocks push higher in 2025? Nvidia investor shares his outlook

Additional reporting by CNBC’s Annie Palmer.

Continue Reading

Technology

Amazon workers in North Carolina to vote on unionization next month

Published

on

By

Amazon workers in North Carolina to vote on unionization next month

An Amazon employee works to fulfill same-day orders during Cyber Monday, one of the company’s busiest days, at an Amazon fulfillment center in Orlando, Florida, on Dec. 2, 2024.

Miguel J. Rodriguez Carrillo | Getty Images

Amazon warehouse workers at a site in North Carolina will vote next month on whether to join a union, setting the stage for the company’s latest labor battle.

Workers at the Garner, North Carolina, facility will cast their ballots from Feb. 10 to Feb. 15, according to a Tuesday post on X by Carolina Amazonians United for Solidarity & Empowerment, the group seeking to organize staffers. Representatives from Amazon and the National Labor Relations Board didn’t immediately respond to requests for comment.

Known as CAUSE, the grassroots group led by current and former employees has been working to organize Amazon employees at the warehouse, which is located in a suburb about 10 miles south of Raleigh, for the past three years.

If the election is successful, the warehouse, known as RDU1, would be only the second Amazon site in the U.S. to unionize. Workers at Amazon’s largest warehouse in New York City voted to join the Amazon Labor Union in 2022, but the group struggled to negotiate a contract with Amazon, and last June, the ALU voted to affiliate with the Teamsters.

A handful of union elections were held at Amazon warehouses in the U.S. in recent years but employees have either rejected unionization or the results continue to be disputed in lengthy court battles. Last November, a federal labor judge ordered a third rerun election at an Amazon warehouse in Bessemer, Alabama, after ruling the company improperly interfered in the vote.

Read more CNBC Amazon coverage

CAUSE filed for a union election last month, saying in a press release that 30% of workers at the North Carolina site signed union authorization cards, which is the necessary threshold to trigger an NLRB vote. Organizers are seeking to boost wages and improve working conditions.

The union filing comes after Amazon delivery and warehouse workers went on strike at nine facilities last month to push the company to come to the bargaining table, according to the International Brotherhood of Teamsters, which represents the employees. The action was intended to snarl Amazon’s operations during the busiest holiday shopping period of the year, referred to as peak season. An Amazon representative told Reuters the company expected to see a limited impact on deliveries from the strike.

WATCH: Amazon’s first U.S. union faces an uphill battle after historic win

How two friends formed Amazon's first U.S. union and what's next

Continue Reading

Technology

Apple’s inaccurate AI news alerts shows the tech has a growing misinformation problem

Published

on

By

Apple's inaccurate AI news alerts shows the tech has a growing misinformation problem

Jaap Arriens | Nurphoto | Getty Images

An artificial intelligence feature on iPhones is generating fake news alerts, stoking concerns about the technology’s ability to spread misinformation.

Last week, a feature recently launched by Apple that summarizes users’ notifications using AI, pushed out inaccurately summarized BBC News app notifications on the broadcaster’s story about the PDC World Darts Championship semi-final, falsely claiming British darts player Luke Littler had won the championship.

The incident happened a day before the actual tournament’s final, which Littler did go on to win.

Then, just hours after that incident occurred, a separate notification generated by Apple Intelligence, the tech giant’s AI system, falsely claimed that Tennis legend Rafael Nadal had come out as gay.

The BBC has been trying for about a month to get Apple to fix the problem. The British state broadcaster complained to Apple in December after its AI feature generated a false headline suggesting that Luigi Mangione, the man arrested following the murder of health insurance firm UnitedHealthcare CEO Brian Thompson in New York, had shot himself — which never happened.

Apple was not immediately available for comment when contacted by CNBC. On Monday, Apple told the BBC that it’s working on an update to resolve the problem by adding a clarification that shows when Apple Intelligence is responsible for the text displayed in the notifications. Currently, generated news notifications show up as coming directly from the source.

“Apple Intelligence features are in beta and we are continuously making improvements with the help of user feedback,” the company said in a statement shared with the BBC. Apple added that it’s encouraging users to report a concern if they view an “unexpected notification summary.”

The BBC isn’t the only news organization that has been affected by Apple Intelligence inaccurately summarizing news notifications. In November, the feature sent an AI-summarized notification wrongly claiming Israeli Prime Minister Benjamin Netanyahu had been arrested.

The mistake was flagged on the social media app Bluesky by Ken Schwencke, a senior editor at investigative journalism site ProPublica.

CNBC has reached out to the BBC and New York Times for comment on Apple’s proposed solution to its AI feature’s misinformation issue.

AI’s misinformation problem

Apple touts its AI-generated notification summaries as an effective way to group and rewrite previews of news app notifications into a single alert on a users’ lock screen.

It’s a feature Apple says is designed to help users scan their notifications for key details and cut down on the overwhelming barrage of updates many smartphone users are familiar with.

However, this has resulted in what AI experts refer to as “hallucinations” — responses generated by AI that contain false or misleading information.

“I suspect that Apple will not be alone in having challenges with AI-generated content. We’ve already seen numerous examples of AI services confidently telling mistruths, so-called ‘hallucinations’,” Ben Wood, chief analyst at tech-focused market research firm CCS Insights, told CNBC.

In Apple’s case, because the AI is trying to consolidate notifications and condense them to show only a basic summary of information, it’s mashed the words together in a way that’s inaccurately characterized the events — but confidently presenting them as facts.

“Apple had the added complexity of trying to compress content into very short summaries, which ended up delivering erroneous messages,” Wood added. “Apple will undoubtedly seek to address this as soon as possible, and I’m sure rivals will be watching closely to see how it responds.”

Generative AI works by trying to figure out the best possible answer to a question or prompt inserted by a user, relying on vast quantities of data which its underlying large language models are trained on.

Sometimes the AI might not know the answer. But because it’s been programmed to always present a response to user prompts, this can result in cases where the AI effectively lies.

It’s not clear exactly when Apple’s resolution to the bug in its notification summarization feature will be fixed. The iPhone maker said to expect one to arrive in “the coming weeks.”

Continue Reading

Trending