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.
“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.
An employee arranges a salad dressing display at an Amazon Fresh grocery store on December 12, 2024 in Federal Way, Washington.
David Ryder | Getty Images
Amazon is closing four more Fresh supermarkets in Southern California as the e-commerce giant continues to focus its grocery strategy around Whole Foods and delivery.
The closures will take place in the coming weeks, Amazon confirmed to CNBC. They follow the shuttering of four other U.S. locations in recent months, in Washington, Virginia, New York and a Los Angeles suburb.
“Certain locations work better than others, and after an assessment, we’ve made the decision to close these Amazon Fresh locations,” Amazon spokesperson Griffin Buch said in a statement. “We’re working closely with affected employees to help them find new roles within Amazon wherever possible.”
At one Fresh supermarket in La Verne, California, employees were told to gather for an all-hands meeting on Wednesday, according to an internal message viewed by CNBC. They learned at the meeting that the store would close in mid-November, and that employees would receive a severance package, according to a person familiar with the matter who asked not to be named because the details were confidential.
The other three stores that are closing are in cities of Mission Viejo, La Habra and Whittier.
Last week, Amazon said it intends to close 14 Fresh grocery stores in the U.K. and convert its five other locations there into Whole Foods markets.
Amazon said it regularly evaluates its store portfolio, which can lead to opening, reopening, relocating or closing certain locations. In the U.S., the company has more than 60 remaining Fresh stores. Last year, the company removed its “Just Walk Out” cashierless technology from the stores. It’s also been culling its footprint of Go cashierless convenience stores.
Amazon has been determined to become a major grocery player for nearly two decades. The company launched Amazon Fresh in 2007, then a pilot project for fresh food delivery, before acquiring upscale chain Whole Foods for $13.7 billion in 2017, its biggest purchase on record.
Amazon debuted its Fresh grocery chain in 2020, with an eye toward mass-market shoppers. The rollout has been turbulent since its early days.
The company opened a flurry of Fresh locations by 2022, but the expansion plans ran into CEO Andy Jassy’s widespread cost-cutting efforts as the company reckoned with the impact of rising interest rates and soaring inflation. In 2023, Amazon announced it would shut some Fresh stores and halt further openings temporarily as it evaluated how to make the chain stand out for shoppers.
While it’s closing Fresh stores, Amazon continues to “innovate and invest in making grocery shopping easier, faster, and more affordable,” Buch said. The company still maintains 500 Whole Foods locations and has opened mini “daily shop” Whole Foods stores in New York City.
On Wednesday, Amazon also launched a new “price-conscious” grocery brand that will be offered online and in its physical stores. And last month, Amazon expanded same-day delivery of fresh foods to more pockets of the U.S.
Jassy and other company executives have touted the success of sales of “everyday essentials” within its online grocery business, which refers to items such as canned goods, paper towels, dish soap and snacks. Jassy told investors at the company’s annual shareholder meeting in May that he remains “bullish” on grocery, calling it a “significant business” for Amazon.
Inside Google’s quantum computing lab in Santa Barbara, California.
CNBC
Quantum computing stocks are wrapping up a big week of double-digit gains.
Shares of Rigetti Computing, D-Wave Quantum and Quantum Computing have surged more than 20%. Rigetti and D-Wave Quantum have more than doubled and tripled, respectively, since the start of the year. Arqit Quantum skyrocketed more than 32% this week.
The jump in shares followed a wave of positive news in the quantum space.
Rigetti said it had purchase orders totalling $5.7 million for two of its 9-qubit Novera quantum computing systems. The owner of drugmaker Novo Nordisk and the Danish government also invested 300 million euros in a quantum venture fund.
In a blog post earlier this week, Nvidia also highlighted accelerated computing, which it argues can make “quantum computing breakthroughs of today and tomorrow possible.”
OpenAI’s new artificial intelligence video app Sora has already grabbed the top spot in Apple‘s App Store as its number one free app, despite being invite-only.
Sora, which was launched on Tuesday, allows users to create short-form AI videos and share them in a feed. The app is available to iPhone users but requires an invite code to access.
Here’s how to snag a Sora app invite code:
First, download the app from the iOS App Store. Note that Sora requires iOS 18.0 or later to be downloaded.
Login using your OpenAI account.
Click “Notify me when access opens.”
A screen will then appear asking for an access code.
Currently, OpenAI has said that it is prioritizing paying ChatGPT Pro users for Sora access. The app is only available in the U.S. and Canada, but is expected to roll out to additional countries soon, the company said.
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If you do not know someone who can provide an access code, several people are sharing invite codes on the official OpenAI Discord server, as well as on X and Reddit threads.
Once you input your access, you will be able to start generating AI videos using text or images. Users are also able to cameo as characters in their videos as well as “remix” other posts.
The app is powered by the new Sora 2.0 model, an updated version of the original Sora model from last year. The video generation model is “physically accurate, realistic, and more controllable” than prior systems, the company said in a blog post.