Tesla CEO Elon Musk arrives for a U.S. Senate bipartisan Artificial Intelligence Insight Forum at the U.S. Capitol in Washington, D.C., Sept. 13, 2023.
Andrew Caballero-Reynolds | AFP | Getty Images
WASHINGTON — Three Democratic members of the Senate Committee on Armed Services have asked the Pentagon for information about SpaceX CEO Elon Musk, and whether he “directed the unilateral disabling or impediment of function of Starlink satellite communications terminals used by the Ukrainian Armed Forces in southern Ukraine in 2022,” or ever had the authority to do so.
Democratic Sens. Jeanne Shaheen of New Hampshire, Elizabeth Warren of Massachusetts and Tammy Duckworth of Illinois wrote a letter Friday to Defense Secretary Lloyd Austin to express their “serious concerns about whether Musk has personally intervened to undermine a key U.S. partner at a critical juncture.”
Their questions follow the publication of a biography of Elon Musk, who is CEO of SpaceX and automaker Tesla, and owner and chief technology officer of the social network X, formerly known as Twitter. In the book, author Walter Isaacson wrote that a Ukrainian drone submarine attack on Russian warships was disrupted by a disconnect from Starlink, ordered by Musk.
Excerpts from the book raised alarm bells in Washington, among NATO allies and in the Ukrainian capital. After they were published, Musk painted himself as a peacekeeper and wrote on social media that he did not disconnect Starlink over Crimea, but rather denied a request by Ukraine to provide it there. He wrote, “If I had agreed to their request, then SpaceX would be explicitly complicit in a major act of war and conflict escalation.” Isaacson has issued a correction to his biography stating that connectivity had already been disabled in the affected area, and that Musk had simply refused a request to turn it on.
Musk also argued, as he has in the past, that Ukraine should strike a “truce” with Russia. Musk’s “peace plan” argument was shouted down by Ukraine officials, politicians and Putin experts.
On Tuesday, in an interview with CNBC’s “Squawk Box,” Isaacson discussed SpaceX developing a military-grade version of Starlink, which would help resolve concerns expressed by Musk regarding the satellite networks’ use in war.
CNBC asked the U.S. Department of Defense several questions pertaining to SpaceX, including whether the department would be re-evaluating any of the company’s government contracts, whether Musk’s calls for a truce between Ukraine and Russia reflect the U.S. government’s position and whether Musk’s conduct, including taking personal meetings with Putin in the past, had been in line with the terms of contracts awarded to his company.
A spokesperson for the department, Jeff Jurgensen, told CNBC via email, “The Department does contract with Starlink for satellite communication services in support of our Ukrainian partners,” but declined to offer further details or answer the specific questions posed.
He added that the Department of Defense “continues to work closely with commercial industry to ensure we have the right capabilities the Ukrainians need to defend themselves — and more broadly — the kind of communication and space-related capabilities necessary to accomplish our own global missions and support our national defense strategy.”
Earlier in the week, Sen. Warren called for a Congressional probe of Musk and SpaceX. “Congress needs to investigate what’s happened here, and whether we have adequate tools to make sure foreign policy is conducted by the government and not by one billionaire,” Warren said Monday, Bloomberg first reported.
SpaceX is currently working to obtain a new license from the Federal Aviation Administration and approvals from the U.S. Fish and Wildlife Service to resume test flights for its Starship Super Heavy launch vehicle from its Boca Chica, Texas, facility. An earlier test flight this year resulted in an explosion and a mishap investigation overseen and recently completed by the FAA.
The company plans to use Starship to launch and deploy its next generation Starlink satellites. Musk also envisions Starship taking astronauts and supplies to the moon, and eventually, Mars.
Barry Diller rips WGA deal with studios, says fair use needs to be redefined to address AI
Slamming the tentative labor deal between Hollywood writers and studios, media mogul Barry Diller on Tuesday laid out his biggest bone of contention with generative artificial intelligence.
Diller, chairman of IAC and Expedia, called for the law to be redefined to protect published material from capture in artificial intelligence knowledge-bases.
“Fair use needs to redefined because what they have done is sucked up everything and that violates the basis of the copyright law,” Diller said on CNBC’s “Squawk Box.” “All we want to do is establish that there is no such thing as fair use for AI, which gives us standing.”
Diller’s complaints came as prominent authors, including George R.R. Martin and Jodi Picoult, sue OpenAI for copyright infringement. His remarks also followed on the heels of the Writers Guild of America’s tentative agreement with Hollywood studios to end a nearly 150-day strike.
Diller isn’t a fan of the deal.
“They spent months trying to craft words to protect writers from AI and they ended up with a paragraph that protected nothing from no one,” Diller said.
The details of the tentative deal between the WGA and Alliance of Motion Picture and Television Producers have not yet been made public. Hollywood studios are expected to walk away with the right to use and train AI models using writers’ work, according to The Wall Street Journal, which cited unnamed sources familiar with the negotiations. On the other hand, writers are expected to be guarenteed compensation for work they do on scripts, even if the studios employ an AI tool, the Journal added.
Legacy media and AI companies, most notably ChatGPT creator OpenAI, have clashed on what content should be allowed into the knowledge base of generative artificial intelligence. Critics of AI point to the fair use doctrine under U.S. copyright law, which permits limited portions of a work to be used without a license or compensation. Generative AI and language-based model systems index entire bodies of work within their knowledge base, a violation of fair use, some argue.
According to Diller, it’s one of his key points of contention with Sam Altman, the CEO of OpenAI.
“The thing that Sam and I disagree and have talked about is that he believes fair use allows him to take all of a publisher’s [work],” said Diller. “We believe that it doesn’t.”
Altman, who also served on the Expedia board with Diller, testified before senators in May to discuss regulations on AI.
“We think that creators deserve control over how their creations are used, and what happens sort of beyond the point of them releasing it into the world,” Altman said during the hearing. “We need to figure out new ways with this new technology that creators can win, succeed and have a vibrant life, and I’m optimistic that this will present it.”
CNBC has reached out to OpenAI for a response to Diller’s remarks.
Shutterstock, a stock media service and OpenAI partner since 2021, set up a contributors fund for creators which provides compensation if their intellectual property is used during AI content generation. Altman also said that Shutterstock was critical in the training of OpenAI’s generative media AI, DALL-E.
SoftBank-backed Improbable slashes losses by 85%, says pivot to the metaverse has paid off
Herman Narula, co-founder and CEO at Improbable, speaks during a session at the Web Summit in Lisbon.
Henrique Casinhas | Sopa Images | Lightrocket | Getty Images
Virtual reality startup Improbable said Wednesday that it reduced losses by 85% in 2022, a year that saw the company pivot its focus to powering new “metaverse” experiences.
The British company said in a press release that its revenues more than doubled last year to £78 million ($95 million), as its work on metaverses expanded significantly.
It recorded a loss of £19 million in the 2022 fiscal year, but this compared to a £131 million loss the year prior.
Improbable CEO Herman Narula said the company had reported its “best financial year” on record which reflected how its bet on the metaverse had paid off.
Improbable has historically burned through lots of money as it attempts to make its vision for vast virtual worlds a success. Critics have raised questions about the commercial sustainability of the business.
Improbable said that part of the reason behind the company’s reduction in losses was a dramatic reduction in the cost of running mass-scale virtual events.
Whereas initially it took millions of pounds to host one event, it now takes hundreds of thousands of pounds, the company said, and it anticipates this to continue to fall.
The year also saw Improbable divest two of its games studios, Inflexion Games and Midwinter Entertainment, and sell off a business unit focused on servicing defense clients.
Improbable finished the year with £140 million cash in the bank, signaling ongoing support from shareholders, the company said.
Improbable’s backers include the likes of SoftBank, Andreessen Horowitz.
Full accounts for Improbable are yet to be released on Companies House, the U.K.’s official register of companies.
In 2022, Improbable unveiled its ambition to become a major player in the so-called “metaverse” — the concept for a vast world, or worlds, in the digital sphere where people can work, buy and sell things, or just hang out.
The company has been working with players in the digital asset sphere, including Yuga Labs, which it worked with to build out the Otherside metaverse, where people can make their own digital avatars, attend events, and more.
The company doubled down on its metaverse strategy earlier this year with a white paper detailing its vision for MSquared, a “network of interoperable Web3 metaverses.”
MSquared, which is a separate business entity from Improbable, raised $150 million from investors last year.
The service — a complex piece of technical engineering with significant computing requirements — is intended to be accessible via cloud streaming, meaning you won’t have to download any software to jump into one of its worlds, similar to how movies and TV shows are accessed on Netflix.
It’s drawn interest from big names in sports and entertainment, like Major League Baseball (MLB).
The company struck a major deal with MLB to launch a new virtual ballpark based on Improbable’s metaverse technology. People in the MLB metaverse can choose any seat they’d like to watch a game, or pick a camera spot to focus on a particular player.
The tech industry has been betting that virtual and augmented reality will prove to be something of a “paradigm” shift in technology akin to the invention of the internet or the smartphone.
Some are calling it the technology’s “iPhone moment,” in reference to effect Apple’s now ubiquitous handset had on consumers and businesses globally.
Apple recently announced its first virtual and augmented reality headset, called the Vision Pro, while Meta unveiled its Quest 3 headset in June.
For one, you won’t need a headset to enter an MSquared space, as the software will be desktop-based. The experience is also intended to be more decentralized and interoperable, with the ability to take content from one metaverse to another.
Founded in 2012, Improbable has for years been attempting to build vast, continuously rendering worlds in which thousands of people can play games and interact with each other.
The London-headquartered firm, one of Japanese tech investment giant SoftBank’s biggest bets in Britain, was founded by Cambridge computer science students Narula and Rob Whitehead with the ambition of developing large-scale computer simulations and “synthetic environments.”
FTC and 17 states sue Amazon on antitrust charges
In a sweeping complaint filed in federal court in Seattle on Tuesday, the FTC and attorneys general from 17 states accused Amazon of wielding its “monopoly power” to inflate prices, degrade quality for shoppers and unlawfully exclude rivals, thereby undermining competition.
Amazon shares slid as much as 3% in afternoon trading.
The agency laid out a two-pronged strategy by which Amazon “unlawfully maintains” its monopoly power. It pointed to so-called anti-discounting measures the company uses to punish sellers and deter other online retailers from offering lower, more competitive prices than Amazon, which translates to keeping prices higher for products across the internet, the FTC said.
Amazon also “effectively requires” that sellers use its “costly” fulfillment services in order to obtain the vaunted Prime badge for their products, the FTC said, which in turn makes it more expensive to do business on the platform. Sellers are paying $1 of every $2 to Amazon, FTC Chair Lina Khan told reporters at a briefing Tuesday.
The FTC and states alleged that Amazon forces sellers to pay expensive fulfillment and advertising fees to market their goods on the site, while facing no other choice “but to rely on Amazon to stay in business.” These tactics have degraded the shopping experience on Amazon by flooding search results with “pay to play ads” that steer shoppers toward more expensive and less relevant products, Khan said.
Amazon CEO Andy Jassy speaks during the New York Times DealBook Summit in the Appel Room at the Jazz At Lincoln Center on November 30, 2022 in New York City.
Michael M. Santiago | Getty Images
“The upshot here is that Amazon is a monopolist and it’s exploiting its monopolies in ways that leave shoppers and sellers paying more for worse service,” Khan said at the briefing. “In a competitive world, a monopoly hiking prices and degrading service would create an opening for rivals and potential rivals to come in, draw business, grow and compete, but Amazon’s unlawful monopolistic strategy has closed off that possibility, and the public is paying directly as a result.”
David Zapolsky, Amazon’s general counsel and senior vice president of global public policy, said in a statement that the FTC’s complaint is “wrong on the facts and the law.”
“The practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store,” Zapolsky said. “If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for consumers, and reduced options for small businesses—the opposite of what antitrust law is designed to do.”
The FTC didn’t lay out potential remedies such as a breakup or divestitures in its announcement, saying it is primarily seeking to hold Amazon liable. In the complaint, the FTC and states called for the court to prevent Amazon from continuing the alleged unlawful behavior and order “structural relief” to the extent necessary to resolve the harm. Structural relief tends to refer to remedies like breakups and divestments, that alter the business itself, rather than simply order it to discontinue a certain behavior.
Often in antitrust cases, a judge will rule on whether a company is liable for the alleged violations first. Only at that point will a separate proceeding to determine the proper remedies occur, should there be a finding of liability.
The lawsuit is a major milestone for Khan, who rose to prominence for her 2017 Yale Law Journal note, “Amazon’s Antitrust Paradox.” Khan argued in the article that the prominent antitrust framework at the time failed to capture the true extent of Amazon’s dominance and potential harm to competition. Through her work at the FTC, Khan has sought to reset that framework and push the boundaries of antitrust law through risky legal battles.
Lina Khan, Chairwoman of the Federal Trade Commission
Amazon sought Khan’s recusal from antitrust investigations into its business, arguing that her past writing and critiques showed she had prejudged the outcome of such probes.
The charges are the culmination of several years of pressure on federal enforcers to deal with what some competitors, sellers and lawmakers saw as anticompetitive practices. Amazon was one of four Big Tech companies investigated by the House Judiciary subcommittee on antitrust, which found it held monopoly power over most of its third-party sellers and many suppliers. The majority Democratic staff at the time alleged that Amazon shored up “competitive moats” by acquiring rival sites like Diapers.com and Zappos.
At the time, an Amazon spokesperson said in a statement that “large companies are not dominant by definition, and the presumption that success can only be the result of anti-competitive behavior is simply wrong.”
Founded by Jeff Bezos in Seattle in 1994, Amazon has transformed from an online bookseller into a retail, advertising and cloud computing giant with a staggering market valuation of roughly $1.4 trillion. The company has sought to expand its dominance by entering verticals like health care, streaming and grocery, acquiring primary-care provider One Medical, legendary film and television studio MGM, and upscale supermarket chain Whole Foods.
Those moves have attracted intense regulatory scrutiny. The House subcommittee report also accused Amazon of abusing its position in online retail to harm third-party merchants who rely on the platform to sell goods, and alleged it uses “strong-arm tactics” to bully retail partners. The FTC is also reviewing Amazon’s planned $1.7 billion acquisition of Roomba maker iRobot on antitrust grounds. Amazon recently paid roughly $30 million to settle two privacy lawsuits brought by the FTC concerning its Ring doorbell and Alexa units. The agency followed up in June with a lawsuit accusing Amazon of tricking users into signing up for Prime, while making it too difficult for them to cancel.
Amazon’s marketplace has evolved into a linchpin of its e-commerce business. At the time of the marketplace’s launch in 2000, Amazon had already expanded beyond its origins as a bookseller to offering things like CDs and videos. But once it opened its doors to third-party sellers, it supercharged the number and variety of products for sale on its website, earning it the moniker “the everything store.”
The third-party marketplace has given Amazon access to a higher-margin business than just selling books. It has also increased the fees it charges sellers to do business on its site, run advertisements, and tap into its fulfillment and delivery services. In the first half of 2023, the company collected a 45% cut of every sale made by sellers in the U.S., up from 19% in 2014, according to the nonprofit Institute for Local Self Reliance. Sales from third-party sellers now comprise 60% of total units sold, the company recently disclosed.
Read the full complaint here:
Sports11 months ago
‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
Environment4 months ago
Japan and South Korea have a lot at stake in a free and open South China Sea
Sports2 years ago
Team Europe easily wins 4th straight Laver Cup
Technology2 years ago
Game consoles were once banned in China. Now Chinese developers want a slice of the $49 billion pie
Sports6 months ago
MLB Rank 2023: Ranking baseball’s top 100 players
Environment7 months ago
Game-changing Lectric XPedition launched as affordable electric cargo bike
Politics2 years ago
Have the last few wobbly weeks seen a turning point for Johnson as PM?
Business12 months ago
Bank of England’s extraordinary response to government policy is almost unthinkable | Ed Conway