Silicon Valley Tech News Roundup – December 11th
US wants to block Microsoft – Activision Blizzard $69 billion acquisition deal – 12/10
The Federal Trade Commission wants to block Microsoft’s plan to acquire Activision Blizzard for $69 billion. The deal was to be the biggest Microsoft purchase in history. Activision Blizzard produces some of the world’s most popular games like Call of Duty, Candy Crush, and World of Warcraft (among others). It is also one of the few game developers producing games for various platforms and devices.
The Federal Trade Commission expressed competition concerns. They think the acquisition would mean Activision Blizzard games would not be available on non-Microsoft consoles. In a press release, the FTC said the acquisition would give Microsoft “the means and motive to harm competition” by manipulating pricing “or withholding content from competitors entirely, resulting in harm to consumers.”
Brad Smith (Microsoft President) stated his company has “complete confidence in our case and welcome the opportunity to present our case in court.” The company also announced it agreed to make Call of Duty available on Nintendo for ten years once they complete the acquisition. Likewise, they offered the same deal to Sony.
Bobby Kotick (Chief Executive of Activision Blizzard) wrote to employees: “This sounds alarming, so I want to reinforce my confidence that this deal will close… The allegation that this deal is anti-competitive doesn’t align with the facts, and we believe we’ll win this challenge.”
SEC issues new guidance – companies will have to disclose cryptocurrency risks – 12/8
On Thursday, the Securities and Exchange Commission (SEC) issued new guidance that requires companies that issue securities to disclose risks in the cryptocurrency market.
According to the new guidance created by the Division of Corporation Finance, publicly traded companies will have to include crypto holdings and the risk exposure to market developments in their public filings. Companies are directed to disclose “such further material information, if any, as may be necessary to make the required statements, in light of the circumstances under which they are made, not misleading.”
Gary Gensler (the Chair of SEC) pushed back on claims that the agency failed to prevent crypto companies from misusing the customers’ funds. Gensler stated the agency would take enforcement actions if the companies do not comply with already existing rules and that the agency took 100 enforcement actions against crypto companies. SEC came under scrutiny after FTX filed for bankruptcy last month. According to some reports, the Justice Department is investigating Sam Bankman-Fried (former Founder of FTX) for fraud.
Sunny Balwani sentenced to 13 years in prison – 12/8
On Wednesday, the San Jose court sentenced Ramesh Sunny Balwani (former President and Chief Operating Officer of Theranos) to almost 13 years in prison. For his role in Theranos, the court convicted Balwani of 12 counts of wire fraud and conspiracy to commit wire fraud in July. The court also found Balwani guilty of defrauding patients, unlike his former partner Elizabeth Holmes, who avoided those charges. Balwani’s lawyers stated he plans to file an appeal.
Initially, the prosecutors charged Holmes and Balwani together. But their trials were separated after Holmes claimed Balwani physically and emotionally abused her. Balwani denied these allegations.
Before the sentencing, Balwani’s lawyers sent a memo to the judge stating: “Mr. Balwani is not the same as Elizabeth Holmes… He actually invested millions of dollars of his own money; he never sought fame or recognition, and he has a long history of quietly giving to those less fortunate.”
Twitter to re-launch paid verification service – 12/10
On Saturday, Twitter announced it will re-launch its paid verification service on Monday, December 12th. The Blue Verification Service will cost $11 per month when users subscribe directly through the company’s iOS. On the web, the service price will be $8 per month.
Twitter launched the Blue Verification Service in November. However, trolls took advantage of the rollout and registered verified accounts for both companies and high-profile individuals, which resulted in chaos on the platform.
To prevent the repeat of imposters taking over, Twitter announced new measures to ensure that will not happen. Users who pay for the verification will have to register their phone numbers. After they obtain the verified status, they can also change their account details (handle, photo, and display details). The company will take away the blue check while it reviews the account again. Other features users will have access to include fewer ads and the ability to post longer videos.
Twitter also plans to launch grey and gold checkmarks – gold checkmarks will be for businesses, while grey checkmarks are reserved for government and other “multilateral” accounts.
