Connect with us

Business

Facebook rejects call by co-founder to break into three companies

Published

on

facebook

Facebook quickly rejected a call from co-founder Chris Hughes on Thursday to split the world’s largest social media company in three, while legislators urged the US justice department to launch an antitrust investigation.

Facebook has been under scrutiny from regulators around the world over data sharing practices as well as hate speech and misinformation on its networks. Some US legislators have pushed for action to break up big tech companies as well as federal privacy regulation.

“We are a nation with a tradition of reining in monopolies, no matter how well intentioned the leaders of these companies may be. Mark’s power is unprecedented and un-American,” Hughes, a former college roommate of Facebook CEO Mark Zuckerberg, wrote in a lengthy New York Times opinion piece.

Facebook’s social network has more than 2-billion users. It also owns WhatsApp, Messenger and Instagram, each used by more than 1-billion people. Facebook bought Instagram in 2012 and WhatsApp in 2014.

Facebook rejected Hughes’ call for WhatsApp and Instagram to be made into separate companies, and said the focus should instead be on regulating the internet. Zuckerberg will be in Paris on Friday to discuss internet regulation with French President Emmanuel Macron.

“Facebook accepts that with success comes accountability. But you don’t enforce accountability by calling for the break up of a successful American company,” Facebook spokesperson Nick Clegg said in a statement.

“Accountability of tech companies can only be achieved through the painstaking introduction of new rules for the internet. That is exactly what Mark Zuckerberg has called for.”

Late on Thursday, Senator Mike Crapo, the Republican who chairs the banking committee and Sherrod Brown, the top Democrat, asked Facebook to answer questions about a potential cryptocurrency-based payments system using its social network and its data collection.

The letter also asked questions about consumer privacy protections and if it had information about users’ creditworthiness.

US Senator Richard Blumenthal, a Democrat, told CNBC he thinks Facebook should be broken up and that the justice department’s antitrust division needs to begin an investigation.

Antitrust law makes such a proposal tough to execute because the government would have to take the company to court and win. It is rare to break up a company but not unheard of, with Standard Oil and AT&T being the two biggest examples.

Sense of responsibility

Hughes co-founded Facebook in 2004 at Harvard with Zuckerberg and Dustin Moskovitz. He left Facebook in 2007, and has said in a LinkedIn post that he made half a billion dollars for his three years of work.

“It’s been 15 years since I co-founded Facebook at Harvard, and I haven’t worked at the company in a decade. But I feel a sense of anger and responsibility,’ Hughes said.

Facebook lost several executives after a bruising series of privacy and disinformation scandals since 2016. The founders of Instagram and WhatsApp have left, as has the executive who took over WhatsApp in 2018.

Chief product officer Chris Cox, who had been at the company for 13 years and was one of Zuckerberg’s closest lieutenants, stepped down in March about the same time Facebook announced a pivot towards more private messaging.

He later cited “artistic differences” with Zuckerberg as his reason for leaving, without elaborating.

Critics say the company’s pivot to privacy, which will introduce more encrypted communications, will restrict Facebook’s ability to police propaganda, hate speech and other abusive behavior. Cox focused on improving tools to catch banned content in recent years.

Despite its scandals, the company’s core business has proven resilient. Facebook has blown past earnings estimates in the past two quarters and its stock price barely budged in response to Hughes’ opinion piece.

Hughes suggested Zuckerberg should be held responsible for privacy and other lapses at the company, echoing a call earlier in May by Democratic Senator Ron Wyden to hold the CEO individually liable for “repeated violations” of privacy.

“The government must hold Mark accountable. For too long, lawmakers have marvelled at Facebook’s explosive growth and overlooked their responsibility to ensure that Americans are protected and markets are competitive,” Hughes said.

Legislator pressure

Senator Elizabeth Warren, who is seeking the Democratic nomination for the 2020 presidential election, has vowed to break up Facebook, Amazon.com and Alphabet’s Google if elected.

“Today’s big tech companies have too much power over our economy, our society, & our democracy. They’ve bulldozed competition, used our private info for profit, hurt small businesses & stifled innovation. It’s time to #BreakUpBigTech,” she said on Twitter on Thursday.

Representative Ro Khanna, a California Democrat, said in a statement he agreed in retrospect that US regulators should not have approved Facebook’s acquisition of Instagram and WhatsApp.

“The way forward is to heavily scrutinise future mergers and to ensure no company has anticompetitive platform privileges,” Khanna said.

In one of a number of scandals to hit the company, Facebook is accused of inappropriately sharing information belonging to 87- million users with the now-defunct British political consulting firm Cambridge Analytica.

Facebook has been in advanced talks with the US Federal Trade Commission (FTC) to settle a year-old investigation and said in April it expected to spend between $3bn and $5bn.

On Monday, Republican and Democratic US senators criticised reported plans for the settlement, calling on the FTC to impose harsher penalties and more restrictions on Facebook’s business practices.

Hughes said he last met with Zuckerberg in the summer of 2017, several months before the Cambridge Analytica scandal broke.

“Mark is a good, kind person. But I’m angry that his focus on growth led him to sacrifice security and civility for clicks,” he said.

Adam Mosseri, Facebook’s previous head of news feed who recently took over Instagram, responded to Hughes on Twitter.

“Regulation is important and necessary, but I’m not convinced breaking us up is the right path. Would love to chat about it if you’re open,” he said.

Source: https://www.businesslive.co.za/bd/companies/2019-05-10-facebook-rejects-call-by-co-founder-to-break-into-three-companies/

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

GM’s Maven, citing strategy shift, pulls out of Chicago, New York

Published

on

By

maven general motors

Maven, the mobility brand operated by General Motors, is ceasing operations in several major U.S. markets.

The brand will stop service in New York, Chicago and multiple other markets as part of a “shift in strategy,” a spokeswoman said Monday.

Maven car-sharing will remain in Detroit and Los Angeles but details were unavailable on how the company plans to address services in other markets.

In some markets, the brand will keep car-sharing services available for consumers while shuttering Maven Gig, which provides short-term leases for vehicles used in ride-hailing or delivery services. The opposite will be true in other markets, according to the spokeswoman. In some markets, both branches of the business will cease operations.

Maven car-sharing is available in 12 cities, while Maven Gig is available in 10. It wasn’t immediately clear whether operations will cease immediately.

The restructuring is the first major change for Maven since Julia Steyn, former head of Maven and GM Urban Mobility, left the company in January.

The moves are a result of the company wanting to “concentrate on markets in which we have the strongest current demand and growth potential,” the spokeswoman said.
Maven, launched in January 2016, was GM’s first significant foray into the car-sharing and mobility space. It debuted in Ann Arbor, Mich. GM has broadly used the brand as a laboratory to gather information for its automated-vehicle and connected-car plans.

At its onset, GM saw Maven as a key part of its evolution from an automotive-centered company into one that spread its business across other mobility services.

“We see the emergence of car share and ride sharing, in general, as much of an opportunity for GM than it is a threat,” said Dan Ammann, president of GM at the time. “The thing that really changes between a shared model and a car-owner model is that the car is used in a much more efficient way. Now, cars are idled 95, 96 percent of the time. Utilization in shared can go up quite dramatically, and that makes the economics good for the customer and the company.”

Source: https://www.autonews.com/mobility-report/gms-maven-citing-strategy-shift-pulls-out-chicago-new-york

Continue Reading

Business

Buying electric vehicles in New York could get a lot cheaper and easier

Published

on

By

electric vehicles

New Yorkers are buying electric vehicles at a record pace, and a new package of bills would make the eco-friendly cars less expensive and their charging stations more readily available in urban areas.

The “Green Wheels Green Streets” legislation, introduced recently by Assemblymember Patricia Fahy and State Sens. Jen Metzger, Tim Kennedy and Neil Breslin, would exempt state sales tax and registration fees on purchases of electric vehicles and make charging station installations easier in condominiums and apartments.

Sales of electric vehicles increased by 63 percent in New York last year, jumping to 36,854 from 24,551 in 2017, according to Gov. Andrew Cuomo’s office. The state has pledged to increase the number of electric vehicles on the road to roughly 850,000 by 2025 and 2 million by 2030.

The package of bills would incentivize drivers to transition from gasoline-powered vehicles to electric cars for both environmental and monetary reasons.

A report released in February revealed that more electric vehicles on the road could provide up to $5.1 billion in societal benefits by 2030, including savings for drivers and utility customers and indirect benefits, like reduced carbon emissions.

“Transportation is the largest source of climate-destabilizing emissions in the country, and a sales tax exemption for the purchase of electric vehicles would be a wise investment by our state to accelerate the switch to clean vehicles,” Metzger said.

“EVs are cheaper to maintain and operate than gas-powered vehicles, and if we can reduce the upfront costs of the purchase, more New Yorkers will be able to reap the economic and environmental benefits of clean vehicles.”
A fourth bill, which Fahy said would particularly benefit Brooklyn, would create additional sidewalks and bike lanes.

“Adjusting state transportation policy to contend with the realities of climate change requires a multi-pronged approach,” Fahy told the Brooklyn Eagle. “The goal of the Green Wheels Green Streets agenda is not just to push cleaner motorized modes of transportation but to make sure we are improving the accessibility of cycling and pedestrian infrastructure.

“Loosening requirements on how certain State transportation dollars are used will allow local governments from Brooklyn to Buffalo to contend with longstanding pedestrian safety problems.”

Breslin said that a major deterrent for drivers to switch to electric vehicles is a lack of charging stations — especially in the city and in condominium units where tenants can face additional bureaucratic hurdles to installation.

A study from 2016 ranked New York City as the fourth-most electric vehicle-friendly city in America after Portland, Washington D.C. and Baltimore.

There are about 50 charging stations in Brooklyn, according to a map from ChargePoint, with the largest number of them congregated in the Downtown Brooklyn area.

Most charging stations were in large multi-family building parking lots or in commercial garages, but there were some notable exceptions, including Whole Foods, IKEA, the Brooklyn Museum and the Brooklyn Navy Yard.

A new fast-charging hub was also recently installed at John F. Kennedy Airport, allowing taxis, ride-hailing vehicles, buses and other electric vehicles to charge in 20 minutes or less.

Mayor Bill de Blasio has made it a priority to increase electric vehicle infrastructure in New York City. In 2016, he required the Department of Transportation to build charging stations at all municipal parking lots, and he announced a plan in September 2017 to install at least one fast-charging hub, with up to 20 chargers per site in every borough.

In partnership with Con Edison, DOT will be installing 120 electric vehicle chargers at curbside locations across the five boroughs. The chargers will be in place for four years as part of a demonstration project, which will also include an evaluation, a DOT spokesperson told the Eagle.

Source: https://brooklyneagle.com/articles/2019/05/07/buying-electric-vehicles-in-new-york-could-get-a-lot-cheaper-and-easier/

Continue Reading

Business

Zoom nearly reaches $16 billion in value after first day of trading

Published

on

By

zoom

Video-conferencing company Zoom soared during its debut as a public company.

Shares were up more than 72% at the end of its first day of trading Thursday, to $62 a share. Zoom (ZM) had priced its IPO at $36 per share. It was valued at just under $16 billion when the markets closed.

The company was the second highest-profile technology IPO on Thursday, overshadowed in hype by social site Pinterest (PINS). Pinterest had a solid showing on its first day, ending 28% higher than its IPO price. But it was vastly outperformed by Zoom.

“There was some worry about unicorn IPOs after Lyft (LYFT) disappointed but Zoom and Pinterest show there’s an appetite for highly valued startups,” Matt Kennedy, an analyst at Renaissance Capital, told CNN Business. “It’s [growing] blazing fast and highly profitable. It wasn’t cheap when it priced its IPO, but despite it being given premium valuation it surged further today.”
Kennedy said it’s extremely rare for a company valued at $10 billion — Zoom was valued similarly before Thursday’s IPO — to have such a surge in share prices. The last company to do so was Twitter in 2013.

Zoom was founded in 2011 by Eric Yuan. Yuan, who is from China, came to the United States in 1997 after eight failed attempts at getting a visa over the span of about one-and-a-half years. He succeeded on the ninth try, he said in interview in July with GGV Capital, a venture capital firm.

Yuan said he was inspired to move to Silicon Valley after hearing a speech given by Microsoft founder Bill Gates several years prior. He said, looking back, it was a lesson in perseverance. Once he got to the United States, he said, “I realized, wow, it’s the first wave of the internet revolution. I don’t think I want to miss that.”
Yuan started by writing code at the web-conferencing company Webex, which was ultimately acquired by Cisco in 2007 and is now known as Cisco Webex. Prior to joining Zoom, he was a corporate vice president of engineering at Cisco.

Yuan says he didn’t intend to stay in the United States more than a few years, but eventually “the thought to go back faded away.”
Zoom is not to be confused Zoom Technologies (ZOOM), a small Chinese wireless communications company. However, some investors might have confused the two: Zoom Technologies’ stock also got a boost Thursday. The stock finished the day up 10%, though it had been up much higher earlier in the day. It is now worth $2.70 a share.

Source: https://edition.cnn.com/2019/04/18/tech/zoom-ipo-video-conference/index.html

Continue Reading

Trending

TransportationVoice