Alphabet (GOOGL - Free Report) saying Apple’s (AAPL - Free Report) ITP vulnerability remains, Amazon (AMZN - Free Report) filing motion to stop work under the JEDI contract, Amazon’s soaring music subs, UK digital tax, ASML (ASML - Free Report) approach to China-U.S. trade spat and other stories are covered in this iteration. Check out the details below-
Google Says Apple Software Facilitates User Tracking
Google researchers say that Apple’s Intelligent Tracking Prevention feature that’s supposed to protect users of the Safari browser from cookie-based tracking can actually be used to do the opposite. The flaw was pointed out by Google in August 2019, two years after the feature became available, and in December, Apple said the vulnerability was patched.
Justin Schuh, engineering director for Google’s Chrome browser is now saying that Apple didn’t provide details at the time and that the problem remains. The thing about the intelligent tracking feature lies in the way that it is customized, because it tracks a person’s usage to determine the algorithms that would work best for each individual. Apple maintains that the bugs were fixed in December, reports Bloomberg.
Privacy groups, some technology companies and users have opposed cookie-based tracking, which is why technology companies are doing away with them. Even Google has decided to phase out the feature.
Amazon Files Motion to Stop Microsoft JEDI Work
As indicated last week, Amazon has filed a motion in court to ensure that no work under the Joint Enterprise Defense Infrastructure Cloud (JEDI) contract can be ordered by the Pentagon or completed by Microsoft (MSFT - Free Report) until a court has ruled on the selection process that Amazon is contesting. Microsoft is filing to dismiss the lawsuit. The companies hope that the judge will rule by Feb 11 when work is scheduled to start.
Amazon said that the selection process was flawed and influenced by President Donald Trump because of his personal vendetta with its CEO Jeff Bezos. The government maintains there was no wrongdoing.
Amazon Music Subscribers Jump
With 50 million songs in its library and five payment plans, Amazon has a lot to offer subscribers. So whether you’re paying $14.99 (or $12.99 as a Prime subscriber) for Amazon Music HD, or $9.99 ($7.99 as a Prime subscriber) for Amazon Music Unlimited, which grew 50% in 2019, competing with Apple Music and Spotify (SPOT - Free Report) , or you’re using the Unlimited service in a single location for as little as $3.99, or you’re getting a limited access to 2 million songs at no extra charge by virtue of being a Prime member, or you’re happy with ad-supported free music, Amazon has something for everybody. And all these subscribers add up to 55 million, according to the company’s recent announcement, which is not bad at all considering that Amazon was late to the streaming party having entered a couple of years after Apple.
Amazon Delivery Robot Patent
Amazon has obtained a patent for a multifaceted last-mile autonomous robot that can move though air, water or the ground or any combination of these, depending on the attachments on the thing. It can carry, deliver and pick up parcels that are then stored in a modular compartment that may also have designated lockers for different people. It’s still very much a concept, but an interesting one, and with an unassuming name, which is "storage compartment vehicle."
UK Digital Tax Up Next
Treasury Secretaries of the U.S. and UK clashed on the question of digital taxes at Davos. While the UK intends to go ahead with a tax similar to the one that France initiated and later decided to put a hold on it, the UK intends to go ahead with its plan and let the thing die a natural death once an international consensus is reached.
The UK holds that the international law is taking too long, so although that was its first preference, it has to make an interim law that will go into operation in April. The U.S. stands to suffer because companies like Alphabet, Facebook (FB - Free Report) and Amazon will be affected while other big non-American companies won’t. So Mnuchin said that these kinds of measures would bring retaliatory action from the U.S., such as a tax on British cars.
Additionally, the post-Brexit UK has trade agreements with the EU as its first priority and something officials feel will happen this year, so any deal with the U.S. will only come after that.
ASML Chief Takes U.S.-China Tiff in Its Stride
ASML chief executive Peter Wennink told Bloomberg radio that the ongoing trade negotiations between the U.S. and Europe wouldn’t affect the company adversely.
The reason the company is caught in the midst of the dog fight is that it has a near monopoly in EUV technology, which is essential for chip manufacture. Since China wants to grow a semiconductor industry to reduce reliance on costly imports and make it a front runner in technological prowess, it desperately needs the lithography equipment that ASML makes. The U.S. on the other hand, is trying to thwart China’s progress as it irons out differences on trade deficit and other things while keeping itself in the lead.
The ASML equipment in question requires a special government license for export because it falls in the “dual use” category, meaning it has military applications. So U.S. government officials were able to get in the middle. With the license not renewed, ASML couldn’t deliver the $150 million machine to China’s Semiconductor Manufacturing International, the first Chinese company to have raised such an order (the machines are currently sold in the U.S., South Korea and Taiwan).
Wennink’s thinking is that since the required number of chips the global tech industry consumes have to be made by somebody, it doesn’t matter who makes them as far as the company’s financials are concerned. So it doesn’t matter that Chinese ambassador Xu Hong is protesting. Moreover, since the Netherlands reportedly imports 39.2 billion euros ($43.7 billion) of Chinese goods (some of it for resale), its likely “relations” will hold up.
TripAdvisor Job Cuts
TripAdvisor is reportedly reducing its headcount by about 200 from the 3,800 it employed at September-end. The company appears to be seeing challenges in its business as the going is rough with Google’s competing business and TripAdvisor forced to spend more on ads above the search engine results page. The company is not suing Google yet, but since the situation is expected to change any time soon, it is reallocating expenses to maintain profitability.
Tech Leads Business Lobbying in 2019
The five biggest tech companies by market value together spent $62.2 million on lobbying in 2019, 3% less than in 2018. Facebook topped the list, followed by Amazon and Apple although Alphabet’s spending surprisingly declined as it overhauled its lobbying structure. The second largest business group was the U.S. Chamber of Commerce, which spent $58.2 million and doubled the amount spent by the Pharmaceutical Research and Manufacturers of America, which takes care of most for the lobbying for pharma companies.
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