Google finds itself in hot water as it faces a whopping $1.67 billion damages demand in an AI-related patent trial.
The tech giant’s legal battle will put its innovative prowess and intellectual property rights to the test.
Google is being sued by a rival company claiming that the search engine giant has infringed upon their AI-related patents.
A lawyer for Singular Computing, founded by Massachusetts-based computer scientist Joseph Bates, argued that Google copied Bates’ technology after multiple meetings to discuss his AI development ideas.
According to lawyer Kerry Timbers, between 2010 and 2014, Bates shared his computer-processing innovations with Google.
However, without his knowledge, Google ended up copying his patented technology instead of licensing it to develop its own AI-supporting chips.
Bates’ innovations were integrated into Google’s Tensor Processing Units, which were used to support AI features in various Google services, including Google Search, Gmail, and Google Translate, among others.
Kerry added that Google’s actions were in violation of Bates’ patent.
Ahron Young is an award winning journalist who has covered major news events around the world. Ahron is the Managing Editor and Founder of TICKER NEWS.
In Short:
– OpenAI’s $6.6 billion share sale allows employees to sell stock at a $500 billion valuation, up from $300 billion.
– The sale supports employee retention amid intense competition for AI talent without pursuing an IPO.
OpenAI has concluded a secondary share sale amounting to $6.6 billion, enabling current and former employees to sell stock at a valuation of $500 billion, as reported by Bloomberg.This valuation represents a significant increase from $300 billion earlier this year, indicating strong investor interest.
Reports indicate that OpenAI had initially authorised up to $10.3 billion for the share sale, although only about two-thirds of this was executed.
The offer was made to eligible employees who had held their shares for over two years, with participation starting in early September.
The recent share sale is OpenAI’s second significant tender offer in less than a year, following a $1.5 billion deal with SoftBank in November.
This transaction solidifies OpenAI’s position as the most valuable privately held company globally, surpassing SpaceX’s valuation of $456 billion.
Talent Competition
Intensified competition for AI talent has emerged, with companies like Meta reportedly offering substantial compensation packages to attract top researchers.
OpenAI is part of a trend among startups, including SpaceX, Stripe, and Databricks, utilising secondary sales to allow employee cash-outs while remaining private.
This strategy aims to retain talent and reward long-serving employees without pursuing an IPO.
Video game publisher Electronic Arts (EA), one of the biggest video game companies in the world behind games such as The Sims and Battlefield, has been sold to a consortium of buyers for US$55 billion (about A$83 billion). It is potentially the largest-ever buyout funded by private equity firms. Not AI, nor mining or banking, but video games.
The members of the consortium include: Silver Lake Partners, an American private global equity firm focusing on technology; the Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund; and the investment firm Affinity Partners, run by Jared Kushner, son-in-law of American President Donald Trump.
The consortium will purchase all of the publicly traded company’s shares, making it private. But while the consortium and EA’s shareholders will likely be celebrating – each share was valued at US$210, representing a 25% premium – it’s not all good news.
PIF acquiring EA raises concerns about possible “game-washing”, and less than ideal future business practices.
EA’s poor reputation
Video games are big business. The global video game industry is worth more than the film and music industries combined. But why would these buyers specifically want to buy EA, an entity that has won The Worst Company in America award twice?
It has been criticised for alleged poor labour practices, a focus on online gaming (even when it’s not ideal, such as in single-player stories), and a history of acquiring popular game studios and franchises and running theminto the ground.
Players of some of EA’s most beloved franchises, such as The Sims, Dragon Age and Star Wars Battlefront II, believe the games have been negatively impacted due to the company meddling in production, and wanting to focus on online play and micro-transactions.
Microtransactions are small amounts of money paid to access, or potentially access, in-game items or currency. Over time, they can add up to a lot of money, and have even been linked to the creation of problem gambling behaviours. Unsurprisingly, they are not popular among players.
Current global economic stresses have affected video games and other high-tech industries. The development costs of a video game can be hundreds of millions of dollars. EA has reacted to its slowing growth by cancelling games and laying-offclose to2,000 workers since 2023. So a US$55 billion offer probably looked enticing.
Saudi Arabia’s investment spree
In recent years, the Saudi wealth fund has been on an entertainment investment splurge. Before this latest acquisition, PIF invested heavily in both golf and tennis.
It is a sponsor and official naming rights partner of both the Women’s Tennis Association rankings and the Association of Tennis Professionals rankings.
The wealth fund also helped establish the LIV Golf tour in 2022, in opposition to the Professional Golf Association (PGA). By offering huge sums of money, it was able to attract players away from the PGA. One player was reportedly offered US$125 million (A$189 million). This tactic worked; a merger was announced between LIV, the DPA (European golf tour) and the PGA (North American golf tour) in 2023, with PIF as the main funder.
PIF, via its subsidiaries, has also been acquiring stakes in other video game companies. For example, it is one of the largest shareholders in Nintendo, the developer behind Mario, and purchased Niantic (the company behind Pokémon Go) earlier this year for US$3.5 billion (A$5.3 billion)
Why does PIF want video game companies?
Live sport and video games have a few things in common: they are fun, engaging and entertaining. And being known for entertainment is good PR for a country that has been accused of human rights abuses.
PIF’s investment in sport has been called “sportswashing”: using an association with sport to counteract bad publicity and a tarnished moral reputation. Video games, with their interactivity and entertainment value, represent an opportunity for game-washing.
The fact EA owns many sports games’ franchises would also be a bonus, potentially allowing for further video game and sport collaboration. And the fact the video game industry is projected to keep growing globally makes it a good investment for an oil-rich nation looking to economically diversify.
Beyond game-washing concerns, we also need to pay attention to the type of buyout happening here. This is a “leveraged” buyout, meaning part of the purchase price – in this case US$20 billion (A$30 billion) – is funded as debt taken on by the company. So once the acquisition is complete, EA will have US$20 billion of new debt.
With all that new debt to service, it would only be natural to have concerns about more lay-offs, cost-cutting and increasing monetisation via strategies such as microtransactions. Ultimately, this would result in a poorer experience for players. It seems the more things change, the more they stay the same.
In Short:
– Cyber attacks increasingly target businesses, with 80% of ransomware victims opting to pay ransoms.
– SMEs are often affected, with only 60% recovering data after paying ransoms amidst rising cyber insurance costs.
Cyber attacks are increasingly targeting sensitive business data, with many companies paying ransoms. A report from Hiscox indicates that 80% of businesses affected by ransomware over the past year opted to pay.The annual Cyber Readiness Report highlights a concerning trend in ransomware attacks against well-known companies, including Marks and Spencer, the Co-op, and Jaguar Land Rover.
The latter recently received a £1.5bn government loan guarantee aimed at protecting its supply chain, which includes numerous small firms.
Many victims of cyber attacks are small and medium-sized enterprises (SMEs), which often require assistance to recover. Hiscox reported that while 27% of the surveyed 5,750 SMEs faced ransomware attacks, only 60% that paid the ransom managed to recover their data.
Impact on Firms
The broader findings revealed that nearly 60% experienced some form of cyber attack, with numerous businesses attributing their vulnerabilities to artificial intelligence.
Companies face not only financial repercussions, including fines and lost revenue, but also damage to their reputations. Eddie Lamb of Hiscox warned against underestimating the severe consequences of cyber attacks on all business sizes.
Jaguar Land Rover was reportedly finalising cyber insurance when it was attacked, incurring significant losses. Industry experts note that the rising costs of comprehensive cyber insurance policies may leave many firms unprotected. The cyber insurance market is growing, responding to the high-profile impacts experienced by businesses like M&S, which anticipates recovering losses through insurance after its own ransomware incident.