Category: UNCATEGORIZED

Black Friday — the day that launched 1,000 other shopping holidays — may have lost its place as the “start” of the Christmas shopping season by now (it gets bigger and earlier with each passing year). But the day after Thanksgiving still pulls in a crowd of buyers looking for a bargain and remains a major bellwether for tracking how sales will progress in what is the most important period for the retail and commerce sector.

Because of the Covid-19 pandemic, this year was definitely slimmer when it came to actual, in-person crowds — kind of a refreshing break from those times when you feel like it’s the worst of humanity when people are breaking out into fights over TVs at a local Walmart — but online it seems that sales did not disappoint.

Figures from Adobe, which is following online sales in real-time at 80 of the top 100 retailers in the U.S., covering some 100 million SKUs, said that we are “on track” for a new sales record for the day, with between $8.9 billion and $9.6 billion expected in sales online for Black Friday, a jump of 20%-29% on last year.

For some context, in 2019, Adobe tracked $7.4 billion in online sales, and yesterday it said that shoppers spent $5.1 billion on Thanksgiving, with more than $3 billion spent online each day in the week leading up to Thursday.

Adobe was still tallying the final numbers for the day as of this morning European time, so we’ll update this post with the final numbers as and when we get them.

Its analysts say that the evening tends to be big for online shopping — which makes sense since people might have been either going out in person during the day, or just doing something else on a day off.

Not all are in agreement that night time is the right time, however. Figures from Shopify — which analyses activity from the 1 million-plus merchants that use its e-commerce platform — said that the peak shopping hour on its platform was actually 9am Eastern, when there were as many as $3 million in sales per minute. The average cart size for US shoppers was $95.60, it added.

Interestingly, Shopify’s per-minute sales number underscores how the long tail of merchants are still quite a ways behind the very biggest: Adobe noted that its figures, across the sites that it tracks (which have at least $1 billion in annual sales) tally to $6.2 million spent per minute on Black Friday.

In either case, smartphones continue to be a major driver of how sales get made. Adobe said that as of 4pm Eastern some 41.5% of all sales were on handsets, a bit lower than the day before but 7% higher than in 2019. And just as was the case yesterday, it seems that smaller retailers are attracting more shoppers on mobile: Shopify said that some 70% of its sales are being made via smartphones.

We’ll see how all of that plays out later today also with the initial figures from “Small Business Saturday”, which is the latest of the shopping designations added to the holiday weekend, this one trying to hone focus more squarely away from major chains and big box merchants.

One big takeaway from the bigger weekend figures will be that offering items — electronics, tech, toys and sports goods being the most popular categories — at the right price will help retailers continue to bring in sales, in what has proven to be an especially strong year for online shopping after many have opted to stay away from crowded places due to the pandemic, but also a critical year for retailers because of the drag that the pandemic has had on the wider economy.

Cyber Monday is likely to continue to be the biggest of them all, expected to bring in between $11.2 billion and $13 billion in e-commerce transactions, up 19%-38% year-on-year.

Perhaps because of the shift to more online shopping, and the concern over flagging sales, it’s interesting that “holiday season” has also been extended and now comes earlier. Adobe said a survey of consumers found that 41% said they would start shopping earlier this year than previous years due to much earlier discounts. Recall too that Amazon’s Prime Day was delayed to start in October this year, an ‘event’ that many treated as a moment to get a jump start on holiday shopping.

“Black Friday is headed for record-breaking levels as consumers flock online to shop for both holiday gifts and necessities,” said Taylor Schreiner, director, Adobe Digital Insights. “Concurrently, it’s also worth noting that this year, we’re seeing strong online sales momentum across not only the major shopping days like Thanksgiving weekend, but throughout the holiday season as consumers spread out their shopping across several weeks in reaction to continued, heavy discounting from retailers.”

Tony Hsieh, the former head of Zappos who catapulted the shoe company into the big leagues with a sale to Amazon and then used the proceeds of his success in a huge project kickstarting regeneration of a run-down part of Las Vegas, Nevada, with tech and wider business investments, has died aged 46.

The cause was injuries he sustained from a house fire, a spokesperson for Hsieh confirmed to TechCrunch. He had been visiting family in Connecticut at the time of the fire. It’s not clear if anyone else was injured. The ultimate cause of Hsieh’s death is still under investigation. We will update this as and if we learn more. The full statement from DTP Companies, which ran the Downtown Project (Hsieh’s mammoth initiative to regenerate the very run-down, older part of Las Vegas) is below.

The news has sent shock waves in the midst of the Thanksgiving holiday weekend, and through a community in a city — heavily dependent on tourism — that has been hit extraordinarily hard by the Covid-19 global health pandemic.

Hsieh was a brilliant, offbeat, and — to many people, often very directly — a kind-hearted person who was regularly described as a visionary.

That was not an overstatement. Growing up in the Bay Area, he sold his first company — a marketing tech firm called LinkExchange — to Microsoft when he was just 24, in 1998.

Using some of the proceeds from that, he formed a venture capital firm called Venture Frog. One of his early investments there was ShoeSite.com, founded in 1999 by Nick Swinmurn at a time when the latter could see a shift happening in how people were shopping for footwear, doing a lot more of it online.

Hsieh was entrepreneurial in his instincts, and took a more hands-on role in the startup, which eventually rebranded to Zappos. As Zappos’ CEO Hsieh moved the company from the Bay Area to the outskirts of Vegas in 2004 to build out a bigger customer service operation, run under a particularly strong ethos of flat management meant to empower and inspire employees. His leadership helped catapult it to huge growth: by 2009 he had sold it to Amazon for around $1.2 billion.

He then continued to run the company, and used the proceeds of that work to focus on his next big project: urban regeneration.

Las Vegas is a city that leaves little to sentimentality. Situated in the middle of the desert, the city’s relentless focus has long been on growth, breaking new, seemingly limitless, ground to do so. For years, that meant that huge swathes of “older” Vegas enterprises, in the Downtown area, simply sat empty, leading to the larger area eventually becoming a hotbed of crime and poverty. As with many other urban centers, it has been a vicious cycle: people focus on building newer homes and businesses elsewhere, and that makes the older areas even more neglected and vulnerable.

Hsieh saw the charm of Downtown underneath its more obvious signs of decline, and proceeded to buy up huge swathes of the area: apartment buildings, houses, small business structures, old casinos and hotels, and empty lots.

His vision was not just to be a real estate magnate — although that is clearly something that interested him, too — but to regenerate Vegas in the mold of what he knew best: tech. He proceeded to invest in a huge run of startups, provided they move to Vegas to build their businesses Downtown, to bring entrepreneurs and jobs to the area.

There were lots of quirky elements to the effort: it was not all about hard-nosed business, and some of it was just about trying to have fun on a grand scale. Inspired by Burning Man, Hsieh paid to have several of the structures built for the festival in the desert to be transported and installed permanently in the Downtown area.

A couple of memorable evenings I spent with him in Vegas really underscored to me his profile in the area.

Hopping from casino to bar to restaurant, one night we ended up in an excellent piano karaoke dive where his best friend from childhood and I sang Duran Duran duets and he knocked back Frenet Brancas. People flocked around him wherever he went (so many breathless “Hi, Tony”‘s from many women we walked past). I remember wondering if this was what being a mafia boss (with me playing the role of a very low-level consigliere or guest for the night) was like back in the day.

The Downtown Project, as it came to be called, was a grand vision, and like many grand visions, it has had its ups and downs. Some of that is unsurprising: Simply willing something to exist isn’t always enough, and the strike rate for success in tech is, in reality, very low.

Still, between Zappos and what he built there, it was and is an important testament to the impact that the tech industry can have with a little imagination and a lot of hard work and persistence. Our condolences go out to his family and his many friends, and also those in the slice of the tech and business world he helped to create.

Statement from DTP below:

Good Afternoon, my name is Megan Fazio and I handle public relations for DTP Companies, formerly known as Downtown Project, which Tony Hsieh serves as the visionary of. With a heavy and devastated heart, we regret to inform you that Tony Hsieh passed away peacefully on November 27, 2020 surrounded by his beloved family.

Tony’s kindness and generosity touched the lives of everyone around him, and forever brightened the world. Delivering happiness was always his mantra, so instead of mourning his transition, we ask you to join us in celebrating his life.

On behalf of all DTP Companies employees and staff, we would like to express our deepest condolences to Tony’s family and friends who have all lost Tony as a cherished loved one, visionary and friend. Tony was highly regarded by all of his fellow friends and colleagues in the tight-knit family at DTP Companies, so this heartbreaking tragedy is one that affects many involved.

We ask that you continue to respect the family’s privacy during this most difficult and challenging time.

According to a report from the Financial Times, Facebook-backed cryptocurrency Libra could launch in January. More interestingly, the Libra Association, the consortium created by Facebook, could scale back its ambitions once again.

When it was first unveiled, the Libra cryptocurrency was supposed to be a brand new currency tied to a basket of fiat currencies and securities. Originally, it wouldn’t be based on a single real world currency, but on a mix of multiple currencies.

Many central banks and regulators have been concerned about this vision. That’s why the Libra Association changed course and started working on several single-currency stablecoins.

Stablecoins are cryptocurrencies that don’t fluctuate in value against a specific fiat currency. For instance, one unit of a USD-backed stablecoin is always worth one dollar. Libra mentioned USD, EUR, GBP or SGD as base currencies for its various stablecoins.

According to the Financial Times, the Libra Association now plans to launch a single dollar-backed coin. It’ll compete directly with other stablecoins, such as USDC, PAX and Tether (USDT). The Libra Association still plans to roll out other currencies, but it’ll happen at a later time.

Facebook will most likely launch its own Libra wallet at the same time. Originally called Calibra, the Facebook subsidiary has been rebranded to Novi back in May.

In addition to a standalone app that will let you send and receive Libra tokens, you’ll be able to manage your Novi account from Messenger and WhatsApp. Facebook expects people to start using Novi for remittance purposes and peer-to-peer payments.

It’s unclear whether other members of the Libra Association also plan to launch their own Libra-based service at the same time. Members include Farfetch, Lyft, Shopify, Spotify and Uber.

Ride-hailing firms such as Ola and Uber can only draw a fee of up to 20% on ride fares in India, New Delhi said in guidelines on Friday, a new setback for the SoftBank-backed firms already struggling to improve their finances in the key overseas market.

The guidelines, which for the first time bring modern-age app-based ride-hailing firms under a regulatory framework in the country, also put a cap on the so-called surge pricing, the fare Uber and Ola charge during hours when their services see peak demands.

According to the guidelines, Ola and Uber — and any other app-operated, ride-hailing firm — can charge a maximum of 1.5 times of the base fare. They can, however, choose to offer their services at 50% of the base fare as well. The rules also state that drivers will not be permitted to work for more than 12 hours in a day, and that the companies need to provide them insurance cover.

Uber and Ola have not previously publicly shared precisely how much they charge their drivers for each ride, but industry estimates show that a driver partner with either of these firms makes up to 74% of the ride fare, after paying taxes. The new guidelines say drivers should get to keep at least 80% of fares.

The cap on the ride fare and implied insurance costs will raise operating costs in India for Uber and Ola, both of which have eliminated jobs in recent months amid the pandemic to trim costs. The South Asian nation, which has attracted many giant international firms in recent years as they look for their next growth market, in the meantime has entered an unprecedented recession.

But not everything about the guidelines will hurt Uber and Ola, both of which had no comment to share on Friday. The rules will enable the companies to offer pooling (shared car) services on private cars, though there is a daily limit of four intra-city rides on such cars, and two weekly inter-city rides.

Ujjwal Chaudhry, an associate partner at Bangalore-based marketing research consulting firm Redseer, said the guidelines by the government will have a mixed impact.

“While it is positive in terms of formalizing the sector as well as increasing the consumer trust on aggregators through improved safety regulations. But, overall the impact of these guidelines on the ecosystem growth are negative as capping surge and platform fee will ultimately lead to reduced earnings for 5 Lac (500,000) drivers (currently on these platforms) and will also lead to increased prices and higher wait times for the 6-8 crore (60 to 80 million) consumers who use it for their mobility and commute needs,” he said in a statement.

The rules also address a range of other factors surrounding a ride. For instance, under no circumstance can the cancellation fee imposed on a rider or driver be more than 10% of the total fare, and the fee cannot exceed 100 Indian rupees, or $1.35. Also, female passengers looking for a pooled service will have the option to share the cab with only female passengers, the rules say. Cab aggregators are also required to establish a control room with round-the-clock operations.

Ola and Uber dominate the app-based ride-hailing market in India. Both the companies claim to lead the market, though SoftBank, a common investor, said recently that Ola had a slight lead over Uber in India.

Hacker houses are making a comeback for entrepreneurs as remote work drags on. While founders are adapting to quarantine in style, a group of college women in their 20s aren’t waiting until they are done with undergraduate to plunge into the lifestyle themselves.

Started by college juniors Coco Sack and Kendall Titus, Womxn Ignite is a house for female and non-binary college undergraduates studying computer science. The idea was born out of Sack and Titus’s exhaustion with remote school at Yale and Stanford respectively. After too many boring Zoom lectures, they took gap semesters and searched for a productive way to spend their time off.

“There are a lot of [programs] that target younger women to get them into coding in high school, and there’s a lot of syndicates and founder groups for women late into their careers,” Titus said. “But there was nothing for anyone in the age range of 20 to 25 where you’re trying to find your way, raise your voice, and hold your ground.”

So, they started their own program. The duo rented out a wedding resort space in California and searched for other women who would experiment the lifestyle and take a gap year. As over 40% of students consider a gap year, the demand became apparent very fast: over 500 people applied for a spot in the house, and just 20 were chosen.

Womxn Ignite is organized as a live-in incubator. Participants are sorted into teams based on their interest areas, and are then pushed to solve a certain problem.

To do so, teams go through a variety of mentor sessions. On Mondays, Tuesdays, and Thursdays, Womxn Ignite sets up mentorship sessions from a revolving-base of female entrepreneurs. There are also guest speaker talks sprinkled throughout the week for high-profile entrepreneurs, including Melinda Gates and bumble’s Whitney Wolfe Herde.

At the end of each week, a team gives a presentation on their progress around problem statements, solution, customer validation, and product development.

Titus says that the goal is not for everyone to come out with a company, but instead to leave with more people in your network and ideas on how to approach starting your business. One participant is writing a TV show about being a Black woman in tech; another is creating a company meant to make programs like Womxn Ignite easier to launch at scale.

In between those sessions is largely spent on team-based collaboration and networking. There are themed-dinners and “platonic date nights” where participants are paired up and encouraged to explore the area or do an activity together to get to know one another. On weekends, women are invited to talk about their niche obsessions, whether it’s the ethical concerns of facial recognition or materials at the nanoscale.

Titus and Sack say that they charge no more than $5,000 for entrance into the program, but over half of participants are on scholarships given by unnamed investors.

Diversity of a cohort matters when trying to create a community that will systemically empower women of all backgrounds. Racial diversity of Womxn Ignite ranges from majority white, but is closely met by Black and LatinX, followed by Middle Easter and Asian Indian. The participants came from all top-tier schools, including Stanford, Yale, Georgetown, Columbia, Harvard, Dartmouth and MIT.

The community of women, many of whom plan to return to school, aren’t focused on classic accelerator tropes like Demo Days or first checks simply because of the stage of life they are in. Instead, the program ends with an optional-ask: will each participant dedicate 1% of their annual income for the next 5 years into a syndicate fund? So far, most have signed yes, the co-founders said, even though the majority will return to school in some capacity.

The fund will be used to invest in other female founders, and grow as Womxn Ignite members grow in their careers, too.

“That number will hopefully grow,” Titus said. “We’ll have pooled what we can collectively think about how we want to spend and invest to help elevate other female founders like ourselves.”

Clara Schwab, a participant in Womxn Ignite, said that the contract will help women get more involved in venture capital, a male-dominated field, earlier in their careers.

“And I don’t know any other environment or situation in which myself and 19 other really talented and smart and ambitious women who are all interested in tech, we come together and like, discuss such a thing,” she said.

The co-founders plan to host another cohort in February, and then focus on building out a digital community for the participants.

 

 

Human rights NGO, Amnesty International, has written to the EU’s competition regulator calling for Google’s acquisition of wearable maker Fitbit to be blocked — unless meaningful safeguards can be baked in.

The tech giant announced its intent to splash $2.1BN to acquire Fitbit a year ago but has yet to gain regulatory approval for the deal in the European Union.

In a letter addressed to the blocs competition chief, Margrethe Vestager, Amnesty writes: “The Commission must ensure that the merger does not proceed unless the two business enterprises can demonstrate that they have taken adequate account of the human rights risks and implemented strong and meaningful safeguards that prevent and mitigate these risks in the future.”

In a report last year the NGO attacked the business model of Google and Facebook — saying the “surveillance giants” enable human rights harm “at a population scale”.

In its letter to Vestager Amnesty warns that Google is “incentivized to merge and aggregate data across its different platforms”.

“Google’s business model incentivizes the company to continuously seek more data on more people across the online world and into the physical world. The merger with Fitbit is a clear example of this expansionist approach to data extraction, enabling the company to extend its data collection into the health and wearables sector,” it warns. “The sheer scale of the intrusion of Google’s business model into our private lives is an unprecedented interference with our privacy, and in fact has undermined the very essence of privacy.”

Amnesty is urging the Commission to take heed of an earlier call by a coalition of civil society groups also raising concerns about the merger for “minimum remedies” which regulators must guarantee before any approval.

We’ve reached out to the Commission and Google for a response to Amnesty’s letter.

Google’s plan to gobble Fitbit and its health tracking data has been stalled as EU regulators dig into competition concerns. Vestager elected to open an in-depth probe in August, saying she wanted to make sure the deal wouldn’t distort competition by further entrenching Google’s dominance of the online ad market.

The Commission has also voiced concerns about the risk of Google locking other wearable device makers out of its Android mobile ecosystem.

However concerns over Google’s plan to gobble up Fitbit range wider than the risk of it getting more market muscle if the deal gets waved through.

Put simply, letting sensitive health data fall into the hands of an advertising giant is a privacy trashfire.

Amnesty International is just the latest rights watcher to call for the merger to be blocked. Privacy campaign groups and the EU’s own data protection advisor have been warning for months against letting the tech giant gobble up sensitive health data.

The Commission’s decision to scrutinize the acquisition rather than waiving it through with a cursory look has led Google to make a number of concessions in an attempt to get it cleared — including a pledge not to use Fitbit data for ad targeting and to guarantee support for other wearables makers to operate on Android.

In its letter, Amnesty argues that the ‘safeguards’ Google has offered are not enough.

“The company’s past practice around privacy further heighten the need for strict safeguards,” it warns, pointing to examples such as Google combining data from advertising network DoubleClick after it had acquired that business with personal data collected from its other platforms.

“The European Data Protection Board has recognized the risks of the merger, stating that the “combination and accumulation of sensitive personal data” by Google could entail a “high level of risk” to the rights to privacy and data protection,” it adds.

As well as undermining people’s privacy, Google’s use of algorithms fed with personal data to generate profiles of Internet users in order to predict their behavior erodes what Amnesty describes as “the critical principle that all people should enjoy equal access to their human rights”.

“This risk is heightened when profiling is deployed in contexts that touch directly on people’s economic, social and cultural rights, such as the right to health where people may suffer unequal treatment based on predictions about their health, and as such must be taken into account in the context of health and fitness data,” it warns.

“This power of the platforms has not only exacerbated and magnified their rights impacts but has also created a situation in which it is very difficult to hold the companies to account, or for those affected to access an effective remedy,” Amnesty adds, noting that while big tech companies have faced a number of regulatory actions around the world none has so far been able to derail what it calls “the fundamental drivers of the surveillance-based business model”.

So far the Commission has stood firm in taking its time to consider the issue in detail.

A series of extensions mean a decision on whether to allow the Google-Fitbit merger may not come until early 2021. Though we understand the bloc’s national competition authorities are meeting to discuss the merger at the start of December so it’s possible a decision could be issued before the end of the year.

Per EU merger law, the Commission college takes the final decision — with a requirement to take “utmost account” of the opinion of the Member States’ advisory committee (though it’s not legally binding).

So it’s ultimately up to Brussels to determine whether Google-Fitbit gets green lit.

In recent years, competition chief Vestager, who is also EVP for the Commission’s digital strategy, has said she favors tighter regulation as a tool for ensuring businesses comply with the EU’s rules, rather than blocking market access or outright bans on certain practices.

She has also voiced opposition to breaking up tech giants, again preferring to advocate for imposing controls on how they can use data as a way to rebalance digital markets.

To date, the Commission has never blocked a tech merger. Though it has had its fingers burnt by big tech’s misleading filings — so has its own reputation to consider above reaching for the usual rubberstamp.

Simultaneously, EU lawmakers are working on a proposal for an ex ante regulation to address competition concerns in digital markets that would put specific rules and obligations on dominant players like Google — again in areas such as data use and data access.

That plan is due to be presented early next month — so it’s another factor which may be adding to the delay to the Commission’s Google-Fitbit decision.

The Exchange is technically off today, but we’re here anyway because there’s neat stuff in the world of startups and money to talk about. So, let’s yammer this morning about Slack’s new valuation and what the market is telling us about what the venerable SaaS company is really worth.

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Recall that on Wednesday, news broke that Salesforce is considering buying Slack, a move that has potential merit and some question marks.

The merits could include bringing Slack’s startup mindshare to Salesforce, and bringing Salesforce’s enterprise reach to Slack. In terms of questions, precisely how Slack fits into Salesforce’s CRM-and-platform play isn’t clear; Salesforce’s own Slack-ish competitor, Chatter, hasn’t taken control of its market in the more than decade since its release (here’s TechCrunch covering its launch back in 2009), making the possible home of Slack inside Salesforce slightly suspect.

Still, Slack investors cheered the concept of Salesforce paying up for their company, while investors in the latter company knocked nearly $20 off its share price, perhaps worried about the very thing that Slack’s owners were stoked to consider.

So, price. What’s Slack worth? This is a question that’s fun in both academic terms, and also for understanding the current dynamics in the software M&A market — what do you have to pay to take a large chess piece off the software market’s board?

Let’s take a look at what we can learn from Slack’s pre-news price, and its current, changed valuation.

What’s it worth?

Here’s a chart of Slack’s value before, and after the Salesforce news, just to give you a taste of how big an impact the reporting had:

We are hearing that a COVID-19 vaccine could be on the way sooner than later, and that means we could be returning to normal life some time in 2021. That’s the good news. The perplexing news, however, is that each time some positive news emerges about a vaccine — and believe me I’m not complaining — Wall Street punishes stocks it thinks benefits from us being stuck at home. That would be companies like Zoom and Peloton.

While I’m not here to give investment advice, I’m confident that these companies are going to be fine even after we return to the office. While we surely pine for human contact, office brainstorming, going out to lunch with colleagues and just meeting and collaborating in the same space, it doesn’t mean we will simply return to life as it was before the pandemic and spend five days a week in the office.

One thing is clear in my discussions with startups born or growing up during the pandemic: They have learned to operate, hire and sell remotely, and many say they will continue to be remote-first when the pandemic is over. Established larger public companies like Dropbox, Facebook, Twitter, Shopify and others have announced they will continue to offer a remote-work option going forward. There are many other such examples.

It’s fair to say that we learned many lessons about working from home over this year, and we will carry them with us whenever we return to school and the office — and some percentage of us will continue to work from home at least some of the time, while a fair number of businesses could become remote-first.

Wall Street reactions

On November 9, news that the Pfizer vaccine was at least 90% effective threw the markets for a loop. The summer trade, in which investors moved capital from traditional, non-tech industries and pushed it into software shares, flipped; suddenly the stocks that had been riding a pandemic wave were losing ground while old-fashioned, even stodgy, companies shot higher.

The UK is moving ahead with a plan to regulate big tech, responding to competition concerns over a ‘winner takes all’ dynamic in digital markets.

It will set up a new Digital Market Unit (DMU) to oversee a “pro-competition” regime for Internet platforms — including those funded by online advertising, such as Facebook and Google — the Department of Digital, Culture, Media and Sport (DCMS) announced today.

It’s moving at a clip — with the new Unit slated to begin work in April. Although the necessary law to empower the new regulator to make interventions will take longer. The government said it will consult on the Unit’s form and function in early 2021 — and legislate “as soon as parliamentary time allows”.

A core part of the plan is a new statutory Code of Conduct aimed at giving platform users more choice and third party businesses more power over the intermediaries that host and monetize them.

The government suggests the code could require tech giants to allow users to opt out of behavioral advertising entirely — something Facebook’s platform, for example, does not currently allow.

It also wants the code to support the sustainability of the news industry by “rebalancing” the relationship between publishers and platform giants, as it puts it.

Concern over how to support quality public interest journalism in an era of ad-funded user-generated-content giants has been stepping up in recent years as online disinformation has been actively weaponized to attack democracies and try to influence votes.

“The new code will set clear expectations for platforms that have considerable market power — known as strategic market status — over what represents acceptable behaviour when interacting with competitors and users,” DCMS writes in a press release.

It suggests the DMU will have powers to “suspend, block and reverse decisions of tech giants, order them to take certain actions to achieve compliance with the code, and impose financial penalties for non-compliance”. Although full details are set to be worked out next year.

A Digital Markets Taskforce, which the government set up earlier this year to advise on the design of the competition measures, will inform the Unit’s work, including how the regime will work in practice, per DCMS.

The taskforce will also come up with the methodology that’s used to determine which platforms/companies should be designated as having strategic market status.

On that front it’s all but certain Facebook and Google will gain the designation, and be subject to the code and oversight by the DMU, although confirmation can only come from the Unit itself once it’s up and running. But UK policymakers don’t appear to have been fooled by bogus big tech talking points of competition being ‘only a click away’.

The move to set up a UK regulator for big tech’s market power follows a competition market review chaired by former U.S. president Barack Obama’s chief economic advisor, professor Jason Furman, which reported last year. The expert panel recommended existing competition policy was fit for purpose but that new tools were needed for it to tackle market challenges flowing from platform power and online network effects.

Crucially, the Furman report advocated for a ‘broad church’ interpretation of consumer welfare as the driver of competition interventions — encompassing factors such as choice, quality and innovation, not just price.

That’s key given big tech’s strategic application of free-at-the-point-of-use services as a tool for dominating markets by gaining massive marketshare which in turn gives it the power to set self-serving usage conditions for consumers and anti-competitive rules for third party businesses — enabling it to entrench its hold on the digital attention sphere.

The UK’s Competition and Markets Authority (CMA) also undertook a market study of the digital advertising sector — going on to report substantial concerns over the power of the adtech duopoly. Although in its final report it deferred competitive intervention in favor of waiting for the government to legislate.

Commenting on the announcement of the DMU in a statement, digital secretary Oliver Dowden said: “I’m unashamedly pro-tech and the services of digital platforms are positively transforming the economy – bringing huge benefits to businesses, consumers and society. But there is growing consensus in the UK and abroad that the concentration of power among a small number of tech companies is curtailing growth of the sector, reducing innovation and having negative impacts on the people and businesses that rely on them. It’s time to address that and unleash a new age of tech growth.”

Business secretary Alok Sharma added: “The dominance of just a few big tech companies is leading to less innovation, higher advertising prices and less choice and control for consumers. Our new, pro-competition regime for digital markets will ensure consumers have choice, and mean smaller firms aren’t pushed out.”

The UK’s move to regulate big tech means there’s now broad consensus among European lawmakers that platform power must be curtailed — and that competition rules need properly resourcing to get the job done.

A similar digital market regime is due to be presented by EU lawmakers next month.

The Commission has said the forthcoming ex ante regulation — which it’s calling the Digital Markets Act — will identify platforms which hold significant market power, so-called Internet gatekeepers, and apply a specific set of fairness and transparency rules and obligations on them with the aim of rebalancing competition.

A second piece of proposed EU legislation, the Digital Services Act, is set to update rules for online businesses by setting clear rules and responsibilities on all players in specific areas such as hate speech and illegal content.

The UK is also working on a similar online safety-focused regime — proposing to regulate a range of harms in its Online Harms white paper last year. Though it has yet to come forward with draft legislation.

This summer the BBC reported that the government has not committed to introduce a draft bill next year either — suggesting its planned wider Internet regulation regime may not be in place until 2023 or 2024.

There’s no lack of news these days on China’s tech giants teaming up with traditional carmakers. Companies from Alibaba to Huawei are striving to become relevant in the trillion-dollar auto industry, which itself is seeking an electric transition and intelligent upgrade as 5G comes of age.

State-owned automaker SAIC Motor, a major player in China, unveiled this week a new electric vehicle arm called Zhiji, in which Alibaba and a Shanghai government-backed entity are minority shareholders. The tie-up comes as Chinese EV startups like Xpeng and Nio and their predecessor Tesla see their stocks soaring in recent months.

Alibaba’s ties with SAIC can be traced back to 2015 when they jointly announced a $160 million investment in internet-connected cars. The partners moved on to form a joint venture called Banma (or ‘Zebra’) and Alibaba has since developed a slew of auto solutions for the Banma platform to enable everything from voice-activated navigation to voice ordering coffee, which is, of course, linked to the Alipay e-wallet.

Alibaba is certainly not SAIC’s exclusive supplier, as it’s also worked closely with the likes of BMW and Audi as well over the years.

For SAIC’s new EV brand, Alibaba will continue to be its “technology solution provider,” an Alibaba spokesperson told TechCrunch.

The other tech giant making big moves in auto is Huawei. Just this week, the telecoms equipment and smartphone maker announced it would fold its smart car unit into its consumer business group, which previously focused on handsets. The expanded group will continue to be steered by Richard Yu, regarded as the man who helped grow Huawei from an underdog in the mobile industry to a leading global player.

Huawei’s ambition in auto is “not to manufacture cars but to focus on developing ICT [information and communications technology] to assist automakers in producing cars,” the firm asserts in the statement, addressing rumors that it wants to encroach on traditional carmakers’ turf.

Huawei’s phone business has taken a hit since U.S. sanctions hobbled its supply chain. It sold its budget phone brand Honor recently in the hope that the spinoff, independent from Huawei, will be free from trade restrictions.