Also in today’s edition: Big Tech laws are in the forge, Europe is churning, China’s quarter of tech-melt
Good morning! Twitter is not the only nation where Elon Musk has a following. Russia loves the eccentric rich boy with space toys, especially because he beat them at rocketry. There are Musk memes and Musk merch, a sweatshirt even showing him as a Russian Orthodox icon. A Moscow bartender Pavel Antonov tried to get in touch with Musk to be the first mixer on Mars. Musk, likewise, is taken in by President Vladimir Putin, even asking for tête-à-tête on Clubhouse, reports the Washington Post. That hasn’t worked out yet but he spoke to Russian students via video link at the Kremlin’s invitation.
Btw, our podcast has been going strong for two months now. Tune in on your daily jog, drive to the office, or even as you WFH-ers have breakfast in bed. We promise it’ll be music to your ears.
The Market Signal
Stocks: Bears had found a foothold in the Indian stock markets after the Paytm listing debacle. They got a firmer grip as news of a new Covid-19 variant roiled global markets. The uncertainty is likely to continue in the coming week with travel restrictions returning, threatening holiday season recovery.
Not So Fast, Elon
The Indian government told prospective users not to pre-order Starlink, Elon Musk-led SpaceX’s satellite-based internet service. The company needs to first obtain a license to operate in India, the government said.
High hopes: Starlink had plans to start broadband service in India from December 2022, with over two lakh active terminals in the country, 80% located in rural areas. It had already booked over 5,000 pre-orders.
Musk has also been seeking lower import duties to roll in Tesla cars but has got no love from the Indian government.
Space wars: Several companies, including Bharti Global-backed OneWeb, Amazon’s Project Kuiper and Tata’s Telesat are prepping to beam down high-speed Internet from low earth orbit satellites or LEOs. The telecom department’s move appears to be the first sign of a new ‘spacecom’ policy.
A Cold Christmas For Big Tech
And it could start down under. Australia is likely to introduce legislation that could force social media companies to unmask anonymous trolls or risk defamation. This, the Aussie Prime Minister Scott Morrison revealed, would happen via valid court orders.
Free speech 🤝 consequences: The legislation would effectively put social media companies, which have used “free speech” and their status as “platforms” as shields against any potential liability, in a spot.
The UK too is working to bring its Online Safety Bill in March. The bill, primarily pitched as protecting users against abuse, bullying and harassment, will “impose a legal duty of care” on big technology companies “to protect users from illegal and legal but harmful content”. Failure to comply, much like Australia’s version, would result in hefty fines.
Oh, and Margrethe Vestager, the EU’s antitrust czar, wants lawmakers to seize the moment and “approve rules to curb the power of Big Tech as a matter of urgency.”
Closer home: Indian Parliament will consider a “global standard law” for social media companies “to curtail user harm” in its winter session that starts today. This legislation, India’s IT minister Rajeev Chandrasekhar told Hindustan Times, will seek to address challenges such as “cyberbullying, cyberstalking, and child sexual abuse content”.
Omicron Threatens Global Shut Down
Governments are battening down the hatches once again as a new variant of Covid-19 originating in South Africa sends waves of fear rippling through the world.
VOC: The new variant has mutated several times and can transmit faster. The WHO has classified it as a variant of concern (VOC) and it is suspected that current vaccines may be less effective against it. A top South African healthcare official has, however, said that infected persons were showing only mild symptoms.
Travel curbs: People infected with the variant have been detected across Europe, and President Joe Biden’s chief medical advisor Anthony Fauci said it may have already arrived in the US. Several countries, including India, have announced travel restrictions and stringent testing of international passengers. Prime Minister Narendra Modi held a high-level meeting on Saturday and asked officials to review easing of travel restrictions.
Setback: Meanwhile, drug maker Merck has said that its antiviral pill Molnupiravir may not be as effective as initially thought.
For the second time in as many years, the virus has threatened the resumption of normal life. The Delta variant that wreaked havoc globally was detected first in India in October 2020. Although health authorities have been warning of a third wave, the general vigil was slowly being relaxed amid signs of economic recovery.
Another wave could snuff out recovery and devastate national economies. Markets are already spooked. The travel industry, which was hoping that the worst was over, is desperately trying to keep flights in the air and vehicles on the road. The World Trade Organization has put off indefinitely its ministerial conference that was set to begin November 30.
BTW: The WHO uses Greek letters to name virus variants. Omicron is the 15th letter in the alphabet but it skipped the two previous ones to avoid the 14th, which is Xi. Now that would have been a global embarrassment. Also, here’s why.
Slow Boil In Europe
Europe is on the edge again and transnational equations within the continent are being rewritten.
New pact: France and Italy have signed a treaty called Quirinal Treaty, named after the presidential palace in Rome where French President Emmanuel Macron and Italian Prime Minister Mario Draghi inked the pact. The treaty is aimed at balancing Germany’s influence on bloc politics, says The Wall Street Journal. The country just got a new chancellor, Olaf Scholz, after 16 Angela Merkel years.
To be sure, France had signed the Aachen Treaty with Germany in 2019, a sort of renewal of vows from the Élysée Treaty of 1963, which played a key role in European integration. With the UK out, the triad, with France in the middle, cements itself at the heart of the European project.
Heating up: It comes at a time when tensions are building up once again between Russia and Ukraine and an economic crisis is brewing in Turkey. It’s so bad Apple has stopped sales. European nations are also reviewing their relationship with China and the decisions they make will have global ramifications.
China’s Techlash Is Showing Up
Over the past six months, Chinese authorities have been tightening the screws on its technology sector, with new regulations. Coupled with China’s economy slowing down, the stress showed up in the quarterly (July to September) earnings of technology companies.
What does that mean? Faced with competition from JD, Alibaba has slashed its growth forecast. Tencent grew at its slowest since the company began operating in 2004. Meituan, the food delivery company that was fined for antitrust violations, reported a nearly $1.56 billion net loss. Baidu reported a decline in advertising revenue, but it made up for it through its AI and cloud businesses. The odd man out here thus far? Short video app Kuaishou, which bucked the trend to report a better-than-expected growth of 33%.
Worst over? While the worst of the crackdown seems to be over, China wants to increase oversight for its online advertising companies. Meanwhile, some state-run companies in China are clamping down on their employees’ usage of Tencent-owned WeChat, “citing security concerns”. Investors, however, appear to be feeling more comfortable.
What Else Made The Signal?
Price hike: India’s largest FMCG companies such as Hindustan Unliever, ITC and Parle have hiked prices of daily-use products, including soaps, deodorants and food items due to high raw material prices.
Beware! A study warns that China can face a ‘colossal’ Covid-19 outbreak with more than 630,000 COVID-19 infections a day if it lifts travel restrictions.
Competition hurts: Visa has complained to the US government that India, particularly Prime Minister Narendra Modi and other officials, promoting RuPay was hurting Visa’s market. Quite rich, we say!
Called for: The ED has summoned senior officials of Amazon and Future Group for alleged foreign exchange norms violations in a deal between the two companies.
Fined: Italian regulators have slapped a €10 million fine apiece on Apple and Google for failing to provide users with information about “commercial uses of their data.”
Unicorn spree: Slice became India’s latest unicorn after raising a $220 million round co-led by Tiger Global and Insight Partners.
Et tu Jio: Following Airtel and Vodafone Idea, Reliance Jio will also hike its prepaid tariffs by 20% effective December 1.
Trump has his drink: Looks like Donald Trump is still benefiting from his presidency. The 45th president of the US now has a cocktail called "Forty-Five '' — that comes with a matching price tag. You can get it in the 45 Wine & Whiskey Bar, a newly opened watering hole in Trump Tower.
New puzzle: A new tile-matching game called “puyoringo” created by the Aomori Prefectural Government in northern Japan has created a buzz in social media within a week of its release. The apple-themed puzzle game is created to promote the region’s apple varieties and with its growing popularity, it may soon become the new Sudoku.
In Rome: Perhaps they are the world’s best-known eyes. In 1985, the National Geographic magazine published a picture of an Afghan girl staring piercingly into photographer Steve McCurry’s camera. In 2002, McCurry, who did not know her name when he first photographed her in a Pakistan refugee camp, found her in the Afghan mountains. The magazine put her, Sharbat Gula, in her mid-40s but the green-eyed stare intact, again on its cover. Now the Italian government has evacuated her to Rome after the Taliban took control of her country.
Want to advertise with us? We’d love to hear from you.
Write to us here for feedback on The Signal.