Here’s what you need to know this week:
- Affairs of state: Amazon dreams of robotic households
- Google Play Store isn’t playing fair
- Apple allegedly mishandled sexual harrassment
- Microsoft’s LinkedIn is putting a human in the loop
- Amazon offered a real pay cut
- Meta is witnessing an exodus
- Tencent is aiming to acquire more of Ubisoft
Affairs of state: Amazon dreams of robotic households
Two recently announced acquisitions by Amazon – of One Medical and iRobot, for a combined $4.6 billion – are building blocks for the tech states’ vision of the future: the smart household.
The deals would expand Amazon’s capabilities and market dominance in two major areas of our lives: domestic technology and domestic healthcare – but they are also just the sort of monopoly-building acquisitions that the US Federal Trade Commission, led by Lina Khan, has promised to resist.
Late last month, Khan put her lawsuit where her mouth is, suing Meta over the acquisition of Within, a small virtual reality experience creator. In a statement the FTC said the lawsuit was necessary to prevent Meta depressing competition by buying out an emerging rival. The case is important and controversial.
Why? Within is a small company, and the virtual reality market is immature. The FTC’s case against Meta’s acquisition is more about the future than the present, even though the agency has typically targeted mergers and acquisitions by already dominant players that would harm competition – not acquisitions in emerging markets where a monopoly might emerge.
If the case succeeds “it will help bring the frontier of enforcement outward,” said William Kovacic, a former chairman of the FTC and antitrust specialist – suggesting that other prospective monopolies would be targeted earlier on in their formation, in markets where there aren’t necessarily any dominant companies.
So what about Amazon’s deals? They will face scrutiny, but that’s not enough to discourage the company. Amazon’s most recent quarterly results showed that its global retail business is far from invincible. Online shopping demand will continue to slump, and costs for its fleet, workers and facilities will continue to rise. Without Amazon Web Services on its balance sheet, the tech state would have run a $2.4 billion operating loss last quarter.
For years, Jeff Bezos and his successor Andy Jassy have been looking for a stable pillar to add to Amazon’s cloud computing and retail businesses. In recent times they’ve turned to households, and healthcare.
One Medical. 1Life Healthcare Inc. operates the One Medical health subscription service that Amazon is acquiring. It has a network of 204 care clinics in the US and employs thousands of clinical workers to administer treatment. It also combines in-person care with digital services like online appointments and diagnostics. The service includes scheduling prescriptions and accessing health records. Coupled with Amazon Pharmacy, its acquisition of PillPack and a health-focused wearable called Halo, Amazon is slowly building a health data empire.
iRobot. iRobot makes the Roomba line of robot vacuum cleaning products, autonomous vacuuming drones that map your house and vacuum it – though Amazon’s ambitions go well beyond dustbusting. It already owns Ring, a home security product, which it acquired in 2018, as well as Eero Wi-Fi, a wireless network platform, and Blink, which makes camera systems. Combined, these technologies are the ingredients for a household in which all the devices are linked, and everything that happens in the household is surveilled.
The robotic household. The Roomba is just the beginning. Multipurpose robots like Amazon’s Astro, which launched earlier this year and has been called “Alexa on wheels”, are for sale by invitation only and come with a $1500 price tag. Later iterations could combine cleaning, healthcare, therapy, entertainment and more. The real vision is for multipurpose robots that can perform a range of functions and learn about their environment over time, says Paul Clarke, co-chair of the robotics growth partnership and former CTO of Ocado.
“Robots that vacuum your house or mow your lawn are examples of single purpose robots that have all the computing power, charging capability, sensing, navigation and mobility to account for most of their cost, but they can only do one task.” Robots that are interlinked and can perform a range of tasks using a range of data inputs would be a game-changer for Amazon. The future of robotics, Clarke said, is “modular robots that can evolve and adapt by docking with new accessories and end effectors, like a dog you can teach new tricks.”
What next? If Amazon’s deals go through, they offer it a massive advantage in the healthcare and robotics markets – and the opportunity to build a data bridge between the two that would make completely smart households much more of a reality.
A robot wakes you up and, using your biometrics, heart rate and sleep data, recommends a check-up with a doctor who appears in your living room that afternoon. Your house adjusts the temperature and humidity, and will notify you when your new prescription is delivered, as well as recommending a new diet that it’ll order for you with one click. Sound appealing?
Why this story? Amazon’s Ring security devices have already raised concerns about privacy and surveillance. Under the Data Protection Act 2018, people in the UK are protected from being filmed and recorded without their knowledge, and a judge has found Ring captures an excessive amount of video and audio data from its surroundings. Amazon has also faced lawsuits over the use of biometric data from its Alexa virtual assistant. Like the other companies we report on, Amazon is a surveillance state, and buying One Medical and iRobot would only bolster that aspect of their business.
Google: Fair Play Store
Google is under investigation by Europe’s antitrust regulators. The allegation: that Google’s Play Store abuses its dominant market position to charge developers unfair fees. The European Commission has begun questioning Google’s rivals to substantiate the case. Brussels is trying to establish whether Play Store is fair, and to assess allegations of anti-competitive practices with developers’ fees. The UK is in the midst of its own antitrust probe of Google, on exactly the same question: should it be allowing developers to use their own billing systems and avoid fees of up to 30 per cent?
Apple: Employee allegations
Employees at Apple are saying their allegations of harassment and sexual assault are falling on deaf ears. “I just want Apple to be the company it pretends to be for its customers,” Megan Mohr, an employee, tells the FT. Mohr was sexually assaulted by a colleague outside work, and was later told there was little the company could do to deal with the abuser, because “as an Apple employee he hasn’t violated any policy in the context of his Apple work”. The investigation found that 15 Apple employees, past and present, have had similar experiences with the HR department – which the company calls its People team. Read more here.
Microsoft: Human in the loop
Microsoft’s LinkedIn is trying something new. The professional social network is adding a new feed with a twist: humans rather than algorithms are making its recommendations. The LinkedIn News team picks the content and adds it to a user’s feed based on their location, profession and interests. It’s an atypical way of encouraging engagement in the social media world; Meta recently made changes to its Facebook news feed in order to introduce more algorithmic recommendations, not fewer, hoping that the discovery of relevant content would help in its fight against TikTok.
Amazon: Real pay cut
Warehouse workers at several Amazon locations in the UK have walked out over pay. Amazon has offered what it says is a “competitive” pay rate and an increase of 35p per hour – which amounts to a 3 per cent raise – in recent months as a response to cost of living pressure. Inflation in the UK is expected to peak at 13.3 per cent this year. Workers were expecting an increase of £2 or more. Action, including further walkouts, is being discussed at facilities in Coventry, Bristol and Rugeley and one worker from Tilbury said that their colleagues were deliberately slowing down their work to protest the real pay cut.
With Zuckerberg’s blessing, a Meta exodus is underway. Adam Mosseri, the head of Instagram, and Nick Clegg, President of Global Affairs, are upping sticks and moving to London, leaving Silicon Valley and Mark Zuckerberg behind. Zuck was initially supportive of remote working during the pandemic, opting to move to Hawaii when it started, and is now seeing his “work from anywhere” attitude extend to his top executives. London, the top destination for Meta’s brass, is a good place to find software engineers at much more affordable rates than in Silicon Valley – a possible motive for the diaspora.
Buying top game development studios is all the rage. Microsoft’s purchase of Activision Blizzard made a splash earlier this year. Now Tencent wants to acquire a majority stake in Ubisoft – the maker of Assassin’s Creed – aiming to become the controlling shareholder. Tencent already bought 5 per cent of the company back in 2018, and an additional stake would have to be negotiated with the Guillemot family, which founded the company and still owns over 15 per cent. A full takeover would be a deal to rival Microsoft’s in scale and significance.
Thanks for reading,