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Amazon and Microsoft Cloud Units Face UK Antitrust Investigation

Amazon and Microsoft Cloud Units Face UK Antitrust Investigation

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In a significant move, Britain’s media regulator, Ofcom, has formally requested the Competition and Markets Authority (CMA) to investigate the dominant positions of U.S. tech giants Amazon and Microsoft in the UK cloud market. 

Amazon and Microsoft Cloud Units Face UK Antitrust Investigation
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The regulator expressed concerns over features that hindered UK businesses from using multiple cloud suppliers, citing a lack of flexibility and increased difficulty in switching providers. According to Ofcom, Amazon Web Services (AWS) and Microsoft jointly commanded a substantial 70-80% share of Britain’s public cloud infrastructure services market in 2022, leaving Google as their distant competitor with a mere 5-10% share. Ofcom contends that this concentration could have adverse effects on competition within the market.

“The CMA will now conduct an independent investigation to decide whether there is an adverse effect on competition, and if so, whether it should take action or recommend others to take action,” stated Ofcom.

Amazon responded with disagreement, stating that Ofcom’s findings were based on a “fundamental misconception of how the IT sector functions, and the services and discounts on offer.” The company warned that unwarranted intervention might lead to unintended harm to IT customers and competition but expressed willingness to work constructively with the CMA.

Similarly, Microsoft, holding a significant stake in the UK cloud industry, pledged its commitment to ensuring innovation and high competitiveness. A Microsoft spokesperson asserted, “We will engage constructively with the CMA.”

Ofcom’s move follows its earlier expression of concern in April, prompting speculation about a potential antitrust investigation. UK businesses, in their feedback to Ofcom, emphasized the difficulties in switching or combining cloud providers, leading to the decision to refer the matter to the CMA. Fergal Farragher, Director at Ofcom, stated, “So, we’re referring the market to the CMA for further scrutiny, to make sure business customers continue to benefit from cloud services.” The CMA welcomed the referral, acknowledging the critical role of effective competition in the £7.5 billion ($9.1 billion) cloud services market, upon which many businesses rely.

Also Read: Google’s New Virtual Assistant to Include Bard AI Tools

This move aligns with a broader global trend, as both the French antitrust authority and EU regulators have shown an increasing interest in scrutinizing practices within the cloud computing sector. Google’s Vice President, Amit Zavery, stressed the need for an open cloud market without vendor lock-in, reflecting the sentiments of UK government agencies, businesses, and consumers.

The CMA is expected to conclude its investigation by April 2025, marking a pivotal moment in shaping the landscape of the UK’s cloud services market.

Amazon to Invest as Much as $4 Billion in AI Startup Anthropic

Amazon to Invest as Much as $4 Billion in AI Startup Anthropic

Leave a Comment / Artificial Intellegence, Story, Tech Story / By

Amazon has announced a significant investment of up to $4 billion in the cutting-edge artificial intelligence startup, Anthropic. 

Amazon to Invest as Much as $4 Billion in AI Startup Anthropic
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This move is part of Amazon’s strategic efforts to stay competitive in the rapidly evolving field of AI and cloud computing, where it faces stiff competition from rivals like Microsoft and Google.

Under the terms of the deal, Amazon’s employees and cloud customers will gain early access to Anthropic’s advanced AI technology, enabling them to integrate it into their businesses. Anthropic, headquartered in San Francisco, has also committed to relying primarily on Amazon’s cloud services, including using Amazon’s proprietary chips for training its future AI models.

In a joint interview, the CEOs of Amazon’s cloud division and Anthropic revealed that the initial investment would amount to $1.25 billion. Additionally, both parties have the option to trigger an additional $2.75 billion in funding from Amazon at a later date. However, specific details about Amazon’s ownership stake in Anthropic and the startup’s updated valuation remain undisclosed. Amazon emphasized that it would not acquire a board seat and that its stake would constitute a minority position.

This investment marks Amazon’s most significant response to the AI advancements made by its competitors, particularly Microsoft and Alphabet’s Google. Microsoft has been investing billions in its partnership with OpenAI since 2019, providing its customers with exclusive access to OpenAI’s innovative text and image generation technology. Google, on the other hand, has been at the forefront of AI development and previously invested in Anthropic during its $450 million fundraising round in May.

The collaboration between Amazon and Anthropic is expected to drive demand for AI-related hardware, including chips essential for AI applications. Anthropic has agreed to collaborate with Amazon on developing technology for Amazon’s in-house Trainium and Inferentia chips.

This investment demonstrates the ongoing efforts of major cloud companies to establish ties with AI startups reshaping the industry landscape. These partnerships are crucial for staying ahead in the fiercely competitive AI and cloud computing market.

Also Read: Amazon Prime Video Content to Include Ads Starting Early 2024

As Amazon intensifies its focus on AI through its investment in Anthropic, the tech giant aims to enhance its position in the AI race, competing head-to-head with industry leaders such as Microsoft, Google, and others. The outcome of this strategic partnership will likely have a significant impact on the future of AI technology and its integration into Amazon’s extensive range of services.

As the tech world continues to evolve, Amazon’s investment in Anthropic showcases the company’s commitment to staying at the forefront of technological innovation and delivering cutting-edge solutions to its customers. With the potential to shape the future of AI, this partnership marks a pivotal moment in the ongoing battle for supremacy in the cloud and AI space.

Amazon, Alphabet, Microsoft, Meta Probed by Lawmakers on Use of AI ‘Ghost’ Staff

Amazon, Alphabet, Microsoft, Meta Probed by Lawmakers on Use of AI ‘Ghost’ Staff

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The chief executive officers of 9 companies, which include Amazon.com Inc., Meta Platforms Inc., Alphabet Inc., Microsoft Corp., as well as International Business Machines Corp., were addressed in a letter by a team of lawmakers led by Massachusetts Senator Ed Markey with Washington Representative Pramila Jayapal on Wednesday. In spite of the fundamental importance of this work, a lot of IT employees around the world carry out these demanding duties under constant scrutiny, with inadequate compensation and no benefits, the letter sent to the chief executives stated.

Amazon, Alphabet, Microsoft, Meta Probed by Lawmakers on Use of AI ‘Ghost’ Staff
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“Workers are expected to screen out dangerous chatbot answers, but they may have little time to assess an answer’s safety,” they added. “Data workers are often given scant training or supervision, which can result in the introduction of bias.”

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The legislators question the executives on a wide range of issues pertaining to their data employees, such as the workers’ capacity to request leave, contest suspensions, or seek out mental health services when exposed to upsetting material.

The recipients of the letter include the more recent companies focused on Artificial Intelligence such as OpenAI Inc., Scale AI, Inflection AI, Inc., and Anthropic in addition to the well-known tech giants.

US corporations depend heavily on subcontracted workers to develop artificial intelligence (AI) products, whether they are based domestically or abroad. These workers are employed through external staffing services and frequently lack the perks offered to direct employees of the company. Companies also depend on similar services for other taxing duties like product quality assurance as well as content monitoring.

When confronted with disturbing pictures, some employees describe experiencing trauma as a way to block them out. According to a January Time article, OpenAI pays Kenyan employees less than $2 per hour to prevent that kind of information from appearing on ChatGPT.

Also Read: Binance US CEO quits as embattled crypto platform slashes one-third of staff

Senators are scheduled to meet with executives from companies like Tesla Inc., Microsoft, Meta, and Alphabet at a closed-door AI summit on Wednesday afternoon organized by Senate Majority Leader Chuck Schumer, who was not one of the politicians who signed the letter.

“These tech moguls are under-paying workers, failing to provide them basic protections and benefits, and subjecting them to an extensive web of surveillance in order to prop up their business,” Markey said in an emailed statement. “When they come to the Capitol to tout their innovation and excellence, I’d like to hear them answer for these disgusting labour practices.”

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How will the European Union's Digital Services Act impact Google, Facebook, TikTok, and other major tech companies

How will the European Union’s Digital Services Act impact Google, Facebook, TikTok, and other major tech companies

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According to the AP, a significant effort is being made to purge online information, which Google, TikTok, Facebook, Amazon, Instagram, Snapchat, as well as other large internet businesses that operate throughout Europe are dealing with. This Friday, August 25, marks the start of the first part of the new digital rules for the European Union, referred to as the Digital Services Act (DSA).

How will the European Union's Digital Services Act impact Google, Facebook, TikTok, and other major tech companies
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By enforcing stringent standards, the DSA hopes to shield people from dangerous information and hold platforms accountable. Organisations are now expected to swiftly and impartially delete items or information that has been reported as illegal. For instance, TikTok has added a new reporting feature for users, and Amazon has established a new route for reporting things that are allegedly unlawful.

DSA forbids using advertisements to specifically target sensitive groups like kids. Snapchat announced that businesses in the European Union and the UK would no longer be allowed to access its teen-focused personalisation and optimisation tools. A firm that violates the DSA may be subject to sanctions of up to six per cent of its annual worldwide earnings and perhaps expulsion from the European Union. Platforms are obliged to examine any systemic dangers by the end of August and submit the necessary assessments, which will subsequently be externally inspected to confirm compliance.

The legislative reforms in Europe might affect the entire world. To handle problematic users and material worldwide, Wikipedia is changing its terms of service and regulations. Sally Broughton Micova, a lecturer at the University of East Anglia, asserts that it will be difficult for digital companies to restrict modifications relating to DSA.

The reason for this is the extensive worldwide reach of social media influencers as well as digital advertising networks.

Since they interact with multichannel systems that operate internationally, the new restrictions will probably have an impact. The Digital Security Act (DSA) is anticipated to have an impact on information technology firms and consumers all across the world as platforms build mitigation measures.

Also Read: Google’s eSIM transfer tool for Android smartphones revealed

Platforms have started implementing unique systems so that European users may report bad items and illegal internet material. Businesses will be required to swiftly and fairly remove reported information. The availability of reporting mechanisms for unlawful or policy-violating content is set to improve on well-known sites.

In a blog post, Meta’s President for Global Affairs, Nick Clegg, stated, “The DSA will wield a significant influence on the digital experiences of Europeans as they access their phones or engage with their laptops.”

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Amazon Offers Influencers $25 Per Video to Promote Inspire, New Shopping Feed

Amazon Offers Influencers $25 Per Video to Promote Inspire, New Shopping Feed

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In a bid to expand its reach and boost its newly launched shopping feed called Inspire, Amazon has extended an offer to influencers in a move that has sparked both interest and skepticism. The tech giant is proposing to compensate content creators with a meager $25 per video to promote its TikTok-inspired shopping feed, but this low rate has left many influencers hesitant to jump on board.

Amazon Offers Influencers $25 Per Video to Promote Inspire, New Shopping Feed
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According to screenshots of emails circulating on social media, Amazon has contacted select influencers to produce videos showcasing two or more of its products. The offer includes $12,500 for creating a maximum of 500 videos. The desired content ranges from product reviews and comparisons to ranking videos and gift inspiration featuring multiple products. With an aim to gather a whopping 35,000 videos for its Inspire feed, Amazon is setting aside $875,000 for this influencer-driven campaign.

Inspire was introduced by Amazon in December 2022, allowing users to engage with a social feed of shoppable content. Oliver Messenger, the director of Amazon Shopping, explained that the feature permits customers to effortlessly discover new products aligned with their interests and promptly make purchases on the Amazon platform. The overarching objective behind Inspire is to augment Amazon’s assortment of “shoppable features” and construct an immersive shopping experience for customers.

Nonetheless, the $25 compensation per video has raised eyebrows among influencers and content creators. The prevailing rate for User Generated Content (UGC) videos stands at $212 on average, with a commonly requested rate of $150 per video, as reported by UGC agency Brands Meet Creators. Insights from UGC creators indicate a wide range of charges, spanning from $150 to $2,500 per video.

Amidst the reveal of Amazon’s offer, some influencers have publicly ridiculed the proposal on social media platforms. One user posted a screenshot of the email on a well-known microblogging site, alongside a dismissive comment implying that Amazon’s offer is far from satisfactory. Others shared similar sentiments, with one commentator scoffing at the proposition of earning “up to $25 per video.”

Also Read:  WhatsApp now allows users to share HD images; check how to use this new feature

While Amazon’s aspiration to leverage influencers to further enhance its Inspire shopping feed is clear, the industry consensus suggests that the offered compensation of $25 per video may not be sufficient to entice content creators to participate wholeheartedly. As discussions continue, the outcome remains uncertain, but one thing is evident: the world of influencer marketing is evolving rapidly, with compensation being a pivotal factor in shaping the dynamics between brands and influencers.

Amazon Is Imposing Fee on Sellers Who Ship Products Themselves

Amazon Is Imposing Fee on Sellers Who Ship Products Themselves

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In a significant shift that could impact third-party sellers on its platform, Amazon is reportedly introducing a new fee for merchants who choose not to utilize the company’s fulfillment service. 

Amazon Is Imposing Fee on Sellers Who Ship Products Themselves
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According to reports from Bloomberg and CNBC, this fee will come into effect on October 1st, targeting sellers enrolled in Amazon’s Seller Fulfilled Prime (SFP) program.

The SFP service, introduced by Amazon in 2015, allows third-party vendors to offer Prime products directly from their own warehouses, bypassing Amazon’s logistics process. While this offers sellers more control over their shipping operations, they are required to uphold Amazon’s stringent delivery standards, including one- to two-day shipping and weekend deliveries.

The timing of this fee imposition has raised eyebrows, especially considering the current regulatory environment. Reports suggest that the Federal Trade Commission is preparing an antitrust lawsuit against Amazon, adding to the company’s challenges. Additionally, this fee compounds the existing 8 to 15 percent commission that Amazon already deducts from orders on its platform.

The 2 percent fee could potentially serve Amazon’s strategic interests. By encouraging sellers to opt for its in-house fulfillment service, Fulfillment by Amazon (FBA), the e-commerce giant gains tighter control over the logistics process while also capitalizing on rising FBA expenses. However, this move might attract regulatory attention, as it echoes accusations made against Amazon in 2019, alleging the company forced sellers into using FBA.

Amazon initially halted new enrollments in the SFP program in 2019, resuming the waitlist only in June of this year, purportedly to appease regulatory concerns. The exact reasoning behind this fee implementation remains unclear, as Amazon has yet to respond to requests for further information.

Also Read:  Amazon’s Robot Workers to Help Run Australia’s Largest Warehouse

For third-party sellers who have been enjoying the flexibility of the SFP program, this added charge could prompt a reassessment of their selling strategies. Some might see the fee as an incentive to shift towards Amazon’s fulfillment services, while others might be prompted to explore alternative platforms or shipping solutions.

As the e-commerce landscape evolves and competition intensifies, Amazon’s actions are being closely monitored by both sellers and regulators alike. While the fee introduction might be an attempt to consolidate Amazon’s control over its ecosystem, it could also spark fresh concerns about the company’s influence and practices within the industry. As the October 1st deadline approaches, sellers will need to carefully evaluate their options and consider the potential implications of this new fee on their business operations.