Latest Tech News This Week: Facebook’s $550M Privacy Payout, GM Goes the EV Way & More


This week could be easily dubbed as the tech earnings week. If January kicked off with CES-hyped products, it ended with the sun shining bright on Big Tech firms Apple, Microsoft, and Amazon that posted healthy revenue and profits. Meanwhile, Facebook’s earnings call pivoted from profits to privacy with the company disclosing a $550 million cash payout to settle a privacy lawsuit.

The electric vehicle industry received welcome news with homegrown auto giant General Motors (GM) rushing back to Detroit to launch an EV-only assembly plant, LG Chem opening a giant factory to produce EV batteries, and tech giants coming together to boost the demand for EVs in the future.

Here Are This Week’s Top Stories:

Electric Vehicles

Data Privacy


Electric Vehicles

GM Drives Back to Detroit to Launch Mammoth EV Assembly Plant at D-HAM

The good ol’ Motown is back, and how! Detroit, the automotive capital of the world in the 20th century that served as the home of the United States’ Big Three – GM, Ford Motor Company and Fiat Chrysler, is set to get another wonder shot at superstardom.

GM, the global automaker with a market cap of $50 billion, rekindled its love for Detroit on Monday by announcing the set up of its first fully dedicated electric vehicle assembly plant at its D-HAM (Detroit-Hamtramck) factory in the city.

At D-HAM, General Motors will kick off EV production by manufacturing a variety of all-electric trucks and SUVs, particularly the Cruise Origin- a self-driving EV that was launched in San Francisco last week. The automaker will spend $2.2 billionOpens a new window to remodel the plant and once production begins in late 2021, GM says the move will create more than “2,200 good-paying U.S. manufacturing jobs”.

Backstory: Based on what we have seen so far, Electric Vehicles hold a lot of promise and the world seems to have made up its mind that EVs will surely drive the future of transportation. However, there are some thorny issues that plague automotive firms – the huge cost of EV batteries, the lack of public infrastructure to support their mass adoption and ensuring economies of scale.

Big Picture: General Motors says it envisions an all-electric future and the company is putting its money where its mouth is. While the move to EVs will involve additional spending of $800 million on supplier tooling and other projects, LG Chem – which won the contract to supply battery cells for EVs to be manufactured at D-HAM, will also spend $2.3 billion to manufacture battery cellsOpens a new window in nearby Ohio.

However, if this is making you think that all GM vehicles on the road will be electric, in ten years, the company is also planning to invest $1.5 billion to build next-gen pickup trucks at its Wentzville site where it manufactures Chevrolet Colorado and GMC Canyon midsize pickups and Chevrolet Express and GMC Savana full-size vans. So, the transition to an “all-electric future” could take longer than expected.

Our Take: GM’s big push in the EV domain is one that the industry sorely needed from one of the Big Three. Mass production of EVs and their Lithium-ion batteries is the best way forward to achieve economies of scale, drive growth and consolidate the supply chain.

Mary Barra, Chairman and CEO of GM, says that the battery is the most expensive component in an electric vehicle; and by combining forces and collective expertise with LG Chem in battery science, GM intends to reduce battery costs significantly— to industry-leading levels.

To gain mass adoption, EVs need to be efficient and cost-competitive on their own rather than rely on government subsidies. Automotive giants like Ford, Chrysler, Toyota, Volkswagen, and Honda must build EV ecosystems of their own as well to drive more competition in the industry.

Learn more: GM Challenges Waymo, Uber’s Supremacy With Driverless ShuttleOpens a new window

U.S. Industry Giants Team Up to Boost the Adoption of EVs

Environment-focused nonprofit Ceres announced on Monday the creation of the Corporate Electric Vehicle Alliance – a grouping that features the likes of AT&T, Amazon, DHL, Siemens, Ikea North America, Direct Energy, Clif Bar, Genentech, Lime, LeasePlan, and Consumers Energy.

“With companies controlling more than half the vehicles on the road in the U.S. today, they have a tremendous role to play in leading the transition to electric vehicles ⁠— both in terms of electrifying their own fleets and in leveraging their buying power to send a strong market signal to automakers and policymakers alike. The Corporate Electric Vehicle Alliance is where the rubber hits the road,” said Sue Reid, Ceres’ VP of Climate and Energy.

Backstory: Even though electric vehicles have been around for a few years, there aren’t enough EVs on the roads yet to visibly reduce the use of fossil fuels or to reduce the carbon footprint of the transportation industry.

While automotive giants are waiting on business-friendly EV policies, tax cuts, and sufficient demand to shore up production, prospective buyers are looking for greater diversity in the range of EVs on offer to make informed buying decisions while also hoping for more charging stations across the country. It’s a Catch 22 situation that the commercial vehicle industry can quickly resolve.

Big Picture: Member companies of the Corporate Electric Vehicle Alliance will initiate measures to electrify their fleetsOpens a new window in the coming years to shore up the number of EVs on U.S. roads, to diversify the range of EVs, to improve the EV industry’s economies of scale, and to promote the creation of supportive policies.

By ensuring wholesale adoption of EVs for their fleets, the Alliance members hope to kickstart corporate demand for EVs in the coming years.

Our Take: With EV technologies ready, the supply chain hungry for orders, and battery makers pouring billions on new factories, someone needs to step up and kickstart the demand for those brand-new electrics. And who can set the wheels rolling better than Big Tech giants that operate the largest car fleets in the US.

Learn more: Ford Acquires Quantum Signal to Enhance Self-Driving Vehicle DevelopmentOpens a new window

Data Privacy

Moving Too Fast on Privacy Will Break the Web, Warns Google

Merely days after Google set a two-year timelineOpens a new window for the phasing out of third party cookies from Chrome, Engineering Director for Chrome Security Justin Schuh laid out a disclaimer – that moving too fast on implementing privacy controls could end up being destructive for the Chrome browser.

“At our scale, it’s not reasonable to move too fast, because it’s too destructive,” Schuh said at the Usenix Enigma security and privacy conference, indicating that Google is now too large to make rapid changes to its code to ensure more privacy controls. He added that making quick changes to web browsers will impact how advertisers earn revenue from the web and this may force them to switch to mobile applications.

Backstory: With regulators and privacy campaigners growing more concerned with each passing day about how advertisers are using third-party cookies to minutely track web users, Google couldn’t just sit around and hope for the tide to pass. Last week, the company finally announced it will completely phase out the use of third party cookies from Chrome by 2022.

Instead, Google will replace cookies with the Privacy Sandbox- a secure environment where user data will be aggregated anonymously. The amount of user data shared with advertisers will be kept at a minimum and much of the user information will be kept on-device only. Users happy. Advertisers happy.

Big Picture: Schuh’s statement makes it clear that even though Big Tech is taking strident steps in the direction of privacy, Google isn’t willing to compete directly with upcoming browsers that have fairly advanced privacy settings in tow. After all, a lot of advertisers and companies rely on Chrome for generating revenues and making changes too quickly could force them to look elsewhere.

However, with the likes of Apple, Microsoft and Mozilla introducing new privacy controls in their browsers, Google cannot afford to play the waiting game for too long. Safari already has an Intelligent Tracking Prevention to prevent advertisers from tracking users across websites and Firefox also boasts a similar feature which it calls Enhanced Tracking Protection.

Learn more: Google Balks at Privacy Push Embraced by AWSOpens a new window

Facebook Settles Privacy Lawsuit with $550m Payout

Facebook paid out $550 million to settle a lawsuit filed against it in the state of Illinois, the company’s CFO Dave Wehner announced during its latest Earnings call on Wednesday. The lawsuit was filed against the social media giant’s collection of biometric details of users through its facial recognition tech in violation of Illinois’ Biometric Information Privacy Act (BIPA).

Backstory: The $550 million payout by Facebook follows the unprecedented $5 billion fine imposed on it by the Federal Trade Commission (FTC) last year for deceiving users about their ability to control the privacy of their personal data. The company’s controversial approach to privacy, as showcased by lawsuits filed across the world, forced FTC to impose unprecedented new restrictions on its business operations and order it to restructure its approach to privacy.

Our Take: While it remains to be seen if the massive cash settlement will make Facebook reconsider its use of facial recognition technology, news about Europe introducing a ban on the use of facial recognition in the coming days would certainly prevent its widespread use by Big Tech giants.

Learn more: What will Facebook’s facial recognition ability mean for privacy?Opens a new window


Apple Kicks Off 2020 With Record $91.8 b Revenue

Apple’s Earnings call for the holiday quarter on Tuesday was a saga of all-time records: an all-time record revenue of $91.8 billion, an all-time record income of $22.2 billion, an all-time record quarterly earnings per diluted share of $4.99, and an all-time record of installed devices of over 1.5 billion.

The Cupertino-based tech giant also forecasted a revenue of up to $67 billion in Q2, up $9 billion from the horror Q2 2019 when the company saw declines across the board.

Earlier in January, Apple also revealed that 2019 was the biggest year for services in its history with its customer base spending a record $1.42 billion between Christmas Eve and New Year’s Eve. The strong growth in the company’s services was led by the App Store, Apple Music, Apple TV, Apple News, Podcasts, iCloud and Apple Pay.

Learn more: Focused on 5G, Apple Reaches for Intel’s Modem BusinessOpens a new window

Microsoft Beats Expectations With Massive Income Boost

Software giant Microsoft released its quarterly results on Wednesday- revealing a 14% jump in Q2 revenue which touched $36.9 billion, easily beating analysts’ expectations of a more conservative $35.7 billion. However, the company’s operating income and net income were more promising, growing by 35% and 38% respectively in the second quarter of fiscal year 2019.

The 14% revenue jump was boosted by a 17% increase in Productivity and Business Processes and a healthy 27% increase in Intelligent Cloud revenue. Revenue growth in the personal computing business was much more muted at just 2% even though the segment continues to provide the highest revenue among the three divisions.

Learn more: Microsoft’s GitHub Acquisition Proves Open Source is Earning SourceOpens a new window

Strong Sales Take Amazon’s Revenue to $87.4 billion

In its earnings call on Thursday night, Amazon announced a revenue of $87.4 billion in the last quarter (up 21% from $72.4 billion in the year-ago quarter) an operating income of $3.9 billion, and net income of $3.3 billion.

The company forecasts net sales of up to $73 billion as well as an operating income of up to $4.2 billion in Q1 2020. In Q4, the company posted a healthy growth in sales of Amazon Music, Prime membership, Fire TV, and Alexa-supported devices across the world. Revenues from AWS also grew 34%, signaling Amazon’s continued dominance in the cloud computing market.

Learn more: Amazon, Launching Microchips, Takes on IntelOpens a new window

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