Pushback against Tiktok, the complicated mergers of Microsoft-Activision and Rogers-Shaw and Big Tech’s financial woes.
With the new year nearly upon us, it’s once again the time to take a look back at the top stories of the year. Welcome to Hashtag Trending, I’m your host, Ashee Pamma, and in this two-episode special, we’ll be listing the top eight tech stories that emerged in 2022.
- Pushback against TikTok
Popular Chinese short form video app, TikTok made the headlines in late 2022 after a number of states in the US announced measures to clamp down on the platform, highlighting national security concerns and fears that information of users are winding up in the hands of Chinese authorities. In 2020, the platform avoided a national ban, pushed by Trump’s administration for similar concerns. Now, at least seven states, including Alabama, Maryland, Oklahoma, South Carolina, South Dakota, Utah and Texas have said they will bar public employees from using the app on government devices. Last week, the state of Indiana announced two lawsuits against the platform, alleging it misrepresents its approach to age-appropriate content and data security. Not much has been done on the federal level, however and pushback is mainly coming from states led by Republican governors, leading to a politically charged discussion about the platform’s ban. The current pushback is neither likely to disrupt how daily users access the app. Senator Marco Rubio on the Senate Intelligence Committee has therefore introduced a new legislation that aims to ban TikTok from operating in the US. In response, TikTok said it is working with the US government to address these national security concerns and has purportedly taken independent steps to isolate US user data from other parts of its business.
2. Microsoft-Activision merger
The start of 2022 was marked by the biggest tech deal in history,with Microsoft’s announcement to acquire video game publisher Activision Blizzard, for $95.00 per share, in a record all-cash transaction valued at US$68.7 billion. Microsoft was set to become the world’s third largest gaming company behind Sony and Tencent, after the planned completion of the acquisition in August 2022. However the proposed merger has faced resistance for months from competitor Sony which makes the competing PlayStation console. Microsoft also faced the concerns of antitrust watchdogs around the world about losing access to popular Activision Blizzard game franchises such as Call of Duty. Microsoft has responded by promising to make Call of Duty available on Nintendo for 10 years, should the acquisition go through and said it made the same proposition to Sony. In latest developments, the acquisition has now been blocked by the Federal Trade Commission over concerns that the tech giant will control too much of the video game market. Microsoft has suggested in a statement that it will likely challenge FTC’s decision.
3. Big Tech poor earnings calls
Big Tech faced the dreariest earnings call in years, in the last week of October. Alphabet, Amazon, Meta and Microsoft all reported dips in share prices and revenue after decades of unhinged growth, as they faced the impact of inflation, rising interest rates and a looming recession. It was reported that the four companies wiped out a combined US$350 Billion in market cap. Alphabet, Google’s parent company saw a decline in revenue growth to 6 per cent from 41 per cent A YEAR earlier. Meta reported a 20 per cent drop in share price following continued decline in revenue throughout 2022 and the current quarter. In the last week of October, Meta’s shares were trading at US$100.55, the lowest since 2016. Both Microsoft and Amazon also missed analysts’ expectations in their October earnings calls, following which, both the companies’ shares plummeted. Apple is the only tech giant that beat its quarterly earnings expectations, reporting record revenue of US$90.1 billion, up 8 per cent YOY, reflecting a steady demand for phones and computers.
4. Rogers-Shaw merger
2022 was definitely a bumpy one for the Rogers-Shaw merger saga. In March 2021, Rogers proposed a $26 billion takeover of Shaw Communications, a move that would reduce the number of Canadian wireless operators from four to three. Shortly after, Competition Bureau of Canada blocked the merger, arguing that the deal would hurt competition. To allay these concerns, Rogers and Shaw announced in August 2022, the sale of Shaw’s wireless carrier company, Freedom Mobile to Quebecor’s subsidiary Videotron. But this failed to convince antitrust regulators who opposed the telcos in a court battle in November 2022. At the time of the recording of this episode, the final verdict of this legal fight is yet to be delivered. If the tribunal approves the deal, the companies will apply to Canada’s Industry Minister Francois-Philippe Champagne, who has the final say.
And that was part two of our trending stories for 2022. Thank you for listening to Hashtag Trending this year. Add us to your Alexa Flash Briefing or your Google Home daily briefing. Make sure to sign up for our Daily IT Wire Newsletter to get all the news that matters directly in your inbox every day. Have a happy new year!