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Today’s topics include SoftBank’s decision to call off a merger between Sprint and T-Mobile; Facebook’s report to Congress that 126 million users saw Russian 2016 presidential election ads; Google’s appeal of a $2.9 billion antitrust fine claims the EU Commission misstated the facts of the case; and the global financial impact of the NotPetya ransomware attack keeps rising.
The board of SoftBank, the Japanese internet and telecommunications company, voted to abandon a proposed merger of Sprint and T-Mobile. For years, Sprint, has been losing market share and subscribers to T-Mobile as well as to larger carriers AT&T and Verizon.
SoftBank had been talking for months to Deutsche Telekom, T-Mobile’s corporate parent about a merger via a stock swap. However, SoftBank board has decided to back away from the merger and instead invest heavily in Sprint’s network in anticipation of an impending move to 5G services.
The merger would have given Deutsche Telekom controlling interest in Sprint, which SoftBank and its CEO Masayoshi Son didn’t want to give up. Although Son had agreed to give up control, he apparently changed his mind, believing the internet of things and artificially intelligent robots would drive future demand for Sprint’s network.
Facebook, Twitter and Google will testify before congressional investigators Oct. 31 to answer questions about the roles their networks played in distributing false, misleading and politically provocative ads during the 2016 presidential election.
The Washington Post reported Oct. 30 that Facebook will tell U.S. representatives that a whopping 126 million of its 2.2 billion users may have viewed content produced and posted by Russian operatives who were intending to sow political discord and divisiveness among American voters. This is more than 10 times Facebook’s first estimate about the reach of the Russian online influence campaign.
Facebook Chief Security Officer Alex Stamos said in a statement to The Post that the company is doing everything it can to assist investigators.
Google is appealing the European Commission’s decision in June to fine Google $2.9 billion for anti-competitive practices, claiming the decision misstates facts and ignores market realities. The EC held that Google was favoring its own online shopping service and drawing traffic away from other sites by highlighting paid product ads on top of search results pages.
Google wants the verdict overturned or at least have the amount of the fine reduced. Google’s appeal is based on six arguments. Two arguments claim that the court erred in finding that Google was favoring its own shopping services, claiming that it highlights paid ads to improve the quality of product search results and not to drive traffic to a Google comparison-shopping service.
The company also argues that the EC has failed to demonstrate how Google’s handling of product search results diverts traffic away from rival sites or increases their own traffic.
Multiple organizations in 2017 have attempted to quantify the impact of ransomware with varying results. Pharmaceutical vendor Merck was impacted by the NotPetya cyber-security ransomware outbreak in June and has reported reduced sales of approximately $240 million in the third quarter due to a temporary production shutdown of HPV vaccines. The total financial impact on Merck represents as much as $375 million.
The NotPetya ransomware attack, originally attributed just to the Ukraine, has turned out to be global, with multiple multinational corporations such as consumer product vendor Reckitt Benckiser reporting that its operations were impacted.
Shipping company Maersk reported on Aug. 16 financial losses of $200 million to 300 million, and FedEx’s TNT business unit also suffered estimated losses of $300 million.