Competition regulation

Synopsys gets EC approval for $35b Ansys acquisition

Synopsys has secured conditional approval from the European Commission for its $35 billion acquisition of simulation software company Ansys. The deal, aimed at merging Synopsys’ semiconductor design expertise with Ansys’ simulation capabilities, promises to enhance solutions for complex chip and system creation. However, the acquisition is still awaiting regulatory approval in the UK and the US.

To address competition concerns, both companies have agreed to divest key business units. Synopsys will sell its Optical Solutions Group to Keysight Technologies, while Ansys will part with its PowerArtist tool, both of which are critical for tech industries like augmented reality and autonomous vehicles. These divestitures are intended to preserve healthy competition in crucial technology markets.

The deal is expected to close by mid-2025, pending final approvals and the completion of the divestments.

Indonesia plans social media age restrictions to protect children

Indonesia is preparing to introduce regulations setting a minimum age for social media users, aiming to shield children from potential online risks, according to Communications Minister Meutya Hafid. The announcement follows Australia’s recent ban on social media access for children under 16, which imposes penalties on platforms like Meta’s Facebook and Instagram, as well as TikTok, for non-compliance.

While the specific age limit for Indonesia remains undecided, Minister Hafid stated that President Prabowo Subianto supports the initiative, emphasising the importance of child protection in the digital space. The move highlights concerns about young users’ exposure to inappropriate content and data privacy risks.

Indonesia, with a population of approximately 280 million, has significant internet usage. A recent survey found internet penetration at 79.5%, with nearly half of children under 12 accessing the web, often using platforms like Facebook, Instagram, and TikTok. Among “Gen Z” users aged 12 to 27, internet penetration reached 87%. The proposed regulation reflects growing global efforts to prioritise child safety online.

UK launches probe into Google’s search practices

Britain’s antitrust regulator, the Competition and Markets Authority (CMA), has launched an investigation into Google’s search operations to assess their impact on consumers, businesses, and competition. With Google handling 90% of UK online searches and supporting over 200,000 businesses through advertising, the CMA aims to ensure fair competition and innovation in search services, said CMA chief Sarah Cardell.

The probe will evaluate whether Google’s dominant position restricts market entry and innovation, as well as whether it provides preferential treatment to its own services. The CMA will also investigate the company’s extensive collection and use of consumer data, including its role in AI services. The findings, expected within nine months, could lead to measures such as requiring Google to share data with rivals or giving publishers more control over their content.

Google has defended its role, stating that its search services foster innovation and help UK businesses grow. The company pledged to work constructively with the CMA to create rules that benefit both businesses and users. The investigation follows similar scrutiny in the US, where prosecutors have pushed for major reforms to curb Google’s dominance in online search.

Microsoft sues hackers over AI security breach

Microsoft has taken legal action against a group accused of bypassing security measures in its Azure OpenAI Service. A lawsuit filed in December alleges that the unnamed defendants stole customer API keys to gain unauthorised access and generate content that violated Microsoft’s policies. The company claims the group used stolen credentials to develop hacking tools, including software named de3u, which allowed users to exploit OpenAI’s DALL-E image generator while evading content moderation filters.

An investigation found that the stolen API keys were used to operate an illicit hacking service. Microsoft alleges the group engaged in systematic credential theft, using custom-built software to process and route unauthorised requests through its cloud AI platform. The company has also taken steps to dismantle the group’s technical infrastructure, including seizing a website linked to the operation.

Court-authorised actions have enabled Microsoft to gather further evidence and disrupt the scheme. The company says additional security measures have been implemented to prevent similar breaches, though specific details were not disclosed. While the case unfolds, Microsoft remains focused on strengthening its AI security protocols.

China to tighten oversight of online platforms and livestream e-commerce

China’s State Administration for Market Regulation (SAMR) announced plans to strengthen regulations on online platforms and the growing livestream e-commerce sector. The move aims to foster fair competition, protect smaller businesses, and improve consumer trust, according to SAMR Deputy Head Shu Wei.

At a press briefing, Shu highlighted plans to enhance transparency, reduce merchants’ operational costs, and address concerns over platform practices that disrupt fair competition. The regulator aims to improve existing frameworks to safeguard merchants’ and consumers’ rights against platform rule abuse.

The SAMR also intends to crack down on deceptive marketing in livestream e-commerce, a sector experiencing rapid growth but facing criticism for misleading tactics. The initiative is expected to address dishonest practices while ensuring a healthier and more balanced market environment.

Lemon8 gains popularity amid TikTok uncertainty

As the possibility of a US TikTok ban looms, social media influencers are increasingly turning to Lemon8, a new app owned by TikTok’s parent company, ByteDance, as a potential alternative. Lemon8, which launched in the US and UK in 2023, combines the best aspects of Instagram and Pinterest, offering a “lifestyle community” with an emphasis on aesthetically pleasing images, videos, and lifestyle topics like beauty, fashion, food, travel, and pets. With over 1 million daily active users in the US, it has quickly gained traction, especially among Gen Z users.

Influencers are particularly drawn to Lemon8’s integration with TikTok, allowing creators to easily cross-post and boost engagement. Despite the platform’s appeal, however, Lemon8’s future remains uncertain. Like TikTok, it is owned by ByteDance, making it potentially subject to the same US regulations, including a law requiring the company to divest from TikTok or face a ban. This uncertainty is causing anxiety among creators who fear the loss of their primary platform and are seeking safer options like Lemon8.

The app itself is gaining attention for its simplicity and visual appeal. Lemon8 stands out by offering a quieter, less chaotic environment compared to the bustling, ad-heavy content on Instagram and TikTok. Its user interface is designed for easy scrolling, and the app encourages creativity through tools that enhance text, stickers, and music, making posts feel inspirational. While it’s still early days, Lemon8 offers a nostalgic, aesthetically curated space for users who may be growing weary of the larger social media giants.

Though the app is still new, it could provide a refreshing change from the current social media landscape, where content can often feel oversaturated or too commercialised. For now, Lemon8 offers a simpler, more intentional way to engage with online content—a return to a more “authentic” era of social media, reminiscent of earlier Instagram days. Whether it will succeed in the long term remains to be seen, but for now, it’s carving out a niche for users seeking a quieter digital space.

Supreme Court weighs TikTok ban amid national security concerns

The US Supreme Court on Friday appeared inclined to uphold a law requiring a sale or ban of TikTok in the United States by January 19, citing national security risks tied to its Chinese parent company, ByteDance. Justices questioned TikTok’s potential role in enabling the Chinese government to collect data on its 170 million American users and influence public opinion covertly. Chief Justice John Roberts and others expressed concerns about China’s potential to exploit the platform, while also probing implications for free speech protections under the First Amendment.

The law, passed with bipartisan support and signed by outgoing President Joe Biden, has been challenged by TikTok, ByteDance, and app users who argue it infringes on free speech. TikTok’s lawyer, Noel Francisco, warned that without a resolution or extension by President-elect Donald Trump, the platform would likely shut down on January 19. Francisco emphasised TikTok’s role as a key platform for expression and called for at least a temporary halt to the law.

Liberal and conservative justices alike acknowledged the tension between national security and constitutional rights. Justice Elena Kagan raised historical parallels to Cold War-era restrictions, while Justice Brett Kavanaugh highlighted the long-term risks of data collection. Solicitor General Elizabeth Prelogar, representing the Biden administration, argued that TikTok’s foreign ownership poses a grave threat, enabling covert manipulation and espionage. She defended Congress’s right to act in the interest of national security.

With global trade tensions and fears of digital surveillance mounting, the Supreme Court’s decision will have wide-ranging implications for technology, free speech, and US-China relations. The court is now considering whether to grant a temporary stay, providing Trump’s incoming administration an opportunity to address the issue politically.

Regulators weigh in on Musk’s lawsuit against OpenAI and Microsoft

US antitrust regulators provided legal insights on Elon Musk’s lawsuit against OpenAI and Microsoft, alleging anticompetitive practices. While not taking a formal stance, the Federal Trade Commission (FTC) and Department of Justice (DOJ) highlighted key legal doctrines supporting Musk’s claims ahead of a court hearing in Oakland, California. Musk, a co-founder of OpenAI and now leading AI startup xAI, accuses OpenAI of enforcing restrictive agreements and sharing board members with Microsoft to stifle competition.

The lawsuit also claims OpenAI orchestrated an investor boycott against rivals. Regulators noted such boycotts are legally actionable, even if the alleged organiser isn’t directly involved. OpenAI has denied these allegations, labelling them baseless harassment. Meanwhile, the FTC is conducting a broader probe into AI partnerships, including those between Microsoft and OpenAI, to assess potential antitrust violations.

Microsoft declined to comment on the case, while OpenAI pointed to prior court filings refuting Musk’s claims. However, the FTC and DOJ stressed that even former board members, like Reid Hoffman, could retain sensitive competitive information, reinforcing Musk’s concerns about anticompetitive practices.

Musk’s legal team sees the regulators’ involvement as validation of the seriousness of the case, underscoring the heightened scrutiny around AI collaborations and their impact on competition.

Meta accused of using pirated books for AI

A group of authors, including Ta-Nehisi Coates and Sarah Silverman, has accused Meta Platforms of using pirated books to train its AI systems with CEO Mark Zuckerberg’s approval. Newly disclosed court documents filed in California allege that Meta knowingly relied on the LibGen dataset, which contains millions of pirated works, to develop its large language model, Llama.

The lawsuit, initially filed in 2023, claims Meta infringed on copyright by using the authors’ works without permission. The authors argue that internal Meta communications reveal concerns within the company about the dataset’s legality, which were ultimately overruled. Meta has not yet responded to the latest allegations.

The case is one of several challenging the use of copyrighted materials to train AI systems. While defendants in similar lawsuits have cited fair use, the authors contend that newly uncovered evidence strengthens their claims. They have requested permission to file an updated complaint, adding computer fraud allegations and revisiting dismissed claims related to copyright management information.

US District Judge Vince Chhabria has allowed the authors to file an amended complaint but expressed doubts about the validity of some new claims. The outcome of the case could have broader implications for how AI companies utilise copyrighted content in training data.

Nvidia warns against Biden’s export restrictions

Nvidia has voiced strong opposition to a reported plan by the Biden administration to impose new restrictions on the export of AI chips, urging the outgoing president to avoid making a decision that could impact the incoming Trump administration. The company warned that such measures would harm the US economy, hinder innovation, and benefit adversaries like China. Nvidia’s Vice President, Ned Finkle, called the policy a “last-minute” move that would leave a legacy of criticism from both US industry and the global community.

The proposed restrictions, as reported by Bloomberg, aim to limit AI chip exports to certain countries, particularly targeting China to prevent the enhancement of its military capabilities. While some nations would face outright bans, the rules would also cap the computing power that can be exported to others. The Biden administration has yet to confirm the details, and requests for comment from the White House and the Commerce Department went unanswered.

Industry groups, including the Information Technology Industry Council, which represents major tech firms like Amazon, Microsoft, and Meta, have expressed concern about the policy. They argue that it would impose arbitrary limitations on US companies’ global competitiveness and risk ceding market leadership to foreign rivals. Nvidia warned that these restrictions could push international markets toward alternative technologies, undermining the US technology sector.

President-elect Donald Trump, who begins his second term on January 20, previously enacted technology export restrictions to China during his first term, citing national security concerns. Nvidia’s statement reflects apprehension about the continuity of US policy on AI chip exports under the new administration.