Pinterest has introduced new generative AI features for its advertisers, enhancing the functionality of its Performance+ suite during the recent Pinterest Presents event. This update allows advertisers to transform plain backgrounds into engaging lifestyle imagery, helping to boost the appeal of their product pins. Pinterest’s move follows similar offerings from major tech companies like Google and Amazon, which have also adopted generative AI to improve advertising effectiveness.
In tests with Walgreens, an early user of Pinterest’s generative AI, the drugstore chain experienced a 55% increase in clickthrough rates and a 13% decrease in cost-per-click when using AI-generated backgrounds. Pinterest claims its new tools will streamline campaign creation, requiring 50% less input from advertisers and potentially leading to a 64% reduction in cost per action and a 30% rise in conversion rates.
Additionally, Pinterest is rolling out new promotional tools that will allow advertisers to offer discounts to users in various countries, including the US, UK, Canada, and Japan. The platform is also enhancing its Performance+ bidding system to prioritise high-value conversions rather than clicks, thereby providing advertisers with greater flexibility in achieving their marketing goals. All global advertisers will now have access to these improved Performance+ campaigns, aimed at driving consideration, conversions, and catalogue sales.
Amazon has secured a partial victory in a US antitrust case brought by the Federal Trade Commission (FTC). The federal court ruled in favour of Amazon’s request to dismiss some of the claims, though others will proceed. The ruling, issued in Seattle, has not yet been fully disclosed.
The FTC initially accused Amazon of using unfair tactics to maintain its dominance in the online market. The lawsuit claimed Amazon’s algorithms raised prices, costing US households over $1 billion. The company has stated it ceased using the controversial pricing system in 2019.
Although the court granted some of Amazon’s requests, other parts of the case remain active. Judge John Chun ruled that the trial would proceed in two phases, separating evidence on violations and proposed remedies. The FTC continues to pursue remaining claims.
Amazon, along with other tech giants like Meta, Apple, and Google, is facing increased scrutiny from antitrust regulators. FTC Chair Lina Khan has been vocal in challenging Amazon’s practices, citing longstanding concerns about its market influence.
SoftBank’s Vision Fund plans to invest $500 million in OpenAI’s latest funding round, according to a report by The Information. While SoftBank declined to comment, OpenAI did not respond immediately. The AI company is seeking to raise $6.5 billion through convertible notes, as reported by Reuters earlier this month.
Before SoftBank’s investment, OpenAI was valued at $150 billion, although this valuation is subject to change based on the company’s ability to restructure its corporate structure and lift the profit cap for investors. This marks SoftBank’s first investment in the firm led by Sam Altman.
OpenAI is reportedly considering a shift to a for-profit corporation that would function independently of its non-profit board. This transition aims to provide more flexibility and access to capital as the company seeks to enhance its business model and attract further investments.
As Google‘s trial on allegations of monopolising the advertising technology market draws to a close, experts believe the financial risk to the tech giant is minimal. The US Department of Justice (DOJ) and a coalition of states accuse Google of illegally controlling the markets used by advertisers and publishers to buy and sell online ads. However, analysts point out that the ad tech business at the centre of the trial, Google Network, is declining and represents a smaller portion of the company’s overall revenue compared to its dominant search business.
In 2023, advertising made up over 75% of Google’s $307.4 billion revenue, though the Network division, which is central to the DOJ case, contributed just $31.4 billion. The DOJ is pushing for the divestiture of Google Ad Manager, but analysts believe that even if Google loses, the financial impact would be small, with revenue losses potentially under 10%. Google has defended itself by highlighting strong competition from other platforms, especially in mobile apps and streaming ads, which could undermine the DOJ’s argument.
The more significant worry for Google lies in the potential consequences of a ruling in favour of the DOJ, as it could facilitate easier transitions for advertisers and publishers between platforms. A successful case might establish a legal precedent that holds tech companies accountable for monopolistic practices. However, the overall impact will hinge on the trial’s outcome and the remedies the court proposes in the upcoming months.
Alphabet Inc.’s Google has announced a $1 billion investment in Thailand to establish a data centre and cloud region, aimed at meeting the increasing demand for cloud services and supporting AI adoption in Southeast Asia. This investment is projected to create approximately 14,000 jobs annually until 2029, according to a Deloitte study.
Google’s new cloud and data centre infrastructure will be situated in Chonburi and Bangkok, respectively, improving access to Google Cloud capabilities and AI innovations while also supporting popular services like Search, Maps, and Google Workspace. This announcement follows Microsoft’s launch of its own regional data centre in Thailand in May, aimed at expanding cloud services in the region.
Thai Prime Minister Paetongtarn Shinawatra praised Google’s investment, stating that it aligns well with the country’s Cloud First Policy, which promotes the adoption of cloud technologies across various sectors.
Germany’s competition watchdog has designated Microsoft as a ‘company with paramount cross-market significance for competition,’ allowing for stronger regulatory actions against the tech giant. Andreas Mundt, head of the Bundeskartellamt, emphasised that Microsoft’s products are essential across various sectors, making its ecosystem more interconnected than ever.
This classification also extends to Apple, Google, and Meta, indicating that Microsoft will undergo heightened scrutiny and may face restrictions on anti-competitive practices. A spokesperson for Microsoft expressed the company’s commitment to promoting a competitive environment and working cooperatively with the Bundeskartellamt.
The designation follows antitrust charges against Microsoft by the European Commission in June, which accused the company of unfairly bundling its Teams app with the Office suite, putting rivals like Slack at a disadvantage. The German authority clarified that its increased oversight will apply to Microsoft as a whole, rather than focusing solely on individual services or products.
ByteDance, the parent company of TikTok, is reportedly developing a new AI model using chips from Chinese tech giant Huawei. The move comes as US restrictions on advanced AI chips, such as those from Nvidia, have led the company to look for domestic alternatives. Sources suggest ByteDance will use Huawei’s Ascend 910B chip to power a new large-language AI model.
Huawei’s Ascend 910B chip has already been used by ByteDance for less demanding AI tasks, but training a new AI model requires a higher level of computational power. While ByteDance continues to order significant quantities of Huawei’s chips, supply shortages are reportedly slowing down their efforts, with only a fraction of the requested units received so far.
Industry experts say AI has become essential for a range of sectors, from gaming to e-commerce, where businesses are developing custom AI models to stay competitive. ByteDance’s decision to turn to Huawei reflects the increasing importance of AI, particularly as global supply chains face challenges.
Both ByteDance and Huawei have remained tight-lipped regarding specific details of this development. A spokesperson from ByteDance denied the existence of a new AI model in progress, while Huawei did not provide any comment on the situation.
In August 2023, Powerchip Semiconductor Manufacturing Corp (PSMC) announced a partnership with Japan’s SBI to build a chipmaking plant in Japan. However, the plan was halted last Friday, with reports suggesting that PSMC’s declining financial performance may be the cause. PSMC has denied these claims, stating that the decision to terminate the collaboration is unrelated to its financial situation.
PSMC explained that its collaboration with SBI was structured around the Fab IP model, which involves offering consulting services, personnel training, and technology transfer in exchange for service fees and royalties. The company does not plan to invest in or oversee the operations of the new factory. After the board confirmed the termination of the partnership, PSMC dispatched representatives to Japan’s Ministry of Economy, Trade and Industry (METI) to clarify the situation and has informed SBI Holdings of the decision.
Reports indicate that PSMC opted not to assume the risks tied to the project, resulting in the dissolution of their partnership to build the facility in Miyagi Prefecture. This plant was projected to start mass production by 2027, specialising in automotive semiconductors with an estimated investment of ¥800 billion. Despite these challenges, SBI intends to proceed with the project by searching for new partners.
Notably, this decision comes after PSMC recently announced its intention to supply technology for a new chip plant in India, in partnership with Tata Group. The company has signed an agreement to assist in constructing India’s first 12-inch wafer fab in Dholera, Gujarat, which will employ mature process technologies and provide training for local workers. This USD 11 billion facility is expected to have a monthly capacity of 50,000 wafers and create over 20,000 high-tech jobs in the region.
Brazil’s Social Development Ministry will soon propose new measures to stop social benefit payments from being used for online gambling. This follows a report showing that 5 million recipients of Bolsa Familia, a cash transfer program, spent 3 billion reais on online betting in August. Bolsa Familia, which provides aid to 21 million families for essentials like food, saw nearly 20% of its monthly budget diverted to gambling, raising concerns about the misuse of these funds.
Social Development Minister Wellington Dias proposed potential solutions, such as banning the use of social benefits for gambling and implementing control mechanisms tied to tax ID numbers. These measures will be submitted to President Luiz Inacio Lula da Silva for approval. Dias stressed that the misuse of Bolsa Familia funds for betting undermines the program’s core goal of supporting low-income families with necessities.
Central Bank Chief Roberto Campos Neto emphasised that the bank’s report was not meant to criticise Bolsa Familia but to serve as a warning. He highlighted that the rapid rise of online gambling among lower-income households could jeopardise their financial stability.
Arm Holdings recently inquired about purchasing Intel Corp.’s product division, which focuses on chips for personal computers and servers. However, Intel informed Arm that the division is not for sale, as confirmed by a source familiar with the discussions. This comes amid ongoing struggles for Intel, which has seen a significant decline in its business, prompting speculation about potential acquisitions and significant layoffs.
Intel is grappling with significant financial difficulties, highlighted by a disappointing earnings report that led to a notable decline in its stock price. In reaction, the company plans to lay off 15,000 employees and reduce its factory expansion initiatives while exploring a potential restructuring that could result in a division of its operations. Meanwhile, Arm, traditionally recognised for its smartphone chip designs, aims to broaden its presence in the personal computer and server markets to strengthen its competitive position against Intel.
With a valuation surpassing $156 billion, Arm is viewed as a beneficiary of the growing AI sector and has the financial backing of Japan’s SoftBank. In contrast, Intel’s market capitalisation has fallen to approximately $102.3 billion this year. Meanwhile, the company is exploring other investment opportunities, including a $5 billion offer from Apollo Global Management and plans to divest part of its stake in Altera Corp., further indicating its intent to stabilise and restructure its operations.
