Enlarge/ The Big Tech groups are competing to offer new services such as virtual assistants and chatbots as part of a multibillion-dollar bet on generative AI
FT
The world’s biggest cloud computing companies that have pushed new artificial intelligence tools to their business customers are offering only limited protections against potential copyright lawsuits over the technology.
Amazon, Microsoft and Google are competing to offer new services such as virtual assistants and chatbots as part of a multibillion-dollar bet on generative AI—systems that can spew out humanlike text, images and code in seconds.
AI models are “trained” on data, such as photographs and text found on the internet. This has led to concern that rights holders, from media companies to image libraries, will make legal claims against third parties who use the AI tools trained on their copyrighted data.
The big three cloud computing providers have pledged to defend business customers from such intellectual property claims. But an analysis of the indemnity clauses published by the cloud computing companies show that the legal protections only extend to the use of models developed by or with oversight from Google, Amazon and Microsoft.
“The indemnities are quite a smart bit of business . . . and make people think ‘I can use this without worrying’,” said Matthew Sag, professor of law at Emory University.
But Brenda Leong, a partner at Luminos Law, said it was “important for companies to understand that [the indemnities] are very narrowly focused and defined.”
Google, Amazon and Microsoft declined to comment.
The indemnities provided to customers do not cover use of third-party models, such as those developed by AI start-up Anthropic, which counts Amazon and Google as investors, even if these tools are available for use on the cloud companies’ platforms.
In the case of Amazon, only content produced by its own models, such as Titan, as well as a range of the company’s AI applications, are covered.
Similarly, Microsoft only provides protection for the use of tools that run on its in-house models and those developed by OpenAI, the startup with which it has a multibillion-dollar alliance.
“People needed those assurances to buy, because they were hyper aware of [the legal] risk,” said one IP lawyer working on the issues.
The three cloud providers, meanwhile, have been adding safety filters to their tools that aim to screen out any potentially problematic content that is generated. The tech groups had become “more satisfied that instances of infringements would be very low,” but did not want to provide “unbounded” protection, the lawyer said.
While the indemnification policies announced by Microsoft, Amazon, and Alphabet are similar, their customers may want to negotiate more specific indemnities in contracts tailored to their needs, though that is not yet common practice, people close to the cloud companies said.
OpenAI and Meta are among the companies fighting the first generative AI test cases brought by prominent authors and the comedian Sarah Silverman. They have focused in large part on allegations that the companies developing models unlawfully used copyrighted content to train them.
Indemnities were being offered as an added layer of “security” to users who might be worried about the prospect of more lawsuits, especially since the test cases could “take significant time to resolve,” which created a period of “uncertainty,” said Angela Dunning, a partner at law firm Cleary Gottlieb.
However, Google’s indemnity does not extend to models that have been “fine-tuned” by customers using their internal company data—a practice that allows businesses to train general models to produce more relevant and specific results—while Microsoft’s does.
Amazon’s covers Titan models that have been customized in this way, but if the alleged infringement is due to the fine-tuning, the protection is voided.
Legal claims brought against the users—rather than the makers—of generative AI tools may be challenging to win, however.
When dismissing part of a claim brought by three artists a year ago against AI companies Stability AI, DeviantArt, and Midjourney, US Judge William Orrick said one “problem” was that it was “not plausible” that every image generated by the tools had relied on “copyrighted training images.”
For copyright infringement to apply, the AI-generated images must be shown to be “substantially similar” to the copyrighted images, Orrick said.
Enlarge/ Lower Manhattan and One World Trade Center in New York City are reflected on a monument as the sun rises on December 22, 2023, as seen from Jersey City, New Jersey.
Unless you’re sinking into quicksand, you might assume that the land beneath your feet is solid and unmoving. In actual fact, your part of the world may well be undergoing “subsidence,” which is where the ground collapses as sediments settle or when people over-extract groundwater. New York City is sinking, too, due to the weight of all those buildings pushing on the ground. In extreme cases, like in California’s agriculturally intensive San Joaquin Valley, elevations have plummeted not by inches, but by dozens of feet.
Last year, scientists reported that the US Atlantic Coast is dropping by several millimeters annually, with some areas, like Delaware, notching figures several times that rate. So just as the seas are rising, the land along the eastern seaboard is sinking, greatly compounding the hazard for coastal communities.
In a follow-up study just published in the journal PNAS Nexus, the researchers tally up the mounting costs of subsidence—due to settling, groundwater extraction, and other factors—for those communities and their infrastructure. Using satellite measurements, they have found that up to 74,000 square kilometers (29,000 square miles) of the Atlantic Coast are exposed to subsidence of up to 2 millimeters (0.079 inches) a year, affecting up to 14 million people and 6 million properties. And over 3,700 square kilometers along the Atlantic Coast are sinking more than 5 millimeters annually. That’s an even faster change than sea-level rise, currently at 4 millimeters a year. (In the map below, warmer colors represent more subsidence, up to 6 millimeters.)
With each millimeter of subsidence, it gets easier for storm surges—essentially a wall of seawater, which hurricanes are particularly good at pushing onshore—to creep farther inland, destroying more and more infrastructure. “And it’s not just about sea levels,” says the study’s lead author, Leonard Ohenhen, an environmental security expert at Virginia Tech. “You also have potential to disrupt the topography of the land, for example, so you have areas that can get full of flooding when it rains.”
A few millimeters of annual subsidence may not sound like much, but these forces are relentless: Unless coastal areas stop extracting groundwater, the land will keep sinking deeper and deeper. The social forces are relentless, too, as more people around the world move to coastal cities, creating even more demand for groundwater. “There are processes that are sometimes even cyclic, for example in summers you pump a lot more water so land subsides rapidly in a short period of time,” says Manoochehr Shirzaei, an environmental security expert at Virginia Tech and coauthor of the paper. “That causes large areas to subside below a threshold that leads the water to flood a large area.” When it comes to flooding, falling elevation of land is a tipping element that has been largely ignored by research so far, Shirzaei says.
In Jakarta, Indonesia, for example, the land is sinking nearly a foot a year because of collapsing aquifers. Accordingly, within the next three decades, 95 percent of North Jakarta could be underwater. The city is planning a giant seawall to hold back the ocean, but it’ll be useless unless subsidence is stopped.
This new study warns that levees and other critical infrastructure along the Atlantic Coast are in similar danger. If the land were to sink uniformly, you might just need to keep raising the elevation of a levee to compensate. But the bigger problem is “differential subsidence,” in which different areas of land sink at different rates. “If you have a building or a runway or something that’s settling uniformly, it’s probably not that big a deal,” says Tom Parsons, a geophysicist with the United States Geological Survey who studies subsidence but wasn’t involved in the new paper. “But if you have one end that’s sinking faster than the other, then you start to distort things.”
Merchants who have been suspended from selling goods on Amazon’s marketplace are turning to a cottage industry of lawyers to regain access to their accounts and money, amid growing scrutiny of how the retailer treats independents.
Millions of accounts on the leading ecommerce platform have been prevented from engaging in sales for alleged violations of Amazon’s broad range of policies and other bad behavior. Even temporary suspensions can be a critical blow to the small business owners who rely on online sales.
Four ecommerce-focused US law firms told the Financial Times that the majority of the cases they took on were complaints brought by aggrieved Amazon sellers, with each handling hundreds or thousands of cases every year.
About a dozen sellers also said they had grown worried about Amazon’s power to suspend their accounts or product listings, as it was not always clear what had triggered the suspension and Amazon’s seller support services did not always help to sort out the issue.
Account suspension was “a big fear of mine,” said one seller, who declined to be named. “At the end of the day, it’s not really your business. One day you can wake up and it’s all gone.”
Amazon’s recent efforts to crack down on issues such as fake product reviews have come as US and European regulators have upped their scrutiny of the online harms facing shoppers.
But critics said the existence of a growing army of lawyers and consultants to deal with the fallout from Amazon’s actions pointed to a problem with the way the retailer treats its sellers.
“If you’re a seller and you need help to navigate the system, that’s a real vulnerability for the marketplace. If you’re operating a business where the people you’re deriving revenue from feel that they’re being treated in an arbitrary way without due process, that is a problem,” said Marianne Rowden, chief executive of the E-Merchants Trade Council.
“The fact that there are entire law firms dedicated to dealing with Amazon says a lot,” said one seller, who like many who spoke to the FT asked to remain anonymous for fear of reprisals.
Amazon declined to comment in detail but said its selling partners were “incredibly important” and the company worked hard to “protect and help them grow their business.” The company worked to “eliminate mistakes and ‘false positive’ enforcements” and had an appeal process for sellers in place.
Sellers on Amazon’s marketplace account for more than 60 percent of sales in its store. In the nine months to September 30, Amazon recorded $96bn in commissions and fees paid by sellers, a jump of nearly 20 percent compared with the same period a year earlier.
As the marketplace has grown, Amazon has had to do more to police it. During the first half of 2023 in its EU store, Amazon took 274mn “actions” in response to potential policy violations and other suspected problems, which included the removal of content and 4.2mn account suspensions. Amazon revealed the numbers as part of its first European transparency report newly required by EU law.
Amazon typically withholds any money in the account of a seller it has suspended for alleged fraudulent or abusive practices, which it may keep permanently if the account is not reinstated and the merchant is deemed to have been a bad actor.
Figuring out what caused a suspension and how to reverse it can be difficult. “We had a listing shut down during Prime Big Deals Days with no warning, no cause, no explanation,” said one kitchenware seller who has been selling on Amazon.com since 2014. “That’s pretty common.”
Amazon gave no further information when the listing was reinstated days later, the seller said.
Such confusion drives some sellers towards lawyers and consultants who advise on underlying problems, such as intellectual property disputes.
Amazon-focused US firms said they typically charged flat fees of between $1,300 and $3,500 per case.
CJ Rosenbaum, founding partner of the Amazon and ecommerce-focused law firm Rosenbaum Famularo, said the practice experienced a “big jump” in demand during the pandemic.
Many cases related to IP complaints from bigger brands “trying to control who sells their products” and making “a baseless counterfeit complaint” against a smaller Amazon seller, he added.
Lawyers said some sellers had been wrongly accused by the company’s automated systems that identify breaches of rules and policies. They added though that others had broken Amazon’s rules.
The retailer has become “more draconian” in the enforcement of its policies in recent years, said attorney Jeff Schick.
“Clients will say Amazon is unfair,” he said, but added that if the company did not strictly enforce its rules “then the platform becomes the next [US classified advertisements website] Craigslist.”
As part of escalated disputes, lawyers might steer merchants through a costly arbitration process that the company requires US sellers to use for most issues, rather than filing lawsuits against it.
Sellers were subject to “forced” arbitration clauses that required them to “sign away the right to their day in court if a dispute with Amazon arises,” said a 2022 US government report.
The details of arbitrations are not public, and decisions do not typically set binding precedents. They can also be hugely expensive: the up to three arbitrators that preside over a case can charge hundreds of dollars an hour.
“Quickly, you’re at $25,000 of costs or more,” said sole practitioner Leo Vaisburg, who left firm Wilson Elser in 2022 to pursue Amazon-related work full time. For many small businesses the high costs were “a barrier to entry,” he added. “Very few cases are worth that kind of money.”
Apple faces a legal reckoning in 2024, with a series of regulatory decisions by US and EU authorities over the coming months set to determine the future of its $85 billion-a-year services business.
The biggest hit to the iPhone maker could come from a US antitrust trial against Google, where it emerged that the fellow tech giant had paid more than $26 billion in 2021 to make its search engine the default on Apple devices and other smartphones and browsers.
Should Google lose the case, it could be forced to stop making regular payments to Apple, which Eric Seufert, an independent analyst, estimates as being worth a quarter of annual revenues earned by Apple’s services arm.
Meanwhile, Apple and other tech giants face increasing scrutiny from the Biden administration over concerns about the dominance of its App Store, which it is already being forced to change in the EU due to legislation designed to rein in the power of Big Tech.
Together, the legal and regulatory actions spanning two of Apple’s biggest markets represent the biggest threat to the company’s business in years.
Its services arm, which includes income from the App Store, video streaming arm, and Apple Music, has steadily increased as a proportion of the company’s total revenues, which is still dominated by sales of devices such as the iPhone.
The Google trial, seen as the most significant antitrust monopoly trial in more than 25 years in Washington, will hear closing arguments in May. Should Google lose, it will almost certainly file an appeal, but such a decision would raise questions about how the two tech giants work with one another into the future.
“I think the judge was intrigued with that issue during the trial,” said Bill Kovacic, a former Federal Trade Commission chair and competition professor of law and policy at George Washington University Law School. “The question in the background was: ‘if Apple is going to have an auction for that prime placement, what should Google have done?’”
The White House is at the same time intensifying its efforts to tackle what it regards as excessive corporate power. Jonathan Kanter, head of the Department of Justice’s antitrust unit since November 2021, has made no secret of his ambition to bring cases against the biggest US companies.
His department has been probing Apple’s App Store policies for years and is now, according to Kanter, “firing on all cylinders.” The window for him to bring a case is closing, however, as the US presidential election and a potential change in administration loom. The DoJ did not respond to a request for comment on the Apple probe.
Regulators, businesses, and enforcers have for years been seeking to pry apart Apple’s iOS ecosystem, a move the tech giant has always insisted would undermine the mobile operating software’s security.
Apple, however, acknowledged recently in a filing to the Securities and Exchange Commission that it would have to make changes to its App Store in the EU, due to the bloc’s new Digital Markets Act, which has a March deadline for legal compliance from tech companies.
In the EU, Apple is preparing to allow “sideloading,” which enables iPhone users to bypass its store and download apps from elsewhere.
This will breach, for the first time, the walled-off ecosystem that the company has protected since Steve Jobs unveiled the iPhone in 2007. Apple has dragged its feet on this issue, since it maintains the practice will create security risks to its system.
Sideloading could have an impact on the App Store, where Apple charges developers as much as a 30 percent fee on digital purchases. Games account for more than half of that revenue. Google’s Play Store, which charges a similar fee, is also in the spotlight after it lost a landmark trial against Epic Games in California in December.
Apple draws between $6 billion and $7 billion in commission fees from the App Store globally each quarter, according to Sensor Tower estimates.
Competitors are pushing to earn some of that share and launch rival app stores and payment methods on Apple devices. Microsoft is talking to partners about launching its own mobile store.
Fortnite maker Epic Games, a longtime Apple foe, wants its store on iOS devices and points to its lower 12 percent fee as an incentive for consumers to switch to its platform.
While Epic broadly lost a lower court judgment into its claims against Apple in 2021, a California judge ordered Apple to put an end to App Store rules that prevent developers from steering customers outside of the store to make purchases. The appeals court upheld that injunction earlier this year. The US Supreme Court will review the case next year.
For investors, gauging the ultimate risk from the raft of regulatory and legal actions across the world is difficult. “I think there’s just a belief that there’s all this noise in the background, and ‘don’t worry about it,’” said Gene Munster, managing partner at Deepwater Asset Management.
Investors, he said, had been “lulled to sleep” by Apple’s initial wins against Epic in particular. “But I think investors should take it seriously.”
Enlarge/ A Huawei Technologies Co. Mate X5 smartphone arranged in Hong Kong, China, on Saturday, Sept. 16, 2023.
Every large smartphone maker except Apple is betting that “foldable” phones will help revive a lackluster mobile market, despite the devices still largely failing to attract mainstream consumers.
Foldables, which have a screen that opens like a book or compact mirror, barely exceed a 1 per cent market share of all smartphones sold globally almost five years after they were first introduced.
But Samsung has doubled down on the product, investing heavily in marketing this year. In July, the Korean group released its 5G Galaxy Z series.
The world’s largest smartphone manufacturer points to estimates from Counterpoint Research that foldable devices may surpass a third of all smartphones costing more than $600 by 2027.
“We will continue to position our foldables as a key engine for our flagship growth with the clear differentiation, experience and flexibility these devices have to offer,” said Samsung.
Other handset makers such as Motorola, China’s Huawei and its spin-off Honor are also pinning their hopes on the product helping to revive a market that suffered its worst year for more than a decade.
“This is the year people [in the industry] really dived in,” said Ben Wood, an analyst at CCS Insight. “Everybody now is betting on this, except Apple.”
The iPhone-maker has yet to show any interest in the category, though patent filings suggest it may one day introduce an iPad that folds in half. Every other big smartphone maker has followed Samsung into the market, including Google’s Pixel Fold and Chinese alternatives from Huawei, Oppo and Xiaomi.
“We believe foldables are the future of smartphone devices, just like electric cars were to the auto industry,” said Bond Zhang, UK chief executive of Honor. “We’re approaching a crucial tipping point where foldables may soon become mainstream.”
But market data shows foldables are still far from mainstream. Counterpoint Research estimates about 16 million foldable phones will be sold this year, just 1.3 per cent of the 1.2 billion smartphone market total. Analysts say consumers are deterred by concerns about price, reliability and utility.
“I do wonder if there are too many products chasing too little market share at the moment,” Wood said.
Enlarge/ Aitana Lopez, an AI-generated influencer, has convinced many social media users she is real.
FT montage/TheClueless/GettyImages
Pink-haired Aitana Lopez is followed by more than 200,000 people on social media. She posts selfies from concerts and her bedroom, while tagging brands such as hair care line Olaplex and lingerie giant Victoria’s Secret.
Brands have paid about $1,000 a post for her to promote their products on social media—despite the fact that she is entirely fictional.
Aitana is a “virtual influencer” created using artificial intelligence tools, one of the hundreds of digital avatars that have broken into the growing $21 billion content creator economy.
Their emergence has led to worry from human influencers their income is being cannibalized and under threat from digital rivals. That concern is shared by people in more established professions that their livelihoods are under threat from generative AI—technology that can spew out humanlike text, images and code in seconds.
But those behind the hyper-realistic AI creations argue they are merely disrupting an overinflated market.
“We were taken aback by the skyrocketing rates influencers charge nowadays. That got us thinking, ‘What if we just create our own influencer?’” said Diana Núñez, co-founder of the Barcelona-based agency The Clueless, which created Aitana. “The rest is history. We unintentionally created a monster. A beautiful one, though.”
Over the past few years, there have been high-profile partnerships between luxury brands and virtual influencers, including Kim Kardashian’s make-up line KKW Beauty with Noonoouri, and Louis Vuitton with Ayayi.
Instagram analysis of an H&M advert featuring virtual influencer Kuki found that it reached 11 times more people and resulted in a 91 percent decrease in cost per person remembering the advert, compared with a traditional ad.
Enlarge/ Where beavers set up home, the dams they build profoundly change the landscape.
For the first time in four centuries, it’s good to be a beaver. Long persecuted for their pelts and reviled as pests, the dam-building rodents are today hailed by scientists as ecological saviors. Their ponds and wetlands store water in the face of drought, filter out pollutants, furnish habitat for endangered species, and fight wildfires. In California, Castor canadensis is so prized that the state recently committed millions to its restoration.
While beavers’ benefits are indisputable, however, our knowledge remains riddled with gaps. We don’t know how many are out there, or which direction their populations are trending, or which watersheds most desperately need a beaver infusion. Few states have systematically surveyed them; moreover, many beaver ponds are tucked into remote streams far from human settlements, where they’re near-impossible to count. “There’s so much we don’t understand about beavers, in part because we don’t have a baseline of where they are,” says Emily Fairfax, a beaver researcher at the University of Minnesota.
But that’s starting to change. Over the past several years, a team of beaver scientists and Google engineers have been teaching an algorithm to spot the rodents’ infrastructure on satellite images. Their creation has the potential to transform our understanding of these paddle-tailed engineers—and help climate-stressed states like California aid their comeback. And while the model hasn’t yet gone public, researchers are already salivating over its potential. “All of our efforts in the state should be taking advantage of this powerful mapping tool,” says Kristen Wilson, the lead forest scientist at the conservation organization the Nature Conservancy. “It’s really exciting.”
The beaver-mapping model is the brainchild of Eddie Corwin, a former member of Google’s real-estate sustainability group. Around 2018, Corwin began to contemplate how his company might become a better steward of water, particularly the many coastal creeks that run past its Bay Area offices. In the course of his research, Corwin read Water: A Natural History, by an author aptly named Alice Outwater. One chapter dealt with beavers, whose bountiful wetlands, Outwater wrote, “can hold millions of gallons of water” and “reduce flooding and erosion downstream.” Corwin, captivated, devoured other beaver books and articles, and soon started proselytizing to his friend Dan Ackerstein, a sustainability consultant who works with Google. “We both fell in love with beavers,” Corwin says.
Corwin’s beaver obsession met a receptive corporate culture. Google’s employees are famously encouraged to devote time to passion projects, the policy that produced Gmail; Corwin decided his passion was beavers. But how best to assist the buck-toothed architects? Corwin knew that beaver infrastructure—their sinuous dams, sprawling ponds, and spidery canals—is often so epic it can be seen from space. In 2010, a Canadian researcher discovered the world’s longest beaver dam, a stick-and-mud bulwark that stretches more than a half-mile across an Alberta park, by perusing Google Earth. Corwin and Ackerstein began to wonder whether they could contribute to beaver research by training a machine-learning algorithm to automatically detect beaver dams and ponds on satellite imagery—not one by one, but thousands at a time, across the surface of an entire state.
After discussing the concept with Google’s engineers and programmers, Corwin and Ackerstein decided it was technically feasible. They reached out next to Fairfax, who’d gained renown for a landmark 2020 study showing that beaver ponds provide damp, fire-proof refuges in which other species can shelter during wildfires. In some cases, Fairfax found, beaver wetlands even stopped blazes in their tracks. The critters were such talented firefighters that she’d half-jokingly proposed that the US Forest Service change its mammal mascot—farewell, Smoky Bear, and hello, Smoky Beaver.
Fairfax was enthusiastic about the pond-mapping idea. She and her students already used Google Earth to find beaver dams to study within burned areas. But it was a laborious process, one that demanded endless hours of tracing alpine streams across screens in search of the bulbous signature of a beaver pond. An automated beaver-finding tool, she says, could “increase the number of fires I can analyze by an order of magnitude.”
With Fairfax’s blessing, Corwin, Ackerstein, and a team of programmers set about creating their model. The task, they decided, was best suited to a convolutional neural network, a type of algorithm that essentially tries to figure out whether a given chunk of geospatial data includes a particular object—whether a stretch of mountain stream contains a beaver dam, say. Fairfax and some obliging beaverologists from Utah State University submitted thousands of coordinates for confirmed dams, ponds, and canals, which the Googlers matched up with their own high-resolution images to teach the model to recognize the distinctive appearance of beaverworks. The team also fed the algorithm negative data—images of beaverless streams and wetlands—so that it would know what it wasn’t looking for. They dubbed their model the Earth Engine Automated Geospatial Elements Recognition, or EEAGER—yes, as in “eager beaver.”
Training EEAGER to pick out beaver ponds wasn’t easy. The American West was rife with human-built features that seemed practically designed to fool a beaver-seeking model. Curving roads reminded EEAGER of winding dams; the edges of man-made reservoirs registered as beaver-built ponds. Most confounding, weirdly, were neighborhood cul-de-sacs, whose asphalt circles, surrounded by gray strips of sidewalk, bore an uncanny resemblance to a beaver pond fringed by a dam. “I don’t think anybody anticipated that suburban America was full of what a computer would think were beaver dams,” Ackerstein says.
As the researchers pumped more data into EEAGER, it got better at distinguishing beaver ponds from impostors. In May 2023, the Google team, along with beaver researchers Fairfax, Joe Wheaton, and Wally Macfarlane, published a paper in the Journal of Geophysical Research Biogeosciencesdemonstrating the model’s efficacy. The group fed EEAGER more than 13,000 landscape images with beaver dams from seven western states, along with some 56,000 dam-less locations. The model categorized the landscape accurately—beaver dammed or not—98.5 percent of the time.
That statistic, granted, oversells EEAGER’s perfection. The Google team opted to make the model fairly liberal, meaning that, when it predicts whether or not a pixel of satellite imagery contains a beaver dam, it’s more likely to err on the side of spitting out a false positive. EEAGER still requires a human to check its answers, in other words—but it can dramatically expedite the work of scientists like Fairfax by pointing them to thousands of probable beaver sites.
“We’re not going to replace the expertise of biologists,” Ackerstein says. “But the model’s success is making human identification much more efficient.”
According to Fairfax, EEAGER’s use cases are many. The model could be used to estimate beaver numbers, monitor population trends, and calculate beaver-provided ecosystem services like water storage and fire prevention. It could help states figure out where to reintroduce beavers, where to target stream and wetland restoration, and where to create conservation areas. It could allow researchers to track beavers’ spread in the Arctic as the rodents move north with climate change; or their movements in South America, where beavers were introduced in the 1940s and have since proliferated. “We literally cannot handle all the requests we’re getting,” says Fairfax, who serves as EEAGER’s scientific adviser.
The algorithm’s most promising application might be in California. The Golden State has a tortured relationship with beavers: For decades, the state generally denied that the species was native, the byproduct of an industrial-scale fur trade that wiped beavers from the West Coast before biologists could properly survey them. Although recent historical research proved that beavers belong virtually everywhere in California, many water managers and farmers still perceive them as nuisances, and frequently have them killed for plugging up road culverts and meddling with irrigation infrastructure.
Yet those deeply entrenched attitudes are changing. After all, no state is in more dire need of beavers’ water-storage services than flammable, drought-stricken, flood-prone California. In recent years, thanks to tireless lobbying by a campaign called Bring Back the Beaver, the California Department of Fish and Wildlife has begun to overhaul its outdated beaver policies. In 2022, the state budgeted more than $1.5 million for beaver restoration, and announced it would hire five scientists to study and support the rodents. It also revised its official approach to beaver conflict to prioritize coexistence over lethal trapping. And, this fall, the wildlife department relocated a family of seven beavers onto the ancestral lands of the Mountain Maidu people—the state’s first beaver release in almost 75 years.
It’s only appropriate, then, that California is where EEAGER is going to get its first major test. The Nature Conservancy and Google plan to run the model across the state sometime in 2024, a comprehensive search for every last beaver dam and pond. That should give the state’s wildlife department a good sense of where its beavers are living, roughly how many it has, and where it could use more. The model will also provide California with solid baseline data against which it can compare future populations, to see whether its new policies are helping beavers recover. “When you have imagery that’s repeated frequently, that gives you the opportunity to understand change through time,” says the Conservancy’s Kristen Wilson.
What’s next for EEAGER after its California trial? The main thing, Ackerstein says, is to train it to identify beaverworks in new places. (Although beaver dams and ponds present as fairly similar in every state, the model also relies on context clues from the surrounding landscape, and a sagebrush plateau in Wyoming looks very different from a deciduous forest in Massachusetts.) The team also has to figure out EEAGER’s long-term fate: Will it remain a tool hosted by Google? Spin off into a stand-alone product? Become a service operated by a university or nonprofit?
“That’s the challenge for the future—how do we make this more universally accessible and usable?” Corwin says. The beaver revolution may not be televised, but it will definitely be documented by satellite.
Over the past year, Apple has taken protective steps to notify iPhone and Android users if an AirTag is in their vicinity for a significant amount of time without the presence of its owner’s iPhone, which could indicate that an AirTag has been planted to secretly track their location. Apple hasn’t said exactly how long this time interval is, but to create the much-needed alert system, Apple made some crucial changes to the location privacy design the company originally developed a few years ago for its “Find My” device tracking feature. Researchers from Johns Hopkins University and the University of California, San Diego, say, though, that they’ve developed a cryptographic scheme to bridge the gap—prioritizing detection of potentially malicious AirTags while also preserving maximum privacy for AirTag users.
The Find My system uses both public and private cryptographic keys to identify individual AirTags and manage their location tracking. But Apple developed a particularly thoughtful mechanism to regularly rotate the public device identifier—every 15 minutes, according to the researchers. This way, it would be much more difficult for someone to track your location over time using a Bluetooth scanner to follow the identifier around. This worked well for privately tracking the location of, say, your MacBook if it was lost or stolen, but the downside of constantly changing this identifier for AirTags was that it provided cover for the tiny devices to be deployed abusively.
In reaction to this conundrum, Apple revised the system so an AirTag’s public identifier now only rotates once every 24 hours if the AirTag is away from an iPhone or other Apple device that “owns” it. The idea is that this way other devices can detect potential stalking, but won’t be throwing up alerts all the time if you spend a weekend with a friend who has their iPhone and the AirTag on their keys in their pockets.
In practice, though, the researchers say that these changes have created a situation where AirTags are broadcasting their location to anyone who’s checking within a 30- to 50-foot radius over the course of an entire day—enough time to track a person as they go about their life and get a sense of their movements.
“We had students walk through cities, walk through Times Square and Washington, DC, and lots and lots of people are broadcasting their locations,” says Johns Hopkins cryptographer Matt Green, who worked on the research with a group of colleagues, including Nadia Heninger and Abhishek Jain. “Hundreds of AirTags were not near the device they were registered to, and we’re assuming that most of those were not stalker AirTags.”
Apple has been working with companies like Google, Samsung, and Tile on a cross-industry effort to address the threat of tracking from products similar to AirTags. And for now, at least, the researchers say that the consortium seems to have adopted Apple’s approach of rotating the device public identifiers once every 24 hours. But the privacy trade-off inherent in this solution made the researchers curious about whether it would be possible to design a system that better balanced both privacy and safety.
Enlarge/ African penguins on a beach near Simon’s Town in South Africa.
CAPE TOWN, South Africa—A weathered, green building stands at the edge of the cozy suburban Table View neighborhood in Cape Town, just a few blocks down from a Burger King and a community library. Upon stepping inside, visitors’ feet squelch on a mat submerged in antibacterial liquid—one of the first signs this isn’t just another shop on the street.
A few steps further down the main hallway, a cacophony of discordant brays and honks fill the air. A couple more strides reveal the source of these guttarall calls: African penguins.
Welcome to the nonprofit Southern African Foundation for the Conservation Of Coastal Birds’ hatchery and nursery, where hundreds of these birds are hand-reared after being injured or abandoned in the wild.
While this conservation center is a flourishing refuge for African penguins, the species as a whole is in dire straits. Over the past century, African penguin populations have plummeted, dropping from around one million breeding pairs in the early 1900s to less than 10,000 in 2023 as environmental conditions have worsened due to increased fishing pressure and climate change, which have both decreased fish populations on which penguins rely.
The climate crisis has also fueled more frequent and severe weather events in South Africa such as floods and heat waves, resulting in an increased number of penguin parents abandoning their eggs to seek refuge.
The staff at the Foundation is working to hand-rear penguins with the goal to release most of them back into one of the threatened Cape colonies they came from. But some of these penguins are destined for a different destination: a rocky outcropping along the Eastern Cape of South Africa within the De Hoop Nature Reserve.
There, scientists and conservationists are working to establish a new penguin colony, which they hope will become a stronghold for the entire African penguin species.
The ecological trap
It’s difficult to pin a single threat to the demise of African penguins; oil spills, avian flu and extreme weather events have wreaked havoc on colonies across South Africa. These chronic issues combine with freak incidents: In 2021, a swarm of bees killed more than 60 African penguins on the popular Boulders Beach in Cape Town and, a year later, two huskies killed 19 penguins in the same area.
However, scientists say that one of the main causes of the seabirds’ decline is the intense fishing pressure on sardines and anchovies, the penguin’s main diet.
Fighting unemployment, low-income people fish around coastal beaches to support themselves, said Shanet Rutgers, an animal health technician at the Two Oceans Aquarium in South Africa, and there is a large commercial industry for purse-seine fishing, in which a wall of netting is cast around a school of fish.
“When they pull out too much fish in the ocean, they leave the colonies with almost little to nothing to feed on,” she said.
The world’s largest traditional entertainment companies face a reckoning in 2024 after losing more than $5 billion in the past year from the streaming services they built to compete with Netflix.
Disney, Warner Bros Discovery, Comcast and Paramount—US entertainment conglomerates that have been growing ever larger for decades—are facing pressure to shrink or sell legacy businesses, scale back production and slash costs following billions in losses from their digital platforms.
Shari Redstone, Paramount’s billionaire controlling shareholder, has effectively put the company on the block in recent weeks. She has held talks about selling the Hollywood studio to Skydance, the production company behind Top Gun: Maverick, people familiar with the matter say.
Paramount chief executive Bob Bakish also discussed a possible combination over lunch with Warner CEO David Zaslav in mid-December. In both cases the discussions were said to be at an early stage and people familiar with the talks cautioned that a deal might not materialize.
Beyond their streaming losses, the traditional media groups are facing a weak advertising market, declining television revenues and higher production costs following the Hollywood strikes.
Rich Greenfield, an analyst at LightShed Partners, said Paramount’s deal discussions were a reflection of the “complete and utter panic” in the industry.
“TV advertising is falling far short, cord-cutting is continuing to accelerate, sports costs are going up and the movie business is not performing,” he said. “Everything is going wrong that can go wrong. The only thing [the companies] know how to do to survive is try to merge and cut costs.”
But as the traditional media owners struggle, Netflix, the tech group that pioneered the streaming model over a decade ago, has emerged as the winner of the battle to reshape video distribution.
“For much of the past four years, the entertainment industry spent money like drunken sailors to fight the first salvos of the streaming wars,” analyst Michael Nathanson wrote in November. “Now, we are finally starting to feel the hangover and the weight of the unpaid bar bill.”
For companies that have been trying to compete with Netflix, Nathanson added, “the shakeout has begun.”
After a bumpy 2022, Netflix has set itself apart from rivals—most notably by being profitable. Earnings for its most recent quarter soared past Wall Street’s expectations as it added 9 million new subscribers—the strongest rise since early 2020, when Covid-19 lockdowns led to a jump.
“Netflix has pulled away,” says John Martin, co-founder of Pugilist Capital and former chief executive of Turner Broadcasting. For its rivals, he said, the question is “how do you create a viable streaming service with a viable business model? Because they’re not working.”
The leading streaming services aggressively raised prices in 2023. Now, analysts, investors and executives predict that consolidation could be ahead next year as some of the smaller services combine or bow out of the streaming wars.
Warner, home to HBO and the Warner Bros movie studio, has made a small profit at its US streaming services this year, in part by raising prices, aggressively culling some series and licensing others to Netflix. However, this has come at a price: Warner lost more than 2 million streaming subscribers in its two most recent quarters.
The company, which merged with rival Discovery last year, has long been rumored as a potential takeover candidate, with Comcast seen as the most likely buyer. But Zaslav in November hinted that his group wanted to be an acquirer instead of a target.
“There are a lot of . . . excess players in the market. So, this will give us a chance not only to fight to grow in the next year, but to have the kind of balance sheet and the kind of stability . . . that we could be really opportunistic over the next 12 to 24 months,” he said on an earnings call.
The terms of the Warner-Discovery merger barred the group from dealmaking for two years. That period expires on April 8.
Disney, the largest traditional media company, is in the midst of a gutting restructuring that has featured 7,000 job cuts and attacks from activist investors. It lost more than $1.6 billion from its streaming businesses in the first nine months of 2023, during which its Disney+ service gained 8 million subscribers. The company says it will turn a profit in streaming in late 2024.
Bob Iger, Disney chief executive, this year openly pondered whether some of its assets still fit within the company, prompting speculation that he was considering disposals. But no deals emerged, leading some investors to conclude there is little appetite among private equity or tech companies for acquiring legacy businesses.
Paramount’s shares have risen almost 40 percent since early November as sale speculation mounted. The stock rose sharply after the Skydance talks were reported, but both Paramount and Warner shares fell after news of their discussions came to light.
Analysts said the two companies’ high debt levels were an immediate concern for investors. “We suspect investors will focus on pro forma leverage above all else,” Citi analysts wrote in a note last week. They estimated that an all-stock combination of Warner and Paramount could yield at least $1 billion of synergies.
But Greenfield said merging two companies with lossmaking streaming services and large portfolios of declining television assets was not the answer to their problems.
“The right answer should be, let’s stop trying to be in the streaming business,” he said. “The answer is, let’s get smaller and focused and stop trying to be a huge company. Let’s dramatically shrink.”
Enlarge/ A string of deals by Microsoft, Google and Amazon amounted to two-thirds of the $27 billion raised by fledgling AI companies in 2023,
FT montage/Dreamstime
Big tech companies have vastly outspent venture capital groups with investments in generative AI startups this year, as established giants use their financial muscle to dominate the much-hyped sector.
Microsoft, Google and Amazon last year struck a series of blockbuster deals, amounting to two-thirds of the $27 billion raised by fledgling AI companies in 2023, according to new data from private market researchers PitchBook.
The huge outlay, which exploded after the launch of OpenAI’s ChatGPT in November 2022, highlights how the biggest Silicon Valley groups are crowding out traditional tech investors for the biggest deals in the industry.
The rise of generative AI—systems capable of producing humanlike video, text, image and audio in seconds—have also attracted top Silicon Valley investors. But VCs have been outmatched, having been forced to slow down their spending as they adjust to higher interest rates and falling valuations for their portfolio companies.
“Over the past year, we’ve seen the market quickly consolidate around a handful of foundation models, with large tech players coming in and pouring billions of dollars into companies like OpenAI, Cohere, Anthropic and Mistral,” said Nina Achadjian, a partner at US venture firm Index Ventures referring to some of the top AI startups.
“For traditional VCs, you had to be in early and you had to have conviction—which meant being in the know on the latest AI research and knowing which teams were spinning out of Google DeepMind, Meta and others,” she added.
Financial Times
A string of deals, such as Microsoft’s $10 billion investment in OpenAI as well as billions of dollars raised by San Francisco-based Anthropic from both Google and Amazon, helped push overall spending on AI groups to nearly three times as much as the previous record of $11 billion set two years ago.
Venture investing in tech hit record levels in 2021, as investors took advantage of ultra-low interest rates to raise and deploy vast sums across a range of industries, particularly those most disrupted by Covid-19.
Microsoft has also committed $1.3 billion to Inflection, another generative AI start-up, as it looks to steal a march on rivals such as Google and Amazon.
Building and training generative AI tools is an intensive process, requiring immense computing power and cash. As a result, start-ups have preferred to partner with Big Tech companies which can provide cloud infrastructure and access to the most powerful chips as well as dollars.
That has rapidly pushed up the valuations of private start-ups in the space, making it harder for VCs to bet on the companies at the forefront of the technology. An employee stock sale at OpenAI is seeking to value the company at $86 billion, almost treble the valuation it received earlier this year.
“Even the world’s top venture investors, with tens of billions under management, can’t compete to keep these AI companies independent and create new challengers that unseat the Big Tech incumbents,” said Patrick Murphy, founding partner at Tapestry VC, an early-stage venture capital firm.
“In this AI platform shift, most of the potentially one-in-a-million companies to appear so far have been captured by the Big Tech incumbents already.”
VCs are not absent from the market, however. Thrive Capital, Josh Kushner’s New York-based firm, is the lead investor in OpenAI’s employee stock sale, having already backed the company earlier this year. Thrive has continued to invest throughout a downturn in venture spending in 2023.
Paris-based Mistral raised around $500 million from investors including venture firms Andreessen Horowitz and General Catalyst, and chipmaker Nvidia since it was founded in May this year.
Some VCs are seeking to invest in companies building applications that are being built over so-called “foundation models” developed by OpenAI and Anthropic, in much the same way apps began being developed on mobile devices in the years after smartphones were introduced.
“There is this myth that only the foundation model companies matter,” said Sarah Guo, founder of AI-focused venture firm Conviction. “There is a huge space of still-unexplored application domains for AI, and a lot of the most valuable AI companies will be fundamentally new.”
Apple is banned from selling the Watch Series 9 and Watch Ultra 2 in the US after President Joe Biden’s administration refused to grant a reprieve from a trade tribunal’s decision that it had infringed another company’s patents.
Biden’s administration had 60 days from the ITC decision, which was handed down in October, to decide whether to allow it to take effect. The authority to decide whether to intervene was delegated by the White House to the US trade representative, Katherine Tai.
“After careful consultations, Ambassador Tai decided not to reverse the ITC’s determination and the ITC’s decision became final on December 26 2023,” Tai’s office said in a statement on Tuesday.
In a statement, Apple said it strongly disagreed with the ITC’s decision and exclusion order and was “taking all measures to return Apple Watch Series 9 and Apple Watch Ultra 2 to customers in the US as soon as possible.”
Ahead of a final decision from the White House, Apple had said it would preemptively halt sales of the affected models in the US on its website from December 21, and in physical stores from December 24.
It is exceptionally rare for the White House to wade into such cases, although the Obama administration vetoed a patent ban on iPhones and iPads in 2013 during the company’s legal dispute with Samsung.
The ruling deals a blow to Apple, which is already facing a slowdown in hardware sales this year. Earlier models of the Apple Watch remain available in the US, and Apple says the ban will have no impact on service for customers who have already bought the new models.
The case stems from a legal dispute between Apple and Irvine, California-headquartered Masimo over patents on the technology for measuring blood oxygen levels on the devices. The method, known as pulse oximetry, measures oxygen in the blood by shining light into the wrist.
Apple first introduced the technology in 2020, in an effort to draw in more consumers and give them the incentive to upgrade with new features on the device. Masimo said Apple copied its patented technology.
The US International Trade Commission ruled in Masimo’s favor, issuing a “limited exclusion order” against Apple’s products.
Masimo has separately sued Apple in federal court alleging trade secret violations. A trial in that case ended with a hung jury in May.
Apple is similarly embroiled in litigation with medical wearables company AliveCor over the heart rate monitoring technology on its watches. In December 2022 the ITC upheld a judge’s ruling that Apple violated AliveCor’s patents.
But that same month, the US Patent Trial and Appeal Board invalidated the AliveCor patents at the center of the dispute, putting any potential ban on hold pending appeals.
