Microsoft quits OpenAI

Hey Superheroes,

U.S. monthly inflation for June came in at 3% overnight, the lowest it’s been in 12 months. The surprisingly soft number led to higher expectations of a Fed rate cut, which will be confirmed at the next Fed meeting on 31 July. Following the news, the S&P SmallCap Index jumped up despite broader Wall Street indices falling.

Closer to home, we’ve got the ASX 200 hitting a new intraday record high. Some of the big banks, CBA and NAB, also saw their share prices hit new highs for the first time since the GFC. 

It’s another eventful week in the markets. Here are your stories.

Microsoft leaves OpenAI board

If you’ve been a Spotlight fan for a while, you’d remember that piece on how Microsoft’s invested $13 billion into OpenAI to get first dibs on its shiny new tech.

Well, it looks like the U.S. Federal Trade Commission (FTC) wasn’t too pleased with that. 

🤖 A bit too dominant

Since Microsoft’s relationship with OpenAI came to light, regulators have been scrutinising the level of influence Big Tech has on AI development.

Microsoft has had a seat on OpenAI’s board for a while now. The relationship between the two companies got the most eyes when Microsoft exercised its power to get OpenAI CEO Sam Altman back into his seat after he was ousted last November.  

Perhaps that act may have gotten them into the limelight, given that the FTC began speaking of antitrust concerns in January. Even EU and UK regulators expressed concerns on the possibility of Big Tech hindering smaller players from entering the market. 

While Microsoft finally announced its decision to leave its observer position on  OpenAI’s board this week, some believe it isn’t enough to resolve the FTC’s concerns.

🦸 Not just Microsoft

Microsoft isn’t the only one under watchful eyes. Apple has also since pulled out of its planned position on OpenAI’s board.

The antitrust regulators are also keeping an eye on Amazon’s US$4 billion collab deal with AI company Anthropic, NVIDIA’s dominance over AI chips and Google’s Gemini AI arrangement with Samsung.

🔦  Some other things we’re shining the Spotlight on:

• TELSTRA PRICE HIKES: It looks like even big telcos are succumbing to inflationary pressures. Telstra announced $2 to $4 a month price hikes on its mobile and broadband plans in order to invest further in its operations. While not the best news for customers, investors welcomed it – evidenced by Telstra’s stock surge following the news.
• MULTI-CHANNEL NBA: The NBA has inked a US$76 billion deal that’ll have Comcast, NBCUniversal and Amazon Prime Video as its new partners for at least 11 seasons. However, Disney’s ESPN still stays as the home for NBA Finals.
• NOT EXACTLY GOOD GUYS?: The ACCC took Aussie retailer, The Good Guys, to court after claiming that the latter misled numerous customers with its marketing materials over the span of four years. The Good Guys operates under parent company, JB Hi-Fi, which touched all-time highs earlier this week. 

Wall Street’s quarterly earnings season is now underway, with some global banks including JP Morgan and Citigroup reporting later tonight. 

Netflix and Johnson & Johnson are among the big names reporting next week.

Keep up to date on the markets by following us on Instagram, @superheroau!