MEF BUSINESS NEWS 12 SEPTEMBER 2024 The European Central Bank is expected to lower interest rates by a quarter-point to 3.5% today, following a June cut and July pause. While inflation in the eurozone has eased, persistent price pressures, especially in services, are keeping officials cautious about future rate moves. Economists predict further reductions in 2024, with markets closely watching both the ECB and the Federal Reserve, which is set to ease U.S. monetary policy soon. ————————————- And the Fed has one more reason to do that. Inflation eased to a three-year low in August, in the U.S, with the consumer price index rising 2.5% from a year earlier, down from 2.9% in July. Core inflation remained steady at 3.2%. This continued cooling trend sets the stage for the Federal Reserve to gradually reduce interest rates at its upcoming meeting. With inflation retreating from its 40-year highs, the Fed is now likely to shift its focus toward concerns about a slowing labor market. ————————————- By the way, Oil prices have dropped sharply amid fears of weakening demand from major economies. Brent crude fell to $68.68, its lowest since 2021, while U.S. WTI hit $65.27. Despite OPEC delaying production increases and downgrading its demand forecast for 2024, analysts expect further declines, with Brent possibly sliding into the $60s. ——————————— EU officials are considering rolling over €350bn in Covid-era bonds to avoid crippling the bloc’s budget with repayment costs. Former Italian prime minister Mario Draghi supported this option when he presented his report on competitiveness, warning that without action, the EU faces a budget crisis. However, the proposal faces legal and political resistance, particularly from Germany, as it would require unanimous approval from all 27 member states who agreed to the original borrowing as a one-off. Critics also warn it could raise interest costs and hurt the EU’s financial credibility. ————————————— Commerzbank is reviewing its defense strategy after UniCredit revealed a 9% stake, signaling a potential takeover, Bloomberg reports citing people familiar with the matter. With Goldman Sachs advising, Commerzbank is preparing for talks, while labor representatives seek political support to block the move. UniCredit sees Commerzbank as a strategic fit for its European expansion. ——————————- PwC’s U.S. unit is laying off 1,800 employees, its first major cuts since 2009, due to reduced demand for advisory services — the Wall Street Journal reports citing an internal memo it obtained. The layoffs, affecting about 2.5% of the U.S. workforce, will mainly impact advisory and technology roles and include offshore positions. Notifications will be made in October. —— —— MEF MOBILE NEWS 12 SEPTEMBER 2024 The GSMA and Connect Europe backed Mario Draghi’s report, warning Europe’s telecom sector risks losing global competitiveness. They support his call for industry consolidation to boost investment and urge reduced regulation, fairer policies toward big tech, and harmonized spectrum licensing. The associations stressed immediate action is needed to prevent Europe from falling further behind in creating a competitive and sustainable digital market. —————————————- Huawei’s new $2,800 Mate XT smartphone, featuring a trifold display, received 5 million pre-orders as for yesterday during its launch week, but it faces production challenges. The Mate XT was unveiled just after Apple’s iPhone 16. Huawei’s model is priced nearly $2,000 higher. Analysts question whether Huawei can meet demand, given U.S. sanctions limiting access to advanced chips and production hurdles with its partner SMIC. The Mate XT follows the release of Huawei’s Mate 60, which used a homegrown chip, marking a recovery from earlier sanctions. —————————————— Chinese authorities have detained Transsion’s chief financial officer, Xiao Yonghui, adding to the challenges facing Africa’s largest smartphone supplier. The Shanghai-listed company, known as the “King of Africa,” saw its shares drop nearly 5% after the announcement. While no details on the investigation were provided, Transsion stated that regular operations would not be affected. The company is expanding into new markets in Asia, Europe, and Latin America to counter growing competition and patent lawsuits. In Latin America, Transsion’s phone sales surged 276% in the first half of 2024. —————————————- Chunghwa Telecom announced a partnership with Nokia to boost Taiwan’s 5G download speeds to 2.34 Gbps. Using Nokia’s AirScale radio base stations and 5G Carrier Aggregation technology, Chunghwa will deploy the latest infrastructure in densely populated areas. Chunghwa Telecom President Alex Chien highlighted the company’s extensive 4G/5G spectrum bandwidth and praised Nokia’s energy-efficient hardware and advanced software for enhancing mobile service. —————————————- The U.S. House unanimously passed bipartisan bills to boost communications security and modernize Congress, including the ROUTERS Act, which aims to protect U.S. networks from foreign-controlled technology. The Senate still needs to vote on the legislation. —— —— MEF TECH NEWS 12 SEPTEMBER 2024 Google is being investigated by Ireland’s Data Protection Commission for potential GDPR violations in its AI model, PaLM 2. The inquiry focuses on whether Google properly assessed data protection risks. This follows similar regulatory actions against Meta and X, as European authorities tighten scrutiny on AI data practices. ——————————- OpenAI is in talks to raise $6.5 billion, which would value the company at around $150 billion, nearly double its valuation from nine months ago — the New York Times reported citing people with knowledge of the matter. This would make it one of the world’s most valuable private companies, second only to ByteDance. Initially seeking $1 billion at a $100 billion valuation, OpenAI’s funding target has rapidly increased due to high expenses from building advanced AI systems. Thrive Capital is expected to lead the round, with interest from Apple, Nvidia, and Microsoft. —————————————- Nvidia CEO Jensen Huang acknowledged growing frustration among customers due to high demand for the company’s latest Blackwell chips, which are crucial for AI development. Speaking at a Goldman Sachs conference, Huang said the intense competition for limited supply has heightened emotions. Nvidia’s stock has surged, more than doubling this year following a 239% gain in 2023. The company relies on major data center operators like Microsoft and Meta for much of its revenue. Huang emphasized that “accelerated computing” with Nvidia’s technology is essential for handling both AI tasks and conventional workloads. However, Nvidia’s dependence on Taiwan Semiconductor Manufacturing raises concerns due to geopolitical tensions between China and Taiwan. Huang noted Nvidia could shift suppliers if necessary, albeit with reduced chip quality. —————————————- AST SpaceMobile, a small telecom company aiming to rival SpaceX, has seen its stock skyrocket from $2 to $28 in six months, a 1,300% increase. Today, the company faces a crucial test with the launch of its first five commercial satellites from Cape Canaveral, Florida, via a SpaceX rocket. Despite the rally, more than 20% of its shares are shorted, reflecting skepticism. AST SpaceMobile secured an agreement with AT&T in May to offer wireless service from space, competing with SpaceX’s Starlink. A $100 million investment from Verizon followed. ————————————— Sony has unveiled the PlayStation 5 Pro, an upgraded version of its console, set to launch on November 7 for £699/$699. Pre-orders begin on September 26. The Pro version is digital-only, featuring a 2TB solid state drive, a GPU with 67% more compute units, and 28% more system memory, promising a 45% boost in graphics rendering for supported games. It also enhances ray tracing and offers an 8K mode. At £300 more than the Digital Edition PlayStation 5, buyers can add a Blu-ray player for an additional £100. —— ——

MEF BUSINESS NEWS 12 SEPTEMBER 2024 The European Central Bank is expected to lower interest rates by a quarter-point to 3.5% today, following a June cut and July pause. While inflation in the eurozone has eased, persistent price pressures, especially in services, are keeping officials cautious about future rate moves. Economists predict further reductions in 2024, with markets closely watching both the ECB and the Federal Reserve, which is set to ease U.S. monetary policy soon. ————————————- And the Fed has one more reason to do that. Inflation eased to a three-year low in August, in the U.S, with the consumer price index rising 2.5% from a year earlier, down from 2.9% in July. Core inflation remained steady at 3.2%. This continued cooling trend sets the stage for the Federal Reserve to gradually reduce interest rates at its upcoming meeting. With inflation retreating from its 40-year highs, the Fed is now likely to shift its focus toward concerns about a slowing labor market. ————————————- By the way, Oil prices have dropped sharply amid fears of weakening demand from major economies. Brent crude fell to $68.68, its lowest since 2021, while U.S. WTI hit $65.27. Despite OPEC delaying production increases and downgrading its demand forecast for 2024, analysts expect further declines, with Brent possibly sliding into the $60s. ——————————— EU officials are considering rolling over €350bn in Covid-era bonds to avoid crippling the bloc’s budget with repayment costs. Former Italian prime minister Mario Draghi supported this option when he presented his report on competitiveness, warning that without action, the EU faces a budget crisis. However, the proposal faces legal and political resistance, particularly from Germany, as it would require unanimous approval from all 27 member states who agreed to the original borrowing as a one-off. Critics also warn it could raise interest costs and hurt the EU’s financial credibility. ————————————— Commerzbank is reviewing its defense strategy after UniCredit revealed a 9% stake, signaling a potential takeover, Bloomberg reports citing people familiar with the matter. With Goldman Sachs advising, Commerzbank is preparing for talks, while labor representatives seek political support to block the move. UniCredit sees Commerzbank as a strategic fit for its European expansion. ——————————- PwC’s U.S. unit is laying off 1,800 employees, its first major cuts since 2009, due to reduced demand for advisory services — the Wall Street Journal reports citing an internal memo it obtained. The layoffs, affecting about 2.5% of the U.S. workforce, will mainly impact advisory and technology roles and include offshore positions. Notifications will be made in October. —— —— MEF MOBILE NEWS 12 SEPTEMBER 2024 The GSMA and Connect Europe backed Mario Draghi’s report, warning Europe’s telecom sector risks losing global competitiveness. They support his call for industry consolidation to boost investment and urge reduced regulation, fairer policies toward big tech, and harmonized spectrum licensing. The associations stressed immediate action is needed to prevent Europe from falling further behind in creating a competitive and sustainable digital market. —————————————- Huawei’s new $2,800 Mate XT smartphone, featuring a trifold display, received 5 million pre-orders as for yesterday during its launch week, but it faces production challenges. The Mate XT was unveiled just after Apple’s iPhone 16. Huawei’s model is priced nearly $2,000 higher. Analysts question whether Huawei can meet demand, given U.S. sanctions limiting access to advanced chips and production hurdles with its partner SMIC. The Mate XT follows the release of Huawei’s Mate 60, which used a homegrown chip, marking a recovery from earlier sanctions. —————————————— Chinese authorities have detained Transsion’s chief financial officer, Xiao Yonghui, adding to the challenges facing Africa’s largest smartphone supplier. The Shanghai-listed company, known as the “King of Africa,” saw its shares drop nearly 5% after the announcement. While no details on the investigation were provided, Transsion stated that regular operations would not be affected. The company is expanding into new markets in Asia, Europe, and Latin America to counter growing competition and patent lawsuits. In Latin America, Transsion’s phone sales surged 276% in the first half of 2024. —————————————- Chunghwa Telecom announced a partnership with Nokia to boost Taiwan’s 5G download speeds to 2.34 Gbps. Using Nokia’s AirScale radio base stations and 5G Carrier Aggregation technology, Chunghwa will deploy the latest infrastructure in densely populated areas. Chunghwa Telecom President Alex Chien highlighted the company’s extensive 4G/5G spectrum bandwidth and praised Nokia’s energy-efficient hardware and advanced software for enhancing mobile service. —————————————- The U.S. House unanimously passed bipartisan bills to boost communications security and modernize Congress, including the ROUTERS Act, which aims to protect U.S. networks from foreign-controlled technology. The Senate still needs to vote on the legislation. —— —— MEF TECH NEWS 12 SEPTEMBER 2024 Google is being investigated by Ireland’s Data Protection Commission for potential GDPR violations in its AI model, PaLM 2. The inquiry focuses on whether Google properly assessed data protection risks. This follows similar regulatory actions against Meta and X, as European authorities tighten scrutiny on AI data practices. ——————————- OpenAI is in talks to raise $6.5 billion, which would value the company at around $150 billion, nearly double its valuation from nine months ago — the New York Times reported citing people with knowledge of the matter. This would make it one of the world’s most valuable private companies, second only to ByteDance. Initially seeking $1 billion at a $100 billion valuation, OpenAI’s funding target has rapidly increased due to high expenses from building advanced AI systems. Thrive Capital is expected to lead the round, with interest from Apple, Nvidia, and Microsoft. —————————————- Nvidia CEO Jensen Huang acknowledged growing frustration among customers due to high demand for the company’s latest Blackwell chips, which are crucial for AI development. Speaking at a Goldman Sachs conference, Huang said the intense competition for limited supply has heightened emotions. Nvidia’s stock has surged, more than doubling this year following a 239% gain in 2023. The company relies on major data center operators like Microsoft and Meta for much of its revenue. Huang emphasized that “accelerated computing” with Nvidia’s technology is essential for handling both AI tasks and conventional workloads. However, Nvidia’s dependence on Taiwan Semiconductor Manufacturing raises concerns due to geopolitical tensions between China and Taiwan. Huang noted Nvidia could shift suppliers if necessary, albeit with reduced chip quality. —————————————- AST SpaceMobile, a small telecom company aiming to rival SpaceX, has seen its stock skyrocket from $2 to $28 in six months, a 1,300% increase. Today, the company faces a crucial test with the launch of its first five commercial satellites from Cape Canaveral, Florida, via a SpaceX rocket. Despite the rally, more than 20% of its shares are shorted, reflecting skepticism. AST SpaceMobile secured an agreement with AT&T in May to offer wireless service from space, competing with SpaceX’s Starlink. A $100 million investment from Verizon followed. ————————————— Sony has unveiled the PlayStation 5 Pro, an upgraded version of its console, set to launch on November 7 for £699/$699. Pre-orders begin on September 26. The Pro version is digital-only, featuring a 2TB solid state drive, a GPU with 67% more compute units, and 28% more system memory, promising a 45% boost in graphics rendering for supported games. It also enhances ray tracing and offers an 8K mode. At £300 more than the Digital Edition PlayStation 5, buyers can add a Blu-ray player for an additional £100. —— ——