snydeq shares a report from CIO.com: ServiceNow has reported potential compliance issues to the US Department of Justice "related to one of its government contracts" as well as the hiring of the then-CIO of the US Army to be its head of global public sector, the company said in regulatory filings on Wednesday. The DOJ is looking into the matter. Following an internal investigation, ServiceNow said, its President and COO, CJ Desai, has resigned, while "the other individual has also departed the company." That executive, Raj Iyer, told CIO.com, "I resigned because I didn't want to be associated with this fiasco in any way. It's not my fault." CEO Bill McDermott told financial analysts in a conference call Wednesday that someone within ServiceNow had complained about the situation and that an internal probe "determined that our company policy was violated."

"Acting with total transparency, the company proactively disclosed the findings of the investigation to the proper government entities. And as a result, today, we're announcing the departure of the individual whose hiring was the subject of the original complaint," McDermott said. "We also came to a mutual agreement that CJ Desai, our President and COO, would offer his resignation from the company effective immediately. While we believe this was an isolated incident, we are further sharpening our hiring policies and procedures as a result of the situation."

Southwest Airlines announced Thursday that it will get rid of open seating in a sweeping change from its decades-long practice. Instead, it will begin assigning seats and offer premium seating with extra leg room. From a report: Southwest CEO Bob Jordan said, "Our implementation of assigned and premium seating is part of an ongoing and comprehensive upgrade to the Customer Experience, one that research shows Customers overwhelmingly prefer."

The low-fare airline has had a tradition of open seating for more than 50 years. Customers taking longer flights preferred assigned seats, according to Southwest. Airlines can also charge more for assigned and premium seating, enabling them to boost profits.

Early termination fees are "a bit like heroin for Adobe," according to an Adobe executive quoted in the FTC's newly unredacted complaint against the company for allegedly hiding fees and making it too hard to cancel Creative Cloud. The Verge: "There is absolutely no way to kill off ETF or talk about it more obviously" in the order flow without "taking a big business hit," this executive said. That's the big reveal in the unredacted complaint, which also contains previously unseen allegations that Adobe was internally aware of studies showing its order and cancellation flows were too complicated and customers were unhappy with surprise early termination fees.

In a short interview, Adobe's general counsel and chief trust officer, Dana Rao, pushed back on both the specific quote and the FTC's complaint more generally, telling me that he was "disappointed in the way they're continuing to take comments out of context from non-executive employees from years ago to make their case."

In a blog post on Tuesday, security firm KnowBe4 revealed that a remote software engineer hire was a North Korean threat actor using a stolen identity and AI-augmented images. "Detailing a seemingly thorough interview process that included background checks, verified references and four video conference-based interviews, KnowBe4 founder and CEO Stu Sjouwerman said the worker avoided being caught by using a valid identity that was stolen from a U.S.-based individual," reports CyberScoop. "The scheme was further enhanced by the actor using a stock image augmented by artificial intelligence." From the report: An internal investigation started when KnowBe4's InfoSec Security Operations Center team detected "a series of suspicious activities" from the new hire. The remote worker was sent an Apple laptop, which was flagged by the company on July 15 when malware was loaded onto the machine. The AI-filtered photo, meanwhile, was flagged by the company's Endpoint Detection and Response software. Later that evening, the SOC team had "contained" the fake worker's systems after he stopped responding to outreach. During a roughly 25-minute period, "the attacker performed various actions to manipulate session history files, transfer potentially harmful files, and execute unauthorized software," Sjouwerman wrote in the post. "He used a [single-board computer] raspberry pi to download the malware." From there, the company shared its data and findings with the FBI and with Mandiant, the Google-owned cyber firm, and came to the conclusion that the worker was a fictional persona operating from North Korea.

KnowBe4 said the fake employee likely had his workstation connected "to an address that is basically an 'IT mule laptop farm.'" They'd then use a VPN to work the night shift from where they actually reside -- in this case, North Korea "or over the border in China." That work would take place overnight, making it appear that they're logged on during normal U.S. business hours. "The scam is that they are actually doing the work, getting paid well, and give a large amount to North Korea to fund their illegal programs," Sjouwerman wrote. "I don't have to tell you about the severe risk of this." Despite the intrusion, Sjouwerman said "no illegal access was gained, and no data was lost, compromised, or exfiltrated on any KnowBe4 systems." He chalked up the incident to a threat actor that "demonstrated a high level of sophistication in creating a believable cover identity" and identified "weaknesses in the hiring and background check processes."

Malaysia's digital minister said today he has asked global tech firms Microsoft and CrowdStrike to consider compensating companies that suffered losses during last week's global tech outage. From a report: Five government agencies and nine companies operating in aviation, banking and healthcare were among those affected in Malaysia, minister Gobind Singh Deo told reporters. "If there are any damages or losses, where there have been any parties that have made such claims, I've asked them to consider those claims and see to what extent they are able to help resolve the issue," Gobind said, adding that the government would also assist on the claims where possible. The total amount of losses incurred has not yet been determined, he said. The outage will cost Fortune 500 companies $5.4 billion, according to estimates from insurers. The projected financial losses exclude Microsoft.

AI is increasingly being employed in job interviews across China and India, marking a significant shift in recruitment practices in the region. This follows a similar practice making inroads in the U.S. Rest of World adds: A 2023 survey of 1,000 human-resources workers by the U.S. firm ResumeBuilder found that 10% of companies were already using AI in the hiring process, and another 30% planned to start the following year. The research firm Gartner listed natural-language chatbots as one of 2023's key innovations for the recruiting industry, designating the technology as experimental but promising. Companies like Meituan, Siemens, and Estee Lauder are using AI-powered interviews, with platforms such as MoSeeker, Talently.ai, and Instahyre leading the charge in AI recruitment solutions.

OpenAI has built one of the fastest-growing businesses in history. It may also be one of the costliest to run. The Information: The ChatGPT maker could lose as much as $5 billion this year [non-paywalled source], according to an analysis by The Information, based on previously undisclosed internal financial data and people involved in the business. [...] On the cost side, OpenAI as of March was on track to spend nearly $4 billion this year on renting Microsoft's servers to power ChatGPT and its underlying LLMs (otherwise known as inference costs), said a person with direct knowledge of the spending. In addition to running ChatGPT, OpenAI's training costs -- including paying for data -- could balloon to as much as $3 billion this year. Last year, OpenAI ramped up the training of new AI faster than it had originally planned, said a person with direct knowledge of the decision. So while the company earlier planned to spend about $800 million on such costs, it ended up spending considerably more, this person said.

T-Mobile and investment firm KKR have formed a joint venture (JV) to acquire fiber service provider Metronet. From a report: The fiber provider reaches over 300 communities and more than 2 million homes in 17 states. Metronet is both a pure-play fiber company and independent FTTH operator. In some markets, Metronet delivers residential speeds up to 5 Gbit/s. The acquisition includes Metronet's broadband infrastructure, residential fiber business operations and existing customers. The JV will acquire Oak Hill Capital's existing stake; Oak Hill Capital will re-invest for a minority position and Metronet CEO John Cinelli will retain a minority position after the deal closes.

T-Mobile said it plans to invest nearly $4.9 billion to acquire a 50% equity stake in the JV and 100% of Metronet's residential fiber retail operations and customers, as well as funding of the JV. After the close of the deal, Metronet, based in Evansville, Indiana, will transition to a wholesale service provider for its retail customers. T-Mobile will take on management of residential customer acquisition and support, using T-Mobile's marketing and service model and Metronet's fiber broadband services.

An anonymous reader quotes a report from TechCrunch: Content creators are busy people. Most spend more than 20 hours a week creating new content for their respective corners of the web. That doesn't leave much time for audience engagement. But Mark Zuckerberg, Meta's CEO, thinks that AI could solve this problem. In an interview with internet personality Rowan Cheung, Zuckerberg laid out his vision for a future in which creators have their own bots, of sorts, that capture their personalities and "business objectives." Creators will offload some community outreach to these bots to free up time for other, presumably more important tasks, Zuckerberg says.

"I think there's going to be a huge unlock where basically every creator can pull in all their information from social media and train these systems to reflect their values and their objectives and what they're trying to do, and then people can can interact with that," Zuckerberg said. "It'll be almost like this artistic artifact that creators create that people can kind of interact with in different ways." [...] It's tough to imagine creators putting trust in the hands of flawed AI bots to interact with their fans. In the interview, Zuckerberg acknowledges that Meta has to "mitigate some of the concerns" around its use of generative AI and win users' trust over the long term. This is especially true as some of Meta's AI training practices are actively driving creators away from its platforms.

Negotiations on a global tax deal have extended beyond the June 30 deadline, with countries now looking to the G20 finance leaders meeting for progress. "The stakes in the negotiations are high," reports Reuters. "A failure to reach agreement on final terms could prompt several countries to reinstate their taxes on U.S. tech giants and risk punitive duties on billions of dollars in exports to the U.S." Some countries, like Canada, have already implemented their own digital services tax. Reuters reports: The so-called "Pillar 1" arrangement, part of a 2021 global two-part tax deal, aims to replace unilateral digital services taxes (DSTs) on U.S. tech giants including Alphabet's Google, Amazon.com and Apple through a new mechanism to share taxing rights on a broader, global group of companies. Standstill agreements under which Washington has suspended threatened trade retaliation against seven countries -- Austria, Britain, France, India, Italy, Spain and Turkey -- expired on June 30, but the U.S. has not taken steps to impose tariffs.

Discussions on the matter are continuing. An Italian government source said that European countries were seeking assurances that the U.S. tariffs on some $2 billion worth of annual imports from French Champagne to Italian handbags and optical lenses remained frozen while the talks continue, including at the G20 meeting in Rio de Janeiro. A European Union document prepared for the G20 meeting lists finalizing the international tax deal as a "top priority." It said the G20 should urge countries and jurisdictions participating in the tax deal "to finalize discussions on all aspects of Pillar 1, with a view to signing the Multilateral Convention (MLC) by summer end and ratifying it as soon as possible." "Treasury continues to oppose all tax measures that discriminate against U.S. businesses," a U.S. Treasury spokesperson said in response to Canada's move. "We encourage all countries to finalize the work on the Pillar 1 agreement. We are in active discussions on next steps related to the existing DST joint statements."

During Alphabet's second-quarter earnings call today, Alphabet CFO Ruth Porat announced the organization will spend an additional $5 billion on its self-driving subsidiary, Waymo. "This new round of funding, which is consistent with recent annual investment levels, will enable Waymo to continue to build the world's leading autonomous driving technology company," said Porat. TechCrunch reports: Porat noted that Google will focus on improving overall efficiencies in its "other bets" segment, which includes innovative projects that are distinct from the tech giant's core search and advertising business. Other companies in this segment are Verily, Calico, Google Ventures and drone company Wing. "Waymo is an important example of this, with its technical leadership coupled with progress on operational performance," Porat continued. The executive noted that parent company Alphabet's 10-Q form, which has yet to be filed, will have more details.

Humble Games, the indie game publisher behind the popular pay-what-you-want "Humble Game Bundle," has laid off its entire staff of 36 people. However, the company says it is not shutting down and Humble Bundle will not be impacted. Instead, the job cuts are part of a restructuring of operations. GameSpot reports: In a statement shared with GameSpot, Humble Games confirmed that Humble Bundle will have "no impact on its operations. Additionally, ongoing and upcoming games from Humble Games will still move ahead and be published by the company. Humble Games is the publisher of many notable indie games, including Stray Gods, Bo: Path of the Teal Lotus, Chinatown Detective Agency, Ikenfell, Unpacking, Slay the Spire, and Midnight Fight Express, just to name a few.

Humble Games is the separate publishing arm of digital storefront Humble Bundle. Both companies are owned by IGN Entertainment, but operate as a separate entities. Earlier this year, IGN Entertainment also bought video game websites Eurogamer, Rock Paper Shotgun, VG247, GamesIndustry.biz, and Dicebreaker from Gamer Network.

Switzerland has enacted the "Federal Law on the Use of Electronic Means for the Fulfillment of Government Tasks" (EMBAG), mandating open-source software (OSS) in the public sector to enhance transparency, security, and efficiency. "This new law requires all public bodies to disclose the source code of software developed by or for them unless third-party rights or security concerns prevent it," writes ZDNet's Steven Vaughan-Nichols. "This 'public money, public code' approach aims to enhance government operations' transparency, security, and efficiency." From the report: Making this move wasn't easy. It began in 2011 when the Swiss Federal Supreme Court published its court application, Open Justitia, under an OSS license. The proprietary legal software company Weblaw wasn't happy about this. There were heated political and legal fights for more than a decade. Finally, the EMBAG was passed in 2023. Now, the law not only allows the release of OSS by the Swiss government or its contractors, but also requires the code to be released under an open-source license "unless the rights of third parties or security-related reasons would exclude or restrict this."

Professor Dr. Matthias Sturmer, head of the Institute for Public Sector Transformation at the Bern University of Applied Sciences, led the fight for this law. He hailed it as "a great opportunity for government, the IT industry, and society." Sturmer believes everyone will benefit from this regulation, as it reduces vendor lock-in for the public sector, allows companies to expand their digital business solutions, and potentially leads to reduced IT costs and improved services for taxpayers.

In addition to mandating OSS, the EMBAG also requires the release of non-personal and non-security-sensitive government data as Open Government Data (OGD). This dual "open by default" approach marks a significant paradigm shift towards greater openness and practical reuse of software and data. Implementing the EMBAG is expected to serve as a model for other countries considering similar measures. It aims to promote digital sovereignty and encourage innovation and collaboration within the public sector. The Swiss Federal Statistical Office (BFS) is leading the law's implementation, but the organizational and financial aspects of the OSS releases still need to be clarified.

smooth wombat writes: The FTC has sent mandatory notices for information to eight companies it says engages in "surveillance pricing", the process by which prices are rapidly changed using AI based on data about customer behavior and characteristics. This process, the FTC claims, allows companies to charge different customers different prices for the same product.

The list includes Mastercard, JPMorgan Chase, Accenture and consulting giant McKinsey. It also includes software firm Task, which counts McDonald's and Starbucks as clients; Revionics, which works with Home Depot, Tractor Supply and grocery chain Hannaford; Bloomreach, which services FreshDirect, Total Wine and Puma; and Pros, which was named Microsoft's internet service vendor of the year this year. "Firms that harvest Americans' personal data can put people's privacy at risk," FTC Chair Lina Khan said in a news release. "Now firms could be exploiting this vast trove of personal information to charge people higher prices."

Amazon's strategy to set prices low for Echo speakers and other smart devices, expecting them to generate income elsewhere in the tech giant, hasn't paid off [paywalled]. From a report: Amazon's Echo speakers are the type of business success companies don't want: a widely purchased product that is also a giant money loser. Chief Executive Andy Jassy is trying to plug that hole -- and move away from the Amazon accounting tactic that helped create it. When Amazon launched the Echo smart home devices with its Alexa voice assistant in 2014, it pulled a page from shaving giant Gillette's classic playbook: sell the razors for a pittance in the hope of making heaps of money on purchases of the refill blades.

A decade later, the payoff for Echo hasn't arrived. While hundreds of millions of customers have Alexa-enabled devices, the idea that people would spend meaningful amounts of money to buy goods on Amazon by talking to the iconic voice assistant on the underpriced speakers didn't take off. Customers actually used Echo mostly for free apps such as setting alarms and checking the weather. "We worried we've hired 10,000 people and we've built a smart timer," said a former senior employee.

As a result, Amazon has lost tens of billions of dollars on its devices business, which includes Echos and other products such as Kindles, Fire TV Sticks and video doorbells, according to internal documents and people familiar with the business. Between 2017 and 2021, Amazon had more than $25 billion in losses from its devices business, according to the documents. The losses for the years before and after that period couldn't be determined.

AT&T's February wireless outage disrupted over 92 million voice calls and hindered more than 25,000 attempts to reach emergency services, an FCC report said. The 12-hour nationwide incident affected approximately 125 million devices, including those of other providers using AT&T's network. Stemming from an equipment configuration error during a network change, the outage also impacted first responders' communications.

Wiz, the cloud security startup that was in acquisition talks with Google, has decided not to forward with the deal and to remain an independent company, according to an internal note sent to company employees on Monday. Fortune: "While we are flattered by offers we have received, we have chosen to continue on our path to building Wiz," CEO Assaf Rappaport wrote in the note. Rappaport said in the email that the company's next target is to reach $1 billion in annual recurring revenue and to take the company public.

An anonymous reader quotes a report from Ars Technica: The European Commission (EC) has finally taken action to block Meta's heavily criticized plan to charge a subscription fee to users who value privacy on its platforms. Surprisingly, this step wasn't taken under laws like the Digital Services Act (DSA), the Digital Markets Act (DMA), or the General Data Protection Regulation (GDPR). Instead, the EC announced Monday that Meta risked sanctions under EU consumer laws if it could not resolve key concerns about Meta's so-called "pay or consent" model. Meta's model is seemingly problematic, the commission said, because Meta "requested consumers overnight to either subscribe to use Facebook and Instagram against a fee or to consent to Meta's use of their personal data to be shown personalized ads, allowing Meta to make revenue out of it." Because users were given such short notice, they may have been "exposed to undue pressure to choose rapidly between the two models, fearing that they would instantly lose access to their accounts and their network of contacts," the EC said. To protect consumers, the EC joined national consumer protection authorities, sending a letter to Meta requiring the tech giant to propose solutions to resolve the commission's biggest concerns by September 1.

That Meta's "pay or consent" model may be "misleading" is a top concern because it uses the term "free" for ad-based plans, even though Meta "can make revenue from using their personal data to show them personalized ads." It seems that while Meta does not consider giving away personal information to be a cost to users, the EC's commissioner for justice, Didier Reynders, apparently does. "Consumers must not be lured into believing that they would either pay and not be shown any ads anymore, or receive a service for free, when, instead, they would agree that the company used their personal data to make revenue with ads," Reynders said. "EU consumer protection law is clear in this respect. Traders must inform consumers upfront and in a fully transparent manner on how they use their personal data. This is a fundamental right that we will protect." Additionally, the EC is concerned that Meta users might be confused about how "to navigate through different screens in the Facebook/Instagram app or web-version and to click on hyperlinks directing them to different parts of the Terms of Service or Privacy Policy to find out how their preferences, personal data, and user-generated data will be used by Meta to show them personalized ads." They may also find Meta's "imprecise terms and language" confusing, such as Meta referring to "your info" instead of clearly referring to consumers' "personal data." A Meta spokesperson said in a statement: "Subscriptions as an alternative to advertising are a well-established business model across many industries. Subscription for no ads follows the direction of the highest court in Europe and we are confident it complies with European regulation."

An anonymous reader quotes a report from Reuters: Boeing-owned Wisk Aero expects its pilotless air-taxi to begin carrying passengers "later in the decade" as it works with the U.S. regulator to secure approvals, its CEO said on Monday, amid skepticism among industry analysts about certification timelines. Wisk is one of several electric vertical take-off and landing (eVTOL) aircraft makers that have emerged over the last few years with a promise to provide an environmentally-friendly mode of transport in congested cities. But the industry faces technological hurdles such as making batteries powerful enough for companies to make more trips on a single charge. They also need to convince regulators and the public that the aircraft are safe, a barrier that is higher when the aircraft is autonomous. Wisk is developing a four-seater autonomous aircraft that will have a range of 90 miles (145 km).

"We are right now testing and producing the elements of this aircraft that we will hope to fly around the end of this year," CEO Brian Yutko told reporters at the Farnborough Airshow. Wisk's strategy is a departure from other major air-taxi makers, which are developing models that will require a pilot to fly the aircraft. The company has said operators of its aircraft will save on pilot costs. But industry experts at Bain say a full autonomous passenger flight is not expected before the late 2030s and pilotless aircraft will face competition from autonomous vehicles on the road. "Maximizing passenger occupancy and avoiding return trips with empty aircraft will be crucial for operator profitability," said Mattia Celli, one of the authors of the Bain report.

Verizon reported a significant loss of wireless subscribers in the second quarter, with its consumer business shedding 624,000 prepaid customers, largely due to the expiration of the federal Affordable Connectivity Program in May.

The telecom giant attributed over half of these losses to the end of the COVID-era internet subsidy that had previously supported 23 million low-income households across the United States. Despite the subscriber exodus, Verizon managed to add 148,000 net monthly bill-paying wireless phone subscribers during the period.