After trying multiple times to find a way to survive as a standalone entity, Yahoo finally convinced Verizon to buy most of the failing Internet company last year for $4.8 billion. But the sale process has been anything but smooth, and one of the biggest potential roadblocks was the news that the company was the target of two massive hacks that exposed the data of hundreds of millions of users.
Although the two attacks happened in 2013 and 2014, Yahoo didn’t disclose this information until last year—and most importantly, it didn’t divulge that news until after it had already signed the deal with Verizon. The telecom giant has since said it is re-evaluating the offer.
Now, to add insult to injury, the Securities and Exchange Commission has opened an investigation into the company’s failure to tell shareholders about the incidents, according to the Wall Street Journal. The securities regulator is just one of a number of federal and state agencies that has asked Yahoo for documents on the attacks, along with the Federal Trade Commission and the U.S. attorney’s office.
Under SEC rules, companies are supposed to disclose any and all information that might be “material” to investors, but there is no precise definition of that term. If the regulator finds the two massive data breaches were things Yahoo should have told its shareholders about, the company could be fined.
One investor that would probably have liked to know about the attacks sooner is Verizon. Since the news broke in December, all the telecom giant has said is that it is reconsidering its original offer. That could mean that it just wants a better price—or it could lead Verizon to walk away from the deal completely. In either case, Yahoo’s reputation will take yet another blow.
| Mathew Ingram | |
| @mathewi | |
| mathew.ingram@fortune.com |
BITS AND BYTES
Apple wants Qualcomm to make good on $1 billion in rebates. The iPhone maker has filed a lawsuit against the wireless semiconductor maker, seeking to recover $1 billion in rebates that Apple said it was promised for agreeing not to buy chips from Qualcomm rivals. The papers accuse Qualcomm—which also faces antitrust complaints by the Federal Trade Commission and South Korea—of using its market dominance to charge higher royalties. (Fortune, New York Times)
Foxconn may spend $7 billion to build a U.S. display plant. The Taiwanese contract manufacturer best-known for making Apple's iPhones is mulling its options but needs to hear more about state and federal incentives before committing, according to CEO Terry Gou. The company current has a presence in Pennsylvania, and that state is the most likely beneficiary if this idea comes to fruition. (Reuters)
Samsung officially blames bad batteries for Galaxy Note 7 fires. The South Korean electronics giant said manufacturing and design flaws involving two suppliers were the root cause of the issue. Officials took responsibility for not catching the problem, and the company formed an outside advisory group to act as a watchdog for quality assurance. (Reuters, New York Times)
Avaya gets huge loan to help with reorg. The telecommunications equipment provider, which declared bankruptcy last Thursday, has received court clearance to borrow $425 million to fund its operations while it figures out what's next. Avaya was trying to sell its call center business to help pay back more than $1.5 billion in debt, but it opted to restructure instead. It's due back in bankruptcy court on Monday. (Reuters)
Tesla's latest sedan sets new benchmark for EV driving range. The Model S update, called the 100D and priced starting at $93,700, comes with a 100 kilowatt-hour battery and is capable of traveling 335 miles on a single charge. That's about 100 miles farther than the range for General Motors' all-electric Chevrolet Bolt, which carries a much lower price tag. (Wall Street Journal)
Ford is letting car buyers apply for credit online. The automaker's financing group is rolling out a mobile and website app that lets people get the application process started before they visit the dealership. The contract still must be finalized in person, but it's a shortcut that many would-be car buyers will appreciate. (Fortune)
PEOPLE AND CULTURE
Chinese smartphone maker Xiaomi loses key executive. Hugo Barra, a former Google leader who helped Xiaomi break into the India market, is returning to Silicon Valley. According to his Facebook post, homesickness and his health helped shape the decisions. His next move hasn't yet been revealed. (Fortune)
Uber, federal government hire respected former Googlers. Amit Singhal, who ran the Alphabet business unit's search technology team for 15 years, has taken a job as Uber's senior vice president of engineering—he'll have the ear of Uber founder Travis Kalanick.
Singhal is bringing along his former colleague and YouTube guru Kevin Thompson, who will become Uber's vice president of marketplace engineering. Both resigned their Google posts last year.
Meanwhile, Google engineer Matt Cutts—who has been on leave advising the federal government's special digital technology team—is taking a permanent job as the program's acting administrator. (Reuters, Recode, Fortune)
SURVEYS AND STUDIES
Let's learn more about this artificial intelligence thing. More than three-quarters of executives responsible for technology strategy and investments believe machine learning, neural networks or some other form of AI will be fundamental to the future success of their company, according to research conducted by consulting firm Infosys. An even larger percentage of its 1,600 poll participants (85%) plan to invest in related education and retraining to figure out why (and how) they should use the technology. (Infosys)
This is what spending on the robot invasion looks like. Projections by market researcher IDC suggest that spending on robotics technology could reach $188 billion in 2020, which is double the $91.5 billion invested last year. The large majority of that money will be for robots working manufacturing plants and production lines. (IDC)
Many consumers would ditch their bank for Amazon, Google, or Facebook. Approximately one-third of the more than 32,700 consumers polled by consulting firm Accenture would be willing to entrust their mobile and digital banking to one of these three Internet giants—should they offer services that are more convenient and secure than their traditional banks . (Reuters)
IN CASE YOU MISSED IT
The President's New Phone, by Jeff John Roberts
Apple Criticized Amid Mixed iPhone Sales Reports, by Don Reisinger
Salesforce CEO Marc Benioff: We're Adjusting Our Gender Pay Gap—Again, by Claire Zillman
Tech's Gender Pay Gap Hits Younger Women Hardest, by David Z. Morris
ONE MORE THING
Could self-driving cars actually make traffic worse? One promise of autonomous vehicle technology is the notion that it will help cars, buses, trucks and other transportation options navigate roadways more efficiently, alleviating some bottlenecks usually associated with peak commuting hours. But self-driving vehicles could actually put more people on the road who aren't there now, a theme explored during a panel discussion last week at the World Economic Forum in Davos. (Fortune)
This edition of Data Sheet was curated by Heather Clancy.
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