iVLG News Roundup Week 3 2014: Net Neutrality Gutted; Google Buys Nest; “First World Problem Delegation” Platforms Exec and Handybook; Retailer Data Security Woes Continue
Net Neutrality Under Pressure after Court Ruling
The US Court of Appeals for the DC Circuit issued an opinion this week that substantially undermines net neutrality. The ruling essentially said that Verizon Communications was exempt from treatment as a common carrier, and thus free to restrict use on the networks it owns. The argument for net neutrality generally is that it protects consumers and small businesses, since it prevents companies from slowing service to sites who don’t pay a toll to the providers. This is especially important since internet service providers have come to look a lot like monopolies in some places. The general argument against net neutrality is that it is inefficient, stifles innovation, and prevents companies from exercising control over the networks their investors have spent billions building, and the argument that ultimately won the Verizon case this week, that is, that the FCC lacks the authority under current law to regulate the ISP under the common carrier rules. The ruling inspired fear and outrage for net neutrality advocates, and the decision leaves the FCC with a only a few avenues for protecting net neutrality.
Mergers and Acquisitions: Google’s hardware play; Market for “first world problem delegation” platforms heats up
Google acquires hardware maker Nest
What originally seemed like a “small idea” to a partner of venture capital firm Kleiner, Perkins, Caufield & Byers netted that same partner’s firm at least $400 million when Google acquired Nest this week. Nest, a company focused on making high tech thermostats and smoke/CO2 detectors, was valued at ~$3.2 billion dollars in the deal. Nest CEO Tony Fadell told Re/code that Google “assured me that Nest is going to stay Nest. A startup has two choices: Either to stay independent or join up with somebody. With this, we have the best of both worlds.” But those concerned about privacy weren’t so thrilled.
Handybook Acquires Exec
“Sharing Economy” player Handybook, a company providing cleaning services that recently raised $10 million dollars from investors, bought competitor Exec in an all-stock deal. Exec, a self-described “Uber for tasks“, was valued at less than $10 million in the sale. The sale may signal continuing consolidation in the personal task service market.
Data Security Woes Continue for Large Retailers; More to come?
Last week we discussed the revelation that Target’s data security woes were bigger than originally thought. This week Nieman Marcus announced it too was a hacking victim, and it turns out it may be the same group of thieves at work. Apparently, the malware that enabled the thieves to execute the attack on the two retailers was able to cover its tracks, which led to Nieman Marcus leaking customer data for months unaware.
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