Plus: Alibaba to raise $10.2 billion for AI investment with share placement. And the Justice Department and TikTok reach $400 million settlement over children’s privacy suit. Julie Chang hosts.
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[00:00:01] Here's your morning TNB Tech Minute for Monday, August 24. I'm Julie Chang for The Wall Street Journal. SoftBank Group plans to issue a record 1 trillion yen or $6.3 billion of retail bonds to help fund its expanding AI investments, including multi-billion dollar commitments to open AI and related infrastructure projects.
[00:00:23] The seven-year bonds will be priced on September 4, with proceeds also used to repay previously issued bonds, according to a company spokeswoman. The fundraising comes as SoftBank's cumulative investments and commitments to open AI are expected to exceed $60 billion. News Corp, owner of The Wall Street Journal and Dow Jones Newswires has a content licensing partnership with OpenAI.
[00:00:48] Alibaba plans to raise over $10 billion by placing 710 million new shares to non-US investors at about $112 HK each, a sharp discount to Friday's closing price. The proceeds will fund its AI capabilities and infrastructure. Demand reached $28 billion within hours.
[00:01:10] The Hangzhou-based tech giant is heavily investing to compete in AI, which contributed to a 76% drop in its fiscal first quarter net profit. The company's stock fell as much as 10% in Hong Kong on Monday amid fears of share dilution. And the Justice Department and TikTok reached a $400 million settlement to resolve allegations that the social media platform violated the Children's Online Privacy Protection Act.
[00:01:37] The 2024 complaint alleged TikTok failed to obtain parental consent before collecting personal data from children under 13. Under Friday's deal, TikTok will pay $300 million upfront and $100 million after vacating a prior consent decree involving predecessor Musically. The DOJ noted TikTok has since updated its ownership, management, compliance, and privacy safeguards for younger users. TikTok and its Chinese owner ByteDance didn't immediately respond to a request for comment.
[00:02:07] TikTok has previously said it disagreed with the allegations. And that's your TMB Tech Minute. We'll be back this afternoon with more.