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SoftBank CEO says after WeWork there will be no rescue investments

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Masayoshi Son, chairman and chief executive officer of SoftBank Group at the SoftBank World 2018 event in Tokyo, Japan.

Kiyoshi Ota | Bloomberg | Getty Images

SoftBank CEO Masayoshi Son won’t call WeWork a rescue, saying instead that the latest financing allowed his company to dramatically reduce the average share price it paid for the coworking company. Nevertheless, he described it as an “exception” that won’t happen again.

SoftBank will make “no investment for the purpose of rescue,” Son told investors on Wednesday, after the Japanese conglomerate reported its first quarterly loss in 14 years. He said portfolio companies must be “self-financing,” and “that’s something that I would like to clearly extend my message to you.”

Son acknowledged making some mistakes in his investment strategy and accepted that WeWork’s dramatic fall in recent months has led some to question his judgment and the viability of SoftBank’s massive Vision Fund. SoftBank recorded a 374.7 billion yen ($3.4 billion) writedown on its WeWork investment about two weeks after taking 80% control of the company with a new $5 billion financing package.

WeWork was forced to pull its IPO at the end of September because of mounting losses and an unwillingness of public investors to fund the business. SoftBank ousted former CEO Adam Neumann, who walked away with more than $1 billion, and installed Marcelo Claure, SoftBank’s operating chief, as executive chairman. Son said there will be no future bailouts for SoftBank-backed start-ups.

T-Mobile CEO John Legere (R) and Sprint CEO Marcelo Claure pose for pictures on the floor of the New York Stock Exchange, April 30, 2018.

Brendan McDermid | Reuters

The Vision Fund has deployed about $80 billion in less than three years, betting big and pushing private tech companies to expand as quickly as possible. On Wednesday’s conference call, Son addressed concerns that the fund is facing more failures in the portfolio.

“Is there any other similar concern? In fact, yes, there is,” Son said. “Like a dog-walking company and other portfolio companies, we may see similar problems surfacing.”

While Son didn’t mention the name of the dog-walking company, he’s referencing SoftBank’s $300 million investment in Wag, which has continued to struggle and is now exploring a sale.

SoftBank also took a loss on its investment in ride-hailing company Uber, which has seen its stock plunge 40% since its IPO in May to a record low on Wednesday. But some big Vision Fund investments are still performing. Son highlighted the fund’s investment in Slack as a success story among the turbulence.

“Actually they have increased about five times compared to our invested amount,” Son said. He also said SoftBank is doing well with its Guardant Health investment and its stake in 10x Genomics.

“There are many of those that are giving us a profit,” he said. “But still market investors are becoming more careful.”

WATCH: SoftBank slammed by first loss in 14 years

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Ireland Finance Minister Donohoe named head of eurozone finance group

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Finance Minister Paschal Donohoe in Government Buildings, Dublin, as the media is briefed on the latest measures Government Departments have introduced in response to Covid-19, April 3, 2020.

Leon Farrell | PA Images via Getty Images

Ireland’s Paschal Donohoe was elected Thursday to head the powerful finance group of the 19 nations using Europe’s single currency, and vowed to lead the bloc through what is set to be a historically deep recession in the wake of the coronavirus pandemic.

Donohoe, who has been Ireland’s finance minister for three years, beat out Luxembourg Finance Minister Pierre Gramegna and Spanish Economy Minister Nadia Calviño, to take the helm of the Eurogroup for the next 2-1/2 years. He takes up the post being vacated by Portugal’s Mario Centeno on Monday, and will chair his first meeting on Sept. 11.

“I’m deeply conscious that the citizens of Europe are looking at where their national economies now stand, are looking at the European economy, and have become concerned, have become fearful again for their futures, for their jobs and for their incomes,” Donohoe said.

“As great as the challenges are, and I know how deep they are, I am absolutely confident that with my colleagues in the Eurogroup, with our governments, we have the ability and we have laid the foundations to overcome these challenges and to prevail,” he told reporters.

The virus has killed more than 100,000 people across Europe, ravaged health care systems and forced the closure of businesses, transport systems and schools. The EU’s executive arm, the European Commission, has warned that Europe faces its worst economic crisis in almost a century, just as it was emerging from its near decade-long sovereign debt crisis.

The Eurogroup’s main task is to ensure the close coordination of economic policies among member countries. While an unofficial body in EU terms, it remains extremely powerful, as shown during the Greek debt crisis.

Because the meeting was virtual, voting took place through an encrypted web-based app, with only the few officials organizing the ballot in the know as to how it was progressing.

No candidate secured the minimum 10 votes required to win outright in the first round of voting so a runoff between Donohoe and Calviño was needed. The subsequent voting tallies were not made public.

Calviño, who was running to become the first woman to hold the top job, tweeted her congratulations to Donohoe, saying that she is “looking forward to working together to ensure a robust recovery that leaves no one behind.”

Belgian Finance Minister Alexander De Croo said that “the coming months will require unparalleled efforts & leadership to kick-start Europe’s economy.”

Donohoe hails from the center-right conservative bloc known as the European People’s Party, which is the biggest formation in the European Parliament and still wields considerable influence, even though it lost support in last year’s Europe-wide elections.

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Sony invests $250 million in ‘Fortnite’ maker Epic Games

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Character actors from the Epic Games Fortnite video game dance during the E3 Electronic Entertainment Expo in Los Angeles, on June 12, 2019.

Kyle Grillot | Bloomberg | Getty Images

Sony has invested $250 million in Epic Games, the company behind the popular battle-royale video game “Fortnite.”

The PlayStation console maker will take a minority stake in Epic, the two companies said Thursday, in a strategic investment deal that expands on an existing relationship between both firms.

Other than being known for creating hit titles like “Fortnite” and the “Gears of War” franchise, Epic is seen as a major player in the video games industry thanks to its Unreal game-engine software that powers many of the world’s top games. The company also runs an online video games store that competes with Steam.

“Epic’s powerful technology in areas such as graphics places them at the forefront of game engine development with Unreal Engine and other innovations,” Sony CEO Kenichiro Yoshida said in a statement Thursday. “There’s no better example of this than the revolutionary entertainment experience, Fortnite.”

“Through our investment, we will explore opportunities for further collaboration with Epic to delight and bring value to consumers and the industry at large, not only in games, but also across the rapidly evolving digital entertainment landscape.”

The investment is subject to regulatory approvals, Sony and Epic said.

It’s a significant deal for Sony into one of the world’s top gaming brands. Privately-held Epic is also backed by another household name in the industry, Chinese firm Tencent.

The news arrives as Sony gears up to launch its PlayStation 5 console later this year. The Japanese firm has been intensifying its battle with Microsoft to convince gamers to buy its next-generation device over the upcoming Xbox Series X.

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TikTok transparency report shows it removed 49 million videos

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TikTok removed over 49 million videos for content violations in just six months, according to the company’s latest transparency report, published Thursday. 

Less than 1% of all videos published on the platform are removed for content violations, TikTok said, in what is its second transparency report. 

India, where the app was banned last week, had 16.5 million videos removed, which is roughly four times more than any other country. 

The U.S., which is “looking at” banning the app, had the second most videos removed with 4.6 million. Pakistan ranked third (3.7 million), the U.K. was in fourth (2 million), and Russia was in fifth (1.3 million).  

Globally, the main reason for removal was “adult nudity and sexual activities,” with one in four of the deleted videos removed for this reason in December. 

Other reasons included alcohol and drug taking, violence, self-harm or suicide. Less than 1% of the videos removed violated TikTok’s polices on hate speech, integrity and authenticity, and dangerous individuals and organizations. 

Of the videos removed, TikTok said 89.4% were taken down before they received any views. 

TikTok refused to disclose how many were taken down by human moderators and how many were removed by the company’s software. 

Owned by China’s ByteDance, the short video app said that it had 500 requests from governments and law enforcement agencies in 26 countries during the second half of 2019. That’s up 67% on the first half of the year, when it received 298. 

India, which was TikTok’s largest market in terms of user numbers, made 302 requests, and TikTok shared data in 90% of those cases. The U.S. made 100,  and TikTok shared data in 82% of those cases. Elsewhere, Japan made 16, Germany made 15, Norway made 10, and the U.K. made 10. 

“Any information request we receive is carefully reviewed for legal sufficiency to determine, for example, whether the requesting entity is authorized to gather evidence in connection with a law enforcement investigation or to investigate an emergency involving imminent harm,” TikTok said in the report. 

Governments requested content be removed on 45 separate occasions but TikTok did not comply with all of those. The bulk of the requests (30) came from India. 

“If we believe that a report isn’t legally valid or doesn’t violate our standards, we may not action the content,” TikTok said. 

The report states that TikTok did not receive any user information or content removal requests from China or Hong Kong. In fact, China doesn’t get mentioned in the report at all. That could be because ByteDance operates a clone of TikTok in China called Douyin so any government requests are likely to be filed there instead.

TikTok isn’t available for download in China and a spokesperson for the company wasn’t immediately available to clarify whether requests to Douyin would be in a separate report.

TikTok has launched “trust and safety hubs” in Dublin, Singapore and Mountain View, California, as part of an effort to provide a more local approach to content moderation. 

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