Amazon acquires Facebook’s satellite internet team, bolstering its efforts to compete with SpaceX

A photo of Mark Zuckerberg, the CEO and cofounder of Facebook.
Facebook CEO Mark Zuckerberg.

  • Amazon has acquired Facebook’s satellite internet team, The Information reported Tuesday.
  • The group of more than a dozen LA-based scientists and engineers joined Amazon in April.
  • The acquisition ends Facebook’s plans to develop satellite internet, while bolstering Amazon’s own.
  • See more stories on Insider’s business page.

Amazon has acquired Facebook’s team of more than a dozen satellite internet experts, The Information reported Tuesday and spokespeople for the two companies confirmed.

The deal bolsters Amazon’s $10 billion effort to develop low Earth orbit (LEO) satellites capable of delivering high-speed broadband internet around the globe, while marking the end of Facebook’s ultimately unsuccessful efforts to do the same.

Facebook’s team, which joined Amazon’s existing 500-person operation in April, included physicists as well as hardware and software engineers who have experience working on aeronautical and wireless systems, according to The Information.

The talent acquisition deal included some intellectual property developed by the team, as well as equipment and facilities, Facebook told Insider. Other terms were not disclosed.

Amazon has raced to compete with other satellite internet companies, including Elon Musk’s SpaceX and its Starlink network, in addition to OneWeb, and the Europe-based Eutelsat.

Amazon received approval in July 2020 from the Federal Communications Commission to launch 3,236 LEO satellites in an effort called Project Kuiper, with the company saying it plans to bring its satellite-based internet service online after 578 satellites are in orbit.

Facebook’s efforts to develop its own satellite-based internet service, which began as early as 2015, have encountered multiple hurdles. The company told The Information it no longer plans to launch its own network, and told Insider it instead plans to continue working with partner companies like Eutelsat and pursuing its other efforts to expand internet access.

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Microsoft wins approval from US antitrust regulators to buy AI firm Nuance as it looks to bolster healthcare business

microsoft healthcare

Microsoft has won US antitrust approval for its deal to buy artificial intelligence and speech technology company Nuance Communications, according to a filing made by Nuance to the government.

The $19.7 billion deal, which was announced in April, came after the companies partnered in 2019 to automate healthcare administrative work, such as documentation.

Nuance said in a filing to the Securities and Exchange Commission on Friday that the deadline for the US government to object to the deal had expired on June 1.

That expiration “satisfies one of the conditions to the closing of the merger,” the company said in the filing.

A spokesperson for Microsoft said in a statement that the deal was undergoing regulatory reviews in other jurisdictions and was intended to close at the end of 2021.

(Reporting by Diane Bartz; Editing by Bill Berkrot)

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Grubhub is facing 14 lawsuits from angry investors who say it misled them about its $7.3 billion takeover by Just Eat Takeaway

grubhub
GrubHub CEO Matt Maloney (C) applauds after ringing the opening bell before the company’s IPO on the floor of the New York Stock Exchange in New York April 4, 2014. Shares of GrubHub Inc, the biggest U.S. online food-delivery service, rose as much as 57 percent in its market debut as investors scrambled for a piece of the fast-growing consumer internet company.

  • Grubhub said it faces 14 lawsuits alleging it misled investors about its Just Eat Takeaway merger.
  • The lawsuits claim Grubhub withheld key financial protections and executives’ conflicts of interest.
  • Investors want the court to invalidate the merger until Grubhub secures a better deal for them.
  • See more stories on Insider’s business page.

Grubhub disclosed in a regulatory filing Thursday that it’s facing 14 lawsuits from investors who say the company misled them about its plans to be acquired by Dutch food delivery giant Just Eat Takeaway.

The investors alleged that Grubhub executives and board members failed to disclose key financial details and massive payouts that they stood to receive as part of the merger, and that they failed to secure the highest possible price for Grubhub’s public shareholders, harming them financially as a result.

Frank Ferreiro, the lead plaintiff in the case, said in a lawsuit filed in New York last month that when Grubhub publicly announced the proposed merger, it withheld underlying financial data it had used to make assumptions about the companies’ future performance, as well as well as “golden parachutes,” job offers, and other lucrative perks guaranteed to Grubhub executives and directors.

Ferreiro’s lawsuit alleged that investors like himself – who would get roughly 0.67 share of Just Eat stock for each of their Grubhub shares regardless of either company’s stock price when the merger closes – lack the information to determine whether they’re getting a raw deal.

“Grubhub insiders are the primary beneficiaries of the Proposed Transaction, not the Company’s public stockholders,” the lawsuit stated.

Ferrerio also said that GrubHub didn’t try hard enough to get the best deal for public investors.

His lawsuit asks the court to invalidate the proposed merger agreement and force Grubhub to seek the “highest possible price” for any sale.

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Amazon’s $8.5 billion bet on MGM is the latest sign that tech is transforming Hollywood. Here are the biggest deals that have altered the streaming world.

star wars harrison ford han solo chewbacca
  • The media business keeps consolidating, and Amazon’s purchase of MGM Holdings isn’t the first sign.
  • Disney bought 21st Century Fox in 2019, gaining control of Hulu, and AT&T is merging WarnerMedia with Discovery.
  • The deals signal a trend that many in the media world realize survival lies in the streaming market.
  • See more stories on Insider’s business page.

It’s official – Amazon is acquiring MGM Studios’ parent company for $8.45 billion, it announced Wednesday.

That means that movies and shows owned by MGM could eventually appear on Amazon’s Prime video streaming platform for users to watch.

It’s yet another instance of a tech company partnering with a film industry power player to round out its streaming offerings and compete with deeply entrenched rivals like Disney and Netflix.

And as streaming services continue to gain favor over traditional TV, media firms are likely happy to oblige, helping further industry consolidation. Film studios without their own streaming service are especially keen on finding a way to get eyeballs on – and monetize – their libraries.

Here are some of the biggest mergers, acquisitions, and deals amongst tech platforms and traditional film companies that have set the stage for the streaming wars.

Disney and 21st Century Fox

drew barrymore never been kissed
Drew Barrymore stars in 1999’s “Never Been Kissed.”

Disney bought the film company 21st Century Fox and its decades-old 20th Century Studios subsidiary, in a $71 billion sale that closed in 2019. Disney’s streaming platform, Disney+, launched in December of that year with films like “Never Been Kissed” and “Ever After” available to watch.

Those 21st Century Fox films will join Disney’s already attractive library it built with past acquisitions of LucasFilm -home to “Star Wars” and “Indiana Jones” – and Marvel.

The Fox deal also gave Disney control of Hulu

handmaids tale
Elisabeth Moss stars in “Handmaid’s Tale.”

Hulu has always had a complicated ownership setup, but Disney now owns a majority of the company and maintains full operations of the streaming platform.

Through its 21st Century Fox acquisition, Disney also absorbed the corporation’s 60% stake in Hulu, one of the original streaming services that launched in 2007. It later acquired AT&T’s 9.5% stake in Hulu, bringing its stake to about 70%.

Comcast is the only other shareholder, which is guaranteed to own a minimum of 21% thanks to a 2019 deal.

Disney even offers a $13.99 bundle that includes Disney+, Hulu, and ESPN+.

Netflix announced a deal with Sony in April

Tom Holland SpiderMan
Tom Holland has played Spider-Man in five MCU movies.

The agreement will allow Netflix to offer Sony’s future 2022 films in the US, including installments of the “Spider-Man” franchise with Tom Holland. Other potential future Sony releases could include “Jumanji” and “Ghostbusters.”

After Sony’s movies are released in theatres in 2022, they’ll first go to pay-per-view and then hit Netflix.

As Insider’s Travis Clark reported, the deal gives Sony – which doesn’t have its own streaming platform – an avenue to showcase its films. And it gives Netflix even more theatrical releases to entice paying customers.

Disney will also have Sony movies after Netflix has its turn

Spider-man
Tom Holland as Spider-Man.

After a Sony film is released in theatres in 2022, has its pay-per-view television run, and spends an expected 18 months on Netflix, it’ll be offered on Disney+ and Hulu. Sony and Disney said the US licensing deal will be in effect from 2022 until 2026.

The agreement means that future “Spider-Man” movies could eventually call Disney+ home alongside Disney-owned Marvel’s film franchise, which Holland appears in as well.

Sony and Disney ran into a snag in the past over Sony’s movie rights to hundreds of Marvel characters and Disney’s Marvel productions. The solution was for Disney and Sony to agree on the Spider-Man character being allowed to appear in one more standalone film and another Marvel Cinematic Universe installment.

AT&T’s massive WarnerMedia-Discovery merger will create a new streaming giant

wonder woman 1984
“Wonder Woman 1984.”

The communications giant announced last week that it was spinning off its WarnerMedia content arm, which includes HBO and Warner Bros., both of which AT&T acquired when it bought then-Time Warner for $81 billion in 2018. AT&T plans to merge WarnerMedia with the media company Discovery.

That means content from the two companies’ 100-plus brands, including HGTV and Discovery, would all exist under one umbrella. Such a service could give Netflix, the reigning streaming champ, a run for its money. The deal is expected to close in mid-2022.

The Discovery Plus streaming platform had already launched in early January with subscriptions starting at $4.99 and showing programs from Food Network, HGTV, TLC, BBC, and Discovery Channel, home to Shark Week. It was the first new streaming service to launch in 2021.

MGM Studios is home to the oldest and most beloved film classics

James Bond movies
James Bonds over the years.

Amazon is shelling out $8.5 billion to acquire MGM Holdings, whose 97-year-old MGM Studios is behind some of the world’s most classic movies and TV shows. The company said that the “more than 4,000 films” and “17,000 TV shows” were big factors in making the purchase.

Movies include “Silence of the Lambs” starring Anthony Hopkins, “Rocky,” and the extensive James Bond film catalog. Although as Insider’s Travis Clark reported, MGM owns just half of the rights to Bond, with the rest belonging to producers that handle the creative direction of the franchise. That means that it could get tricky if Amazon ever wanted to, say, produce a TV series starring the famous character.

Viacom merged with CBS in 2019 with Paramount already under its belt

a quiet place 2
Emily Blunt in “A Quiet Place 2.”

Viacom’s acquisition of Paramount may have closed in 1994, but the move set the company up well for what would become the 21st-century streaming wars. So did Viacom’s merger with CBS in 2019.

The streaming service CBS All Access launched in 2014 and was rebranded as Paramount Plus in 2020 as the pandemic drove a business boom in the streaming market.

Since “A Quiet Place 2” is distributed by Paramount Pictures, the movie starring Emily Blunt will be available on the streaming service on July 12.

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Amazon’s $8.5 billion purchase of MGM will give it rights to James Bond, ‘Legally Blonde,’ ‘Robocop,’ ‘The Handmaid’s Tale,’ and much more. Here’s what the tech giant could own under the deal.

robocop original
Amazon now owns the rights to “Robocop,” among many other classic films.

  • Amazon is buying MGM for $8.45 billion, the companies announced on Wednesday.
  • From James Bond to “The Handmaid’s Tale,” MGM is getting a massive trove of movies and TV.
  • These are the highlights of the blockbuster acquisition.
  • Visit the Business section of Insider for more stories.

Amazon just dropped $8.45 billion to buy MGM Studios, the decades-old film studio that owns rights to some of the biggest movies and TV shows in the world.

In the press release announcing the deal, Amazon pointed to the “vast catalog” of “more than 4,000 films” and “17,000 TV shows” as the reason for the purchase – assuredly intended to bolster Amazon’s Prime video streaming service.

So, what’s Amazon getting for nearly $8.5 billion?

James Bond movies
A smattering of Bonds.

The decades-long catalog of James Bond films is among the “more than 4,000” films Amazon is buying, in addition to classic movies like “12 Angry Men,” “Silence of the Lambs,” “Thelma & Louise,” “Midnight Cowboy,” “Fiddler on the Roof,” “Dances with Wolves,” and “Raging Bull.”

Another major franchise Amazon gets in the deal: “Rocky,” as well as the more recent “Creed” films.

And that’s just movies.

In terms of television, Amazon’s getting more recent classics, like “Fargo,” “The Handmaid’s Tale,” and “Vikings.”

Beyond the titles specifically noted by Amazon, there are countless others that belong to the MGM Holdings catalog – though it’s not completely clear which movies and TV shows have rights split up between several companies.

MGM Holdings includes MGM Television, for instance, which counts “The Real Housewives” franchise among its titles. An MGM rep confirmed that “The Real Housewives” franchise is part of the deal, as well as “The Voice,” “Shark Tank,” and “Survivor.”

What we know for sure isn’t included in the deal is the vast library of MGM films from prior to 1986, which are controlled by Turner Entertainment Company.

Beyond what’s listed above, Amazon’s press release included “Basic Instinct,” “Legally Blonde,” “Moonstruck,” “Poltergeist,” “Stargate,” “Tomb Raider,” The Magnificent Seven,” The Pink Panther,” and “The Thomas Crown Affair” among the movie rights it acquired in the deal.

Amazon and MGM representatives were unable to clarify the full list of acquired movie and TV rights in the deal.

Got a tip? Contact Insider senior correspondent Ben Gilbert via email (bgilbert@insider.com), or Twitter DM (@realbengilbert). We can keep sources anonymous. Use a non-work device to reach out. PR pitches by email only, please.

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The founder of a startup bought by WeWork describes how he almost destroyed his 7-year-old company in the span of 24 hours over one simple mistake

Adam Neumann, CEO of WeWork
Adam Neumann, CEO of WeWork, one of the big, private companies held by mutual funds at different valuations.

  • David Fano is the founder of CASE, a startup bought by WeWork in 2015.
  • On Twitter, Fano said the acquisition process moved quickly, closing in just 25 days.
  • But the process almost destroyed his company when employees were faced with a snap decision.
  • See more stories on Insider’s business page.

The founder of a company acquired by WeWork described the lessons from a whirlwind process of joining Adam Neumann’s startup in a Twitter thread on Wednesday.

Dave Fano worked at WeWork for nearly four years after his architecture and planning company, CASE, was acquired in 2015, according to his LinkedIn profile. But it almost didn’t happen.

“We spent 7 years building an amazing culture of trust and transparency, and in a span of 24 hours, almost lost it all,” Fano wrote. “Caught up in trying to get the deal done, we lost sight of how this process would make everyone feel.”

Fano said CASE told its workers of the WeWork acquisition and asked them to return signed documents within 24 hours. The entire process took less than a month from when a verbal agreement was reached to when the deal officially closed.

The transaction put many of the firm’s employees in a tailspin, Fano said. CASE was given less than two weeks after the letter of intent was signed to officially close the deal by informing employees and getting the workers to review WeWork’s employment agreement.

According to data from Forbes, most mergers and acquisitions take about four to six months, but can also encompass a period of several years. Even at that rate, many employees choose to leave companies after mergers and acquisitions. Data from the MIT Sloan Management School found that within the first year of a company’s acquisition 33% of workers leave the company as compared to the standard rate of 12%.

“That was one of the worst business decisions I’ve been a part of in all my career,” Fano, who’s now the CEO of career planning company Teal, said in his Twitter thread.

At the time, WeWork was considered a promising startup. It was chosen by Fortune magazine as one of its three unicorns to bet on in 2016 but went downhill fast when it filed to go public in 2019.

Fano left his position at WeWork as the company’s chief growth officer about five months before it filed to go public. Within six weeks of filing, WeWork spiraled down from a $47 billion valuation to talk of bankruptcy when its S-1 filing revealed the company had suffered heavy financial losses.

Since then, the company appears to have turned around for WeWork. In March, the company announced it had reached a deal to go public via a SPAC.

Eventually, Fano said, he asked for more time from CEO Adam Neumann, who agreed to give the team several extra weeks.

Despite the extra time, he said the company still lost many employees as a result of the acquisition. But he does not regret his decision to join WeWork.

Fano said the situation opened his eyes to the importance of company values. By asking employees to make a 24-hour decision, he felt he violated a culture of trust and dependency.

“As intense as that moment was, I would not trade it for the following 4 years at WeWork,” he wrote. “Everyone experienced incredible career growth. WeWork enabled people to explore new career paths, take on new responsibilities, and build relationships that will stay with them forever.”

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Box stock surges 10% after report says the company is exploring a sale amid pressure from activist investor Starboard

Box CEO
Aaron Levie, the CEO of Box.

  • Box stock surged as much as 10% on Monday before paring gains.
  • A report from Reuters Monday said the cloud storage company may be open to a sale amid pressure from activist investor Starboard Value LP.
  • Starboard has been edging Box to sell after pushing for a board challenge less than a month ago.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Shares of Box surged as much as 10% on Monday after reports from Reuters and CNBC said the company is exploring a sale amid pressure from hedge fund and activist investor Starboard Value LP.

The news comes after Reuters reported last month that Starboard was preparing to launch a board challenge against Box unless major changes were made at the cloud storage company.

Reports say Starboard has been upset with Box’s inability to capitalize on the work-from-home trend during the pandemic. Starboard currently owns 10.9 million shares of Box, worth some $246 million as of March 19’s closing price.

Despite the pressure from Starboard, Box stock is up roughly 100% over the past year. However, even after Monday’s move higher, the Redwood City, California-based firm is down 13% from its May, 2018 record highs.

In Box’s fiscal year 2021 earnings report filed last Friday the company revealed revenues of $770 million versus $696 million a year ago.

Although the company was able to limit losses to just $43 million versus $144 million in fiscal year 2020, Box’s slowing revenue growth during the pandemic has been a cause for concern for investors.

In January, DA Davidson analyst Rishi Jaluria downgraded Box to “neutral” and issued an $18 price target on the company citing low scores in a CIO survey for 2021 spending intentions.

Box traded down 6.63% as of 1:14 p.m. ET on Monday.

Box chart
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