Researched by: Nirmal Bhansali & Anannya Parekh
GST for gaming
The Indian government plans to slap a 28% tax on all forms of online gaming. Until now, only online gambling and betting attracted such a steep tax. Why this matters: the move may have a chilling effect on a rare startup space that is highly profitable:
Bhavin Pandya, cofounder and co-chief executive officer of Games 24x7, said the move would “effectively drive consumers towards offshore and illegal platforms that pay no taxes, resulting in a loss of taxes and outflow of foreign exchange”.
But none of this complaining is likely to move the government—which is already counting on added tax revenue of Rs 170 billion (17,000 crore). Economic Times has more about the announcement—and Medianama offers a good analysis of its effect on the industry.
Disney’s got an India problem
The history: Once upon a time, Disney ruled Indian television thanks to Star India—which gave it valuable IPL broadcast rights, dozens of channels and a stake in a Bollywood production company. The company was also the foundation upon which the streaming behemoth Hotstar was built.
When it all went wrong: Then in June 2022, Disney+Hotstar lost the rights to stream IPL to Reliance. And things have been going south ever since. Without IPL, Hotstar is expected to lose 8 million to 10 million subscribers in its third quarter. And Star’s overall revenue for the fiscal year ending September 2023 is expected to drop around 20% to slightly less than $2 billion. And it is expected to lose money next year.
What happens next: The problem is that Disney has never made a lot of money per user in India for Disney—and it is getting worse: “Hotstar generated an average of 59 cents in revenue per subscriber each month in the April quarter, down from an average of $1.20 at its peak in the summer of 2022.” So it doesn’t make sense to keep on keeping on. Both Bloomberg News and Wall Street Journal report strong rumours that Disney may restructure its television business to cut costs. It may enter into a joint venture—perhaps with a bank or even Reliance—or sell Star India outright.
A new & improved AI chatbot
The San Francisco-based startup Anthropic has rolled out a new version of its chatbot—Claude 2—which describes itself as “helpful, harmless, and honest.” And it can do some things a lot better than ChatGPT:
The company says Claude 2 has the ability to summarise up to about 75,000 words, which could be the length of a book. Users can input large data sets, and ask for summaries in the form of a memo, letter or story. ChatGPT, by contrast, can handle about 3,000 words.
This version is also better at coding—and taking law and GRE exams. The chatbot is available for beta testing in the US and UK. The Guardian has more on the ‘Constitutional AI’ that guides Claude. (CNBC)
Also shiny and new: Elon Musk’s AI company. All we know is that it is called xAI, has 12 staffers—all male—and was formed “to understand reality.” Its website is equally vague: “The goal of xAI is to understand the true nature of the universe.” We presume more details will be available at a Twitter Spaces convo slated for Friday. (Quartz)
Microsoft wins Activision lawsuit
The context: Last year, Microsoft announced plans to acquire video game maker Activision Blizzard for $69 billion. The deal immediately attracted antitrust investigations in the UK and EU—and a lawsuit filed by the US Federal Trade Commission. The reason: Microsoft could make Activision’s successful franchises like Call of Duty exclusive to the Xbox—undermining competitors like Sony’s PlayStation.
What happened now: A federal judge shot down the US government’s lawsuit—saying it “had failed to show it was likely to prove the merger would result in a substantial reduction in competition that would harm consumers.” Why this matters: the ruling is a huge blow to the US government’s efforts to go after Big Tech for anti-competitive behaviour. It walked away from one of its lawsuits against Meta—and the case involving Amazon is yet to be decided. The deadline to close the deal is July 18. (New York Times)
Yamuna hits an all-time high
The water level of the river has been rising over the past week due to torrential rain in Delhi. It has now hit a record 207.71 metres—breaking the previous high set in 1963. The government is evacuating 41,000 people living on the riverbanks. Yamuna’s level in Delhi depends heavily on the amount of water released by the Hathnikund Barrage in Haryana, which is upstream. The government has asked Haryana to reduce the speed at which it releases water. The Telegraph has more on how encroachment plays a part. You can see the raging river below. (The Hindu)
Farewell, Milan Kundera
The 94-year-old author who defined anti-communist literature has died after a prolonged illness. While younger generations may not remember him, his novel ‘The Unbearable Lightness of Being’ was a masterpiece on totalitarianism—which “describe(s) a world in which choice is exhausted and people simply cannot find a way to express their humanity.” He shaped the writing of an entire generation of novelists—including Salman Rushdie. Kundera was just as infamous for his misogynist portrayal of women who “tended to be objectified, and the less fortunate were sometimes victimised in disturbing detail.” New York Times and The Guardian have more on his life and impact.
Four things to see
One: Behold the first Google Doodle dedicated to pani puri—aka puchka aka gol gappa. It commemorates the world record set by Masterchef Neha Shah, who offered 51 types of pani puri at a restaurant in Indore in 2015. It also includes a pani puri game because why not? Check it out here. See a demo of the game below. (The Telegraph)
Two: We’d like a Burger King cheeseburger—except hold the patty. That’s what you get when you order the new ‘real cheeseburger’ in Thailand. It has no meat and 20 slices of cheese (yes, 20!)—but is around $7 cheaper than its meaty cousin. It’s become wildly popular but mostly because everyone wants to try it once—and never again! You can see what it looks like below. (CNN)
Three: Say hello to the trailer for ‘Wonka’—a spin-off of the Roald Dahl classic ‘Charlie and the Chocolate Factory’. Timothée Chalamet plays young Willy Wonka in this origin story of the creepiest capitalist known to children. What we appreciate: Hugh Grant’s turn as an oompa-loompa. The movie hits theatres on December 15. (The Hindu)
Four: NASA marked the one-year anniversary of its super-duper James Webb Space Telescope by releasing this image of 50 baby stars—located in a cloud complex 390 light-years away. What you’re also looking at: “It’s like a glimpse of what our own system would have looked like billions of years ago when it was forming,” Hmm, it’s increasingly hard to tell the difference between deep space images and AI art. (Associated Press)