The daily business briefing: January 19, 2022
AT&T and Verizon agree to limit 5G rollout near airports, Microsoft announces plan to acquire Activision Blizzard, and more


1. AT&T, Verizon agree to limit 5G rollout near airports
AT&T and Verizon on Tuesday agreed to limit their 5G network rollout near airports to address warnings from airlines that the high-speed wireless service would cause catastrophic disruptions to passenger and cargo flights. The Federal Aviation Administration said the changes should eliminate much of the feared interference with airplane safety technology. The White House helped broker the temporary fix. "This agreement protects flight safety and allows aviation operations to continue without significant disruption and will bring more high-speed internet options to millions of Americans," Biden said in a statement. The new 5G systems use a wireless spectrum, the C-band, that is close to airwaves used by radio altimeters, which measure how high planes are flying and are crucial in low-visibility landings.
2. Microsoft to acquire game-maker Activision Blizzard
Microsoft announced Tuesday that it would acquire Activision Blizzard, the publisher behind hit games like World of Warcraft, Call of Duty, and Overwatch, in a deal valued at $68.7 billion. Microsoft said the acquisition would bolster the offerings on its Game Pass subscription service. Activision Blizzard CEO Bobby Kotick will continue in his role. The deal comes after Activision Blizzard was hit with a bombshell lawsuit by the California Department of Fair Employment and Housing last year, which alleged the company created a "breeding ground" for sexual harassment and discrimination" that "was akin to working in a frat house, which invariably involved male employees drinking and subjecting female employees to sexual harassment with no repercussion." Activision Blizzard has denied the claims.
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3. Goldman Sachs earnings fall short of expectations
Goldman Sachs shares plunged by 7 percent on Tuesday after the investment bank posted fourth-quarter profit that fell short of analysts' expectations. Earnings came in at $10.81 per share compared to the $11.76 that analysts surveyed by Refinitiv expected on average. Revenue rose by 8 percent and slightly exceeded estimates at $12.64 billion, but profit fell by 13 percent compared to a year earlier as operating expenses jumped by 23 percent due to increased pay for Wall Street workers after a year of strong performance, and higher litigation reserves. "Goldman Sachs' disappointing Q4 earnings are a stark reminder that wage inflation is hitting the banking sector hard," Octavio Marenzi, CEO of bank consultancy Opimas, told MSN in an emailed statement. "It is clear that employees are able to demand significantly higher pay."
4. Stock futures rise after Tuesday's sell-off
U.S. stock futures edged higher early Wednesday after Tuesday's sell-off, which was fueled by concerns about rising bond yields. Futures tied to the Dow Jones Industrial Average and the S&P 500 were up by 0.2 percent and 0.3 percent, respectively, at 6:30 a.m. ET. Futures for the tech-heavy Nasdaq were up by 0.4 percent, even though government bond yields were higher again early Wednesday. The Dow fell by 1.5 percent on Tuesday, thanks partly to Goldman Sachs' 7 percent drop. The S&P 500 declined by 1.8 percent. The Nasdaq plunged by 2.6 percent, as high-growth technology stocks most sensitive to higher borrowing costs took the biggest hit from rising Treasury yields. The Nasdaq closed at its lowest point in three months as investors brace for the Federal Reserve to raise interest rates to curb inflation.
5. New York AG pushes for Trump testimony, citing pattern of fraud
New York Attorney General Letitia James filed court papers Tuesday accusing former President Donald Trump's family business of "falsely and fraudulently" valuing properties to banks for economic benefit. James also sought to compel Trump and two of his children, Donald Jr. and Ivanka, to give sworn testimony in her ongoing civil investigation of the Trump Organization's financial dealings. James had subpoenaed Trump in December and Don Jr. and Ivanka earlier in January, and Tuesday's motion was in opposition to the Trumps' attempts to quash those subpoenas. James said her office had "uncovered significant evidence" of the phony valuations — including tripling the value of Trump's own Trump Tower apartment. James said the Trumps must comply because nobody "can pick and choose if and how the law applies to them."
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Harold Maass is a contributing editor at The Week. He has been writing for The Week since the 2001 debut of the U.S. print edition and served as editor of TheWeek.com when it launched in 2008. Harold started his career as a newspaper reporter in South Florida and Haiti. He has previously worked for a variety of news outlets, including The Miami Herald, ABC News and Fox News, and for several years wrote a daily roundup of financial news for The Week and Yahoo Finance.
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