News Corp agrees deal with Google on payments for its journalism


Rupert Murdoch’s News Corp reached a landmark global deal with Google that it said would bring “significant payments” for its journalism, ending a long-running dispute that had been a focal point in the media industry’s fight with big tech companies.

The breakthrough in the News Corp campaign came as Australia, the cradle of the Murdoch media empire, began debating laws on Wednesday that would force Google and Facebook to pay for news.

Google and Facebook have been rushing to complete deals with Australian publishers in an attempt to blunt the force of the bargaining code, which is inspiring other regulators in Europe, the UK and Canada.

However, the Google deal with News Corp announced on Wednesday goes beyond the Australian market, extending to Murdoch titles such as The Wall Street Journal and New York Post in the US and The Times and The Sun in the UK. No other news publisher has reached a single deal with Google across multiple countries.

Robert Thomson, News Corp’s chief executive, said the effort to make platforms pay for using news content had been a “passionate cause” for the company for “well over a decade”.

“I am gratified that the terms of trade are changing, not just for News Corp, but for every publisher,” he said. “For many years, we were accused of tilting at tech windmills, but what was a solitary campaign, a quixotic quest, has become a movement, and both journalism and society will be enhanced.”

Critics said the deal would mainly benefit News Corp rather than the rest of the news industry, since other publishers lacked the negotiating power that Murdoch enjoyed thanks to his extensive news operations in Australia.

“In every attempt to take power away from the platforms, it only gives them more,” said Jeff Jarvis, a journalism professor at City University of New York. “Google has the power to decide which news organisations should get money, and which shouldn’t. It is the big old legacy players who have political clout who can cash it in.”

The terms of the three-year deal cover licensing payments for content used on Google’s News Showcase feature, the development of a subscription platform, the sharing of ad revenue via Google’s ad technology services, and other audio and video projects.

Don Harrison, president of global partnerships at Google, said News Showcase now has deals with more than 500 publications around the world and the company hoped to “announce even more partnerships soon”.

The size of News Corp’s global deal was not disclosed. Thomson said earlier this month that an agreement with Google would “benefit our company’s financial fortunes” and have a “material impact”.

Google pledged last year to spend $1bn over three years on buying news content, and has reached agreements with publishers in about a dozen countries. But people involved in negotiations in Australia told the Financial Times the sums now under discussion were “multiple times” the size of agreements signed in other parts of the world.

The legislative passage of the bargaining code in Australia is being closely watched in Europe and the US for evidence that a tougher approach can reset the balance between publishers and tech platforms.

Among the code’s features is an arbitration system that would make binding decisions on the fees that Facebook and Google would have to pay news providers if commercial negotiations fail.

It remains unclear how Google’s rush of dealmaking in Australia will affect the bill and its implementation. As well as the deal with Murdoch’s News Corp, Australia’s biggest publisher, Google signed a letter of intent on Wednesday with Nine Entertainment, another large media group in the country.

Angela Mills Wade, executive director of the European Publishers Council, said the global News Corp deal “proves without doubt the value of news media content to Google”.

However, she warned regulators in Australia and Europe to “not be misled into thinking that single big deals between Google and a few influential media companies — just before comprehensive laws come into effect — are the answer to the fair remuneration due to all publishers under the law”.

“The government should continue with a full implementation of the code,” she said.

Senate acquittal exposes deep Republican rifts over Trump


Donald Trump’s acquittal in his second Senate impeachment trial has exposed deep divisions with the Republican party over whether to break decisively from the former president or further embrace his brand of politics.

Trump was exonerated on Saturday even after seven Republican senators voted to convict him of inciting an insurrection that led to last month’s deadly assault on the US Capitol. Under the US constitution, two-thirds of the Senate was needed to find him guilty in order for him to be convicted.

But the final 57-43 vote has revealed serious tensions within the Republican party over how to recover from their recent election losses.

After voting to acquit Trump, Mitch McConnell, the Republican Senate leader, excoriated the former president, describing his actions in the run-up to the January 6 riot as “a disgraceful dereliction of duty”.

“There is no question that President Trump is practically and morally responsible for provoking the events of that day,” he said.

However, Lindsey Graham, the South Carolina senator and fierce Trump ally, called on the party to rally round the former president ahead of next year’s midterm elections, when the GOP will try to win back control of both the House of Representatives and the Senate.

“Trump plus is the way back in 2022,” he told Fox News on Sunday.

Graham also suggested that Lara Trump, the ex-president’s daughter-in-law, should run for a senate seat in North Carolina, which is due to become vacant in 2022. “I think she represents the future of the Republican Party,” he said.

Some moderate Republicans have sought distance themselves from the former president. Larry Hogan, governor of Maryland and a potential 2024 presidential candidate, said the party needed to abandon Trump’s politics if it was going to remain competitive across the country.

“There was a hostile takeover of the Republican party”, he told NBC News. “I think we’ve got to move on from the cult of Donald Trump and return to the basic principles that the party has always stood for.”

Trump, who has kept a low profile since snubbing Joe Biden’s inauguration last month, seemed to make his own intentions clear in a statement on Saturday: “Our historic, patriotic and beautiful movement to Make America Great Again has only just begun.”

“In the months ahead I have much to share with you, and I look forward to continuing our incredible journey together to achieve American greatness for all of our people,” he added.

The former president, 74, has not ruled out running for president again in 2024. But he is facing several criminal probes, including investigations in Georgia and New York, that could complicate his political ambitions.

There were signs yesterday of recriminations against the seven Republicans — Richard Burr of North Carolina, Bill Cassidy of Louisiana, Maine’s Susan Collins, Alaska’s Lisa Murkowski, Mitt Romney of Utah, Ben Sasse of Nebraska and Pennsylvania’s Pat Toomey — who voted with Democrats to convict the president.

Cassidy defended his decision on Sunday after Trump-loyal Republican officials in Louisiana said he was “part of the problem” and should not expect a “warm welcome” when he returns to his home state.

“As these facts become more and more out there, if you will, and folks have a chance to look for themselves, more folks will move to where I was,” Cassidy told ABC News. “People . . . want to trust their leaders. They want people to be held accountable.”

Several Republican lawmakers have either publicly or privately condemned Trump’s behaviour on January 6. But few have been willing to make a clean break with the former president, given the grip he still holds over large swaths of the Republican base.

At the same time, McConnell and others are grappling with whether the party can win back moderate Republicans and independents who abandoned the GOP over Trump last November, and public opinion polls show are outraged by January 6.

Murkowski, who will be up for re-election in 2022, dismissed suggestions that she would lose her seat over the impeachment vote. “If I can’t say what I believe that our president should stand for, then why should I ask Alaskans to stand with me?”

 

Treasuries supported by Fed pledge of ‘patiently accommodative’ policy


Government bonds rallied on Thursday after the head of the US central bank stressed no rapid changes would be made to monetary policy for the world’s largest economy.

Speaking at the Economic Club of New York on Wednesday afternoon, Jay Powell, the Federal Reserve chair, underscored the importance of “patiently accommodative” monetary policy to boost the pandemic-ridden US labour market.

The yield on the two-year US Treasury bond briefly slipped below 0.1 per cent for the first time on Thursday, according to Bloomberg data, before steadying at about 0.11 per cent.

The benchmark 10-year Treasury yield was stable at 1.15 per cent, although European bonds were in demand. Germany’s 10-year bond yield dropped 0.02 percentage points to minus 0.46 per cent. The yield on the equivalent UK bond fell the same amount to 0.47 per cent.

Prospects for a strong economic rebound later in the year had stoked expectations of higher inflation, encouraging fears of the Fed dialling back its $120bn-plus of monthly asset purchases. This monetary stimulus has supported global financial markets throughout the pandemic by flooding the system with cash that institutional investors have then spent on corporate bonds and stocks.

But Powell moved to damp down inflation expectations on Wednesday by saying that any rise in prices would be transient and unlikely to affect monetary policy while the labour market remained “very far” from being strong.

“This is the Fed signalling they will keep things the same until unemployment gets back to pre-Covid levels,” said Remi Olu-Pitan, multi-asset fund manager at Schroders. “Despite fears of inflation, they are using the labour market to justify very loose policy.”

Market forecasts of US inflation remain elevated as President Joe Biden’s $1.9tn stimulus bill is debated in Congress.

The 10-year break-even rate, a measure of US inflation expectations derived from the prices of inflation-protected bonds, is running at about 2.2 per cent. The gold price, at $1,830 on Thursday, has also risen about 2 per cent in the past week as investors bought the metal as a hedge against inflationary pressures.

“Markets have been worried about inflation but what we now have from the Fed is that this is not their primary concern,” Olu-Pitan said.

On Wall Street, the S&P 500 index gained 0.2 per cent at lunchtime in New York while the tech-focused Nasdaq Composite rose 0.5 per cent. This followed data showing that new unemployment claims in the US fell slightly to 793,000 last week, from 812,000 the week before. Roughly 10m fewer Americans are employed compared to a year ago, however.

In Europe the Stoxx 600 benchmark closed up 0.5 per cent, while London’s FTSE 100 rose 0.1 per cent and Frankfurt’s Xetra Dax climbed 0.8 per cent.

The dollar, as measured against a basket of currencies, edged fractionally higher.

Brent crude, the international oil marker, fell 0.2 per cent to just above $61 a barrel after the latest industry data showed falling inventories as oil producers looked to clear the surplus built up during the pandemic.

Oil prices have been on a strong run through the turn of the year, while the prices of industrial metals have also firmed. London-traded platinum rallied to a six-year high of $1,268 an ounce on Thursday before paring back some of those gains in the afternoon.

Nadège Dufossé, head of cross-asset strategy at fund manager Candriam, said she was adding commodities to her portfolios in case the end of coronavirus lockdowns created a “demand shock” that drove inflation expectations higher and caused a sell-off of bonds and equities. “To protect your portfolio from this, you really want to be in assets that would definitely benefit from a surge in consumer demand,” she said.

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Coronavirus latest: Republican congressman dies after contracting Covid


George Russell in Hong Kong

US daily case rates of Covid-19 illnesses were lower among states that adopted mask mandates earlier, while hospitalisation growth rates declined during the first two weeks after implementing statewide mask mandates, researchers have found.

A study published in the Clinical Infectious Diseases journal on Sunday showed case-rate slopes of minus 1.08 per 100,000 per day among early-adopting states, and minus 0.37 per cent per 100,000 per day among late-adopters, compared with never-adopter states.

“Our findings support statewide mask requirements to mitigate Covid-19 transmission,” they said.

Peter Rebeiro, David Aronoff and Kevin Smith of Vanderbilt University School of Medicine found there were 15 early mask requirement adopters, 19 late adopters, and 17 never adopters among US states and the District of Columbia.

The median Covid-19 rates per 100,000 were 5.70, 5.59 and 5.99 cases a day, respectively. “These analyses advance the scientific evidence showing positive impacts of statewide mask requirements in the US,” they said.

A Kansas City Chiefs fan sits in a bar in Tampa, Florida, ahead of Sunday’s American football Super Bowl

In a separate US Centers for Disease Control and Prevention study, hospital admissions growth rates declined by 5.5 percentage points among persons aged 18-64 years After mask mandates had been implemented for more than three weeks.

Even a two-week mandate resulted in a 2.9 percentage point decline among adults aged 40-64 years.

The study, led by Heesoo Joo and Gabrielle Miller, concluded that statewide mask mandates might be associated with reductions in transmission of Sars-CoV-2, the virus that causes Covid-19, and might contribute to reductions in Covid-19 hospitalization growth rates.

The researchers analysed admissions from March 22 to October 17 2020 at 10 hospitals and hospital networks.

“Mask-wearing is a component of a multipronged strategy to decrease exposure to and transmission of Sars-CoV-2 and reduce strain on the health care system, with likely direct effects on Covid-19 morbidity and associated mortality,” they wrote.

Coronavirus latest: US military to help vaccinate Americans


A car stolen from a vaccination site in Florida had vials of the coronavirus shot inside, prompting a nationwide alert in search of the vehicle. Police in Plant City, Florida, said the suspect drove off in the 2018 Hyundai Accent on Wednesday.

Northern Ireland will give students a one-off cash payment of £500 in compensation for the disruption they have suffered during the pandemic, as coronavirus restrictions force most universities in the UK to continue running classes remotely.

New, more infectious Covid-19 variants — including those first identified in the UK and South Africa — have risen to 14 per cent of infections in France from 3.3 per cent on January 8, French prime minister Jean Castex announced on Thursday.

Pakistani cleric Maulana Tahir Ashrafi, who serves as an adviser to Prime Minister Imran Khan, has taken the unusual step of issuing a fatwa, or religious decree, urging Pakistanis to ignore calls to refuse Covid-19 jabs. “I just want people to know there is nothing wrong with taking coronavirus vaccines,” he said.

Ralph Lauren reported a bigger-than-expected sales drop as the US retailer was hit by coronavirus-driven restrictions in Europe and Japan. Fiscal third-quarter revenues fell 18 per cent from a year ago to $1.43bn, just shy of Wall Street expectations for $1.46bn, according to a Refinitiv survey.

New US jobless claims dropped to their lowest level since November. First-time applications for unemployment benefits totalled a seasonally adjusted 779,000 last week, the Department of Labor said on Thursday, compared with economists’ forecast for 830,000.

Tapestry, the luxury conglomerate behind Coach and Kate Spade, has eked out an increase in quarterly profits thanks to limited discounts and strong demand for high-end handbags online and from China. The New York-based group generated net income of $311m in the three months to December 26, a year-on-year increase of 4 per cent.

Quest Diagnostics, the largest laboratory company in the US, plans to return more money to shareholders after reporting record profits thanks to surging demand for Covid-19 test processing. The New Jersey-based company raised its quarterly dividend 10.7 per cent and increased its share buyback authorisation by $1bn after higher demand for virus tests pushed up its fourth-quarter sales 56 per cent to $3bn.

The Bank of England announced on Thursday that it would put active preparations in place so that it could set negative interest rates within six months, but stressed that this was not a signal that its Monetary Policy Committee thought such a move was necessary.

Clorox raised its full-year profit and sales guidance as demand for its bleach and disinfectant wipes remained buoyant amid a pandemic-induced cleaning boom. The US company’s net sales rose 27 per cent to $1.87bn year on year in the three months to the end of December, its fiscal second quarter.

Anxiety levels in the UK population hit a record high during the first national lockdown last year, official figures showed on Thursday. Overall wellbeing fell sharply and, while it improved later in the summer as social activities resumed, even then it remained well below pre-pandemic levels on all measures.

UK consumer spending remained depressed as lockdown measures dragged on in January. Spending on credit and debit cards in the week to January 28 was 32 per cent below its average level last February, and had risen only slightly since the start of England’s third lockdown, according to Bank of England figures.

Biden to order review of critical US supply chains


President Joe Biden will issue an executive order requiring the government to review critical supply chains, in an effort to ensure that the US is not too reliant on other countries, including China, for technology and materials.

Three people familiar with the order, including one senior US official, said it would demand that the government make a broad examination of US supply chains. It would require agencies to examine procurement, in addition to critical technologies and materials in private-sector supply chains.

The move follows a pledge Mr Biden made during the presidential race to address both the vulnerabilities in US medical-related supply chains that were exposed by the pandemic as well as a wide range of technologies and materials used in manufacturing that are important for the US industrial base, including for military purposes.

 “What we’re planning is really just to implement the commitment he made on the campaign trail to take a comprehensive look at US supply chain vulnerabilities,” said the senior US official, who stressed that the order was not specifically aimed at China or any particular country.

The official said the administration would take the recommendations from various agencies “to develop proactive steps to close supply chain vulnerabilities not only for government procurement . . . but to really look across the board at supply chains, including very much the private sector”.

He added that the administration would work with US allies to try to reduce some of the current vulnerabilities in American supply chains.

“There’s a lot of opportunity to work with allies and partners on supply chain issues. But we are also obviously, thinking about ways in which we can strengthen our own domestic resilience and add capacity,” he added.

One former official familiar with the debate inside the administration said the order would give agencies one year to come up with classified and non-secret recommendations for steps to implement.

But the senior official said the government would not wait until the end of that period and would implement recommendations as they were made and after evaluation by the National Security Council and the White House National Economic Council.

While the executive order is not expected to single out China — or name the country — it comes as US government agencies are paying much more attention to national and economic security threats from China.

The former official said a draft of the order did not mention China specifically but talked about “competition among great powers”.

Some Biden officials have said that Donald Trump was correct to take a tougher line on China, but that his chaotic approach to policymaking and dismissive attitude towards US allies had been counterproductive.

The US official said the Biden administration wanted to take a less “ad hoc approach” but would look to some of the studies across the government that have already been done — including on rare earths, other critical minerals and semiconductors — as it crafted its own set of policies to address supply chain gaps and vulnerabilities.