The New York Stock Exchange briefly paused trading on GameStop and AMC stocks shortly before 10:15 a.m. ET, while the Investment Industry Regulatory Organization of Canada (IIROC) announced at 9:54 a.m. ET a temporary suspension of BlackBerry shares.
The moves come as all three stocks have been soaring for a fourth day running, sparking calls for scrutiny of a social media-driven trading frenzy.
You’ve Got Mail: A history of the BlackBerry
The rally has also forced some hedge funds to retreat with heavy losses. Short-seller Citron, a target for some of the individual traders who have helped drive huge gains for a number of niche Wall Street stocks in the past week, said in a video post it had abandoned its bet on GameStop shares falling.
With commentators and lawyers calling for scrutiny of the moves, Nasdaq chief Adena Friedman said exchanges and regulators needed to pay attention to the potential for “pump and dump” schemes driven by chatter on social media.
The Securities and Exchange Commission (SEC) declined to comment.
Mainstream commentators have questioned the justification of moves in a number of heavily-hyped stocks in recent days, at a time when some on Wall Street are wondering if months of stellar overall gains have driven shares into bubble territory.
GameStop’s stock has surged nearly 700 per cent in the past two weeks, upping the struggling video retailer’s market value from $1.24 billion to more than $10 billion. BlackBerry is up 185 per cent and on course for its best month ever.
Along with AMC and Nokia Oyj, the two were again among the most heavily traded in pre-market deals, with Reddit discussion threads again humming with chatter about the stocks.
“These are not normal times and while the (Reddit) … thing is fascinating to watch, I can’t help but think that this is unlikely to end well for someone,” Deutsche Bank strategist Jim Reid said.
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The advent of easily access apps like Robinhood that allow ordinary Americans to make stock market trades at almost no initial cost has spurred a boom in direct investment over the past year as trillions of dollars in official stimulus drove markets higher.
On GameStop, the retail army have pitched themselves against some of the institutional short-sellers — a traditional area for hedge funds — who promote and bet on falls in companies they judge as weak.
Overall, short-sellers in GameStop were down $5 billion on a mark-to-market, net-of-financing basis in 2021, which included $876 million of losses early Tuesday, according to analytics firm S3 Partners.
Barron’s reported late on Tuesday that the top securities regulator in Massachusetts believes trading in GameStop stock suggests there is something “systemically wrong” with the options trading around the stock.
Others say that the trades are at the end of the day up to the investors who make them.
“The SEC has investigated Robinhood before, but when you have a structure in place that allows the zero-cost trading platforms to operate – how do you stop that flow?” said Neil Campling, head of tech media and telecom research at Mirabaud Securities.
Trading in GameStop stock was halted for volatility nine times on Monday and five times on Tuesday.
— With files from Global News money reporter Erica Alini
© 2021 Reuters
India unveils tougher rules for social media such as Facebook, Twitter – The Guardian
By Sankalp Phartiyal and Aditya Kalra
NEW DELHI (Reuters) – India announced new rules on Thursday to regulate big social media firms, such as Facebook and Twitter, the latest effort by Prime Minister Narendra Modi’s government to tighten control over Big Tech firms.
The rules come after Twitter ignored orders to drop content on farmers’ protests, fuelling the government’s zeal, dating from 2018, to clamp down on material it regards as disinformation or unlawful.
The new measures will require big social media companies to set up a grievance redressal mechanism and appoint executives to coordinate with law enforcement, the government said in a news statement.
The government said the guidelines in its code of digital media ethics were needed to hold social media and other companies accountable for misuse and abuse.
Social media firms should be “more responsible and accountable,” Ravi Shankar Prasad, the minister for information technology, told reporters in outlining the rules.
A detailed version of the guidelines is to be published later and take effect three months after that, the government said. It did not specify the date, however.
Facebook said it welcomes rules that prescribe ways to address challenges on the web. “The details of rules like these matter and we will carefully study the new rules,” it said in a statement.
Twitter declined to comment.
On Wednesday, Reuters reported the draft of the rules, which give companies a maximum of 36 hours to remove content after they receive a government or legal order.
Prasad also told reporters the rules would oblige the companies to reveal the originator of a message or posting when asked to do so through a legal order.
Tech firms are coming under tighter scrutiny worldwide. Facebook faced a global backlash last week from publishers and politicians after it blocked news feeds in Australia in a dispute with the government over revenue-sharing.
That prompted last-ditch changes by Australia in a law passed on Thursday to ensure Alphabet Inc’s Google and Facebook Inc pay media companies for content, a step that nations such as Britain and Canada want to follow.
India’s rules will also require video streaming platforms like Netflix and Amazon Prime to classify content into five categories based on users’ age, the government said.
Online news media will also be regulated as part of the new rules, with the ministry of information and broadcasting creating an oversight system, the government added.
Apar Gupta, the executive director at advocacy Internet Freedom Foundation, said the new rules for digital news media portals and video streaming platforms posed risks to freedom of speech.
“To fix the problems in these sectors the government has adopted an approach which carries the risks of political control and censorship,” he said.
(Reporting by Sankalp Pharityal and Aditya Kalra in New Delhi; Editing by Clarence Fernandez, Alexandra Hudson)
India announces sweeping guidelines for social media, on-demand streaming firms, and digital news outlets – Yahoo Movies Canada
India announced sweeping changes to its guidelines for social media, on-demand video streaming services, and digital news outlets on Thursday, posing new challenges for small firms as well as giants such as Facebook and Google that count the nation as its biggest market by users.
Ravi Shankar Prasad, India’s IT, Law, and Justice minister, said in a press conference that social media companies will be required to acknowledge the request within 24 hours and deliver a complete redressal in 15 days. In sensitive cases that surround rape or other sexual nature, firms will be required to takedown the objectionable content within 24 hours.
These firms will also be required to appoint a chief compliance officer, a nodal contact officer, who shall be reachable round the clock, and a resident grievance officer. The firms will also be required to have an office in the country.
For social media companies, Prasad said they will be required to disclose the originator of objectionable content. “We don’t want to know the content, but firms need to be able to tell who was the first person who began spreading misinformation and other objectionable content,” he said. WhatsApp has previously said that it can’t comply with such traceability request without compromising end-to-end encryption security for every user.
Firms will also be required to publish a monthly compliance report to disclose the number of requests they received and what actions they took. They will also be required to offer a voluntary option to users who wish to verify their accounts.
The guidelines go into effect for small firms effective immediately, but bigger services will be provided three months to comply, said Prasad.
New Delhi has put together these guidelines because citizens in India have long requested a “mechanism to address grievances,” said Prasad. India has been working on a law aimed at intermediaries since 2018. This is the first time New Delhi has publicly shared an update on the specifics of the guidelines.
“India is the world’s largest open Internet society and the Government welcomes social media companies to operate in India, do business and also earn profits. However, they will have to be accountable to the Constitution and laws of India,” he said, adding that WhatsApp had amassed 530 million users, YouTube, 448 million users, Facebook’s marquee service 410 million users, Instagram 210 million users, and Twitter, 175 million users in the country.
Full guidelines for social media firms and other intermediaries. (Source: Indian government.)
For streaming platforms, the draft, which will be legally enforceable when it becomes a law, has outlined a three-tier structure for “observance and adherence to the code.” Until now, on-demand services such as Netflix, Disney+ Hotstar, and MX Player have operated in India with little to no censorship.
New Delhi last year said India’s broadcasting ministry, which regulates content on TV, will also be overseeing digital streaming platforms. 17 popular streaming firms had banded together to devise a self-regulation code. Prakash Javedkar, Minister of Information and Broadcasting, said the proposed solution from the industry wasn’t adequate and there will be an oversight mechanism from the government to ensure compliance of code of practices.
Streaming services will also have to attach a content ratings to their titles. “The OTT platforms, called as the publishers of online curated content in the rules, would self-classify the content into five age based categories- U (Universal), U/A 7+, U/A 13+, U/A 16+, and A (Adult). Platforms would be required to implement parental locks for content classified as U/A 13+ or higher, and reliable age verification mechanisms for content classified as “A”,” the Indian government said.
“The publisher of online curated content shall prominently display the classification rating specific to each content or programme together with a content descriptor informing the user about the nature of the content, and advising on viewer description (if applicable) at the beginning of every programme enabling the user to make an informed decision, prior to watching the programme.”
Digital news outlets will be required to disclose the size of their reach and structure of their ownership.
Industry executives have expressed concerns over the new proposed regulation, saying New Delhi hasn’t consulted them for these changes. IAMAI, a powerful industry body that represents nearly all on-demand streaming services, said it was “dismayed” by the guidelines, and hoped to have a dialogue with the government.
Javedkar and Prasad were asked if there will be any consultation with the industry before these guidelines become law. The ministers said that they had already received enough inputs from the industry.
This is a developing story. More to follow…
Australia passes law to make Google and Facebook pay media companies for news content – Financial Post
Australia will be the first country where a government arbitrator will decide the price to be paid by the tech giants if commercial negotiations with local news outlets fail
CANBERRA — The Australian parliament on Thursday passed a new law designed to force Alphabet Inc’s Google and Facebook Inc to pay media companies for content used on their platforms in reforms that could be replicated in other countries.
Australia will be the first country where a government arbitrator will decide the price to be paid by the tech giants if commercial negotiations with local news outlets fail.
The legislation was watered down, however, at the last minute after a standoff between the government and Facebook culminated in the social media company blocking all news for Australian users.
Subsequent amendments to the bill included giving the government the discretion to release Facebook or Google from the arbitration process if they prove they have made a “significant contribution” to the Australian news industry.
Some lawmakers and publishers have warned that could unfairly leave smaller media companies out in the cold, but both the government and Facebook have claimed the revised legislation as a win.
“The code will ensure that news media businesses are fairly remunerated for the content they generate, helping to sustain public-interest journalism in Australia,” Treasurer Josh Frydenberg and Communications Minister Paul Fletcher said in a joint statement on Thursday.
The progress of the legislation has been closely watched around the world as countries including Canada and Britain consider similar steps to rein in the dominant tech platforms.
The revised code, which also includes a longer period for the tech companies to strike deals with media companies before the state intervenes, will be reviewed within one year of its commencement, the statement said. It did not provide a start date.
The legislation does not specifically name Facebook or Google. Frydenberg said earlier this week he will wait for the tech giants to strike commercial deals with media companies before deciding whether to compel both to do so under the new law.
Google has struck a series of deals with publishers, including a global content arrangement with News Corp, after earlier threatening to withdraw its search engine from Australia over the laws.
Several media companies, including Seven West Media , Nine Entertainment and the Australian Broadcasting Corp have said they are in talks with Facebook.
Representatives for both Google and Facebook did not immediately respond to requests from Reuters for comment on Thursday.
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