• Ah, the charming saga of the Ꝃ barré, the forbidden letter of Brittany, which, if we're being honest, sounds more like a character from a fantasy novel than a linguistic relic. Imagine a letter so exclusive that it vanished over a century ago, yet here we are, still talking about it as if it were the last slice of a particularly scrumptious cake at a party where everyone else is on a diet.

    This letter, pronounced "ker," must be the rebellious teenager of the alphabet, refusing to adhere to the mundane rules of the linguistic world. Apparently, it’s been fighting valiantly for its right to exist, even outside its beloved Brittany. Talk about dedication! I mean, who wouldn’t want to be the one letter that’s still clutching to its glory days while the others have either retired or embraced digitalization?

    Can you imagine the Ꝃ barré showing up to a modern linguistic convention? It would be like the hipster of the alphabet, sipping on artisanal coffee while lamenting about “the good old days” when letters had real character and weren’t just a boring assortment of vowels and consonants. "Remember when I was the life of the party?" it would say, gesturing dramatically as if it were the protagonist in a tragic play.

    But let’s not forget the irony here. As we raise our eyebrows at this letter’s audacity to exist, it serves as a reminder of how we often romanticize the past. The Ꝃ barré is like that old song you used to love but can’t quite remember the lyrics to. You know it was great, but is it really worth reviving? Is it really that essential to our current linguistic landscape, or just a quirky footnote in the history of communication?

    And then there’s the whole notion of "interdiction." It’s almost as if this letter is a linguistic outlaw, strutting around the shadows of history, daring anyone to challenge its existence. What’s next? A “Free the Ꝃ barré” campaign? T-shirts, bumper stickers, maybe even a social media movement? Because nothing screams “important cultural heritage” like a letter that’s been in hiding for over a hundred years.

    So, let’s raise a toast to the Ꝃ barré! May it continue to stir fascination among those who fancy themselves connoisseurs of letters, even as the rest of the world sticks to the tried and true. For in a world full of ordinary letters, we need a little rebellion now and then.

    #LetterOfTheDay #LinguisticRevolution #BrittanyPride #HistoricalHeritage #AlphabetAntics
    Ah, the charming saga of the Ꝃ barré, the forbidden letter of Brittany, which, if we're being honest, sounds more like a character from a fantasy novel than a linguistic relic. Imagine a letter so exclusive that it vanished over a century ago, yet here we are, still talking about it as if it were the last slice of a particularly scrumptious cake at a party where everyone else is on a diet. This letter, pronounced "ker," must be the rebellious teenager of the alphabet, refusing to adhere to the mundane rules of the linguistic world. Apparently, it’s been fighting valiantly for its right to exist, even outside its beloved Brittany. Talk about dedication! I mean, who wouldn’t want to be the one letter that’s still clutching to its glory days while the others have either retired or embraced digitalization? Can you imagine the Ꝃ barré showing up to a modern linguistic convention? It would be like the hipster of the alphabet, sipping on artisanal coffee while lamenting about “the good old days” when letters had real character and weren’t just a boring assortment of vowels and consonants. "Remember when I was the life of the party?" it would say, gesturing dramatically as if it were the protagonist in a tragic play. But let’s not forget the irony here. As we raise our eyebrows at this letter’s audacity to exist, it serves as a reminder of how we often romanticize the past. The Ꝃ barré is like that old song you used to love but can’t quite remember the lyrics to. You know it was great, but is it really worth reviving? Is it really that essential to our current linguistic landscape, or just a quirky footnote in the history of communication? And then there’s the whole notion of "interdiction." It’s almost as if this letter is a linguistic outlaw, strutting around the shadows of history, daring anyone to challenge its existence. What’s next? A “Free the Ꝃ barré” campaign? T-shirts, bumper stickers, maybe even a social media movement? Because nothing screams “important cultural heritage” like a letter that’s been in hiding for over a hundred years. So, let’s raise a toast to the Ꝃ barré! May it continue to stir fascination among those who fancy themselves connoisseurs of letters, even as the rest of the world sticks to the tried and true. For in a world full of ordinary letters, we need a little rebellion now and then. #LetterOfTheDay #LinguisticRevolution #BrittanyPride #HistoricalHeritage #AlphabetAntics
    Le Ꝃ barré : la lettre interdite de Bretagne
    Disparu il y a plus d'un siècle, la lettre Ꝃ "k barré", prononcé ker, continue pourtant de fasciner et se bat pour exister, même hors de Bretagne. L’article Le Ꝃ barré : la lettre interdite de Bretagne est apparu en premier sur Graphéine - Agence de
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  • Waymo limits service ahead of today’s ‘No Kings’ protests

    In Brief

    Posted:
    10:54 AM PDT · June 14, 2025

    Image Credits:Mario Tama / Getty Images

    Waymo limits service ahead of today’s ‘No Kings’ protests

    Alphabet-owned robotaxi company Waymo is limiting service due to Saturday’s scheduled nationwide “No Kings” protests against President Donald Trump and his policies.
    A Waymo spokesperson confirmed the changes to Wired on Friday. Service is reportedly affected in San Francisco, Austin, Atlanta, and Phoenix, and is entirely suspended in Los Angeles. It’s not clear how long the limited service will last.
    As part of protests last weekend in Los Angeles against the Trump administration’s immigration crackdown, five Waymo vehicles were set on fire and spray painted with anti-Immigration and Customs Enforcementmessages. In response, Waymo suspended service in downtown LA.
    While it’s not entirely clear why protestors targeted the vehicles, they may be seen as a surveillance tool, as police departments have requested robotaxi footage for their investigations in the past.According to the San Francisco Chronicle, the city’s fire chief told officials Wednesday that “in a period of civil unrest, we will not try to extinguish those fires unless they are up against a building.”

    Topics
    #waymo #limits #service #ahead #todays
    Waymo limits service ahead of today’s ‘No Kings’ protests
    In Brief Posted: 10:54 AM PDT · June 14, 2025 Image Credits:Mario Tama / Getty Images Waymo limits service ahead of today’s ‘No Kings’ protests Alphabet-owned robotaxi company Waymo is limiting service due to Saturday’s scheduled nationwide “No Kings” protests against President Donald Trump and his policies. A Waymo spokesperson confirmed the changes to Wired on Friday. Service is reportedly affected in San Francisco, Austin, Atlanta, and Phoenix, and is entirely suspended in Los Angeles. It’s not clear how long the limited service will last. As part of protests last weekend in Los Angeles against the Trump administration’s immigration crackdown, five Waymo vehicles were set on fire and spray painted with anti-Immigration and Customs Enforcementmessages. In response, Waymo suspended service in downtown LA. While it’s not entirely clear why protestors targeted the vehicles, they may be seen as a surveillance tool, as police departments have requested robotaxi footage for their investigations in the past.According to the San Francisco Chronicle, the city’s fire chief told officials Wednesday that “in a period of civil unrest, we will not try to extinguish those fires unless they are up against a building.” Topics #waymo #limits #service #ahead #todays
    TECHCRUNCH.COM
    Waymo limits service ahead of today’s ‘No Kings’ protests
    In Brief Posted: 10:54 AM PDT · June 14, 2025 Image Credits:Mario Tama / Getty Images Waymo limits service ahead of today’s ‘No Kings’ protests Alphabet-owned robotaxi company Waymo is limiting service due to Saturday’s scheduled nationwide “No Kings” protests against President Donald Trump and his policies. A Waymo spokesperson confirmed the changes to Wired on Friday. Service is reportedly affected in San Francisco, Austin, Atlanta, and Phoenix, and is entirely suspended in Los Angeles. It’s not clear how long the limited service will last. As part of protests last weekend in Los Angeles against the Trump administration’s immigration crackdown, five Waymo vehicles were set on fire and spray painted with anti-Immigration and Customs Enforcement (ICE) messages. In response, Waymo suspended service in downtown LA. While it’s not entirely clear why protestors targeted the vehicles, they may be seen as a surveillance tool, as police departments have requested robotaxi footage for their investigations in the past. (Waymo says it challenges requests that it sees as overly broad or lacking a legal basis.) According to the San Francisco Chronicle, the city’s fire chief told officials Wednesday that “in a period of civil unrest, we will not try to extinguish those fires unless they are up against a building.” Topics
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  • From Rivals to Partners: What’s Up with the Google and OpenAI Cloud Deal?

    Google and OpenAI struck a cloud computing deal in May, according to a Reuters report.
    The deal surprised the industry as the two are seen as major AI rivals.
    Signs of friction between OpenAI and Microsoft may have also fueled the move.
    The partnership is a win-win.OpenAI gets more badly needed computing resources while Google profits from its B investment to boost its cloud computing capacity in 2025.

    In a surprise move, Google and OpenAI inked a deal that will see the AI rivals partnering to address OpenAI’s growing cloud computing needs.
    The story, reported by Reuters, cited anonymous sources saying that the deal had been discussed for months and finalized in May. Around this time, OpenAI has struggled to keep up with demand as its number of weekly active users and business users grew in Q1 2025. There’s also speculation of friction between OpenAI and its biggest investor Microsoft.
    Why the Deal Surprised the Tech Industry
    The rivalry between the two companies hardly needs an introduction. When OpenAI’s ChatGPT launched in November 2022, it posed a huge threat to Google that triggered a code red within the search giant and cloud services provider.
    Since then, Google has launched Bardto compete with OpenAI head-on. However, it had to play catch up with OpenAI’s more advanced ChatGPT AI chatbot. This led to numerous issues with Bard, with critics referring to it as a half-baked product.

    A post on X in February 2023 showed the Bard AI chatbot erroneously stating that the James Webb Telescope took the first picture of an exoplanet. It was, in fact, the European Southern Observatory’s Very Large Telescope that did this in 2004. Google’s parent company Alphabet lost B off its market value within 24 hours as a result.
    Two years on, Gemini made significant strides in terms of accuracy, quoting sources, and depth of information, but is still prone to hallucinations from time to time. You can see examples of these posted on social media, like telling a user to make spicy spaghetti with gasoline or the AI thinking it’s still 2024. 
    And then there’s this gem:

    With the entire industry shifting towards more AI integrations, Google went ahead and integrated its AI suite into Search via AI Overviews. It then doubled down on this integration with AI Mode, an experimental feature that lets you perform AI-powered searches by typing in a question, uploading a photo, or using your voice.
    In the future, AI Mode from Google Search could be a viable competitor to ChatGPT—unless of course, Google decides to bin it along with many of its previous products. Given the scope of the investment, and Gemini’s significant improvement, we doubt AI + Search will be axed.
    It’s a Win-Win for Google and OpenAI—Not So Much for Microsoft?
    In the business world, money and the desire for expansion can break even the biggest rivalries. And the one between the two tech giants isn’t an exception.
    Partly, it could be attributed to OpenAI’s relationship with Microsoft. Although the Redmond, Washington-based company has invested billions in OpenAI and has the resources to meet the latter’s cloud computing needs, their partnership hasn’t always been rosy. 
    Some would say it began when OpenAI CEO Sam Altman was briefly ousted in November 2023, which put a strain on the ‘best bromance in tech’ between him and Microsoft CEO Satya Nadella. Then last year, Microsoft added OpenAI to its list of competitors in the AI space before eventually losing its status as OpenAI’s exclusive cloud provider in January 2025.
    If that wasn’t enough, there’s also the matter of the two companies’ goal of achieving artificial general intelligence. Defined as when OpenAI develops AI systems that generate B in profits, reaching AGI means Microsoft will lose access to the former’s technology. With the company behind ChatGPT expecting to triple its 2025 revenue to from B the previous year, this could happen sooner rather than later.
    While OpenAI already has deals with Microsoft, Oracle, and CoreWeave to provide it with cloud services and access to infrastructure, it needs more and soon as the company has seen massive growth in the past few months.
    In February, OpenAI announced that it had over 400M weekly active users, up from 300M in December 2024. Meanwhile, the number of its business users who use ChatGPT Enterprise, ChatGPT Team, and ChatGPT Edu products also jumped from 2M in February to 3M in March.
    The good news is Google is more than ready to deliver. Its parent company has earmarked B towards its investments in AI this year, which includes boosting its cloud computing capacity.

    In April, Google launched its 7th generation tensor processing unitcalled Ironwood, which has been designed specifically for inference. According to the company, the new TPU will help power AI models that will ‘proactively retrieve and generate data to collaboratively deliver insights and answers, not just data.’The deal with OpenAI can be seen as a vote of confidence in Google’s cloud computing capability that competes with the likes of Microsoft Azure and Amazon Web Services. It also expands Google’s vast client list that includes tech, gaming, entertainment, and retail companies, as well as organizations in the public sector.

    As technology continues to evolve—from the return of 'dumbphones' to faster and sleeker computers—seasoned tech journalist, Cedric Solidon, continues to dedicate himself to writing stories that inform, empower, and connect with readers across all levels of digital literacy.
    With 20 years of professional writing experience, this University of the Philippines Journalism graduate has carved out a niche as a trusted voice in tech media. Whether he's breaking down the latest advancements in cybersecurity or explaining how silicon-carbon batteries can extend your phone’s battery life, his writing remains rooted in clarity, curiosity, and utility.
    Long before he was writing for Techreport, HP, Citrix, SAP, Globe Telecom, CyberGhost VPN, and ExpressVPN, Cedric's love for technology began at home courtesy of a Nintendo Family Computer and a stack of tech magazines.
    Growing up, his days were often filled with sessions of Contra, Bomberman, Red Alert 2, and the criminally underrated Crusader: No Regret. But gaming wasn't his only gateway to tech. 
    He devoured every T3, PCMag, and PC Gamer issue he could get his hands on, often reading them cover to cover. It wasn’t long before he explored the early web in IRC chatrooms, online forums, and fledgling tech blogs, soaking in every byte of knowledge from the late '90s and early 2000s internet boom.
    That fascination with tech didn’t just stick. It evolved into a full-blown calling.
    After graduating with a degree in Journalism, he began his writing career at the dawn of Web 2.0. What started with small editorial roles and freelance gigs soon grew into a full-fledged career.
    He has since collaborated with global tech leaders, lending his voice to content that bridges technical expertise with everyday usability. He’s also written annual reports for Globe Telecom and consumer-friendly guides for VPN companies like CyberGhost and ExpressVPN, empowering readers to understand the importance of digital privacy.
    His versatility spans not just tech journalism but also technical writing. He once worked with a local tech company developing web and mobile apps for logistics firms, crafting documentation and communication materials that brought together user-friendliness with deep technical understanding. That experience sharpened his ability to break down dense, often jargon-heavy material into content that speaks clearly to both developers and decision-makers.
    At the heart of his work lies a simple belief: technology should feel empowering, not intimidating. Even if the likes of smartphones and AI are now commonplace, he understands that there's still a knowledge gap, especially when it comes to hardware or the real-world benefits of new tools. His writing hopes to help close that gap.
    Cedric’s writing style reflects that mission. It’s friendly without being fluffy and informative without being overwhelming. Whether writing for seasoned IT professionals or casual readers curious about the latest gadgets, he focuses on how a piece of technology can improve our lives, boost our productivity, or make our work more efficient. That human-first approach makes his content feel more like a conversation than a technical manual.
    As his writing career progresses, his passion for tech journalism remains as strong as ever. With the growing need for accessible, responsible tech communication, he sees his role not just as a journalist but as a guide who helps readers navigate a digital world that’s often as confusing as it is exciting.
    From reviewing the latest devices to unpacking global tech trends, Cedric isn’t just reporting on the future; he’s helping to write it.

    View all articles by Cedric Solidon

    Our editorial process

    The Tech Report editorial policy is centered on providing helpful, accurate content that offers real value to our readers. We only work with experienced writers who have specific knowledge in the topics they cover, including latest developments in technology, online privacy, cryptocurrencies, software, and more. Our editorial policy ensures that each topic is researched and curated by our in-house editors. We maintain rigorous journalistic standards, and every article is 100% written by real authors.
    #rivals #partners #whats #with #google
    From Rivals to Partners: What’s Up with the Google and OpenAI Cloud Deal?
    Google and OpenAI struck a cloud computing deal in May, according to a Reuters report. The deal surprised the industry as the two are seen as major AI rivals. Signs of friction between OpenAI and Microsoft may have also fueled the move. The partnership is a win-win.OpenAI gets more badly needed computing resources while Google profits from its B investment to boost its cloud computing capacity in 2025. In a surprise move, Google and OpenAI inked a deal that will see the AI rivals partnering to address OpenAI’s growing cloud computing needs. The story, reported by Reuters, cited anonymous sources saying that the deal had been discussed for months and finalized in May. Around this time, OpenAI has struggled to keep up with demand as its number of weekly active users and business users grew in Q1 2025. There’s also speculation of friction between OpenAI and its biggest investor Microsoft. Why the Deal Surprised the Tech Industry The rivalry between the two companies hardly needs an introduction. When OpenAI’s ChatGPT launched in November 2022, it posed a huge threat to Google that triggered a code red within the search giant and cloud services provider. Since then, Google has launched Bardto compete with OpenAI head-on. However, it had to play catch up with OpenAI’s more advanced ChatGPT AI chatbot. This led to numerous issues with Bard, with critics referring to it as a half-baked product. A post on X in February 2023 showed the Bard AI chatbot erroneously stating that the James Webb Telescope took the first picture of an exoplanet. It was, in fact, the European Southern Observatory’s Very Large Telescope that did this in 2004. Google’s parent company Alphabet lost B off its market value within 24 hours as a result. Two years on, Gemini made significant strides in terms of accuracy, quoting sources, and depth of information, but is still prone to hallucinations from time to time. You can see examples of these posted on social media, like telling a user to make spicy spaghetti with gasoline or the AI thinking it’s still 2024.  And then there’s this gem: With the entire industry shifting towards more AI integrations, Google went ahead and integrated its AI suite into Search via AI Overviews. It then doubled down on this integration with AI Mode, an experimental feature that lets you perform AI-powered searches by typing in a question, uploading a photo, or using your voice. In the future, AI Mode from Google Search could be a viable competitor to ChatGPT—unless of course, Google decides to bin it along with many of its previous products. Given the scope of the investment, and Gemini’s significant improvement, we doubt AI + Search will be axed. It’s a Win-Win for Google and OpenAI—Not So Much for Microsoft? In the business world, money and the desire for expansion can break even the biggest rivalries. And the one between the two tech giants isn’t an exception. Partly, it could be attributed to OpenAI’s relationship with Microsoft. Although the Redmond, Washington-based company has invested billions in OpenAI and has the resources to meet the latter’s cloud computing needs, their partnership hasn’t always been rosy.  Some would say it began when OpenAI CEO Sam Altman was briefly ousted in November 2023, which put a strain on the ‘best bromance in tech’ between him and Microsoft CEO Satya Nadella. Then last year, Microsoft added OpenAI to its list of competitors in the AI space before eventually losing its status as OpenAI’s exclusive cloud provider in January 2025. If that wasn’t enough, there’s also the matter of the two companies’ goal of achieving artificial general intelligence. Defined as when OpenAI develops AI systems that generate B in profits, reaching AGI means Microsoft will lose access to the former’s technology. With the company behind ChatGPT expecting to triple its 2025 revenue to from B the previous year, this could happen sooner rather than later. While OpenAI already has deals with Microsoft, Oracle, and CoreWeave to provide it with cloud services and access to infrastructure, it needs more and soon as the company has seen massive growth in the past few months. In February, OpenAI announced that it had over 400M weekly active users, up from 300M in December 2024. Meanwhile, the number of its business users who use ChatGPT Enterprise, ChatGPT Team, and ChatGPT Edu products also jumped from 2M in February to 3M in March. The good news is Google is more than ready to deliver. Its parent company has earmarked B towards its investments in AI this year, which includes boosting its cloud computing capacity. In April, Google launched its 7th generation tensor processing unitcalled Ironwood, which has been designed specifically for inference. According to the company, the new TPU will help power AI models that will ‘proactively retrieve and generate data to collaboratively deliver insights and answers, not just data.’The deal with OpenAI can be seen as a vote of confidence in Google’s cloud computing capability that competes with the likes of Microsoft Azure and Amazon Web Services. It also expands Google’s vast client list that includes tech, gaming, entertainment, and retail companies, as well as organizations in the public sector. As technology continues to evolve—from the return of 'dumbphones' to faster and sleeker computers—seasoned tech journalist, Cedric Solidon, continues to dedicate himself to writing stories that inform, empower, and connect with readers across all levels of digital literacy. With 20 years of professional writing experience, this University of the Philippines Journalism graduate has carved out a niche as a trusted voice in tech media. Whether he's breaking down the latest advancements in cybersecurity or explaining how silicon-carbon batteries can extend your phone’s battery life, his writing remains rooted in clarity, curiosity, and utility. Long before he was writing for Techreport, HP, Citrix, SAP, Globe Telecom, CyberGhost VPN, and ExpressVPN, Cedric's love for technology began at home courtesy of a Nintendo Family Computer and a stack of tech magazines. Growing up, his days were often filled with sessions of Contra, Bomberman, Red Alert 2, and the criminally underrated Crusader: No Regret. But gaming wasn't his only gateway to tech.  He devoured every T3, PCMag, and PC Gamer issue he could get his hands on, often reading them cover to cover. It wasn’t long before he explored the early web in IRC chatrooms, online forums, and fledgling tech blogs, soaking in every byte of knowledge from the late '90s and early 2000s internet boom. That fascination with tech didn’t just stick. It evolved into a full-blown calling. After graduating with a degree in Journalism, he began his writing career at the dawn of Web 2.0. What started with small editorial roles and freelance gigs soon grew into a full-fledged career. He has since collaborated with global tech leaders, lending his voice to content that bridges technical expertise with everyday usability. He’s also written annual reports for Globe Telecom and consumer-friendly guides for VPN companies like CyberGhost and ExpressVPN, empowering readers to understand the importance of digital privacy. His versatility spans not just tech journalism but also technical writing. He once worked with a local tech company developing web and mobile apps for logistics firms, crafting documentation and communication materials that brought together user-friendliness with deep technical understanding. That experience sharpened his ability to break down dense, often jargon-heavy material into content that speaks clearly to both developers and decision-makers. At the heart of his work lies a simple belief: technology should feel empowering, not intimidating. Even if the likes of smartphones and AI are now commonplace, he understands that there's still a knowledge gap, especially when it comes to hardware or the real-world benefits of new tools. His writing hopes to help close that gap. Cedric’s writing style reflects that mission. It’s friendly without being fluffy and informative without being overwhelming. Whether writing for seasoned IT professionals or casual readers curious about the latest gadgets, he focuses on how a piece of technology can improve our lives, boost our productivity, or make our work more efficient. That human-first approach makes his content feel more like a conversation than a technical manual. As his writing career progresses, his passion for tech journalism remains as strong as ever. With the growing need for accessible, responsible tech communication, he sees his role not just as a journalist but as a guide who helps readers navigate a digital world that’s often as confusing as it is exciting. From reviewing the latest devices to unpacking global tech trends, Cedric isn’t just reporting on the future; he’s helping to write it. View all articles by Cedric Solidon Our editorial process The Tech Report editorial policy is centered on providing helpful, accurate content that offers real value to our readers. We only work with experienced writers who have specific knowledge in the topics they cover, including latest developments in technology, online privacy, cryptocurrencies, software, and more. Our editorial policy ensures that each topic is researched and curated by our in-house editors. We maintain rigorous journalistic standards, and every article is 100% written by real authors. #rivals #partners #whats #with #google
    TECHREPORT.COM
    From Rivals to Partners: What’s Up with the Google and OpenAI Cloud Deal?
    Google and OpenAI struck a cloud computing deal in May, according to a Reuters report. The deal surprised the industry as the two are seen as major AI rivals. Signs of friction between OpenAI and Microsoft may have also fueled the move. The partnership is a win-win.OpenAI gets more badly needed computing resources while Google profits from its $75B investment to boost its cloud computing capacity in 2025. In a surprise move, Google and OpenAI inked a deal that will see the AI rivals partnering to address OpenAI’s growing cloud computing needs. The story, reported by Reuters, cited anonymous sources saying that the deal had been discussed for months and finalized in May. Around this time, OpenAI has struggled to keep up with demand as its number of weekly active users and business users grew in Q1 2025. There’s also speculation of friction between OpenAI and its biggest investor Microsoft. Why the Deal Surprised the Tech Industry The rivalry between the two companies hardly needs an introduction. When OpenAI’s ChatGPT launched in November 2022, it posed a huge threat to Google that triggered a code red within the search giant and cloud services provider. Since then, Google has launched Bard (now known as Gemini) to compete with OpenAI head-on. However, it had to play catch up with OpenAI’s more advanced ChatGPT AI chatbot. This led to numerous issues with Bard, with critics referring to it as a half-baked product. A post on X in February 2023 showed the Bard AI chatbot erroneously stating that the James Webb Telescope took the first picture of an exoplanet. It was, in fact, the European Southern Observatory’s Very Large Telescope that did this in 2004. Google’s parent company Alphabet lost $100B off its market value within 24 hours as a result. Two years on, Gemini made significant strides in terms of accuracy, quoting sources, and depth of information, but is still prone to hallucinations from time to time. You can see examples of these posted on social media, like telling a user to make spicy spaghetti with gasoline or the AI thinking it’s still 2024.  And then there’s this gem: With the entire industry shifting towards more AI integrations, Google went ahead and integrated its AI suite into Search via AI Overviews. It then doubled down on this integration with AI Mode, an experimental feature that lets you perform AI-powered searches by typing in a question, uploading a photo, or using your voice. In the future, AI Mode from Google Search could be a viable competitor to ChatGPT—unless of course, Google decides to bin it along with many of its previous products. Given the scope of the investment, and Gemini’s significant improvement, we doubt AI + Search will be axed. It’s a Win-Win for Google and OpenAI—Not So Much for Microsoft? In the business world, money and the desire for expansion can break even the biggest rivalries. And the one between the two tech giants isn’t an exception. Partly, it could be attributed to OpenAI’s relationship with Microsoft. Although the Redmond, Washington-based company has invested billions in OpenAI and has the resources to meet the latter’s cloud computing needs, their partnership hasn’t always been rosy.  Some would say it began when OpenAI CEO Sam Altman was briefly ousted in November 2023, which put a strain on the ‘best bromance in tech’ between him and Microsoft CEO Satya Nadella. Then last year, Microsoft added OpenAI to its list of competitors in the AI space before eventually losing its status as OpenAI’s exclusive cloud provider in January 2025. If that wasn’t enough, there’s also the matter of the two companies’ goal of achieving artificial general intelligence (AGI). Defined as when OpenAI develops AI systems that generate $100B in profits, reaching AGI means Microsoft will lose access to the former’s technology. With the company behind ChatGPT expecting to triple its 2025 revenue to $12.7 from $3.7B the previous year, this could happen sooner rather than later. While OpenAI already has deals with Microsoft, Oracle, and CoreWeave to provide it with cloud services and access to infrastructure, it needs more and soon as the company has seen massive growth in the past few months. In February, OpenAI announced that it had over 400M weekly active users, up from 300M in December 2024. Meanwhile, the number of its business users who use ChatGPT Enterprise, ChatGPT Team, and ChatGPT Edu products also jumped from 2M in February to 3M in March. The good news is Google is more than ready to deliver. Its parent company has earmarked $75B towards its investments in AI this year, which includes boosting its cloud computing capacity. In April, Google launched its 7th generation tensor processing unit (TPU) called Ironwood, which has been designed specifically for inference. According to the company, the new TPU will help power AI models that will ‘proactively retrieve and generate data to collaboratively deliver insights and answers, not just data.’The deal with OpenAI can be seen as a vote of confidence in Google’s cloud computing capability that competes with the likes of Microsoft Azure and Amazon Web Services. It also expands Google’s vast client list that includes tech, gaming, entertainment, and retail companies, as well as organizations in the public sector. As technology continues to evolve—from the return of 'dumbphones' to faster and sleeker computers—seasoned tech journalist, Cedric Solidon, continues to dedicate himself to writing stories that inform, empower, and connect with readers across all levels of digital literacy. With 20 years of professional writing experience, this University of the Philippines Journalism graduate has carved out a niche as a trusted voice in tech media. Whether he's breaking down the latest advancements in cybersecurity or explaining how silicon-carbon batteries can extend your phone’s battery life, his writing remains rooted in clarity, curiosity, and utility. Long before he was writing for Techreport, HP, Citrix, SAP, Globe Telecom, CyberGhost VPN, and ExpressVPN, Cedric's love for technology began at home courtesy of a Nintendo Family Computer and a stack of tech magazines. Growing up, his days were often filled with sessions of Contra, Bomberman, Red Alert 2, and the criminally underrated Crusader: No Regret. But gaming wasn't his only gateway to tech.  He devoured every T3, PCMag, and PC Gamer issue he could get his hands on, often reading them cover to cover. It wasn’t long before he explored the early web in IRC chatrooms, online forums, and fledgling tech blogs, soaking in every byte of knowledge from the late '90s and early 2000s internet boom. That fascination with tech didn’t just stick. It evolved into a full-blown calling. After graduating with a degree in Journalism, he began his writing career at the dawn of Web 2.0. What started with small editorial roles and freelance gigs soon grew into a full-fledged career. He has since collaborated with global tech leaders, lending his voice to content that bridges technical expertise with everyday usability. He’s also written annual reports for Globe Telecom and consumer-friendly guides for VPN companies like CyberGhost and ExpressVPN, empowering readers to understand the importance of digital privacy. His versatility spans not just tech journalism but also technical writing. He once worked with a local tech company developing web and mobile apps for logistics firms, crafting documentation and communication materials that brought together user-friendliness with deep technical understanding. That experience sharpened his ability to break down dense, often jargon-heavy material into content that speaks clearly to both developers and decision-makers. At the heart of his work lies a simple belief: technology should feel empowering, not intimidating. Even if the likes of smartphones and AI are now commonplace, he understands that there's still a knowledge gap, especially when it comes to hardware or the real-world benefits of new tools. His writing hopes to help close that gap. Cedric’s writing style reflects that mission. It’s friendly without being fluffy and informative without being overwhelming. Whether writing for seasoned IT professionals or casual readers curious about the latest gadgets, he focuses on how a piece of technology can improve our lives, boost our productivity, or make our work more efficient. That human-first approach makes his content feel more like a conversation than a technical manual. As his writing career progresses, his passion for tech journalism remains as strong as ever. With the growing need for accessible, responsible tech communication, he sees his role not just as a journalist but as a guide who helps readers navigate a digital world that’s often as confusing as it is exciting. From reviewing the latest devices to unpacking global tech trends, Cedric isn’t just reporting on the future; he’s helping to write it. View all articles by Cedric Solidon Our editorial process The Tech Report editorial policy is centered on providing helpful, accurate content that offers real value to our readers. We only work with experienced writers who have specific knowledge in the topics they cover, including latest developments in technology, online privacy, cryptocurrencies, software, and more. Our editorial policy ensures that each topic is researched and curated by our in-house editors. We maintain rigorous journalistic standards, and every article is 100% written by real authors.
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  • The hidden time bomb in the tax code that's fueling mass tech layoffs: A decades-old tax rule helped build America's tech economy. A quiet change under Trump helped dismantle it

    For the past two years, it’s been a ghost in the machine of American tech. Between 2022 and today, a little-noticed tweak to the U.S. tax code has quietly rewired the financial logic of how American companies invest in research and development. Outside of CFO and accounting circles, almost no one knew it existed. “I work on these tax write-offs and still hadn’t heard about this,” a chief operating officer at a private-equity-backed tech company told Quartz. “It’s just been so weirdly silent.”AdvertisementStill, the delayed change to a decades-old tax provision — buried deep in the 2017 tax law — has contributed to the loss of hundreds of thousands of high-paying, white-collar jobs. That’s the picture that emerges from a review of corporate filings, public financial data, analysis of timelines, and interviews with industry insiders. One accountant, working in-house at a tech company, described it as a “niche issue with broad impact,” echoing sentiments from venture capital investors also interviewed for this article. Some spoke on condition of anonymity to discuss sensitive political matters.Since the start of 2023, more than half-a-million tech workers have been laid off, according to industry tallies. Headlines have blamed over-hiring during the pandemic and, more recently, AI. But beneath the surface was a hidden accelerant: a change to what’s known as Section 174 that helped gut in-house software and product development teams everywhere from tech giants such as Microsoftand Metato much smaller, private, direct-to-consumer and other internet-first companies.Now, as a bipartisan effort to repeal the Section 174 change moves through Congress, bigger questions are surfacing: How did a single line in the tax code help trigger a tsunami of mass layoffs? And why did no one see it coming? For almost 70 years, American companies could deduct 100% of qualified research and development spending in the year they incurred the costs. Salaries, software, contractor payments — if it contributed to creating or improving a product, it came off the top of a firm’s taxable income.AdvertisementThe deduction was guaranteed by Section 174 of the IRS Code of 1954, and under the provision, R&D flourished in the U.S.Microsoft was founded in 1975. Applelaunched its first computer in 1976. Googleincorporated in 1998. Facebook opened to the general public in 2006. All these companies, now among the most valuable in the world, developed their earliest products — programming tools, hardware, search engines — under a tax system that rewarded building now, not later.The subsequent rise of smartphones, cloud computing, and mobile apps also happened in an America where companies could immediately write off their investments in engineering, infrastructure, and experimentation. It was a baseline assumption — innovation and risk-taking subsidized by the tax code — that shaped how founders operated and how investors made decisions.In turn, tech companies largely built their products in the U.S. AdvertisementMicrosoft’s operating systems were coded in Washington state. Apple’s early hardware and software teams were in California. Google’s search engine was born at Stanford and scaled from Mountain View. Facebook’s entire social architecture was developed in Menlo Park. The deduction directly incentivized keeping R&D close to home, rewarding companies for investing in American workers, engineers, and infrastructure.That’s what makes the politics of Section 174 so revealing. For all the rhetoric about bringing jobs back and making things in America, the first Trump administration’s major tax bill arguably helped accomplish the opposite.When Congress passed the Tax Cuts and Jobs Act, the signature legislative achievement of President Donald Trump’s first term, it slashed the corporate tax rate from 35% to 21% — a massive revenue loss on paper for the federal government.To make the 2017 bill comply with Senate budget rules, lawmakers needed to offset the cost. So they added future tax hikes that wouldn’t kick in right away, wouldn’t provoke immediate backlash from businesses, and could, in theory, be quietly repealed later.AdvertisementThe delayed change to Section 174 — from immediate expensing of R&D to mandatory amortization, meaning that companies must spread the deduction out in smaller chunks over five or even 15-year periods — was that kind of provision. It didn’t start affecting the budget until 2022, but it helped the TCJA appear “deficit neutral” over the 10-year window used for legislative scoring.The delay wasn’t a technical necessity. It was a political tactic. Such moves are common in tax legislation. Phase-ins and delayed provisions let lawmakers game how the Congressional Budget Office— Congress’ nonpartisan analyst of how bills impact budgets and deficits — scores legislation, pushing costs or revenue losses outside official forecasting windows.And so, on schedule in 2022, the change to Section 174 went into effect. Companies filed their 2022 tax returns under the new rules in early 2023. And suddenly, R&D wasn’t a full, immediate write-off anymore. The tax benefits of salaries for engineers, product and project managers, data scientists, and even some user experience and marketing staff — all of which had previously reduced taxable income in year one — now had to be spread out over five- or 15-year periods. To understand the impact, imagine a personal tax code change that allowed you to deduct 100% of your biggest source of expenses, and that becoming a 20% deduction. For cash-strapped companies, especially those not yet profitable, the result was a painful tax bill just as venture funding dried up and interest rates soared.AdvertisementSalesforce office buildings in San Francisco.Photo: Jason Henry/BloombergIt’s no coincidence that Meta announced its “Year of Efficiency” immediately after the Section 174 change took effect. Ditto Microsoft laying off 10,000 employees in January 2023 despite strong earnings, or Google parent Alphabet cutting 12,000 jobs around the same time.Amazonalso laid off almost 30,000 people, with cuts focused not just on logistics but on Alexa and internal cloud tools — precisely the kinds of projects that would have once qualified as immediately deductible R&D. Salesforceeliminated 10% of its staff, or 8,000 people, including entire product teams.In public, companies blamed bloat and AI. But inside boardrooms, spreadsheets were telling a quieter story. And MD&A notes — management’s notes on the numbers — buried deep in 10-K filings recorded the change, too. R&D had become more expensive to carry. Headcount, the leading R&D expense across the tech industry, was the easiest thing to cut.AdvertisementIn its 2023 annual report, Meta described salaries as its single biggest R&D expense. Between the first and second years that the Section 174 change began affecting tax returns, Meta cut its total workforce by almost 25%. Over the same period, Microsoft reduced its global headcount by about 7%, with cuts concentrated in product-facing, engineering-heavy roles.Smaller companies without the fortress-like balance sheets of Big Tech have arguably been hit even harder. Twilioslashed 22% of its workforce in 2023 alone. Shopifycut almost 30% of staff in 2022 and 2023. Coinbasereduced headcount by 36% across a pair of brutal restructuring waves.Since going into effect, the provision has hit at the very heart of America’s economic growth engine: the tech sector.By market cap, tech giants dominate the S&P 500, with the “Magnificent 7” alone accounting for more than a third of the index’s total value. Workforce numbers tell a similar story, with tech employing millions of Americans directly and supporting the employment of tens of millions more. As measured by GDP, capital-T tech contributes about 10% of national output.AdvertisementIt’s not just that tech layoffs were large, it’s that they were massively disproportionate. Across the broader U.S. economy, job cuts hovered around in low single digits across most sectors. But in tech, entire divisions vanished, with a whopping 60% jump in layoffs between 2022 and 2023. Some cuts reflected real inefficiencies — a response to over-hiring during the zero-interest rate boom. At the same time, many of the roles eliminated were in R&D, product, and engineering, precisely the kind of functions that had once benefitted from generous tax treatment under Section 174.Throughout the 2010s, a broad swath of startups, direct-to-consumer brands, and internet-first firms — basically every company you recognize from Instagram or Facebook ads — built their growth models around a kind of engineered break-even.The tax code allowed them to spend aggressively on product and engineering, then write it all off as R&D, keeping their taxable income close to zero by design. It worked because taxable income and actual cash flow were often notGAAP accounting practices. Basically, as long as spending counted as R&D, companies could report losses to investors while owing almost nothing to the IRS.But the Section 174 change broke that model. Once those same expenses had to be spread out, or amortized, over multiple years, the tax shield vanished. Companies that were still burning cash suddenly looked profitable on paper, triggering real tax bills on imaginary gains.AdvertisementThe logic that once fueled a generation of digital-first growth collapsed overnight.So it wasn’t just tech experiencing effects. From 1954 until 2022, the U.S. tax code had encouraged businesses of all stripes to behave like tech companies. From retail to logistics, healthcare to media, if firms built internal tools, customized a software stack, or invested in business intelligence and data-driven product development, they could expense those costs. The write-off incentivized in-house builds and fast growth well outside the capital-T tech sector. This lines up with OECD research showing that immediate deductions foster innovation more than spread-out ones.And American companies ran with that logic. According to government data, U.S. businesses reported about billion in R&D expenditures in 2019 alone, and almost half of that came from industries outside traditional tech. The Bureau of Economic Analysis estimates that this sector, the broader digital economy, accounts for another 10% of GDP.Add that to core tech’s contribution, and the Section 174 shift has likely touched at least 20% of the U.S. economy.AdvertisementThe result? A tax policy aimed at raising short-term revenue effectively hid a time bomb inside the growth engines of thousands of companies. And when it detonated, it kneecapped the incentive for hiring American engineers or investing in American-made tech and digital products.It made building tech companies in America look irrational on a spreadsheet.A bipartisan group of lawmakers is pushing to repeal the Section 174 change, with business groups, CFOs, crypto executives, and venture capitalists lobbying hard for retroactive relief. But the politics are messy. Fixing 174 would mean handing a tax break to the same companies many voters in both parties see as symbols of corporate excess. Any repeal would also come too late for the hundreds of thousands of workers already laid off.And of course, the losses don’t stop at Meta’s or Google’s campus gates. They ripple out. When high-paid tech workers disappear, so do the lunch orders. The house tours. The contract gigs. The spending habits that sustain entire urban economies and thousands of other jobs. Sandwich artists. Rideshare drivers. Realtors. Personal trainers. House cleaners. In tech-heavy cities, the fallout runs deep — and it’s still unfolding.AdvertisementWashington is now poised to pass a second Trump tax bill — one packed with more obscure provisions, more delayed impacts, more quiet redistribution. And it comes as analysts are only just beginning to understand the real-world effects of the last round.The Section 174 change “significantly increased the tax burden on companies investing in innovation, potentially stifling economic growth and reducing the United States’ competitiveness on the global stage,” according to the tax consulting firm KBKG. Whether the U.S. will reverse course — or simply adapt to a new normal — remains to be seen.
    #hidden #time #bomb #tax #code
    The hidden time bomb in the tax code that's fueling mass tech layoffs: A decades-old tax rule helped build America's tech economy. A quiet change under Trump helped dismantle it
    For the past two years, it’s been a ghost in the machine of American tech. Between 2022 and today, a little-noticed tweak to the U.S. tax code has quietly rewired the financial logic of how American companies invest in research and development. Outside of CFO and accounting circles, almost no one knew it existed. “I work on these tax write-offs and still hadn’t heard about this,” a chief operating officer at a private-equity-backed tech company told Quartz. “It’s just been so weirdly silent.”AdvertisementStill, the delayed change to a decades-old tax provision — buried deep in the 2017 tax law — has contributed to the loss of hundreds of thousands of high-paying, white-collar jobs. That’s the picture that emerges from a review of corporate filings, public financial data, analysis of timelines, and interviews with industry insiders. One accountant, working in-house at a tech company, described it as a “niche issue with broad impact,” echoing sentiments from venture capital investors also interviewed for this article. Some spoke on condition of anonymity to discuss sensitive political matters.Since the start of 2023, more than half-a-million tech workers have been laid off, according to industry tallies. Headlines have blamed over-hiring during the pandemic and, more recently, AI. But beneath the surface was a hidden accelerant: a change to what’s known as Section 174 that helped gut in-house software and product development teams everywhere from tech giants such as Microsoftand Metato much smaller, private, direct-to-consumer and other internet-first companies.Now, as a bipartisan effort to repeal the Section 174 change moves through Congress, bigger questions are surfacing: How did a single line in the tax code help trigger a tsunami of mass layoffs? And why did no one see it coming? For almost 70 years, American companies could deduct 100% of qualified research and development spending in the year they incurred the costs. Salaries, software, contractor payments — if it contributed to creating or improving a product, it came off the top of a firm’s taxable income.AdvertisementThe deduction was guaranteed by Section 174 of the IRS Code of 1954, and under the provision, R&D flourished in the U.S.Microsoft was founded in 1975. Applelaunched its first computer in 1976. Googleincorporated in 1998. Facebook opened to the general public in 2006. All these companies, now among the most valuable in the world, developed their earliest products — programming tools, hardware, search engines — under a tax system that rewarded building now, not later.The subsequent rise of smartphones, cloud computing, and mobile apps also happened in an America where companies could immediately write off their investments in engineering, infrastructure, and experimentation. It was a baseline assumption — innovation and risk-taking subsidized by the tax code — that shaped how founders operated and how investors made decisions.In turn, tech companies largely built their products in the U.S. AdvertisementMicrosoft’s operating systems were coded in Washington state. Apple’s early hardware and software teams were in California. Google’s search engine was born at Stanford and scaled from Mountain View. Facebook’s entire social architecture was developed in Menlo Park. The deduction directly incentivized keeping R&D close to home, rewarding companies for investing in American workers, engineers, and infrastructure.That’s what makes the politics of Section 174 so revealing. For all the rhetoric about bringing jobs back and making things in America, the first Trump administration’s major tax bill arguably helped accomplish the opposite.When Congress passed the Tax Cuts and Jobs Act, the signature legislative achievement of President Donald Trump’s first term, it slashed the corporate tax rate from 35% to 21% — a massive revenue loss on paper for the federal government.To make the 2017 bill comply with Senate budget rules, lawmakers needed to offset the cost. So they added future tax hikes that wouldn’t kick in right away, wouldn’t provoke immediate backlash from businesses, and could, in theory, be quietly repealed later.AdvertisementThe delayed change to Section 174 — from immediate expensing of R&D to mandatory amortization, meaning that companies must spread the deduction out in smaller chunks over five or even 15-year periods — was that kind of provision. It didn’t start affecting the budget until 2022, but it helped the TCJA appear “deficit neutral” over the 10-year window used for legislative scoring.The delay wasn’t a technical necessity. It was a political tactic. Such moves are common in tax legislation. Phase-ins and delayed provisions let lawmakers game how the Congressional Budget Office— Congress’ nonpartisan analyst of how bills impact budgets and deficits — scores legislation, pushing costs or revenue losses outside official forecasting windows.And so, on schedule in 2022, the change to Section 174 went into effect. Companies filed their 2022 tax returns under the new rules in early 2023. And suddenly, R&D wasn’t a full, immediate write-off anymore. The tax benefits of salaries for engineers, product and project managers, data scientists, and even some user experience and marketing staff — all of which had previously reduced taxable income in year one — now had to be spread out over five- or 15-year periods. To understand the impact, imagine a personal tax code change that allowed you to deduct 100% of your biggest source of expenses, and that becoming a 20% deduction. For cash-strapped companies, especially those not yet profitable, the result was a painful tax bill just as venture funding dried up and interest rates soared.AdvertisementSalesforce office buildings in San Francisco.Photo: Jason Henry/BloombergIt’s no coincidence that Meta announced its “Year of Efficiency” immediately after the Section 174 change took effect. Ditto Microsoft laying off 10,000 employees in January 2023 despite strong earnings, or Google parent Alphabet cutting 12,000 jobs around the same time.Amazonalso laid off almost 30,000 people, with cuts focused not just on logistics but on Alexa and internal cloud tools — precisely the kinds of projects that would have once qualified as immediately deductible R&D. Salesforceeliminated 10% of its staff, or 8,000 people, including entire product teams.In public, companies blamed bloat and AI. But inside boardrooms, spreadsheets were telling a quieter story. And MD&A notes — management’s notes on the numbers — buried deep in 10-K filings recorded the change, too. R&D had become more expensive to carry. Headcount, the leading R&D expense across the tech industry, was the easiest thing to cut.AdvertisementIn its 2023 annual report, Meta described salaries as its single biggest R&D expense. Between the first and second years that the Section 174 change began affecting tax returns, Meta cut its total workforce by almost 25%. Over the same period, Microsoft reduced its global headcount by about 7%, with cuts concentrated in product-facing, engineering-heavy roles.Smaller companies without the fortress-like balance sheets of Big Tech have arguably been hit even harder. Twilioslashed 22% of its workforce in 2023 alone. Shopifycut almost 30% of staff in 2022 and 2023. Coinbasereduced headcount by 36% across a pair of brutal restructuring waves.Since going into effect, the provision has hit at the very heart of America’s economic growth engine: the tech sector.By market cap, tech giants dominate the S&P 500, with the “Magnificent 7” alone accounting for more than a third of the index’s total value. Workforce numbers tell a similar story, with tech employing millions of Americans directly and supporting the employment of tens of millions more. As measured by GDP, capital-T tech contributes about 10% of national output.AdvertisementIt’s not just that tech layoffs were large, it’s that they were massively disproportionate. Across the broader U.S. economy, job cuts hovered around in low single digits across most sectors. But in tech, entire divisions vanished, with a whopping 60% jump in layoffs between 2022 and 2023. Some cuts reflected real inefficiencies — a response to over-hiring during the zero-interest rate boom. At the same time, many of the roles eliminated were in R&D, product, and engineering, precisely the kind of functions that had once benefitted from generous tax treatment under Section 174.Throughout the 2010s, a broad swath of startups, direct-to-consumer brands, and internet-first firms — basically every company you recognize from Instagram or Facebook ads — built their growth models around a kind of engineered break-even.The tax code allowed them to spend aggressively on product and engineering, then write it all off as R&D, keeping their taxable income close to zero by design. It worked because taxable income and actual cash flow were often notGAAP accounting practices. Basically, as long as spending counted as R&D, companies could report losses to investors while owing almost nothing to the IRS.But the Section 174 change broke that model. Once those same expenses had to be spread out, or amortized, over multiple years, the tax shield vanished. Companies that were still burning cash suddenly looked profitable on paper, triggering real tax bills on imaginary gains.AdvertisementThe logic that once fueled a generation of digital-first growth collapsed overnight.So it wasn’t just tech experiencing effects. From 1954 until 2022, the U.S. tax code had encouraged businesses of all stripes to behave like tech companies. From retail to logistics, healthcare to media, if firms built internal tools, customized a software stack, or invested in business intelligence and data-driven product development, they could expense those costs. The write-off incentivized in-house builds and fast growth well outside the capital-T tech sector. This lines up with OECD research showing that immediate deductions foster innovation more than spread-out ones.And American companies ran with that logic. According to government data, U.S. businesses reported about billion in R&D expenditures in 2019 alone, and almost half of that came from industries outside traditional tech. The Bureau of Economic Analysis estimates that this sector, the broader digital economy, accounts for another 10% of GDP.Add that to core tech’s contribution, and the Section 174 shift has likely touched at least 20% of the U.S. economy.AdvertisementThe result? A tax policy aimed at raising short-term revenue effectively hid a time bomb inside the growth engines of thousands of companies. And when it detonated, it kneecapped the incentive for hiring American engineers or investing in American-made tech and digital products.It made building tech companies in America look irrational on a spreadsheet.A bipartisan group of lawmakers is pushing to repeal the Section 174 change, with business groups, CFOs, crypto executives, and venture capitalists lobbying hard for retroactive relief. But the politics are messy. Fixing 174 would mean handing a tax break to the same companies many voters in both parties see as symbols of corporate excess. Any repeal would also come too late for the hundreds of thousands of workers already laid off.And of course, the losses don’t stop at Meta’s or Google’s campus gates. They ripple out. When high-paid tech workers disappear, so do the lunch orders. The house tours. The contract gigs. The spending habits that sustain entire urban economies and thousands of other jobs. Sandwich artists. Rideshare drivers. Realtors. Personal trainers. House cleaners. In tech-heavy cities, the fallout runs deep — and it’s still unfolding.AdvertisementWashington is now poised to pass a second Trump tax bill — one packed with more obscure provisions, more delayed impacts, more quiet redistribution. And it comes as analysts are only just beginning to understand the real-world effects of the last round.The Section 174 change “significantly increased the tax burden on companies investing in innovation, potentially stifling economic growth and reducing the United States’ competitiveness on the global stage,” according to the tax consulting firm KBKG. Whether the U.S. will reverse course — or simply adapt to a new normal — remains to be seen. #hidden #time #bomb #tax #code
    QZ.COM
    The hidden time bomb in the tax code that's fueling mass tech layoffs: A decades-old tax rule helped build America's tech economy. A quiet change under Trump helped dismantle it
    For the past two years, it’s been a ghost in the machine of American tech. Between 2022 and today, a little-noticed tweak to the U.S. tax code has quietly rewired the financial logic of how American companies invest in research and development. Outside of CFO and accounting circles, almost no one knew it existed. “I work on these tax write-offs and still hadn’t heard about this,” a chief operating officer at a private-equity-backed tech company told Quartz. “It’s just been so weirdly silent.”AdvertisementStill, the delayed change to a decades-old tax provision — buried deep in the 2017 tax law — has contributed to the loss of hundreds of thousands of high-paying, white-collar jobs. That’s the picture that emerges from a review of corporate filings, public financial data, analysis of timelines, and interviews with industry insiders. One accountant, working in-house at a tech company, described it as a “niche issue with broad impact,” echoing sentiments from venture capital investors also interviewed for this article. Some spoke on condition of anonymity to discuss sensitive political matters.Since the start of 2023, more than half-a-million tech workers have been laid off, according to industry tallies. Headlines have blamed over-hiring during the pandemic and, more recently, AI. But beneath the surface was a hidden accelerant: a change to what’s known as Section 174 that helped gut in-house software and product development teams everywhere from tech giants such as Microsoft (MSFT) and Meta (META) to much smaller, private, direct-to-consumer and other internet-first companies.Now, as a bipartisan effort to repeal the Section 174 change moves through Congress, bigger questions are surfacing: How did a single line in the tax code help trigger a tsunami of mass layoffs? And why did no one see it coming? For almost 70 years, American companies could deduct 100% of qualified research and development spending in the year they incurred the costs. Salaries, software, contractor payments — if it contributed to creating or improving a product, it came off the top of a firm’s taxable income.AdvertisementThe deduction was guaranteed by Section 174 of the IRS Code of 1954, and under the provision, R&D flourished in the U.S.Microsoft was founded in 1975. Apple (AAPL) launched its first computer in 1976. Google (GOOGL) incorporated in 1998. Facebook opened to the general public in 2006. All these companies, now among the most valuable in the world, developed their earliest products — programming tools, hardware, search engines — under a tax system that rewarded building now, not later.The subsequent rise of smartphones, cloud computing, and mobile apps also happened in an America where companies could immediately write off their investments in engineering, infrastructure, and experimentation. It was a baseline assumption — innovation and risk-taking subsidized by the tax code — that shaped how founders operated and how investors made decisions.In turn, tech companies largely built their products in the U.S. AdvertisementMicrosoft’s operating systems were coded in Washington state. Apple’s early hardware and software teams were in California. Google’s search engine was born at Stanford and scaled from Mountain View. Facebook’s entire social architecture was developed in Menlo Park. The deduction directly incentivized keeping R&D close to home, rewarding companies for investing in American workers, engineers, and infrastructure.That’s what makes the politics of Section 174 so revealing. For all the rhetoric about bringing jobs back and making things in America, the first Trump administration’s major tax bill arguably helped accomplish the opposite.When Congress passed the Tax Cuts and Jobs Act (TCJA), the signature legislative achievement of President Donald Trump’s first term, it slashed the corporate tax rate from 35% to 21% — a massive revenue loss on paper for the federal government.To make the 2017 bill comply with Senate budget rules, lawmakers needed to offset the cost. So they added future tax hikes that wouldn’t kick in right away, wouldn’t provoke immediate backlash from businesses, and could, in theory, be quietly repealed later.AdvertisementThe delayed change to Section 174 — from immediate expensing of R&D to mandatory amortization, meaning that companies must spread the deduction out in smaller chunks over five or even 15-year periods — was that kind of provision. It didn’t start affecting the budget until 2022, but it helped the TCJA appear “deficit neutral” over the 10-year window used for legislative scoring.The delay wasn’t a technical necessity. It was a political tactic. Such moves are common in tax legislation. Phase-ins and delayed provisions let lawmakers game how the Congressional Budget Office (CBO) — Congress’ nonpartisan analyst of how bills impact budgets and deficits — scores legislation, pushing costs or revenue losses outside official forecasting windows.And so, on schedule in 2022, the change to Section 174 went into effect. Companies filed their 2022 tax returns under the new rules in early 2023. And suddenly, R&D wasn’t a full, immediate write-off anymore. The tax benefits of salaries for engineers, product and project managers, data scientists, and even some user experience and marketing staff — all of which had previously reduced taxable income in year one — now had to be spread out over five- or 15-year periods. To understand the impact, imagine a personal tax code change that allowed you to deduct 100% of your biggest source of expenses, and that becoming a 20% deduction. For cash-strapped companies, especially those not yet profitable, the result was a painful tax bill just as venture funding dried up and interest rates soared.AdvertisementSalesforce office buildings in San Francisco.Photo: Jason Henry/Bloomberg (Getty Images)It’s no coincidence that Meta announced its “Year of Efficiency” immediately after the Section 174 change took effect. Ditto Microsoft laying off 10,000 employees in January 2023 despite strong earnings, or Google parent Alphabet cutting 12,000 jobs around the same time.Amazon (AMZN) also laid off almost 30,000 people, with cuts focused not just on logistics but on Alexa and internal cloud tools — precisely the kinds of projects that would have once qualified as immediately deductible R&D. Salesforce (CRM) eliminated 10% of its staff, or 8,000 people, including entire product teams.In public, companies blamed bloat and AI. But inside boardrooms, spreadsheets were telling a quieter story. And MD&A notes — management’s notes on the numbers — buried deep in 10-K filings recorded the change, too. R&D had become more expensive to carry. Headcount, the leading R&D expense across the tech industry, was the easiest thing to cut.AdvertisementIn its 2023 annual report, Meta described salaries as its single biggest R&D expense. Between the first and second years that the Section 174 change began affecting tax returns, Meta cut its total workforce by almost 25%. Over the same period, Microsoft reduced its global headcount by about 7%, with cuts concentrated in product-facing, engineering-heavy roles.Smaller companies without the fortress-like balance sheets of Big Tech have arguably been hit even harder. Twilio (TWLO) slashed 22% of its workforce in 2023 alone. Shopify (SHOP) (headquartered in Canada but with much of its R&D teams in the U.S.) cut almost 30% of staff in 2022 and 2023. Coinbase (COIN) reduced headcount by 36% across a pair of brutal restructuring waves.Since going into effect, the provision has hit at the very heart of America’s economic growth engine: the tech sector.By market cap, tech giants dominate the S&P 500, with the “Magnificent 7” alone accounting for more than a third of the index’s total value. Workforce numbers tell a similar story, with tech employing millions of Americans directly and supporting the employment of tens of millions more. As measured by GDP, capital-T tech contributes about 10% of national output.AdvertisementIt’s not just that tech layoffs were large, it’s that they were massively disproportionate. Across the broader U.S. economy, job cuts hovered around in low single digits across most sectors. But in tech, entire divisions vanished, with a whopping 60% jump in layoffs between 2022 and 2023. Some cuts reflected real inefficiencies — a response to over-hiring during the zero-interest rate boom. At the same time, many of the roles eliminated were in R&D, product, and engineering, precisely the kind of functions that had once benefitted from generous tax treatment under Section 174.Throughout the 2010s, a broad swath of startups, direct-to-consumer brands, and internet-first firms — basically every company you recognize from Instagram or Facebook ads — built their growth models around a kind of engineered break-even.The tax code allowed them to spend aggressively on product and engineering, then write it all off as R&D, keeping their taxable income close to zero by design. It worked because taxable income and actual cash flow were often notGAAP accounting practices. Basically, as long as spending counted as R&D, companies could report losses to investors while owing almost nothing to the IRS.But the Section 174 change broke that model. Once those same expenses had to be spread out, or amortized, over multiple years, the tax shield vanished. Companies that were still burning cash suddenly looked profitable on paper, triggering real tax bills on imaginary gains.AdvertisementThe logic that once fueled a generation of digital-first growth collapsed overnight.So it wasn’t just tech experiencing effects. From 1954 until 2022, the U.S. tax code had encouraged businesses of all stripes to behave like tech companies. From retail to logistics, healthcare to media, if firms built internal tools, customized a software stack, or invested in business intelligence and data-driven product development, they could expense those costs. The write-off incentivized in-house builds and fast growth well outside the capital-T tech sector. This lines up with OECD research showing that immediate deductions foster innovation more than spread-out ones.And American companies ran with that logic. According to government data, U.S. businesses reported about $500 billion in R&D expenditures in 2019 alone, and almost half of that came from industries outside traditional tech. The Bureau of Economic Analysis estimates that this sector, the broader digital economy, accounts for another 10% of GDP.Add that to core tech’s contribution, and the Section 174 shift has likely touched at least 20% of the U.S. economy.AdvertisementThe result? A tax policy aimed at raising short-term revenue effectively hid a time bomb inside the growth engines of thousands of companies. And when it detonated, it kneecapped the incentive for hiring American engineers or investing in American-made tech and digital products.It made building tech companies in America look irrational on a spreadsheet.A bipartisan group of lawmakers is pushing to repeal the Section 174 change, with business groups, CFOs, crypto executives, and venture capitalists lobbying hard for retroactive relief. But the politics are messy. Fixing 174 would mean handing a tax break to the same companies many voters in both parties see as symbols of corporate excess. Any repeal would also come too late for the hundreds of thousands of workers already laid off.And of course, the losses don’t stop at Meta’s or Google’s campus gates. They ripple out. When high-paid tech workers disappear, so do the lunch orders. The house tours. The contract gigs. The spending habits that sustain entire urban economies and thousands of other jobs. Sandwich artists. Rideshare drivers. Realtors. Personal trainers. House cleaners. In tech-heavy cities, the fallout runs deep — and it’s still unfolding.AdvertisementWashington is now poised to pass a second Trump tax bill — one packed with more obscure provisions, more delayed impacts, more quiet redistribution. And it comes as analysts are only just beginning to understand the real-world effects of the last round.The Section 174 change “significantly increased the tax burden on companies investing in innovation, potentially stifling economic growth and reducing the United States’ competitiveness on the global stage,” according to the tax consulting firm KBKG. Whether the U.S. will reverse course — or simply adapt to a new normal — remains to be seen.
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  • Alphabet CEO Sundar Pichai dismisses AI job fears, emphasizes expansion plans

    In a Bloomberg interview Wednesday night in downtown San Francisco, Alphabet CEO Sundar Pichai pushed back against concerns that AI could eventually make half the company’s 180,000-person workforce redundant. Instead, Pichai stressed the company’s commitment to growth through at least next year.
    “I expect we will grow from our current engineering phase even into next year, because it allows us to do more,” Pichai said, adding that AI is making engineers more productive by eliminating tedious tasks and enabling them to focus on more impactful work. Rather than replacing workers, he referred to AI as “an accelerator” that will drive new product development, thereby creating demand for more employees.
    Alphabet has staged numerous layoffs in recent years, though so far, cuts in 2025 appear to be more targeted than in previous years. It reportedly parted ways with less than 100 people in Google’s cloud division earlier this year and, more recently, hundreds more in its platforms and devices unit. In 2024 and 2023, the cuts were far more severe, with 12,000 people dropped from the company in 2023 and at least another 1,000 employees laid off last year.
    Looking forward, Pichai pointed to Alphabet’s expanding ventures like Waymo autonomous vehicles, quantum computing initiatives, and YouTube’s explosive growth as evidence of innovation opportunities that continually bubble up. He noted YouTube’s scale in India alone, with 100 million channels and 15,000 channels boasting over one million subscribers.
    At one point, Pichai said trying to think too far ahead is “pointless.” But he also acknowledged the legitimacy of fears about job displacement, saying when asked about Anthropic CEO Dario Amodei’s recent comments that AI could erode half of entry-level white collar jobs within five years, “I respect that . . .I think it’s important to voice those concerns and debate them.”
    As the interview wrapped up, Pichai was asked about the limits of AI, and whether it’s possible that the world might never achieve artificial general intelligence, meaning AI that’s as smart as humans at everything. He quickly paused before answering. “There’s a lot of forward progress ahead with the paths we are on, not only the set of ideas we are working on today,some of the newer ideas we are experimenting with,” he said.
    “I’m very optimistic on seeing a lot of progress. But you know,” he added, “you’ve always had these technology curves where you may hit a temporary plateau. So are we currently on an absolute path to AGI? I don’t think anyone can say for sure.”

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    Alphabet CEO Sundar Pichai dismisses AI job fears, emphasizes expansion plans
    In a Bloomberg interview Wednesday night in downtown San Francisco, Alphabet CEO Sundar Pichai pushed back against concerns that AI could eventually make half the company’s 180,000-person workforce redundant. Instead, Pichai stressed the company’s commitment to growth through at least next year. “I expect we will grow from our current engineering phase even into next year, because it allows us to do more,” Pichai said, adding that AI is making engineers more productive by eliminating tedious tasks and enabling them to focus on more impactful work. Rather than replacing workers, he referred to AI as “an accelerator” that will drive new product development, thereby creating demand for more employees. Alphabet has staged numerous layoffs in recent years, though so far, cuts in 2025 appear to be more targeted than in previous years. It reportedly parted ways with less than 100 people in Google’s cloud division earlier this year and, more recently, hundreds more in its platforms and devices unit. In 2024 and 2023, the cuts were far more severe, with 12,000 people dropped from the company in 2023 and at least another 1,000 employees laid off last year. Looking forward, Pichai pointed to Alphabet’s expanding ventures like Waymo autonomous vehicles, quantum computing initiatives, and YouTube’s explosive growth as evidence of innovation opportunities that continually bubble up. He noted YouTube’s scale in India alone, with 100 million channels and 15,000 channels boasting over one million subscribers. At one point, Pichai said trying to think too far ahead is “pointless.” But he also acknowledged the legitimacy of fears about job displacement, saying when asked about Anthropic CEO Dario Amodei’s recent comments that AI could erode half of entry-level white collar jobs within five years, “I respect that . . .I think it’s important to voice those concerns and debate them.” As the interview wrapped up, Pichai was asked about the limits of AI, and whether it’s possible that the world might never achieve artificial general intelligence, meaning AI that’s as smart as humans at everything. He quickly paused before answering. “There’s a lot of forward progress ahead with the paths we are on, not only the set of ideas we are working on today,some of the newer ideas we are experimenting with,” he said. “I’m very optimistic on seeing a lot of progress. But you know,” he added, “you’ve always had these technology curves where you may hit a temporary plateau. So are we currently on an absolute path to AGI? I don’t think anyone can say for sure.” Techcrunch event now through June 4 for TechCrunch Sessions: AI on your ticket to TC Sessions: AI—and get 50% off a second. Hear from leaders at OpenAI, Anthropic, Khosla Ventures, and more during a full day of expert insights, hands-on workshops, and high-impact networking. These low-rate deals disappear when the doors open on June 5. Exhibit at TechCrunch Sessions: AI Secure your spot at TC Sessions: AI and show 1,200+ decision-makers what you’ve built — without the big spend. Available through May 9 or while tables last. Berkeley, CA | June 5 REGISTER NOW #alphabet #ceo #sundar #pichai #dismisses
    TECHCRUNCH.COM
    Alphabet CEO Sundar Pichai dismisses AI job fears, emphasizes expansion plans
    In a Bloomberg interview Wednesday night in downtown San Francisco, Alphabet CEO Sundar Pichai pushed back against concerns that AI could eventually make half the company’s 180,000-person workforce redundant. Instead, Pichai stressed the company’s commitment to growth through at least next year. “I expect we will grow from our current engineering phase even into next year, because it allows us to do more,” Pichai said, adding that AI is making engineers more productive by eliminating tedious tasks and enabling them to focus on more impactful work. Rather than replacing workers, he referred to AI as “an accelerator” that will drive new product development, thereby creating demand for more employees. Alphabet has staged numerous layoffs in recent years, though so far, cuts in 2025 appear to be more targeted than in previous years. It reportedly parted ways with less than 100 people in Google’s cloud division earlier this year and, more recently, hundreds more in its platforms and devices unit. In 2024 and 2023, the cuts were far more severe, with 12,000 people dropped from the company in 2023 and at least another 1,000 employees laid off last year. Looking forward, Pichai pointed to Alphabet’s expanding ventures like Waymo autonomous vehicles, quantum computing initiatives, and YouTube’s explosive growth as evidence of innovation opportunities that continually bubble up. He noted YouTube’s scale in India alone, with 100 million channels and 15,000 channels boasting over one million subscribers. At one point, Pichai said trying to think too far ahead is “pointless.” But he also acknowledged the legitimacy of fears about job displacement, saying when asked about Anthropic CEO Dario Amodei’s recent comments that AI could erode half of entry-level white collar jobs within five years, “I respect that . . .I think it’s important to voice those concerns and debate them.” As the interview wrapped up, Pichai was asked about the limits of AI, and whether it’s possible that the world might never achieve artificial general intelligence, meaning AI that’s as smart as humans at everything. He quickly paused before answering. “There’s a lot of forward progress ahead with the paths we are on, not only the set of ideas we are working on today, [but] some of the newer ideas we are experimenting with,” he said. “I’m very optimistic on seeing a lot of progress. But you know,” he added, “you’ve always had these technology curves where you may hit a temporary plateau. So are we currently on an absolute path to AGI? I don’t think anyone can say for sure.” Techcrunch event Save now through June 4 for TechCrunch Sessions: AI Save $300 on your ticket to TC Sessions: AI—and get 50% off a second. Hear from leaders at OpenAI, Anthropic, Khosla Ventures, and more during a full day of expert insights, hands-on workshops, and high-impact networking. These low-rate deals disappear when the doors open on June 5. Exhibit at TechCrunch Sessions: AI Secure your spot at TC Sessions: AI and show 1,200+ decision-makers what you’ve built — without the big spend. Available through May 9 or while tables last. Berkeley, CA | June 5 REGISTER NOW
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