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How TikTok Evaded a Ban Again and Again, Until Now

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How TikTok Evaded a Ban Again and Again, Until Now

In mid-2023, TikTok had just eluded an effort in Congress to ban the video app, the latest Houdini-like escape for the young tech company. For several years, during both Republican and Democratic administrations, lawmakers and officials had trained their sights on the app, saying its Chinese ownership posed a national security risk.

Inside TikTok, a small group of employees started formulating a plan to ensure that the regulatory threat would never reappear, three people with knowledge of the project said. The employees pitched a campaign of TV commercials, messages to users and other public advocacy to turn Washington’s attention elsewhere. They called it Project Achilles.

But TikTok’s leaders lost interest by the end of the year. Several, including Shou Chew, its chief executive, seemed to think the threat of a ban was no longer imminent, the people said. Project Achilles never became reality.

The misreading of the political winds could not have been greater.

Just a few months later, Congress overwhelmingly passed and President Biden signed a law that would ban TikTok unless the app’s owner, ByteDance, sold it to a non-Chinese company. On Friday, the Supreme Court upheld the law. TikTok is set to be removed from app stores on Sunday, when the law goes into effect.

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The ban will end a remarkable eight-year roller-coaster ride for TikTok in the United States. The company wriggled its way out of political danger time and again. The threats to its very existence came so often, from so many directions, dealing with them became almost second nature for executives — perhaps to the point of complacency.

All the while, TikTok reached new heights of popularity and public influence. It boasts 170 million monthly U.S. users, giving the company confidence that those masses could help beat back whatever regulators aimed its way. Behind the scenes, TikTok conducted secretive negotiations with government officials and advertising blitzes aimed at rescuing it.

But in the end, the company ran into a well-organized and focused effort among Washington officials that it could not stop. Its biggest gamble yet was that it could overturn the law and avoid a sale altogether — a bet that failed.

Many social media companies have skyrocketed in popularity only to fade away nearly as fast, and others, like Facebook and X, have faced tough scrutiny in Washington. But none have been effectively forced to erase their presence in the country. Only TikTok will have that distinction.

“The vast majority of people I’ve talked to have said TikTok will figure something out, without a very clear answer to what that something will be, because they always have,” said Joe Marchese, a venture capitalist and former TV network executive. People “can’t picture it not working out.”

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TikTok is already appealing directly to President-elect Donald J. Trump, who has vowed to save the app, somehow. Mr. Chew posted a direct appeal to Mr. Trump on TikTok after the Supreme Court decision, thanking him “for his commitment to work with us to find a solution that keeps TikTok available in the United States.” TikTok declined to comment on Project Achilles.

Late Friday, the company said that unless the Biden administration made it clear to service providers that they could continue providing services to the app after the law took effect, “unfortunately TikTok will be forced to go dark on Jan. 19.” But on Saturday, the White House press secretary called TikTok’s statement “a stunt.” And Mr. Trump indicated in an interview with NBC News on Saturday that he would “most likely” give TikTok a 90-day extension once he takes office on Monday.

TikTok users are grieving, often couching their dismay in dark humor. Few seem to believe the app will be blocked on Sunday.

“In 2020 I did an interview about the TikTok ban, and I was saying the same thing: ‘I don’t think it’s going to get banned,’” said Yumna Jawad, a recipe developer and content creator who goes by Feel Good Foodie. “Five years later, I’m still doing the same interview.”

Before it was TikTok, it was Musical.ly, a Chinese lip-syncing app popular with teenagers and tweens.

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Musical.ly’s two founders had nearly run out of venture funding for an education app when they decided to pivot to D.I.Y. music videos in 2014. The app let users film over 15-second clips of popular songs, often accompanied by a distinct brand of hand choreography.

As Musical.ly grew, ByteDance took notice. It paid around $1 billion for Musical.ly in 2017 and ultimately folded its technology and users into an app that ByteDance had launched internationally only a few months earlier: TikTok. By 2018, TikTok was roaring into the rankings of the most downloaded apps in the United States.

During the Covid-19 pandemic, TikTok became a mainstay in Americans’ lives. The app, with its endless stream of short-form entertainment, was perfectly positioned for a period when many people had more free time than ever. Or, as the musician Curtis Roach put it in the video that would make him one of the pandemic’s earliest breakout stars, a time when many people were “bored in the house.”

I joined just to post my little funny videos, and TikTok turned into something that can change somebody’s life,” Mr. Roach said in a recent interview.

TikTok seemingly left no corner of culture untouched.

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Emma Straub, an author and owner of the independent Books Are Magic bookstores, recalled seeing backlist titles like Madeline Miller’s “The Song of Achilles” suddenly in high demand after BookTok made them popular again. In the culinary world, TikTok sent feta cheese and, later, cucumbers flying off the shelves as home cooks clamored to recreate viral recipes. Jane Wickline leveraged parody videos into a role on “Saturday Night Live.” TikTok was the most downloaded app in the United States and world in 2020, 2021 and 2022.

Almost overnight, teenagers became household names. By November 2020, Charli D’Amelio had amassed 100 million followers, making her, at that time, the most-followed person on TikTok in the world. She became, at age 16, famous for recording dance videos in her bedroom. By 2021, her family would have a reality show on Hulu.

“It was a vehicle for my kids and us to follow their dreams,” said Marc D’Amelio, Ms. D’Amelio’s father.

As TikTok’s popularity surged, so did scrutiny from the U.S. government. But TikTok managed to evade almost everything officials threw at it.

The first serious effort to ban the app in the United States came in the summer of 2020 from Mr. Trump, during his first term as president. TikTok was already on edge after a ban in India. Then Mr. Trump raised concerns that ByteDance could hand over sensitive TikTok user data to the Chinese government.

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“As far as TikTok is concerned, we’re banning them from the United States,” he said in July 2020.

Mr. Trump later hedged, saying he did not mind if Microsoft or another “very, very American” company bought TikTok instead. In August, he issued an executive order that effectively barred app stores from hosting TikTok. It gave companies a 45-day deadline to comply.

TikTok sued to block the executive order. As the deadline approached, the company tried to find a path that would assuage Mr. Trump’s fears by having two American companies take a stake in a new U.S.-based company, TikTok Global, which would go public within a year. But at the 11th hour, the deal appeared to be imperiled by the Chinese government and conflicts over ByteDance’s involvement.

Suddenly the ban seemed imminent — and yet TikTok emerged unscathed.

That fall, two federal courts agreed with TikTok that the executive order was unlawful and stopped the ban from going into effect. Shortly afterward, Mr. Trump lost his bid for re-election, complicating policymakers’ approach to addressing the concerns they had about TikTok and shelving the contentious deal.

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TikTok wasn’t out of the woods. The Biden administration had many of the same national security concerns about the app. And some states began acting on their own against it.

By early 2023, more than a dozen states had blocked the app from government-owned devices and networks, joining previous bans by the Army and the Air Force. That April, Montana passed a law to block the app outright in the state to protect its citizens’ data from China. TikTok sued, saying the law was overreaching and violated the First Amendment.

Congress had also started discussing a ban in earnest — conversations that multiplied after lawmakers grilled Mr. Chew, TikTok’s chief executive, in a five-hour hearing in March 2023. TikTok had also been working for years on a proposal to show it could operate independently from China, but that same month, the Biden administration started to seem increasingly skeptical of it in public.

That fall, Republican lawmakers began accusing TikTok of amplifying pro-Palestinian and anti-Israel videos and a decades-old letter by Osama bin Laden through its algorithmic feed.

Yet by the end of 2023, TikTok had escaped defeat again. A huge lobbying campaign that included flying TikTok stars to Washington helped fend off the proposal that Congress had been discussing.

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The company’s legal case against the Montana law prevailed, too. That November, a federal court ruled that TikTok wouldn’t have to go dark in that state after all.

By December 2023, more than 150 million people were using TikTok in the United States.

With both the congressional effort and Montana’s ban behind them, some of TikTok’s top leaders seemed to believe the worst of the threats had passed.

Mr. Chew agreed to a rare profile in Vogue Singapore. Michael Beckerman, TikTok’s head of policy for the Americas, and Zenia Mucha, who oversees TikTok’s marketing and communications, were among executives who flew to Singapore, where Mr. Chew was based, and downplayed the near-term risk of a ban to company leaders, two people familiar with the trip said. After all, President Biden had just joined the app around the 2024 Super Bowl.

Ms. Mucha reflected that the company needed to “lower the temperature” and keep TikTok out of the news, according to four employees who heard her use the phrase when dismissing efforts, like Project Achilles, to prepare for a ban.

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What ByteDance and TikTok didn’t realize — despite their well-paid policy staff and millions in lobbying expenditures — was that a small bipartisan group of lawmakers was secretly working on drafting a new law designed to withstand every legal challenge that TikTok had raised in the past. It was formally introduced last March.

TikTok was blindsided. It scrambled to respond, flying creators to Washington and sending pop-up messages to users, urging them to call their representatives to oppose the legislation.

But this time, its campaign failed. Congress passed the bill rapidly, with rare bipartisan support, and Mr. Biden signed it into law in April, less than eight weeks after its introduction — leading some aides to nickname it “Thunder Run.” Unlike Mr. Trump’s executive action, the law was upheld in the courts.

Despite TikTok’s looming ban, it was largely business as usual inside the company.

Two weeks after Mr. Biden signed the TikTok law, Mr. Chew and his wife joined dozens of celebrity guests at the 2024 Met Gala in Manhattan, which TikTok sponsored. The company told advertisers like L’Oreal and Victoria’s Secret that it wasn’t backing down from its U.S. business over drinks in New York and on the French Riviera at the ad industry’s annual confab in Cannes. It said it would sponsor the Washington Capitals hockey team in September.

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TikTok executives have, at times, made light of the possible ban, suggesting in one staff meeting over the summer that it would one day be the subject of a Hollywood film.

In October, Mr. Beckerman held a gathering for his team in Lima, Peru, flying dozens of employees there, three people with knowledge of the outing said. The team outings were typically a mix of business and fun — but the jaunt struck some as surprising given the company’s situation. (TikTok said a hurricane had forced it to switch from an original destination of Miami.)

Now, TikTok is pinning its last hope on Mr. Trump.

Mr. Trump, who now has 14.8 million followers on his TikTok account, publicly changed his stance on the app last March. He has vowed to save it, though his options, even as president, are limited. He cannot overturn the law on his own, and it is not clear how he might stop its enforcement. He could try to exercise a one-time 90-day extension for TikTok if he determines sale talks are underway that would meet the terms of the law.

TikTok does not seem to be giving up. The company is spending thousands to be the headline sponsor of an event on Sunday, the day the law is scheduled to go into effect, celebrating the conservative influencers who helped shape the 2024 election. On Monday, Mr. Chew will attend the inauguration, alongside former presidents, family members and other important guests.

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TikTok’s stars do not seem to believe this is the final blow, either. Bethenny Frankel, the Bravo star and entrepreneur, said she had a hard time believing that TikTok could be gone on Sunday. TikTok’s users will figure out a way forward, she said.

“They’re club kids, and they’re going to figure out where the after-party is,” Ms. Frankel said. “They’re not letting the club get shut down.”

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Another tech company says it will cut hundreds of jobs amid pivot to AI

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Another tech company says it will cut hundreds of jobs amid pivot to AI

Layoffs have continued with another tech company saying it was cutting people to enable it to use more artificial intelligence.

Groupon announced in a security filing this month that it will cut up to 400 jobs, or nearly 25% of its worldwide workforce, as part of a broader restructuring plan to make the platform AI-native. The Chicago company plans to carry out the layoffs in the coming months.

Earlier the company’s Chief Executive Officer Dušan Šenkypl had said the company “fell short of our expectations” last quarter.

Since 2022, more than 800,000 tech workers have been laid off, according to Layoffs.fyi, a website that tracks job cuts.

The surge in pink slips started in 2023, when companies that had gone on hiring sprees during the COVID-19 pandemic began to cut back. From January to April this year, U.S. tech employers announced 85,411 job cuts, up 33% from the same period last year, according to global outplacement and executive coaching firm Challenger, Gray & Christmas.

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Groupon said in the filing that the decision to shift toward an AI-based company is to “better deliver on our mission, serving both customers and merchants.”

The company said the layoffs will cost it as much as $13 million, but save it more than $20 million per year.

This announcement comes as many e-commerce companies are shifting their business models to AI to reduce costs by automating many roles.

Artificial intelligence has also triggered fierce competition for top talent and is also fueling tens of thousands of layoffs this year. The result is that the class divide is widening in Silicon Valley as a tiny group of employees are landing unprecedented packages for AI skills, while many others struggle to find work.

The have-nots are doing everything that used to guarantee great jobs — refreshing resumes, optimizing LinkedIn profiles and doing interviews — but companies are much more picky these days. The tech jobless are rethinking their lives. Some are taking pay cuts, while others are leaving tech. Some are going back to study or launch startups. Some have retired.

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Groupon shares, which have fallen 27% over the last 12 months, slipped 1% on Thursday to $21.20.

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ABC files applications ‘under protest’ for early renewal of TV station licenses

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ABC files applications ‘under protest’ for early renewal of TV station licenses

Walt Disney Co.’s ABC has filed renewal applications with the Federal Communications Commission “under protest” after an order mandating a years-early review of the network’s eight television station licenses.

The criticism was part of the network’s applications for the FCC review, which were filed ahead of a deadline Thursday. In an objection to the early renewal, Disney’s New York station WABC called the FCC order “unlawful, arbitrary and unconstitutional” and said it was “legally indefensible.”

“The Commission had not demanded early renewal in over five decades,” the station wrote in its filing. “And it has never before demanded simultaneous license renewal applications from a group of stations commonly owned with a network as it has here. The order has no legitimate purpose.”

The licenses for the eight ABC-owned TV stations, including KABC in Los Angeles, were originally scheduled for renewal between 2028 and 2031.

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The FCC order came shortly after ABC late-night host Jimmy Kimmel made a joke about First Lady Melania Trump looking like an “expectant widow” days before a gunman tried to breach the White House Correspondents’ Assn. gala last month that President Trump attended.

Trump has frequently threatened to have TV station licenses pulled when he is unhappy with their coverage, but the order is the first time the government has acted on his wishes, sparking anger from free speech advocates. The FCC has said the order is part of an investigation into whether Disney’s diversity and inclusion policies violate federal law and the agency’s rules against “unlawful discrimination.”

In its response, WABC said the “only plausible reason” to issue the order was to “punish the station for speech the government does not like.”

“The ultimate injury here is not to the station or its parent company. It is to the public,” WABC wrote. “When a broadcaster must weigh regulatory retaliation before making editorial decisions, the public loses access to journalism that is free from government influence.”

FCC Chairman Brendan Carr said in a statement Thursday that Disney filed its applications to renew its broadcast licenses only after the company was told its previous answers were “disingenuous, deficient and improper.”

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“Contrary to Disney’s claim that the FCC called in their broadcast licenses for early renewal for no reason, the record shows something very different,” Carr said. “Broadcast licensees have a unique obligation to operate in the public interest. The FCC will follow the facts and law wherever they may lead.”

FCC Commissioner Anna M. Gomez, the panel’s only Democrat who has backed Disney in its fight, cheered the Burbank media and entertainment company’s filing, saying in a post on X that she was “glad to see them expose the FCC’s actions as nothing more than naked political retribution and an unlawful assault on free speech and a free press.”

Times staff writer Meg James contributed to this report.

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The Google Insider Trading Case Hits Polymarket

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The Google Insider Trading Case Hits Polymarket

Andrew here. Warning: If you bet on prediction markets about things you could know about from your work, it may be insider trading. That’s the lesson from new charges against an employee of Google.

Also, Jamie Dimon is thinking about spending $20 billion on acquisitions; we go through some possible targets. And take our quiz about the U.F.C. fight scheduled to take place at the White House.

In the public’s view, prediction markets are a way to bet on the N.B.A. playoffs, the Texas Senate race or what Costco executives will say on their next earnings call.

They’re also often seen as a hive of insider trading, a view reinforced by charges filed on Wednesday against a Google employee who made more than $1 million on Polymarket. The case raises more questions about how these platforms are policed — and who should do the policing.

What happened: The Google employee, Michele Spagnuolo (who used the handle AlphaRaccoon), was accused of betting on what people were searching for on Google — wagers he was sure to win because he had access to internal search data.

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“Spagnuolo correctly predicted virtually all of the outcomes on these positions,” the Commodity Futures Trading Commission wrote in its complaint.

A Google representative said in a statement that using confidential information for making these kinds of bets was “a serious breach of our policies.”

Spagnuolo isn’t the only person charged with insider trading on Polymarket. Federal prosecutors in Manhattan last month accused Master Sgt. Gannon Ken Van Dyke, a U.S. Special Forces soldier, of betting on the capture of Nicolás Maduro of Venezuela, an operation he participated in.

Insider trading is an increasing problem for prediction markets. Polymarket has faced significant scrutiny because its unregulated offshore platform has long made it easy to bet anonymously. (Kalshi, which is regulated in the U.S., has also suffered from insider trading.)

Polymarket has started clamping down on that practice, according to The Information — though some longtime users have chafed at those efforts. “Polymarket will go down the drain if they make KYC mandatory,” one user wrote on the company’s Discord discussion forum, referring to “know your customer” practices.

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What are policymakers doing? Critics have accused the C.F.T.C., the primary American regulator of prediction markets, of failing to adequately police the industry. (Mike Selig, the commission’s chairman, told ABC News that his agency actively patrolled for wrongdoing.)

Some lawmakers are seeking to crack down on insider trading, including Representative James Comer, the Kentucky Republican who leads the House Oversight and Government Reform Committee, and several bipartisan groups of senators.

Why it matters: Prediction markets have become big businesses. (Kalshi was most recently valued at $22 billion.) But a growing perception that they’re rife with cheating could threaten their popularity.

The Trump administration is reportedly preparing to fund U.S. drone companies. Shares in Unusual Machines, a drone start-up in which Donald Trump Jr. is an investor and advisory board member, are soaring in premarket trading after The Wall Street Journal, citing unnamed sources, reported on the potential investments. (The Times hasn’t independently confirmed the report.) The deals, aimed at bolstering domestic production, are still in the negotiation stage — equity stakes are a possibility — as the Pentagon vets the companies, The Journal adds.

Investors brace for Thursday’s inflation data. The Personal Consumption Expenditures report for April, which will be closely watched by the Fed, is expected to show on Thursday that headline inflation hit a three-year high of 3.9 percent. The wartime energy spike is a big culprit, and that’s likely to tie the Fed’s hands on interest rates. Lisa Cook, a Fed governor whom President Trump has tried to fire, is the latest policymaker to say that there’s even a rate increase in the cards.

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Jensen Huang reportedly agrees to join the board of a Chinese university. Huang, the Nvidia C.E.O., is expected to be the latest U.S. business leader to join the advisory board of Tsinghua University School of Economics and Management, The Financial Times reports. Tim Cook, Apple’s departing C.E.O., is the chairman, and Michael Dell and Elon Musk are members. (Nvidia is trying to jump-start business in China as the Washington-Beijing trade war continues.) Laura Loomer, a right-wing agitator, quickly seized on the Huang news, calling it “a massive scandal!!!!” on social media, and a national security risk.

Jamie Dimon, the C.E.O. of JPMorgan Chase, is sitting on a pile of cash and says he’s open to a deal. He even put a number on it: up to $20 billion.

While that’s not a big sum relative to the bank’s assets, it got us thinking: Where could JPMorgan, whose last major acquisition was First Republic during the 2023 regional-banking crisis, go fishing for a company to buy? Brian O’Keefe asked Mike Mayo, a banking analyst at Wells Fargo.

Here are three possibilities:

Wealth management. Driven by solid margins and lucrative high-net-worth customers, this area of finance has experienced an M.&A. boom in recent years. (The First Republic deal already bolstered JPMorgan’s wealth-advisory ranks.) Such a move would tick a lot of boxes, Mayo said, adding, “It could be a high-end private bank, it could be kind of a mass-affluent brokerage firm, it could be wealth advisory.”

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  • Mary Erdoes, who runs JPMorgan’s wealth management division, told analysts in February that her unit had reviewed 25 potential deals last year and passed on all of them.

Payments. JPMorgan has invested heavily in new payment platforms, including in JPM Coin, a digital token it has tested with Coinbase and Mastercard. The bank handles between $5 trillion and $10 trillion in transactions daily, Mayo said. “There could be more opportunities to enhance the efficiency, the effectiveness, the timeliness or the geographic reach in the payments area,” he added.

Digital banking. Dimon recently singled out Revolut, the British banking app that is plotting expansion into the U.S., as an emerging competitive threat. “To the extent that an acquisition could help JPMorgan become the next Revolut outside the United States, that would seem to be attractive,” Mayo noted.

There are some big asterisks to consider. Because of its size, JPMorgan would most likely be barred from buying another U.S. lender on antitrust grounds. For that reason, Mayo thinks that a deal, if there is one, would probably happen abroad.

Dimon himself is being coy. The bank may have amassed ample capital for acquisitions, but “it’s not burning a hole in our pocket at all,” Dimon said on Wednesday at an investor conference. “If it sits there for a while, no problem,” he added.

Dimon did not suggest any potential targets on Wednesday.

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Here are some guesses:

  • Aberdeen Group, Invesco or Julius Baer in wealth management?

  • Revolut is too big, but how about Wise or Toast in payments?

  • Or what about Monzo or Bunq, fintech banks that have grown rapidly in Europe?


Meta will begin charging customers for access to its A.I.-powered chatbot, a big change for a company best known for its free products — and the latest sign that even deep-pocketed companies are wrestling with the enormous cost of artificial intelligence.

On Wednesday, we looked at how companies were reining in the costs of consuming A.I., including by switching to cheaper models. Meta’s move shows that the companies supplying A.I. models are also reckoning with ballooning costs, and seeking revenue to make up for those losses.

Meta is spending a fortune on A.I. Last month the company increased its 2026 capital expenditure forecast to as high as $145 billion, and Meta’s C.E.O., Mark Zuckerberg, said it would spend at least $600 billion on A.I. infrastructure in the next few years.

Some investors have looked skeptically on that plan. The company’s stock is down 2.3 percent this year.

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Meta will use paid subscriptions to offset some of its A.I. investment. The basic tier of the chatbot, Meta One Plus, will be $7.99 per month. A premium version, Meta One Premium, will cost $19.99. From Bloomberg, which reported the subscription news earlier:

Meta has long argued that its A.I. investments are already paying off in the form of highly targeted and efficient advertising, which is improved thanks to A.I. models. But the company is also looking for other ways to recoup its A.I. spending, and consumer chatbot subscriptions have become popular with several other A.I. competitors, including Alphabet Inc.’s Google and OpenAI. Both rivals offer similarly priced subscription tiers.

The company has sought to expand its subscription business, testing plans for WhatsApp, Instagram and Facebook. It has also tried to cut costs in other corners of its business. This month, Meta laid off 10 percent of its employee base, about 8,000 workers.

Investors, eager to see revenue gains from A.I., cheered Meta’s subscription-chatbot plan. The company’s stock price was up 3.7 percent at the market close on Wednesday.

  • Elsewhere, shares in the software maker Snowflake are soaring in premarket trading on Thursday after it reported strong quarterly results that suggested that A.I. agents weren’t clobbering its core subscription business. Salesforce’s analyst call on Wednesday, however, renewed fears that this sector was still vulnerable to A.I. disruption.

This question comes from a recent Times article. Click an answer to see if you’re right. (The link will be free.)

President Trump is getting ready to celebrate his 80th birthday — and America’s 250th — with an evening of mixed martial arts. Preparations are underway to host Ultimate Fighting Championship matches in an octagon on the White House’s South Lawn on June 14. Construction of the temporary arena, along with a 90-foot-tall arch known as “The Claw,” featuring LED lights and audio equipment, began this week.

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U.F.C. plans to spend around $60 million on the event, said Mark Shapiro, the president and chief operating officer of TKO Group Holdings, U.F.C.’s parent company, on a recent earnings call. (He added that U.F.C. would lose about $30 million on the event but that it would be “an investment for the long term.”)

The expenses include about $700,000 to repair the lawn after the fight, Dana White, the U.F.C. president and chief executive, told Sports Business Journal.

How many people will the temporary arena hold for the U.F.C. event at the White House?

Deals

  • “SpaceX-Tesla Merger Is ‘Only a Matter of When,’ Early Investor Says” (Bloomberg)

  • Shares in the European food-delivery company Delivery Hero are down sharply on Thursday after Uber, which is pursuing a takeover bid for the company, raised its stake to nearly 37 percent. (WSJ)

Politics, policy and regulation

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  • The attorneys general of New York and New Jersey subpoenaed FIFA over soaring World Cup ticket prices. (WSJ)

  • Gov. Gavin Newsom of California said he would impose a 100 percent tax on payouts to state residents from the $1.8 billion fund tied to the Justice Department’s settlement with President Trump. (Politico)

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