From California requiring all residents to stay at home to Tesla's tussle with Alameda County law enforcement, the nation's authorities are trying to weather the pandemic that now has large swaths of the world on lockdown.
The impact is being felt by everyone, and the tech sector is not being spared. We're updating this story as coronavirus news happens, and as the industry continues to sort through its new reality.
Here's what you need to know.
The markets get some respite
Tech stocks had a positive start to Friday's trading session, with the NASDAQ rising by around 1% as of 10 a.m. Eastern. That mirrored positivity abroad, where the U.K.'s FTSE, Germany's DAX, and Hong Kong's Hang Seng were all up.
Investors will be hoping for a cheery end to a turbulent week: If markets close higher, that would mark the second consecutive day of gains after yesterday's 2.3% NASDAQ rise. The positive moves come after heavy stimulus measures from both governments and central banks around the world, which seem to be inspiring confidence that the economy could recover from coronavirus disruption.
Bonds also climbed, as did foreign currencies, curtailing the dollar's huge rally over the past week. Volatility, meanwhile, was the lowest it's been all week.
How coronavirus hit tech on Thursday
California to residents: Stay home
California Gov. Gavin Newsom ordered all Californians to stay home on Thursday evening in order to prevent the spread of coronavirus. Newsom's order, which affects nearly 40 million people, represents the strictest effort in the nation to date taken to protect residents against COVID-19. Californians are required to stay home except to meet essential needs, according to the order, which is in effect "until further notice." Certain businesses, including banks, gas stations, pharmacies, grocery stores, Laundromats and take-out and delivery restaurants will remain open.
As of Wednesday evening, 675 people in the state had contracted the virus and 16 had died, according to the California Department of Public Health. — Joanna Pearlstein
SoftBank reportedly raising $10 billion to bail out its startups
SoftBank is trying to get more cash on hand to support its startups amid the spread of the coronavirus outbreak, according to a new report from Bloomberg. The fund reportedly wants to raise $10 billion — $5 billion from outside investors and $5 billion matched by SoftBank — but that money is no guarantee. First, there's the troubling performance of SoftBank's investments, from WeWork's failed IPO to Uber's disappointing public debut. Also, many of its previous backers have largely been from sovereign wealth funds in the Middle East, which are getting hammered by the steep decline in oil prices. SoftBank declined to comment.
Still, SoftBank is going through what many venture capitalists are doing right now: reevaluating their cash reserves and deciding which companies are going to be the ones who need the money and which startups won't get the bridge funding they might need to survive. The fund's portfolio has several real estate and travel startups that may be hit hard, including travel-booking platform Klook, hotelier Oyo and home buyer Opendoor. — Biz Carson
Battered Uber tries to soothe analysts
Uber's stock has plummeted nearly 64% in the past month as the company reels from the effects of coronavirus taking a toll on work, travel and mobility. Uber did not update its guidance on a call with investors Thursday because the pandemic is a "fluid situation," according to CEO Dara Khosrowshahi. But he tried to reassure analysts, saying that even though the company is being hit hard, it will be resilient because it has size, reach, multiple businesses and plenty of liquidity.
"We are well-positioned to weather this crisis," he said. "As soon as cities start moving, Uber will, too."
In Seattle, which has been hit hard by the pandemic, Khosrowshahi said ride bookings are down 60% to 70%. But he pointed to Hong Kong, which he said has been in recovery for a couple of weeks, where bookings are returning and are now down about 30% from their peak.
"People want to get back to work, they want to get back to living," he said, adding that the company is using Seattle as an archetype for Western cities and is "assuming about two months of absolute lockdown."
CFO Nelson Chai said the "driver funnel" is strong and actually increased this week. The company is encouraging ride-hailing drivers to deliver for Uber Eats, where demand is rising.
"We can give them alternate work," Khosrowshahi said. "This time is about getting as much flexible work as you can."
The worst-case scenario, Uber's CEO said, is that the number of rides the company provides could plummet 80% this year. Even then, he said that the ride part of the company's business would break even, and the company would still have $4 billion in cash at year-end. — Levi Sumagaysay
The show will go on (thanks to tech)
With studio sets, theaters and music venues now closed, performers are using iPhones, video-conferencing tools and livestreaming to keep audiences entertained. Stars such as John Legend and Chris Martin hosted at-home concerts on Instagram Live, taking requests from fans in the accompanying chat. The Dropkick Murphys livestreamed a show from an empty venue.
Comedians are fast-adapting, too. Jimmy Fallon and Conan O'Brien are making their nightly talkshows from home, while Catherine Cohen, who hosts a weekly variety show in New York, used Instagram Live's joint broadcasting feature to do the show remotely. Even the most traditional of arts have taken to the web, with the Met Opera and Vienna State Opera both streaming performances. And entirely new formats are springing up, such as "Love Is Quarantine," a remote, phone-call based dating show.
But all that streaming is taking its toll on networks, with Vodafone seeing a 50% rise in internet use. The FCC has already allowed Verizon, T-Mobile and U.S. Cellular to use additional spectrum. And on Wednesday, the EU said streaming platforms should consider limiting streams to standard definition to reduce the extra load. — Shakeel Hashim
Markets are calmer, but the fall isn't over
As of 7 a.m. EDT, volatility was a little lower than the highs of recent days, but things still weren't looking good ahead of the U.S. markets opening. Futures were once again in the red, while European and Asian markets continued to fall, albeit less than has become normal this week. That could in part be thanks to a €750 billion, or around $820 billion, bond purchase program announced by the EU on Wednesday night. — Shakeel Hashim
How coronavirus hit tech on Wednesday
Tesla factory still open — but county says it is decreasing workforce
Alameda County officials said Wednesday that Tesla has reduced its Fremont factory's active workforce. This comes after two days of the plant continuing as normal, despite county orders that require nonessential businesses to curtail operations as residents shelter in place. Tesla made no announcements about staffing changes Wednesday, and county officials sent mixed messages about the status of the factory.
Shawn Wilson, chief of staff for Alameda County District 1 Supervisor Scott Haggerty, told Protocol that it is his understanding that Tesla has reduced its workforce at the plant, though he didn't have exact numbers, and that "they are complying to all CDC requirements."
Alameda County Sheriff's Office spokesperson Ray Kelly did not return multiple requests for comment, but he told BuzzFeed News earlier on Wednesday that Tesla "assured me in a phone call to do a step-down reduction from about 10,000 to 2,500 people."
Kelly had told Protocol on Tuesday night that "Tesla is not an essential business as defined in the Alameda County health order" and therefore could only maintain minimum basic operations. On Wednesday he told the Los Angeles Times that car production was not part of the allowed basic operations, though "it sounds like they're still making cars." He then suggested enforcement would be up to the Fremont police.
Wilson seemed to contradict Kelly on Wednesday, saying it is not up to the county — which issued the order — to deem whether a business is essential.
"Our order asks businesses to comply based on our order and how it relate[s] to their business practices," he said in an email, adding that Tesla "feels" it complies with one part of the county order's exemptions and "they also feel they comply with the Department of Homeland Security's definitions and exemptions."
Tesla has not returned a request for comment Wednesday. —
Levi Sumagaysay
Social media platforms get the word out about coronavirus
Facebook will show coronavirus information at the top of its News Feeds. The new "coronavirus information center" will prioritize data from the WHO and other authoritative outlets, Mark Zuckerberg said in a press call on Wednesday.
It's particularly focused on "encouraging people to take the social distancing orders seriously," Zuckerberg said. The feature will roll out in the next 24 hours in the U.S. and Europe, and Facebook plans to eventually show it to users worldwide.
Meanwhile, POLITICO reports that the nation's top health officials are using Twitter to find out about equipment shortages during the coronavirus outbreak. U.S. Food and Drug Administration deputy commissioner Anand Shah tweeted Tuesday that the FDA was asking companies to publicize their inventory and production schedule for supplies needed for COVID-19 testing. — Sofie Kodner
Stocks fall again, and gig-economy companies see their fortunes fall
The stock market continued to fall Wednesday, as investors feared massive economic fallout from the coronavirus pandemic. The Dow fell below 20,000, to its lowest level since December 2016; the Nasdaq closed down nearly 5%. As air travel plummeted, hotels closed and consumers fled indoors, companies that rely on travel saw their fortunes fall. Both Uber and Lyft have seen their stock fall more than 60% in the past month. — Joanna Pearlstein
Trump invoking wartime law
President Donald Trump said Wednesday he is invoking the Defense Production Act, a law enacted during the start of the Korean War, to address the shortage in medical supplies as the nation deals with the coronavirus pandemic.
The 1950 law gives the administration broad authority to allocate materials and resources in the name of national defense. In this case, the U.S. surgeon general and other medical professionals have been reporting and warning of shortages in hospital masks, gowns, gloves, hand sanitizer and more.
Earlier this week, the U.S. Department of Health and Human Services reportedly told medical professionals that the strategic national stockpile lacks adequate personal protective equipment and that the administration was working on a solution.
The law would allow the president to force other industries to prioritize the effort to increase production of critical supplies and could potentially affect other supply chains. — Levi Sumagaysay
The markets look set to plummet. Again.
As of 7.45 a.m. EDT, funds that track the value of the S&P 500 were down 6.13% ahead of markets opening, eliminating all of yesterday's 6.11% gains. Nasdaq and Dow trackers were similarly down, reflecting a global return to pessimism. Japan's Nikkei and Hong Kong's Hang Seng both ended trading down on Wednesday, with European stock markets dropping more than 4% within hours of trading starting. Bond prices also dropped, driving up yields, as investors prepared for a surge in supply thanks to increased government borrowing.
Investors will be looking for more information today on governments' responses to the crisis, particularly in the U.S. where direct payments to Americans are being mooted. With investors still nervous, governments may feel pressured to do even more than they already are.
As Bloomberg points out, although the NYSE FANG+ index of big tech stocks is down 33% from its February peak, compared to 29.5% drop in the S&P 500, a big tech rally last month means that, looking at the year as a whole, the index has outperformed the wider market. So, that's somewhat of a silver lining? — Shakeel Hashim
How coronavirus hit tech on Tuesday
New York City weighs a shelter-in-place measure
New York City Mayor Bill de Blasio said on Tuesday that New Yorkers should "be prepared" for the possibility of a shelter-in-place order — just hours after New York Gov. Andrew Cuomo, who would have to approve such a measure, said he had "no plan whatsoever to quarantine any city."
After de Blasio's announcement, Cuomo confirmed in no uncertain terms that New Yorkers shouldn't expect such extreme measures. "There is not going to be any quarantine," he told NY1. "No one is going to lock you in your home … That's not going to happen." Later that evening on CNN, Cuomo explained that local coronavirus-related measures wouldn't be effective if people could simply flee to nearby states without similar restrictions. He's working with neighboring states — New Jersey, Connecticut and Pennsylvania — to coordinate policies, he said. "Otherwise it doesn't work," he told CNN's Jake Tapper. "For example, we just closed the bars in New York. If I just closed the bars and restaurants in New York, everybody would get in a bar and drive to New Jersey … The geographic basis has to make sense."
Meanwhile, on Tuesday de Blasio banned shared rides in New York City. "We're doing this in agreement with the major ride-share companies," he tweeted.
According to the New York City Department of Public Health, 814 people in the city have tested positive for coronavirus. — Emma Johanningsmeier
Facebook's giving its employees coronavirus bonuses
Mark Zuckerberg announced that Facebook will give every employee a $1,000 bonus due to coronavirus, reports The Information. With more than 45,000 full-time employees, that will cost the company over $45 million. All employees will also automatically get a high performance rating for their first six-month review of 2020, The Information adds, helping provide many employees with significant regular bonuses, too. It wasn't clear if contractors would also receive the bonus.
On Monday, Workday also promised employees a bonus worth two weeks' pay to help during the lockdown. — Shakeel Hashim
Markets whipsaw amid hope for stimulus
The S&P 500, the tech-heavy Nasdaq Composite and the Dow Jones Industrial Average all rose by around 2% in early trading Tuesday — only to fall by around 1% compared to yesterday's close just minutes later. The volatility comes after suffering on Monday their largest losses since the stock market crash of October 1987.
"What a crazy day, people just don't know what to do," Matt Maley, equity strategist at Miller and Tabak and Co, told Bloomberg. "There's confusion. People don't have a good idea about the future fundamentals. Right now because of the coronavirus we have no idea."
The Trump administration reportedly plans to ask for an $850 billion package to counter the economic impact of coronavirus. Steven Mnuchin, the Treasury secretary, is expected to request the bailout later today,
according to The New York Times. — Jamie Condliffe
Facebook's (small) gift to small businesses
The social network said Tuesday that it would provide grants totaling $100 million to up to 30,000 small businesses in the form of cash grants and ad credits. Reuters reports that the majority will be given in cash. Sheryl Sandberg said: "We've listened to small businesses to understand how we can best help them. We've heard loud and clear that financial support could enable them to keep the lights on and pay people who can't come to work."
Worth noting: That $100 million is just 1.3% of the $7.3 billion of profit Facebook made in the fourth quarter of 2019. — Shakeel Hashim
Startups should prepare for tougher deal terms, says PitchBook
In a new research report, PitchBook analyst Dylan Cox wrote that "deal terms appear to have shifted in favor of investors as startups do whatever they can to close on capital." He said this could be "be a catalyst for a shift" away from founder-friendly terms — like voting rights, high valuations and so on — that have become common in recent years.
That doesn't quite appear to be the case on the ground yet, if Y Combinator's online demo day Monday is anything to go by. After that event, Switch Ventures founder Paul Arnold told Protocol's Biz Carson that deal terms were "jarring." Some companies he spoke to were asking for $10 million valuations out of the gate. "That's tough in a great market," Arnold said. "And when the sky is falling, it's hard to make sense of that." So founders may be in for somewhat of an awakening in the coming days and weeks.
Other nuggets from the PitchBook report: "Various PE firms have asked their portfolio companies to tap revolving credit lines"; the analysts expect a "more sustained pullback in VC- and PE-backed exits" throughout this year; and the "main headwind [for VCs raising new funds] seems to be the potential for a prolonged hiatus of in-person meetings, which could delay approval processes." — Shakeel Hashim
Big tech teams up against the virus
Here's what Facebook, Google, LinkedIn, Microsoft, Reddit, Twitter and YouTube say they're doing together in a joint statement:
"We are working closely together on COVID-19 response efforts. We're helping millions of people stay connected while also jointly combating fraud and misinformation about the virus, elevating authoritative content on our platforms, and sharing critical updates in coordination with government healthcare agencies around the world. We invite other companies to join us as we work to keep our communities healthy and safe."
— David Pierce
How coronavirus hit tech on Monday
Six Bay Area county residents must shelter in place
Leaders and health officers for the counties of Santa Clara, San Mateo, San Francisco, Alameda, Contra Costa and Marin said Monday their residents will be required to stay in their homes and away from others for the next three weeks, effective at midnight Tuesday, as officials scramble to deal with the coronavirus crisis.
The orders are effectively a lockdown on all nonessential trips outside residents' homes. Necessary government services and essential businesses such as gas stations, grocery stores, pharmacies and banks will stay open, officials said. Restaurants will be required to switch to delivery or takeout only.
At a news conference, San Francisco Mayor London Breed acknowledged that the orders would be "disruptive to day-to-day life." But she and other officials asked people not to panic.
"You will still be able to get food, care for relatives, run necessary errands, walk your dog or go on a hike alone or with another person," said Grant Colfax, director of the San Francisco Department of Public Health.
He said the region's coordinated response is "evidence-based" and comes from a meeting over the weekend of Bay Area officials, who decided that "This is a critical intervention that we know can reduce harm and save lives … Every hour counts."
Law enforcement officers will take a "compassionate approach," said Bill Scott, San Francisco's police chief. "This is not about a criminal justice approach to a public health issue."
Scott said officers will be part of the effort to help educate people about why the rules are necessary, and would ask for "voluntary compliance."
The counties' orders are effective through April 7, but that date could be amended. — Levi Sumagaysay
The White House and big tech partner to tackle COVID-19 research
Microsoft, Chan Zuckerberg Initiative and Kaggle have joined the White House in launching a coronavirus research challenge for technologists. The challenge, which the White House announced Monday, calls on AI experts to use their tech skills to parse mass quantities of scientific literature about COVID-19 and other coronavirus illnesses in order to answer key questions posed by the World Health Organization. As part of the challenge, the White House is publishing a machine-readable dataset, including 29,000 scholarly articles related to the virus. The dataset will be available on the Allen Institute for AI's
SemanticScholar website as well as Kaggle, a Google-owned community of more than 4 million data scientists.
In a call with reporters on Monday, the United States' chief technology officer, Michael Kratsios, said the goal of the challenge is to help scientists sift through the vast and growing number of coronavirus-related articles being published every day. "The medical community has been struggling to keep pace with the sheer amount of content," Kratsios said. "Artificial intelligence can be incredibly powerful in helping scientists summarize and analyze the information."
Kaggle is offering $1,000 prizes, which can be deferred as donations to relief efforts, to whoever comes up with the best answers to a series of questions. Those questions include things like: What do we know about COVID-19 risk factors? And what do we know about vaccines and therapeutics?
"It's very, very, very difficult for the scientific community to go through more than 20,000 articles and synthesize the findings," Anthony Goldbloom, co-founder and CEO of Kaggle, said on the call. Natural language processing, Goldbloom said, can do a lot of that work for them. — Issie Lapowsky
The markets fell through the floor
Stocks crashed Monday, with the Dow losing nearly 13% and the tech-heavy Nasdaq losing over 12%. The day's losses were the largest for investors since the stock market crash of October 1987 and came despite exceptional stimulus measures announced by the Federal Reserve on Sunday, reducing interest rates to as low as 0%.
On Monday IBM's stock had dropped 34% since Feb. 14; Facebook is down 32%, with Google down 29%. — Joanna Pearlstein
U.S. Health Department reportedly hit by a cyberattack
Bloomberg reports that hackers attempted to slow the U.S. Health and Human Services Department's systems, potentially to hamper the country's coronavirus response. The hack "didn't do so in any meaningful way," reports Bloomberg, citing anonymous sources. The news outlet says that the department assumes a "hostile foreign actor" was responsible, though there is currently no evidence about the attacker's identity. — Shakeel Hashim
California governor: Close bars and wineries
Gov. Gavin Newsom said in a news conference Sunday that wineries, clubs, breweries and pubs must close down immediately, and that restaurants should halve their occupancy.
"We need people to be able to order food and pick it up," he said, while stressing that restaurants should ensure "deep social distancing."
The governor also called for home isolation for residents ages 65 and older and for those with chronic conditions, as those groups are more vulnerable to COVID-19, of which there are 335 cases in the state.
Newsom did not call for all schools to be shut down, although he said the state would release detailed guidelines and updates about schools on Tuesday. Closures now affect 80 percent to 85 percent of California students, he said. The state is also working on guidance for child care providers that it plans to release soon.
Asked about how California will enforce the restrictions he announced, Newsom said, "We'll exercise broad authority" but declined to go into specifics.
"Individuals need to meet this moment," he said.
California's guidance came on the same day as the CDC recommended that for the next eight weeks, gatherings of 50 people or more be canceled or postponed nationwide. — Levi Sumagaysay
Google, Verily and Trump's coronavirus website claims
Alphabet and Google CEO Sundar Pichai said in a Sunday blog post that the tech giant is working with the federal government on an informational COVID-19 website, two days after President Donald Trump announced that Google was working on such an effort in an apparent shock to the company.
Pichai's Sunday evening announcement followed a morning blog post by Verily, Alphabet's life sciences division, which said the South San Francisco company is working with California Gov. Gavin Newsom's office, along with local and federal authorities, on coronavirus testing and online tools. Pichai's blog post also followed the president's declaration during a Sunday news conference that Pichai called him to apologize. "I don't know where the press got their fake news, but they got it someplace," Trump said.
Related:
- How the bear market could hit tech
- Trump announcement of Google coronavirus website shocks many, including Google
- How execs at Twitter, Slack and Box decided to send everyone home
A Google spokesperson said Sunday night that the company would have no comment beyond what Pichai wrote in his blog post.
The informational website Google is developing will include COVID-19 education, prevention and resources such as links and tips, Pichai wrote. It is scheduled to roll out late Monday, he said.
Separately, Californians will be able to take an online COVID-19 screener survey through Verily's Project Baseline beginning Monday, the company said. Verily said it will begin testing the highest-risk individuals, who will be sent to mobile testing sites and can get their results within a few days. The first counties where the tests will be available are Santa Clara and San Mateo, Gov. Newsom said on Sunday.
A couple of hours after Trump's Friday announcement, Google tweeted out a statement saying Verily was in the early stages of developing a COVID-19 tool "to help triage individuals for testing," but the company said it would be rolling it out in the Bay Area first. On Sunday Verily confirmed that the Bay Area would host pilot programs and said its ultimate goal is to help local authorities expand testing access in California. Spokesperson Kathleen Parkes told Protocol, "We plan to test, iterate and collaborate closely with our partners to make testing more accessible and expedient in other areas but don't have any specific dates or locations to share on this." — Levi Sumagaysay
