Xbox Hit With 3,200 Layoffs, Four Studios Leaving Microsoft

Microsoft and OpenAI face a lawsuit from the New York Times over alleged copyright infringement related to AI training. Internal documents reveal concerns about large-scale copying, potential market substitution, and data acquisition methods. Microsoft and OpenAI argue their use qualifies as fair use under US copyright law. The case hinges on whether AI training is transformative and harms the market for original works.

Microsoft's internal documents, revealed in a lawsuit, show executives admitting AI models steal content from media companies, creating a 'doom loop' that harms both AI performance and the web. CEO Satya Nadella noted AI chatbots reduce traffic to original sources. OpenAI is accused of bypassing paywalls for training data.

Nscale, an AI infrastructure provider backed by Nvidia, filed for an IPO on the NYSE under the ticker NSCL. The company reported $140.6M in revenue for the first half of 2023, up 1,252% year-over-year, but also reported $1.02B in net losses. Nscale rents Nvidia GPUs to AI companies and competes with Amazon and other neocloud providers. The company has partnerships with Microsoft and significant commitments from customers like Figure AI.

Microsoft's Satya Nadella joined 40+ Indian-American tech CEOs at a Seattle forum to discuss India-US tech ties, including AI and quantum computing. Microsoft plans a $17.5B India investment (2026-2029), while Amazon announced $48B (2026-2030). The event, under the India-US TRUST Initiative, focused on strengthening bilateral tech cooperation.

Microsoft plans a $44.6 billion hostile takeover bid for Yahoo, aiming to counter Google's dominance. Yahoo's board held an emergency meeting to discuss the offer, which may face regulatory scrutiny. The deal could reduce competition in the internet market.

The Federal Reserve raised the benchmark interest rate to 3.75%-4.00%, with most officials projecting one more hike this year. U.S. stock futures rallied as bond yields fell. Key economic data, including jobless claims and manufacturing indices, are expected later. Pre-market, Arm Holdings (ARM) and other tech stocks advanced, while Fluence Energy (FLNC) dropped after cutting revenue guidance.