Tech Digest: Google's £1.2B Play Store Case, Toshiba's AI Hard Drive Push, Gemini's Free Tier Cut and Valley's $340M Bluevine Deal

Google is preparing to defend itself in London against a £1.2 billion class action claiming it charged excessive fees on Android apps downloaded from Google Play since 2015. The fight is over Google’s cut of app sales and in-app purchases (up to 30%) and whether a store facing real competition could have kept it that high. Google denies the claims. The sum is big for a British court and small for Alphabet. What matters is the fee, because a finding that 30% was excessive would travel well beyond Britain.

Google’s other headache this week is AI slop. Since October 1 its open-source bug bounty, the OSS Vulnerability Reward Program, has stopped accepting reports of flaws in Google’s open-source products, after a flood of invalid AI-generated submissions. Google plans to update the program by the first quarter of 2027. Bug bounties were built on the idea that writing a credible report took real work. That idea is dead. A model can produce a confident, tidy vulnerability report in seconds; someone at Google still has to read it before throwing it out.

Gemini is getting less generous too. From October 9, free users get a single model, 3.5 Flash-Lite, the lightest in the range. AI Plus subscribers keep Flash-Lite and get 3.6 Flash but lose Pro, while AI Pro picks up Deep Think, the reasoning mode that until now sat in the top Ultra plan. Running these models costs real money. The free tier is the easiest place to save it.

All that AI has to be stored somewhere, and Toshiba is betting a lot of it lands on spinning disks. The company plans to double its hard drive production capacity from its 2025 level within fiscal 2027 (which runs to March 2028), putting about ¥60 billion into its plant in the Philippines, its first major HDD investment in roughly five years. It wants 30% of the market measured by storage capacity, up from just over 10% now. Hard drives still cost far less per terabyte than flash, which matters when data centers are filling up with training sets and logs. Doubling output won’t double Toshiba’s share on its own, though. Seagate and Western Digital aren’t standing still.

Whether AI changes how people actually buy things is a separate question, and Brian Chesky has a view. In a long interview this week, Airbnb’s CEO said chatbots are poor at travel shopping. They show a handful of options and make it hard to do what people really do when planning a trip, which is browse listings with friends and family. Airbnb is looking at how agents could deal with each other directly. Chesky’s bigger complaint is that nobody is building a real operating system for AI, one with the tools that would let agents and apps work together. He also expects apps to stay important for a while, since Apple and Google control the platforms. For a company whose product is a very visual app, that’s a convenient conclusion. It’s also hard to argue with.

One fintech found its exit this week, inside a bank. Valley National Bancorp is buying Bluevine, the Jersey City company that runs digital banking and payments for about 175,000 small businesses in the US, for around $340 million, roughly three quarters in cash and the rest in Valley stock. The price looks modest until you see the deposits: $2.1 billion of them, cheap, and almost all from customers who don’t borrow. For a regional bank, that’s funding it would otherwise have to pay up for. Bluevine co-founder and CEO Eyal Lifshitz will join Valley as head of small business banking, and the deal is expected to close in early 2027.

Flipkart’s people are still waiting for theirs. The Walmart-owned retailer has lost at least eight vice presidents and senior vice presidents in recent weeks, and morale is reportedly sagging as Indian startup rivals push ahead with IPOs that turn employee stock into cash. Flipkart has paid out to staff before, including $700 million in 2023, but a payout isn’t a listing, and its own IPO still has no date. The company says a listing is still on the roadmap. It’s been on the roadmap for years.