Good Morning, Builders.

Today, we look at Tesla’s texting behind the wheel, Etsy’s disappearing digital witches, Meta’s metaverse cuts, and a legal AI startup hitting $8B. Here’s what’s shaping tech and business today. Let’s get to work.

Tesla CEO Elon Musk said in a recent X post that the latest Full Self-Driving (FSD) software allows drivers to use their phones while on the road, “depending on the context of surrounding traffic.” The claim comes despite texting being illegal in most U.S. states and handheld phone use banned in about half. FSD remains a driver-assistance system, not full autonomy, meaning drivers must keep hands on the wheel and be ready to intervene, especially as regulators investigate reports of FSD running red lights and entering wrong lanes. Tesla is also facing ongoing legal scrutiny from the California DMV over claims that its cars can drive themselves. (TechCrunch)

Meta plans to cut up to 30% of its metaverse budget, a move that helped lift shares 4% as investors reacted positively. The cuts could include layoffs as early as January. Reality Labs, which produces Quest headsets and smart glasses, has burned over $60 billion since 2020, and Meta has struggled to grow the metaverse beyond the gaming community. The company continues to invest heavily in AI, committing as much as $72 billion in capital spending this year, while reorganizing its AI efforts under Superintelligence Labs and aggressively recruiting top talent. (Reuters)

Etsy’s online witches, who once sold digital spells and metaphysical services to a thriving niche audience, are facing a sharp decline as the platform enforces rules requiring tangible goods in listings. Despite high demand and low overhead, controversial publicity and stricter enforcement have pushed many sellers off the marketplace. The shift reflects Etsy’s broader evolution from a quirky, artisanal platform to a more mainstream, scalable ecommerce model, leaving little room for unconventional or magical offerings. (Financial Times)

Harvey, a legal AI startup founded in 2022, has confirmed an $8 billion valuation after raising $160 million in a funding round led by Andreessen Horowitz. The company, which specializes in helping law firms and corporate legal teams search, summarize, and draft documents using domain-specific AI, counts 50 of the top AmLaw 100 firms as customers and surpassed $100 million in annual recurring revenue. Harvey’s rapid growth reflects both its technological edge and a trend in venture capital where significant funding signals credibility. (TechCrunch)

The New York Times sued the Defense Department and Secretary Pete Hegseth over new Pentagon rules requiring reporters to get approval before publishing information. The Times says the policy violates the First Amendment by restricting journalists’ ability to cover the military. After mainstream outlets protested, access was given to reporters sympathetic to the Trump administration. Critics warn the rules give the Pentagon unchecked power to revoke credentials, limiting public access to vital information. (CNBC)

Car renters are discovering a new problem at pickup counters as AI-powered inspection scanners roll out across major airports. Reports say Sixt, following Hertz’s lead, is using automated photo systems that flag minor and sometimes pre-existing damage, leading to repair bills that arrive weeks after a car is returned. In several cases, customers only avoided paying after spotting timestamp errors that showed the supposed damage existed before their rental began. As these AI tools continue to become more prevalent, could a system meant to speed up inspections turn into an unfair, machine-driven revenue stream that leaves travelers at a major disadvantage? (New York Post)

To the Arena,
- Nathan

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