In today's ExchangeWire news digest: the latest State of European Tech Report finds that investment in "deep tech" fell by 13% in 2020; a second federal judge rules against the Trump administration's attempt to ban TikTok; and Zenith forecasts ad spend to fall by 7.5% in 2020, down from its July prediction of 9.1%.

Deep tech funding declined 13% in Europe

Funding for “deep tech” declined by 13% in Europe over 2020, according to the latest State of European Tech report. The result, attributed in large part to the disruption caused by the COVID pandemic, means that investment in advanced technologies, such as AI and VR, dropped to USD $8.9bn (£6.7bn) from the USD $10.2bn (£7.6bn) recorded in 2019.

The report, produced each year by venture capital Atomico, contained good news for Europe despite the fall in deep tech funding. The continent is continuing to draw in investment from US, and start-up investment is set to stay in line with 2019 levels, raising USD $41bn (£30.7bn) compared to USD $40.6bn (£30.4bn) last year. However, this amount pales in comparison to North America, where start-ups raised USD $141bn (£105.8bn) in 2020, according to the report.

European firms across deep tech have raised over USD $36bn (£27bn) since 2016, an impressive figure, but not enough to make Europe a real contender in the space, according to the report. The EU and non-member countries will have to continue to invest big in areas such as machine learning, blockchain, and the internet of things if it wants to be a leader in deep tech.

Second federal judge rules against US TikTok ban

A second federal judge has delivered a preliminary injunction against the Trump administration’s attempt to ban TikTok from the US. Made by US District Court Judge Carl Nichols, the ruling resolves a lawsuit filed against president Trump, secretary of Commerce Wilbur Ross, and the Commerce Department by TikTok and its parent-company ByteDance.

The outcome follows a similar injunction granted by US District Court Judge Wendy Beetlestone in October, who ruled against the executive order issued by president Trump which sought to make the popular short-form video app inoperable within the US. Judge Beetlestone’s ruling concluded a separate lawsuit filed against Trump and the US Commerce Department by three of the platform’s creators.

The executive order, signed by the president on 7^th August, invoked the International Emergency Economic Powers Act (IEEPA) and the National Emergencies Act, with the Trump administration asserting that TikTok’s Chinese ownership made it a threat to US national security. Judge Nichols, however, concluded that the restrictions imposed by secretary of Commerce Ross had likely violated the limits within the IEEPA and the Administrative Procedures Act.

In an email, TikTok told TechCrunch that it is “pleased” with the ruling, and is “focused on continuing to build” within the US.

Global ad spend to decline 7.5%, predicts Zenith

Zenith has predicted that ad spend around the world will fall by 7.5% in 2020. In its latest ad spend forecast, the agency anticipates that spend will grow by 5.6% in 2021, with much of this recovery stirred by the Tokyo Summer Olympics and UEFA Euros football tournament, which had to be postponed due to the pandemic.

In its latest Advertising Expenditure Report, Zenith predicts a less severe drop than the 9.1% the firm warned of in July. Whilst the new projections still place ad spend for 2020 below the levels recorded in 2019, the report estimates that spend will grow beyond these levels in 2022.

Elizabeth Baker, head of national investment for Zenith Australia, says that the country will recover some lost ground from the start of 2021. “We’re expecting that the New Year will start showing growth across most media, as the market starts to claw back on this year’s losses,” she said.

“However, we don’t expect the 2020 drop to be fully mitigated before 2022 at best. Digital investment will lead the growth, with consumption accelerated throughout this pandemic.” Australia is expected to experience a higher growth of 8% than the global rate predicted by Zenith.