Communications

Slack would be better off as part of a team

19 Nov 2019

Shares of the work-messaging service are down 45% since its June IPO. For all Slack’s charms, Microsoft’s alternative has nearly double the users, and is untroubled by the need to raise capital or turn a profit. Slack’s best course is to find a rich benefactor, like Salesforce.

5G hype faces a U.S. market sanity check

18 Nov 2019

Next-generation networks have inspired big deals, killed off others and kicked off a political arms race. Now the regulator wants to auction some spectrum publicly, rather than letting its owners sell privately. That might help raise more funds, but it also raises the stakes.

T-Mobile US CEO exit leaves big question dangling

18 Nov 2019

Boss John Legere is leaving the telecom just as its $26 bln merger with Sprint nears its final hurdle. Successor Mike Sievert is a safe pair of hands. Still, the timing is peculiar, especially when Legere’s counterparts at Disney and AT&T stuck around to see M&A plans through.

Brazil’s basket-case telco is not quite dead yet

7 Nov 2019

Oi, the country’s largest fixed-line carrier, has been making investors kvetch for years. Rivals are now sniffing around its assets. An upcoming earnings report is likely to show the company, crawling out of a restructuring, needs more than a cash infusion. It needs a miracle.

AT&T’s brush with activism creates four winners

28 Oct 2019

The $270 bln U.S. telecom plans to raise margins, add directors and sell assets, and it only took a nudge from Elliott. Both sides look smart, and investors gain too. So do shareholders in other companies: AT&T’s plan to split chair and CEO roles helps them to ask for the same.

India’s richest man tarnishes his telecoms aura

10 Oct 2019

Mukesh Ambani’s promise to keep voice calls free for life helped his startup Jio win 340 mln customers. Now he’s partly reneging, charging for connections to rival networks. It’s a setback for him, and a sign parent Reliance Industries is feeling squeezed by its mega-giveaways.

DirecTV not the only thing AT&T ought to offload

19 Sep 2019

Boss Randall Stephenson’s $49 bln purchase of the satellite TV firm has been a flop. But hiving it off would address a symptom, not the cause. Stephenson defended DirecTV right through AT&T’s purchase of Time Warner. A thorough divestment plan would start with the CEO himself.

Viewsroom: Nissan’s car-crash CEO

11 Sep 2019

Hiroto Saikawa is stepping down amid controversy over his pay. It has implications for the company’s rocky Renault alliance, and by extension for the French carmaker’s recent attempt to merge with Fiat Chrysler. Plus, is activist Elliott Management going soft on AT&T?

AT&T tilt can transform Elliott as well

9 Sep 2019

Paul Singer’s hedge fund beat Argentina and forced out Arconic’s ex-boss, earning a reputation for ruthlessness. AT&T, its bluest of blue-chip targets yet, is a new frontier. Getting the telecom giant to cooperate could make Elliott part of the high-finance establishment.

Elliott brandishes velvet-clad fist at AT&T

9 Sep 2019

The activist fund’s demands for the $270 bln U.S. telco are mild: Be leaner, stop doing deals, cut debt and improve governance. Missing, but worthy of discussion, is the idea of dethroning boss Randall Stephenson. The reticence may reflect that Elliott can’t fight this one alone.

Viacom-CBS is the Rip Van Winkle of TV

14 Aug 2019

The two firms split 13 years ago to extract value and boost growth. That plan failed, while peers got larger like Disney, or sold like Fox. A reunited Viacom and CBS can best shake off its slumber by amassing a portfolio of great shows to sell to more established video streamers.

CBS-Viacom merger is more whimper than Big Bang

13 Aug 2019

The broadcaster and the MTV owner, both controlled by the Redstone family, have finally inked a $30 bln reunion. Rogue CEOs, supine boards and dumb disputes gummed up the process. Hefty synergies won’t make up for perhaps more than $15 bln of value lost in three years of limbo.

Verizon’s best media strategy is not having any

13 Aug 2019

The wireless giant’s bet on internet advertising never made sense. The sad trajectory of high profile, low revenue Tumblr illustrates the divide. The site’s sale carries an embarrassing price tag. That’s another wake up call for Verizon to pull the plug on AOL and Yahoo.

Disney, Netflix similarities diverge at ambition

6 Aug 2019

The Magic Kingdom’s stock is near an all-time high as the $250 bln media firm readies its streaming video service. Disney has the content and brand to be a strong Netflix rival as their paths converge. But unlike Reed Hastings’ company, cord cutters will test investor patience.

Disney movie mojo is tight squeeze on small screen

22 Jul 2019

The $250 bln media giant’s “Avengers: Endgame” is now the No. 1 grossing film in the world. The Mouse House is home to another six of the top 10 movies, too, thanks to boss Bob Iger’s savvy deals. Transferring the magic to its forthcoming video-streaming services may be hard.

CBS and Viacom could be media’s own Switzerland

11 Jul 2019

A merger of the two media firms backed by the Redstone family is likely. But what then? CBS-Viacom will still be no match for rivals Disney and Netflix. Its best move may be to stay neutral, make content and leave streaming wars to rivals – provided it can keep ambition in check.

Cisco’s latest deal is an optical illusion

9 Jul 2019

The networking giant is paying $2.8 bln for Acacia, one of its suppliers. Booming bandwidth use is driving demand for its high-speed optical components, but a lofty 46% premium virtually guarantees subpar returns. It’s an odd choice when software is driving Cisco’s margin growth.

Buyout firms download promising $14 bln data deal

8 May 2019

EQT and Digital Colony Partners are buying serial acquirer Zayo on the cheap. The fiber and data center firm’s subdued growth and hefty need for capital made for an uncomfortable five-year ride as a public company. A brighter future, helped by 5G growth, awaits as a private firm.

T-Mobile and Sprint can bear antitrust pain

16 Apr 2019

The telecom firms have yet to convince U.S. officials over their $88 bln merger. They may have to make cuts, like selling T-Mobile’s prepaid unit or spectrum. Bigger rivals Verizon and AT&T are already diversifying. Unless trustbusters get draconian, combining is the best bet.

Apple and Qualcomm face up to mutual need

16 Apr 2019

The smartphone maker and chips firm ended a two-year fight over royalties, with a cash payment to Qualcomm and a licensing agreement. Apple can’t risk being stuck with second-rate chips, and Qualcomm has huge revenue at stake. At first blush, both sides benefit from the truce.