Internet

China web giants stuck with telco reform bill

22 Jun 2017

Alibaba and Tencent will join a group investing $10 bln in struggling China Unicom, Reuters reported. It’s part of Beijing's plan to increase private investment in state-owned firms. Unicom is the clear beneficiary of the boost. How the internet giants will profit is unclear.

Tech selloff lumps apples with oranges

12 Jun 2017

Shares in technology giants including Apple, Facebook and Amazon have suddenly tumbled. Given their rapid ascent this year, a correction always seemed likely. Still, such sector-wide moves obscure huge differences in different companies’ earning power and cash reserves.

Pinterest valuation logic is yet to be discovered

7 Jun 2017

A funding round at a $12.3 bln all-in worth puts "the world's catalog of ideas" on a 25 times revenue multiple, close to Snap's, and in the same market-cap ballpark as Twitter, which has double the users and nearly five times the sales. It's a DIY figure in search of support.

Facebook investors shouldn’t discount fake news

7 Jun 2017

Investors spurned a proposal that the social network report on the business risks of bogus news on its site. It’s a complacent stance on a topic Mark Zuckerberg has started taking seriously. At least opposition to multiple voting rights suggests governance isn’t a dead issue.

KKR bid tests investor faith in Aussie telco

7 Jun 2017

The U.S. buyout firm offered $1.7 bln for the struggling Vocus, a mild premium for a battered target. Shares in the Australian group are down over 60 pct since last June on downgrades and management problems. Given weak prospects, KKR is betting investors have lost confidence.

UK cyberspace crackdown faces reality checks

5 Jun 2017

Prime Minister Theresa May pledged new curbs on extremist propaganda and communications via YouTube, WhatsApp and the like following attacks in London and Manchester. Such promises can be good politics, but to actually happen they must make technological and economic sense.

Review: Tragedy makes Facebook a better place

2 Jun 2017

COO Sheryl Sandberg’s "Option B," a moving exploration of grief, emerged from the death of her husband. Top executives rarely reveal so much. She has also changed Facebook's policies. More so than "Lean in," Sandberg's new book sets her up as the $450 bln firm's best ambassador.

Mark Zuckerberg listening tour could start at home

31 May 2017

Activists want the Facebook CEO to give up his role as chairman. The quixotic proposal doesn’t stand a chance as Zuckerberg controls the vote. Yet the idea holds merit. The $440 bln firm would benefit from an independent board boss and a patina of good corporate governance.

Holding: Courts may save startups from redemptions

25 May 2017

Cashing out venture capitalists on demand can leave other investors in a lurch. A case involving onetime dot-com darling Oversee.net and Oak Hill suggests judges have growing concerns. It’s an overdue warning about how such conflicts can hurt fledgling firms and their owners.

Alibaba’s $6bln buyback disrupts financial reality

18 May 2017

Repurchasing shares will offset dilution from paying staff in equity, the Chinese e-commerce giant says. Only, buybacks don’t do that as they leave companies with less cash. Alibaba is replacing one pretence – that investors should ignore stock-based compensation – with another.

Snap lays an egg worthy of Twitter nest

10 May 2017

The messaging app reported its first quarterly results showing a slowdown in user growth. That’s a worrisome trend since its lofty $27 bln value hinges on attracting more people. Meanwhile, rivals are co-opting features. The sheen of being the next new thing is fading fast.

Even yellow flags can’t dent Facebook’s growth

3 May 2017

The social network largely defied its own executives’ slowdown warnings with a 51 pct jump in ad sales, helped by Instagram’s success. Boss Mark Zuckerberg is adding 3,000 staff to police content after a spate of violent videos. He may need more to contain reputational risk.

All-in gaming mergers will echo banking tie-ups

25 Apr 2017

The UK gambling industry faces a new wave of regulatory costs that favour bulking up, like in banking after 2008. A few big betting firms will probably emerge, with a long tail of me-too mass-market players. Online savvy should keep smallish peers Sky Bet and 888 in the hunt.

India’s tech poolside is running out of sunbeds

10 Apr 2017

Tencent, eBay, and Microsoft are piling into Indian e-commerce with a $1.4 bln investment in Flipkart. Japan’s SoftBank already backs local rival Snapdeal. Attractive as India is, having so many global tech groups rubbing shoulders ensures not everyone will get what they want.

Google and Facebook tipping balance of power

20 Mar 2017

The web-search giant lost Havas as a client in Britain and is being squeezed by the UK government over ad placements and policies. Similarly, Mark Zuckerberg’s social network faces outcries over fake news. Pressure is slowly but steadily mounting for this $1 trln digital duopoly.

India becomes front in global e-commerce proxy war

5 Mar 2017

Alibaba is leading a $200 mln investment into Paytm’s marketplace, creating a new Indian unicorn. That confirms the Chinese juggernaut's decision to take on Amazon, which is investing $5 bln in India. As homegrown rivals flail, tech's big boys will duke it out. Only one will win.

Amazon outage triggers internet alarm

1 Mar 2017

Websites, apps, connected cameras and the like went dark on Tuesday after a breakdown of the online giant's cloud service. Amazon's dominance, Silicon Valley's self-confidence and users’ reluctance to pay extra for backup all add up to rising risk for the internet of things.

SoftBank satellite bid orbits optimistic creditors

28 Feb 2017

The Japanese telecom group wants to merge its OneWeb startup with industry titan Intelsat. A combination depends on bondholders accepting haircuts on much of the $14 bln in debt. There's a juicy quid pro quo: long-term backing from Masayoshi Son’s giant tech fund.

Pearson buyout would be a study in low returns

23 Feb 2017

The UK education publisher's stock is down 22 percent this year, and its sprawling global business looks ripe for a breakup. Factor in the chance that the core U.S. textbook market is in terminal decline, however, and private equity would be brave to write the cheque.

Yahoo paying small price for big hacks

15 Feb 2017

The $40 bln internet company may be on the verge of discounting its core-business sale to Verizon by $250-350 mln, less than a 10 pct cut in the original price. For such poorly handled data breaches involving over 1 bln users, some 25 cents each seems a light penalty.