Internet

Twitter takes Wall Street brain drain to new level

1 Jul 2014

The microblogging site enticed former Goldmanite Anthony Noto to become its CFO with a $60 mln-plus signon bonus. That easily prices banks out of the battle for talent. It also poses a threat to private equity and hedge funds – where Noto was heading before Twitter chirped up.

Rob Cox: Solving the second-class stock conundrum

1 Jul 2014

Entrepreneurs want super-voting rights to execute their vision without bother from uppity investors. “Class V” shares, with ballot power that lapses over time, would be a way to minimize this violation of democratic capitalism. A decade, say, would give founders their chance.

Rob Cox: Hollywood’s hopes in China rest on Youku

24 Jun 2014

The Chinese website streams 400 mln videos a day, making it Netflix, YouTube and Comcast stuffed into one dumpling. For all that, Youku loses money. Yet the interests of Tinseltown and the Chinese Communist Party may be converging around its business model.

China’s e-commerce shift puts malls under pressure

24 Jun 2014

Stores have closed as customers move online. If internet shopping keeps growing at the same pace, it could account for a quarter of retail sales by 2020. Yet while growth in malls will peak this year, China’s urbanising population means well-planned plazas can still find success.

Alibaba is case study in U.S.-China legal gulf

23 Jun 2014

As the Chinese ecommerce giant prepares for its U.S. IPO, a congressional group is flagging the dangers in its ownership structure. Uncertainty in PRC law is to blame. The certainty that American authorities have the right to pursue graft in China is another less obvious risk.

Alibaba’s slow unveiling shows good and bad sides

17 Jun 2014

The e-commerce giant has revealed more details ahead of its upcoming IPO. The growing importance of commission revenue is positive. But the rapid shift to mobile transactions is squeezing margins. The quartet of non-executive directors is unlikely to win over governance sceptics.

Morgan Stanley email shame begs a tech solution

16 Jun 2014

Messages sent by the bank’s head of M&A to Allergan look bad now that it works for hostile suitor Valeant. Merger practitioners, meanwhile, won’t like Allergan’s scorched-earth tactic releasing them. The episode does, however, prove there’s a market for a corporate Snapchat.

Samsung software bet rests on future beyond phones

16 Jun 2014

The Korean group has launched a smartphone running its own operating system instead of Google’s Android. Samsung is unlikely to challenge the search giant’s lead in handsets. But it may have more success with software that can control televisions, appliances - and even cars.

Priceline’s OpenTable buy is costly appetizer

13 Jun 2014

The $64 bln online travel outfit is paying a 46 pct premium – $2.6 bln in cash – to snag the restaurant reservation site. Each helps small businesses and customers find each other. But the tariff only makes sense if Priceline can plug many more of both into OpenTable worldwide.

PokerStars goes all-in with $4.9 bln U.S. gamble

13 Jun 2014

The leading poker site is being staked by Canada’s Amaya and Blackstone in an aggressive deal that lifts debt to 6.6 times EBITDA. Cashing out the backers of PokerStars should increase the odds of cracking the United States. If Amaya plays its cards right, the bet could pay off.

Twitter requires a clearer cast of characters

12 Jun 2014

The COO’s departure signals flagging growth and lost direction. None of the microblogging site’s four founders is the controlling visionary some tech groups have. Boss Dick Costolo may be taking more of a grip. But he needs to spell out how he’ll restore Twitter’s fortunes.

China-U.S. cyber spat risks corporate casualties

9 Jun 2014

Beijing has responded to spying charges by taking aim at American tech companies. An escalating dispute could lead to blocked deals in the U.S. and lost sales in China. Though companies can try to ease security concerns, it’s hard for them to escape a political escalation.

Facebook is near-universal buyer in virtual world

6 Jun 2014

The $160 bln website’s users are worth nearly $130 each. WhatsApp, at $19 bln or $42 per user, was a relative steal. Users of Twitter and Japan’s Line look cheap, too. Clamp on an Oculus Rift and there’s a case for Mark Zuckerberg to buy most of the planet’s social and chat apps.

SoftBank may as well roll dice on U.S. mobile deal

6 Jun 2014

The Japanese group’s Sprint unit is pushing ahead with a bid for T-Mobile US. The odds are high regulators will block it. But creating a stronger third player could produce $30 bln in synergies. The alternative of a miserable future justifies the risk of paying a big break fee.

Jack Ma soccer buy does Alibaba investors a favour

6 Jun 2014

The internet giant’s founder hatched a $192 mln investment in China’s most popular team during a drinking session. Though the deal is immaterial to Alibaba’s value, it shows how the group works. It’s a reminder that investors in its IPO will be little more than spectators.

Reality yet to cut into ASOS valuation

5 Jun 2014

A profit warning lopped nearly a third off shares in the UK online fashion retailer. ASOS’s higher-margin foreign sales have been hit by a strong pound. But the revision implies a similar fall in profit. So ASOS’s shares are still tottering on an uncomfortably high multiple.

Alibaba hints at overseas push with SingPost stake

29 May 2014

Buying a $249 mln stake in logistics operator Singapore Post suggests the Chinese e-commerce group is planning its move overseas. But the concrete benefits are unclear – besides encouraging investors to consider the value of Alibaba’s future expansion ahead of its imminent IPO.

Korean chat app sends mixed valuation messages

28 May 2014

Kakao is going public in a $3.3 bln reverse takeover. That’s just one sixth of what Facebook paid for WhatsApp. The Korean app rules its home market and is profitable, but its metrics offer few clues for valuing rivals. Putting a price on mobile chat is still anybody’s guess.

Qihoo disrupts the disruptors of Chinese internet

28 May 2014

The software company doubled its revenue in the first quarter, and has won 25 pct of China’s search market in just two years. Its business model – free anti-virus apps – makes it an unlikely foil to giants like Baidu. But an early march into mobile gives Qihoo nuisance value.

Patent trolls again elude would-be captors

27 May 2014

The U.S. Supreme Court roughed up the infringement-lawsuit racket by giving its targets more leeway to recoup legal fees. New coverage for such costs provides a workaround, however. And with legislation just killed to rein in trolls, they seem free to prey on companies unscathed.