Internet

Hacked eBay exposes itself to another attack

23 May 2014

Carl Icahn buried the hatchet with the online auctioneer’s board before it came out that records of 145 mln customers were breached. Similar cracks just cost the boss of retailer Target his job. That leaves an opening for another investor to pressure eBay’s CEO and directors.

JD.com wins rich price despite poor governance

22 May 2014

The e-commerce group priced its $25 bln IPO above expectations. Investors seem unfazed by the revelation of a $591 mln gift of stock to boss Richard Liu. Investors are buying into his expertise, but a large, unexplained transfer of value days from going public raises red flags.

Retail bricks battle for clicks appreciation

20 May 2014

Williams-Sonoma is a prime example of a common oddity. The cookware-to-furniture merchant generates nearly half its sales over the web with Amazon-like growth and more profitability. Yet investors pay 10 times as much for the e-commerce king’s earnings. That logic has its limits.

Long arm of U.S. law doesn’t extend to cyberspace

20 May 2014

Credit Suisse’s guilty plea and $2.5 billion fine for helping tax dodgers shows Uncle Sam’s hold over finance is strong even beyond its borders. Yet hacking accusations against Chinese military personnel have produced only defiance. It’s a sign of the limits to U.S. legal power.

Rob Cox: ITT’s ghost hangs over Silicon Valley

20 May 2014

As Amazon, Facebook, Alibaba and Google have become the new conglomerates, it’s instructive to consider the experience of Harold Geneen, who turned ITT into the original M&A machine. The internet approach may be different, but the driver is the same: a fear of obsolescence.

Alibaba tries out role of the noble monopolist

20 May 2014

The retailing group effectively owns Chinese online shoppers. Its payment affiliate is the biggest game in town. Both are attractions for the upcoming IPO. As China’s monopoly regime matures, Alibaba’s challenge will be showing its dominance helps the market rather than restricts it.

Two deals Alibaba could strike in America

15 May 2014

Yahoo’s holdings in the Chinese e-commerce giant and Yahoo Japan are valuable, but selling them brings tax pain. IPO hopeful Alibaba wants to reduce foreign internet groups’ stakes. Buying Yahoo could reduce both problems. Industrial logic, though, suggests an eBay deal instead.

Tencent shows China’s online giants can coexist

15 May 2014

Growth in mobile gaming revenue tripled in just three months. It’s a small part of the group’s overall business, but the most important as users switch to handheld devices. While Alibaba rules mobile shopping, there’s enough to go round, and justify Tencent’s premium valuation.

China’s online shoppers more mobile than they look

14 May 2014

Alibaba sold $37 bln of goods via handsets in 2013. That suggests the market is 60 pct larger than estimated by go-to data provider iResearch. Tech metrics are always slippery. But if mobile commerce really quadrupled in 2013, prospects for internet players are due a rethink.

Rob Cox: The worry now is a brewing M&A bubble

13 May 2014

The corporate urge to merge has gone into global hyper-drive. Activity has surged as investors egg companies on and bid up the shares of acquirers well beyond mathematical prudence. When new metrics to justify the irrational are trotted out, it’s time to exercise caution.

China’s other e-commerce giant is priced to go

13 May 2014

JD.com sorely lags Alibaba in online retail, and its mooted $23 billion IPO valuation reflects that. But it doesn’t factor in greater mobile market share from an alliance with Tencent, or the potential for making a decent profit. Either would leave the shares with room to rise.

Top U.S. patent court stuck in own tech bubble

12 May 2014

The tribunal’s focus on minutiae and IP owners can lead to head-scratchers like a copyright ruling for Oracle over Google. The Supreme Court may confuse iCloud with Dropbox, but its broader view allows it to get tech cases right. Even in law, expertise can’t replace common sense.

China’s central bank tames unruly internet finance

12 May 2014

Authorities are reining in the banking ambitions of the country’s web giants. News of potential curbs on online payments and funds has alarmed investors. But by providing some much-needed order in web finance, China’s central bank seems to be endorsing rather than killing it.

Alibaba finance arm better out than in for IPO

9 May 2014

Alipay is crucial to Alibaba’s success, yet isn’t part of the soon-to-be listed Chinese e-commerce group. Founder Jack Ma caused outrage when he whisked Alipay away in 2011. But with hindsight, the current arms-length arrangement might be better for future Alibaba shareholders.

Alibaba’s IPO filing has strategy-shaped hole

8 May 2014

The Chinese e-commerce giant’s disclosures make little sense of its recent investments. A near-monopoly and fat margins give Alibaba leeway with new investors, but the worry is that having other people’s money to spend isn’t conducive to discipline.

Yahoo’s Alibaba windfall tough to spend wisely

7 May 2014

After selling part of its stake in the Chinese company’s mega-IPO, Yahoo could have $12 bln in cash. Buybacks have been getting pricier, and with Alibaba stock traded separately the U.S. firm may be tempted to throw money at its own business – whatever that may actually be.

Alibaba’s big reveal: high growth, odd governance

7 May 2014

The Chinese e-commerce giant’s IPO filing shows it processed $248 bln of goods in 2013, yet squeezed just a third as much revenue from sellers as eBay. Both numbers should continue to grow. The catch is that new investors have little say: the founders are keeping firm control.

Mini-me tech bubble is mere shadow of 2000 excess

5 May 2014

The run-up may have paused, but dozens of companies are in line to float, hubris is rampant, oddball metrics abound, and revenue-free startups are still worth fortunes. Even nerd culture has become hip. The latest internet boom is as absurd as the last, but it’s far smaller.

Muzzling China’s money market mania

5 May 2014

Online funds that offer rates 15 times better than demand deposits are all the rage. By shifting savings around, they can help get finance to companies that need it. But if China doesn’t set clear rules to keep money market funds in check a helpful innovation could bring trouble.

Twitter’s slow user growth is an ill canary

29 Apr 2014

Sure, first-quarter revenue doubled. But Twitter is finding it increasingly difficult to sign up new users or tempt existing ones to tweet more. That’s a bad combination for the microblogging service that’s losing money yet valued at 18 times projected 2014 sales.