Internet

Twitter may grow fat and happy on low-patent diet

1 Nov 2013

The soon-to-IPO social network has an incredibly slim IP portfolio. Its nine patents may leave Twitter vulnerable to lawsuits and light on proven assets. But a policy of allowing engineers control over their inventions speeds innovation, lures top talent and cuts legal costs.

Facebook’s mobile surge bodes well for Twitter too

31 Oct 2013

Mark Zuckerberg’s social network once looked stymied by the smartphone migration. Its solid Q3 results show just how Facebook has answered the call. Mobile is lifting margins and the shift in revenue should persist. The growth is also a good sign for would-be Twitter investors.

Twitter avoids Facebook IPO overreach – thus far

25 Oct 2013

The microblogging site’s early public offer pricing is $17-$20 a share. Breakingviews calculations suggest that’s modest by available metrics, though without profit these require faith. At least Twitter seems to be avoiding the premature heights of Facebook’s flawed 2012 debut.

Apple jabs at Microsoft with giveaways

22 Oct 2013

Mac users won’t have to pay for the latest operating system. Those who buy a new product won’t pay for spreadsheets or movie creation – on the device or in the cloud. In short, Apple and Google are training users to expect software to be free. For Microsoft, that’s a problem.

Netflix could turn troublesome euphoria into useful cash

22 Oct 2013

The online video company’s stock has quadrupled since January. CEO Reed Hastings warns that momentum investors are too euphoric. Diluting the punchbowl is a better way to calm this rowdy party - and answer doubts about its balance sheet.

Alibaba creative governance should come at a cost

22 Oct 2013

New York says the Chinese e-commerce group could list with a structure that lets insiders nominate directors. Hong Kong regulators disagreed. The debate is really about the value of shareholder democracy. Investors should be wary of giving up their rights cheaply.

Obamacare mess is opportunity for Valley hackfest

21 Oct 2013

The launch of the new U.S. healthcare law has been accompanied by technological disarray. That gives West Coast tech whizzes who talk about improving the world a chance to muck in. Medical IT projects are tough, but a dose of crowdsourcing could help this one.

Hope tweets eternal for Twitter IPO valuation

18 Oct 2013

Early disorganization and a late focus on the top line make the microblogging service seem younger than Facebook when it went public. Twitter is in the red, but revenue is growing faster than at Mark Zuckerberg’s outfit. How many billions that becomes depends on animal spirits.

Beware a big and impatient Google

18 Oct 2013

The web search giant’s Q3 results suggest a smooth mobile transition. Steady success could be boring CEO Larry Page, though, who may skip future earnings calls and is struggling to invest in new ideas fast enough. The danger is the allure of acquisitions that suit Google’s scale.

Mark Zuckerberg’s new IPO religion wins disciples

17 Oct 2013

The Facebook founder’s early contempt for going public was supposed to influence a generation of Silicon Valley entrepreneurs. The stock’s calamitous debut only reinforced the disdain. Zuckerberg and Facebook have come around, though – and many other tech firms are set to follow.

John Malone wraps digital riddle inside an enigma

10 Oct 2013

The U.S. cable magnate’s Liberty Interactive is creating two tracking stocks, each with two classes of shares, and spinning off a stake in TripAdvisor. Only Malone could form a more labyrinthine structure in the name of simplification. Complexity may offset any value creation.

Activision lawyers saved from missing call of duty

10 Oct 2013

Delaware justices cleared the videogame maker’s $8.2 bln plan to buy out Vivendi, ruling that a quirky bylaw didn’t give investors approval rights. M&A deal terms can be tricky, but attorneys probably should have caught this one. A courtroom reprieve won’t always come through.

Tech disruptors could save China’s savers

10 Oct 2013

Alibaba and Tencent are taking on China’s bank oligopolists. That’s good for depositors: even if the upstarts fail, the industry will have to raise its game. The danger is that more digital channels for lending and saving sow further confusion about who is on the hook for risk.

Twitter’s sky-high R&D hits the right spot

4 Oct 2013

At 44 pct of revenue, the microblogging site is spending far more than Facebook. But with a lower number of users than its rival, Twitter needs to grow to make new investors happy. Hiring engineers at a fast clip to build new features and services is the best way to deliver that.

China’s online land grab risks value mudslide

17 Sep 2013

Tencent’s $448 million offer for a stake in search engine Sogou says less about value creation, and more about fear of losing out. While mobile strategies are starting to pay off, the ultimate size of the market remains unknown. Investors seem happy to take the risk.

Twitter prospectus edits will be worth following

13 Sep 2013

New U.S. rules mean there’s scarcely 140 characters so far about the micro-messaging service’s IPO. When changes are made public, it will repay investors to comb SEC modifications for red flags. On the checklist will be funny financial metrics and multiple share classes.

Twitter hopes for an Instagram moment

10 Sep 2013

Facebook leaned on a chunky acquisition of the picture-sharing app to prove its mobile chops, just as Marissa Mayer did with Tumblr to restore Yahoo’s image. Buying ad seller MoPub is Twitter’s biggest deal and may have the same uplifting effect as investors await an IPO.

LinkedIn’s toppy stock sale is better than buying

4 Sep 2013

The $27 bln job-focused social network is raising another $1 bln. With $900 mln in cash and rising profit, it doesn’t need it. But when a company trades at over 1,000 times 2012 earnings, selling stock makes sense. At least it makes a change from firms doing overpriced buybacks.

Letter to the Editor: Another Twitter IPO idea

22 Aug 2013

A consultant on Google’s initial stock sale says a Dutch auction, as suggested in a Breakingviews article, is only partly right. Finance professor Ann Sherman recommends a hybrid model used globally by the likes of SingTel to welcome both institutional and individual investors.

Facebook effort could help poor, itself – and you

21 Aug 2013

Connecting the rest of the world to the internet won’t be easy or offer huge profits. The 2.4 bln people earning less than $2 a day aren’t quite an advertiser’s dream. But communication aids development, and improved data compression and transmission technologies benefit all.