Facebook crisis could bust digital-ad duopoly 23 Mar 2018 Advertisers may pull money from the social network, which together with Google sucked up 84 pct of digital ad spending in 2017. That cash is likely to stay with data-rich platforms rather than older media. Amazon could benefit if CEO Jeff Bezos can avoid raising antitrust fears.
Elliott forced to play long game at Telecom Italia 23 Mar 2018 The sudden resignation of eight Vivendi-backed directors triggers a full board reshuffle at the Italian telecom. The move makes it harder for Elliott to install its preferred candidates. But the activist could still get some of what it wants by aligning with Italian funds.
Zuckerberg’s slow defense reveals real weakness 21 Mar 2018 The Facebook founder finally explained how users’ information was harvested - four days after it was revealed by press reports. But his promise to tighten controls rings hollow. The trouble is the social network is built on data. Truly securing it may blow up its business.
Facebook leads Silicon Valley to its Minsky moment 21 Mar 2018 The social network feasted on burgeoning data and devices, just as banks gorged on easy money before the crisis. Society’s focus on benefits over risk gave tech companies free rein – until the resulting abuses couldn’t be overlooked. As user trust evaporates, regulation beckons.
Europe’s data tax war is worthy but hard to win 20 Mar 2018 The EU may tax tech groups’ revenue. The bloc is right to argue that current rules overlook the value firms like Google extract from its citizens’ data. A crude levy on sales is far from perfect, but might add impetus to longer-term international reform efforts.
Facebook gives members one more reason to leave 19 Mar 2018 An election consultant’s use of 50 mln profiles creates fresh risks at a company reeling over fake-news and ad-measurement mishaps. Users have plateaued in key markets and people are spending less time on the social network. The danger is that members may unfriend it altogether.
Google offers Aramco unlikely route to IPO heaven 1 Feb 2018 The Saudi oil producer is in talks with the search engine’s owner to create a tech hub in the kingdom, says the WSJ. There could be a secondary benefit. If investors valued Aramco the way they do Alphabet, the $2 trln valuation Riyadh wants from a future IPO would be a shoo-in.
Old-media stalwart tries out new business model 31 Jan 2018 Thomson Reuters’ $20 bln deal to cede control of its Financial & Risk unit to Blackstone includes a 30-year commitment to help fund the news division. That gives Reuters protection in a competitive industry, assuming its now highly leveraged biggest client prospers.
Blackstone could double its money betting on data 30 Jan 2018 The buyout firm is taking control of Thomson Reuters’ financial unit in a $20 bln deal. With a shade more efficiency and some acquisition-led growth, Blackstone could generate a generous return. The risk comes from adding financial leverage to a cyclical, competitive industry.
Ping An’s Big Health plan risks excess success 23 Jan 2018 A $9 bln unit of the Chinese insurer that analyses patient data has lured backers like SoftBank, Reuters reports. The digital upgrade of China’s clunky medical system is a lucrative opportunity for private firms. Data security is a risk; getting too big, too quickly may be worse.
Bank clients will learn the value of data in 2018 28 Dec 2017 New EU regulations will force lenders to share account information with competitors - subject to savers’ consent. Up to two-fifths of banks’ revenue could be at stake. New entrants will need to overcome privacy concerns. Even so, customers will discover what their data is worth.
Data M&A bomb blasts hole in Iron Mountain 12 Dec 2017 Its $1.3 bln deal for IO Data’s U.S. assets wiped some 7 pct off the value of the records-storage company. It’s smart to expand into stashing information electronically. But Iron Mountain is paying way above its own EBITDA multiple for only a modest impact on earnings.
Bank of England is too sanguine on inflation 12 Dec 2017 Prices rose 3.1 pct in the year to November, the fastest pace in six years. The central bank blames Brexit and says inflation is near peaking. That’s convenient with further interest-rate hikes a risk to sluggish economic growth. But the BoE may not get off so easily.
Uber cover-up makes new boss’s job even harder 22 Nov 2017 The ride-hailing app paid off hackers but didn’t tell regulators, or 57 mln people whose data might have been exposed. It’s an ugly coda to ex-CEO Travis Kalanick’s irresponsible reign. With Uber’s London future, for one, in the balance, Dara Khosrowshahi has his work cut out.
McKinsey needs to run a matrix on itself 10 Nov 2017 The consulting firm has been facing tough questions over hiring in Saudi, and work in South Africa. Neither helps its image. But more worrying is how data is making consulting a commodity. Doling out advice looks less valuable when one’s own business is struggling.
Yahoo ex-boss shows everyone’s in dark on hacks 8 Nov 2017 Marissa Mayer told senators she still doesn’t know who was behind a 2013 data theft affecting 3 bln users. Equifax’s CEO said the same of a breach involving 145 mln consumers. And Congress struggles to draft cyber rules. Amid such cluelessness, the epidemic can only get worse.
Twitter’s credibility is for the birds 26 Oct 2017 Jack Dorsey’s social network had to restate user numbers for three years. Quarterly ad revenue fell a whopping 8 pct. However, a promise of coming profitability has put investors in a tizzy. Cutting costs is a start, but it’s going to take more to mend Twitter’s broken wings.
Server-farm growth fuels hot IPO mumbo jumbo 6 Oct 2017 Rocketing data-storage demand is creating winners – witness the 46 pct rise in Switch in its first day of trading. It also encourages silliness such as the company crediting its performance on CEO and “inventrepreneur” Rob Roy’s practice of “Switchful Thinking.”
Equifax can’t even oust its failed CEO effectively 26 Sep 2017 Rick Smith is "retiring," as the euphemism goes, after a massive cyber attack and fumbled response - and with little financial penalty. The interim management plan makes clear the board hadn't planned succession adequately either. Equifax needs regime change at every level.
Facebook’s fuzzy math blurs its TV picture 6 Sep 2017 A claim to reach 100 mln younger people in America doesn't square with U.S. census figures, an analyst found. Despite a growing list of number blunders, advertisers have limited sway over the $500 bln titan. As Facebook pushes into streaming, though, it'll find tougher pushback.