Netflix gets the last laugh in HBO “Friends” deal 10 Jul 2019 WarnerMedia’s new video service HBO Max will exclusively air the comedy series for a mooted $425 mln – snatching it back from its online rival. A blow to Netflix? Not quite. The streaming giant has effectively made sure the next buyer has to shell out a high price to win it back.
Crypto blank-check deal has at least one virtue 10 Jul 2019 The idea of a blockchain company backing into a listed special-purpose buyout vehicle sounds like risk on steroids. Hong Kong-based Diginex has big ambitions but a skimpy track record. Yet the transparency of a Nasdaq listing can help sort cryptocurrency reality from hype.
Cisco’s latest deal is an optical illusion 9 Jul 2019 The networking giant is paying $2.8 bln for Acacia, one of its suppliers. Booming bandwidth use is driving demand for its high-speed optical components, but a lofty 46% premium virtually guarantees subpar returns. It’s an odd choice when software is driving Cisco’s margin growth.
Branson’s space deal defies financial gravity 9 Jul 2019 The bearded billionaire is selling half his cosmic travel group to former Facebook executive Chamath Palihapitiya’s blank-check vehicle. A $1.5 bln valuation looks rich given Virgin Galactic’s record of two test flights. Still, it needs cash, and Palihapitiya has too much of it.
Shanghai’s new board could lead to a bigger trade 9 Jul 2019 Suzhou HYC Technology became the first company to price an IPO on the hyped Star Market. Investors disappointed by similar past efforts will be waiting for more signs of success. They should have some soon, given it seems to be a prelude to liberalising China’s main exchanges.
U.S. curb on China research runs technology risk 8 Jul 2019 The Trump administration is putting more Chinese universities on blacklists, making it risky for American entities to work with them. Concern about academic spying for Beijing is valid, but discouraging ties with a leader in fields like AI and biotech can hurt U.S. capabilities.
The Exchange: Surviving the digital-media meltdown 8 Jul 2019 Venture capitalist Ben Lerer, whose firm backed BuzzFeed and Axios, drops by Breakingviews to discuss why startups in the news industry have been suffering. Unlike some of his peers, Lerer reckons these minnows can have mutually beneficial relationships with giants like Facebook.
Gulf backers can recycle Vision Fund cash 8 Jul 2019 Saudi and Abu Dhabi investors are mulling whether to support SoftBank’s plans for a second $100 bln vehicle. Though cash is tight, they could pledge to reinvest returns from the first fund. The hitch is that CEO Masayoshi Son may not get the money as fast as he wants to spend it.
Cox: Parisian elite’s offsite exposes fractures 8 Jul 2019 The annual gathering of French government, business and economic bigwigs in Aix revealed a political class struggling to deal with China, Trump and Big Tech. But French firms exude international ambition and benefit from globalisation. Reconciling the two will be tricky.
British Airways hacking fine is painful precedent 8 Jul 2019 The UK data commissioner wants to fine the airline 183 mln pounds after customer information was stolen last year. Even though that is at the lower end of the possible penalties, it dwarfs what Facebook had to pay under old rules and sets a higher bar for such security breaches.
Japan’s testy trade row strikes at Samsung 5 Jul 2019 Tokyo is curbing exports of tech materials to South Korea over a wartime spat. Hardest hit may be the $260 bln handset maker, which expects second-quarter operating profit to fall by 56% amid U.S.-China tensions. If supply chains keep getting disrupted, so too should valuations.
Huawei is now driving the U.S.-China trade bus 1 Jul 2019 President Trump’s ban on the Chinese telecom firm made sense, but mixing business and national security puts his own party in a bind. It’ll be hard to seal a broader trade deal without giving Huawei a break. U.S. lawmakers won’t like it, but politics may force them to cave.
San Francisco vaping ban shows warped agenda 28 Jun 2019 Juul Labs’ home is the first U.S. city to block its sales. Local agencies can’t use facial-recognition software. Meanwhile the area has a property-crime problem and human feces on its streets. The place boasting the highest density of billionaires is neglecting basic services.
Nio’s upscale brand singed by battery blazes 28 Jun 2019 The New York-listed group has recalled almost 5,000 ES8 cars, more than a quarter of those delivered, after fires. Samsung recovered from worse, but Nio is a startup betting on quality to stand out from electric-car rivals in China. Much-needed cost cuts may have to wait too.
Apple tastes luxury’s less lustrous side 28 Jun 2019 Jony Ive, whose iMac and iPhone designs fueled the $920 bln firm’s meteoric rise, is leaving - and at a time when phone sales are falling and trade flows under threat. Design-dependent brands can recover from creative brain drain, but it’s sometimes a painful process. Just ask Gucci.
Facebook discovers money is tougher than data 26 Jun 2019 Fed Chair Jerome Powell joined foreign watchdogs in vowing tough scrutiny of the $539 billion company’s planned crypto coin. Some of its own partners may have doubts about the project, too. The tactics Facebook used to pioneer social networking don’t transfer easily to finance.
Creepy data practices go beyond Silicon Valley 26 Jun 2019 A U.S. Senate plan requires big tech firms like Facebook to disclose the value of user information. Large merchants such as Walmart are included; financial firms like JPMorgan aren’t. Yet they all monetize data in ways not clear to consumers. There’s a case for widening the net.
Rocket exerts downward drag on German fashion IPO 26 Jun 2019 A clothing site in which Oliver Samwer’s tech investor owns 20% is struggling to float. Global Fashion Group was tainted by association with Home24, another Rocket-backed group which flopped, despite their differences. Investors’ growing aversion is a big problem for Samwer.
Capgemini will toil to turn buzzwords into gold 25 Jun 2019 The French consultancy led by Paul Hermelin is buying R&D outsourcer Altran for 3.6 bln euros. It’s highly accretive to earnings, and they can cross-sell engineering and IT services to big firms. Apply a more sober financial lens, however, and the returns don’t quite stack up.
Tech’s finance push is disrupting regulators too 25 Jun 2019 Innovations like Facebook’s proposed digital currency challenge established banking rules. New arrivals are hard to pin down, weaken existing players, and invert the risks and rewards of competition. A joined-up global response is necessary - but will be hard to agree.