Posts in category Business and finance


ApprovedBusinessBusiness and finance

Dirt-cheap mobile data is a thrill for Indian consumers

A swami gets the religion

THE security guards at the foot of Antilia, a 27-floor private residence in Mumbai, while away the days just as all bored Indians have been doing in recent months—watching movies on their phone. Using a mobile network to stream endless Bollywood epics would until recently have been an unthinkable luxury, even in the rich world. In India it now costs less than a cup of street-side chai.

Thank the tycoon lording it in the skyscraper’s upper reaches. As boss of Reliance Industries, Mukesh Ambani, India’s richest man, has spent more than $25bn on building Jio, a state-of-the-art mobile-telecoms network. The delight of the guards at Antilia, and of the roughly 130m Indians who have signed up to the service since it launched in September 2016, is matched only by the misery of Mr Ambani’s rivals.

Jio’s rise is nothing short of spectacular. It took less than a year for it to be delivering more data than any other mobile…Continue reading

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ApprovedBusinessBusiness and finance

Dara Khosrowshahi is off to a strong start but there are miles to go

 

HERE’S the job spec. Unite a deeply divided board. Keep a strong-willed founder under control. Immediately recruit a new chief financial officer. Negotiate with angry local regulators intent on closing down the business in their city. Convince courts that the company does not have to provide its contract workers with the benefits due to full-time employees. Change a cut-throat culture without curbing employees’ drive. On top of all this, deal not only with an intellectual-property (IP) lawsuit that could cost the firm nearly $2bn, but also cope with a criminal investigation by the FBI that could see some managers end up in prison.

No one sane, you would think, would even apply for such misery. But after some hesitation Dara Khosrowshahi (pronounced cause-ro-SHAH-hee), until recently the chief executive of Expedia, an online travel agency, returned the headhunter’s call. Now he is boss of Uber, which, at $68bn, is the world’s most highly valued privately-held company. Can he…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

A Chinese carmaker agrees to buy a Danish investment bank

A COMPANY that moves up the value chain from refrigerator parts to cars is impressive but not that surprising. A car company that buys an investment bank is audacious. But Zhejiang Geely Holding Group, a conglomerate based in Hangzhou, China, did not become big by paring its ambitions. Having successfully made the fridge-parts-to-cars transition at home, it went global in 2010. It acquired Volvo, a Swedish carmaker, from Ford of America. Now Geely is back in Scandinavia for another acquisition. This time it is buying one of Denmark’s biggest banks.

Saxo Bank announced on October 2nd that Geely would acquire 51.5% of its shares. It will spend over $800m on the deal, which still requires regulatory approval. Sampo Group, a Finnish insurance company, will acquire 19.9% of Saxo shares for €265m ($311m), and Kim Fournais, Saxo’s co-founder and chief executive, will retain 25.7%. The sellers are Sinar Mas, an Indonesian conglomerate, and TPG, an American private-equity firm.

Saxo was an early adopter of online securities trading and still invests heavily in financial technology. It makes a substantial portion of its profits from selling trading platforms to other firms. Daniel Donghui Li, Geely’s chief financial officer, says Geely hopes to expand Saxo’s technologies into Asia. Besides facilitating this expansion, Geely does not intend to change how…Continue reading

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ApprovedBusinessBusiness and finance

The bosses of two famous French firms struggle to keep customers

You see her after the third glass

ALEXANDRE RICARD wants to talk boxing. He runs Pernod Ricard, a firm that sells Chivas whisky and Absolut vodka, among other drinks. Formed by his grandfather in 1975, with roots in a Pernod distiller set up in 1805, it is the world’s second-largest seller of wine and spirits, with a market capitalisation of €32bn ($37bn). He brags that Floyd Mayweather, an American pugilist with 19m Instagram followers, recently endorsed one of the company’s tequila brands. Such a “key influencer” on a digital channel “gives us speed and scale”, says Mr Ricard.

Celebrity endorsements are an old ploy: French singers, actors and racing drivers used to push Pernod Ricard’s liquor. But with 90% of sales in markets outside of France, punchier efforts are needed. Two years ago the firm commissioned a global study of boozing habits, which totted up all “moments of consumption” for drinkers, identifying 20 important ones in…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

Manias, panics and Initial Coin Offerings

EVERY market mania reaches a point when pitches to would-be investors enter the realm of the surreal. So it goes for “initial coin offerings”, or ICOs. A new one by a firm called POW invites Facebook users to claim tokens for nothing; when they later become convertible into other tokens, the first to take advantage of the offer could “become worth $124bn…making them the richest person on Earth”, the blurb says. Not a bad return for no money invested and no risk borne. However bizarre, bubbles are hard to resist: no one wants to be the only one of their friends left out. They can also be financially ruinous. But gambling on a craze, even a highly dubious one, can be about more than blind greed.

The ICO boom is an outgrowth of the emerging, occasionally inscrutable world of cryptocurrencies. These are a form of money (bitcoin and ether are examples) used in transactions which are recorded on a distributed public ledger called a blockchain. An ICO is a scheme to raise funds for an…Continue reading

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ApprovedBusinessBusiness and finance

After a bite of Apple, Margrethe Vestager targets another tech giant

MARGRETHE VESTAGER’S assault on technology firms she deems to have improperly massaged down their tax bills continued this week with a tilt at Amazon. The internet retailer faces a bill of €250m ($293m) for back taxes over what the European Union’s competition commissioner considers to have been an illegal sweetheart deal with Luxembourg.

The order requiring the Grand Duchy to recover the money follows a well-publicised three-year investigation. It is the latest in a series of tax-avoidance cases brought by the European Commission against multinationals, most of them American. Last year, Ireland was ordered to recover €13bn from Apple—smashing all past records for EU corporate-tax cases.

As with Apple, the commission concluded that Amazon received illegal state aid—in the retailer’s case between 2006 and 2014—through a tax-cutting arrangement that was unavailable to its rivals. This came in the form of a ruling from Luxembourg’s tax authority,…Continue reading

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Business and financeGulliver

Concerns over charges for checked bags in America miss the point

FEES for checked luggage are working exactly as intended. That is the main thrust of a new report from America’s Government Accountability Office (GAO) on the recent rise of charges for checking a bag onto a plane when flying. But not everyone is interpreting the study in such a positive light.

Critics are crying foul because these fees cost some passengers more money. Bill Nelson, a Democratic senator who requested the study and sits on the committee that oversees the airline industry, has described the charges as a “last-minute shakedown”. William McGee of Consumer Reports, a non-profit organisation that reviews products, told USA Today that “consumers should be able to shop for airline seats without being nickel-and-dimed.”

Media outlets are also making the same point. When the Associated Press Continue reading

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Business and financeGulliver

Monarch Airlines goes into administration

JUST before dawn on October 2nd, passengers booked to fly on Monarch Airlines began to receive texts informing them that their flights had been cancelled. This was the first news that Britain’s fifth-biggest airline had ceased trading and is now in administration.

It is the country’s biggest airline ever to collapse. Monarch had been in last-ditch talks with the Civil Aviation Authority, a regulator, to renew its licence to sell package holidays, but failed to reach a deal. About 110,000 passengers have been left stranded, although the government has hired over 30 planes, in effect creating another airline, to bring holiday-makers back over the next two weeks. Chris Grayling, the transport secretary, is calling it the “biggest ever peacetime repatriation”. A further 860,000 have lost future bookings, and with it weddings, vacations and more, although many should be able to reclaim some of their costs. Monarch also employs about 2,100 people, all now…Continue reading

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ApprovedBusinessBusiness and finance

Facebook and the meaning of share ownership

ONE group of Facebook friends that Mark Zuckerberg recently decided were not worth hanging out with were its public shareholders, who expected to cross-examine him (via a lawyer) on September 26th in a Delaware court. At issue would have been Mr Zuckerberg’s plans to refashion the social-media firm’s share-ownership structure more in his favour.

There is not a scintilla of doubt over who controls Facebook. Not only does Mr Zuckerberg, its founder, serve as its CEO and chairman; owning 16% of its shares, he controls 60% of the voting authority through a special class of stock with ten times normal voting rights. A year ago, Mr Zuckerberg decided he would like to sell a large slug of his holdings (worth $74bn) without diluting control. The firm made a plan to distribute non-voting shares enabling him to reduce his economic interest to 3% without affecting control.

That prompted litigation. Shareholder votes can be directly meaningful on many issues, including management pay…Continue reading

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ApprovedBusinessBusiness and finance

Rivigo is helping the Indian truck-driving industry out of a jam

Time to freshen up the model

THERE are 36 gradations in India’s archaic caste system, from the priestly to the supposedly untouchable. And then, somewhere below that, are the long-haul truck-drivers. Plying the subcontinent’s potholed highways for weeks at a time, few can settle into anything like a home life. Their marriage prospects are grim; venereal diseases and sore backs from sleeping in cramped cabs are but two occupational hazards. Despite an oversupplied national job market, the industry has struggled to attract the roughly 1m new drivers it needs each year to keep everything from Amazon packages to car parts moving. Can technology help?

To fend off shortages, most truck owners have done precisely what economists suggest, which is to increase pay. Drivers can now command nearly 40,000 rupees ($610) a month, a decent white-collar wage—and not far from double the level of trucker pay just three years ago. Rivigo, a startup based in Gurgaon, an…Continue reading

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ApprovedBusinessBusiness and finance

A shareholder pact is rocked by Liliane Bettencourt’s death

A face of the firm

DEATH does not end all uncertainties. News that Liliane Bettencourt, a glamorous 94-year-old Parisian heiress, died on September 20th has provoked a flurry of investor speculation over L’Oréal, the world’s biggest cosmetics company. She had held a controlling stake in the firm her father, an inventor of hair dyes, founded in 1909. Its market value has since grown to be a whisker short of €100bn ($117bn).

Her death brings few immediate consequences. An Alzheimer’s sufferer, she had been declared legally unfit to manage her concerns. That followed a scandal, made public in 2010 after her butler secretly recorded politicians, lawyers and friends as they bilked her for millions of euros. The case still haunts Nicolas Sarkozy, an ex-president. He seethed in October that opponents had stymied his return to politics by repeating allegations he profited from the “sordid Bettencourt affair” (he was cleared of charges over it in…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

Venture capitalists with daughters are more successful

RICHARD NESBITT, a former chief operating officer at the Canadian Imperial Bank of Commerce, has long been an evangelist for women in business. In “Results at the Top”, a book he wrote with Barbara Annis, he describes his efforts to convince men to promote women. When speaking to bosses, he stresses data showing that companies with more senior women are more successful. But he has noticed that men with daughters tend to be more receptive to his message. At least for venture-capital (VC) firms, recent research confirms this observation, as well as the assertion that gender diversity boosts performance.

Paul Gompers and Sophie Wang at Harvard University wanted to determine whether VC firms with more women managers do better. Answering this question is tricky—firms that hire more women may have other characteristics that lead to success. VC-investing remains a predominantly male activity. In the authors’ sample of 988 VC funds in 301 firms, around 8% of new hires were women. Very few firms…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

The Bank of Japan sticks to its guns

SEVENTH time lucky? Minutes of the Bank of Japan’s (BoJ) policy meeting in July, published on September 26th, showed that the central bank had, for the sixth time since 2013, pushed back the date at which it expected prices to meet its 2% inflation target—to the fiscal year ending in March 2020.

Four-and-a-half years since Haruhiko Kuroda took office as governor and embarked on an unprecedented experiment in quantitative easing (QE), the bank is still far from its goal. It has swept up 40% of Japanese government bonds and a whopping 71% of exchange-traded funds. The bank’s balance-sheet has tripled. It is now roughly the size of the American Federal Reserve’s.

Yet, despite his apparent failure, and despite a snap general election, Mr Kuroda may yet stay for another five years when his term runs out next April. If not, most of his likely successors are signed up to the same reflationary policy. At least one member of the bank’s board gave warning at its…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

Three trade cases facing the Trump administration spell trouble

Ruinously competitive

IN 1845 Frédéric Bastiat, a French economist, wrote an open letter to his national parliament, pleading for help on behalf of makers of candles and other forms of lighting. The French market was being flooded with cheap light, he complained. Action was necessary: a law closing all windows, shutters and curtains. Only that would offer protection against the source of this “ruinous competition”, the sun.

Three similar pleas are facing the administration of President Donald Trump. But these are not parodies. On September 22nd the United States International Trade Commission paved the way for import restrictions on solar panels, ruling that imports had injured American cell manufacturers. On September 26th the Department of Commerce pencilled in tariffs of 220% on airliners made by Bombardier, a Canadian manufacturer. A third decision on washing machines is due by October 5th.

This cluster of cases represents around $15bn of…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

Once a leader in virtual currencies, China turns against them

BITCOIN and China always made odd bedfellows. Devotees of bitcoin love its independence from central authorities; in China the central authorities love their power. That they would accept a cryptocurrency that weakened their control over something as fundamental as the management of money seemed unlikely. Yet China had become the world’s biggest bitcoin market, dominating both its trading and computer-powered “mining”.

It was not meant to be. Bitcoin’s surprising success in China appears to be nearing its end. A series of bans announced over the past month have made clear that bitcoin and all fellow travellers, from ethereum to litecoin, have little place within its borders. Some hope that the bans are temporary. The government has, after all, declared an ambition to make China a leader in the blockchain technology that is integral to bitcoin. But its seems more likely that officials will tighten their grip on China’s remaining crypto-coin bastions.

Bitcoin had been in trouble in China since February, when the central bank, aiming to stem illicit capital flows, ordered exchanges to halt virtual-currency withdrawals until they could identify their customers. China’s share of global bitcoin-trading went from more than 90% to just about 10% (see chart).

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ApprovedBusiness and financeFINANCEFinance and economics

Nordic payments firms have become acquisition targets

THE Vikings were slow to adopt coins. They preferred to pay by cutting pieces off silver bars, at least until contact with the rest of Europe convinced them of the benefits of standardised coins. Today their Nordic descendants are abandoning coins and notes in favour of electronic payments. Two Nordic e-payments firms have recently announced that they will be acquired by foreign companies. The rest of the world, too, is using less cash. And they want the financial backing to enter new markets.

On September 25th Nets, a payments firm based in Denmark, announced that Hellman & Friedman, an American private-equity firm, had offered to acquire it for DKr33.1bn ($5.3bn). Nets is following Bambora, a Swedish-based payments firm, for which Ingenico, a French electronic-payments firm, offered €1.5bn ($1.7bn) in July.

Nets was created in 2010 from the merger of payments companies in Denmark and Norway. It has a strong presence in both countries. Dankort, Denmark’s national…Continue reading

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ApprovedBusinessBusiness and finance

McDonald’s wages a food fight in India

Bakshi gives McDonald’s the shakes

IN MOST ways the McDonald’s outlet in Jangpura, a gentrifying neighbourhood in south Delhi, looks like one anywhere else, with bright displays, plastic seating and a familiar menu. But this week a disconcerting sign warns that “unpredictable” conditions have affected tomato supplies; none are available. Not bad though for a store that McDonald’s has been trying to close since September 6th. Over a third of its 400 or so outlets in India were supposed to shut their doors then—yet nearly all are still slinging McSpicy Paneers to customers.

War rages between McDonald’s India and Vikram Bakshi of Connaught Place Restaurants Limited (CPRL), who first brought the American chain to India in 1996 as a local partner in a 50-50 joint venture, starting in Delhi (along with another franchisee, Hardcastle Restaurants, which went into the southern and western states). Over the next two decades, Mr Bakshi expanded in the north…Continue reading

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ApprovedBusinessBusiness and finance

American entrepreneurship is flourishing, if you know where to look

It’s hard to keep them down for long

AT FIRST glance, it seems that America’s economy is losing its mojo. Many economists, most notably Robert Gordon of Northwestern University, have lamented that productivity growth seems to be anaemic when compared with earlier golden eras (see Free exchange). A gloomy chorus of business leaders has echoed what media outlets have by now turned into a mantra, that American entrepreneurship is in steady decline. Surely America’s overall competitiveness, then, is plummeting?

The answer from one influential think-tank, the World Economic Forum (WEF), is no. In its latest update to its long-running annual ranking of global economic competitiveness, published on September 27th, America rose from third place to second, ranking below only Switzerland.

This is partly…Continue reading

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ApprovedBusinessBusiness and finance

Yandex, Russia’s biggest technology company, celebrates 20 years

ARKADY VOLOZH, the bearded co-founder of Yandex, Russia’s largest search engine, bristles at his company being branded the “Google of Russia”. Far from emulating the American firm, Yandex launched in 1997, a full year before Google, he points out. More crucially, the moniker poorly describes what Yandex offers today, which is a group of products and services that includes taxis, shopping, payments, music and education. “Really we’re the Silicon Valley of Russia,” says Mikhail Parakhin, Yandex’s chief technology officer.

That may only be a slight overstatement. Yandex’s Russian presence is immense; it accounts for just over half of the search market and 61% of online advertising, and its sites attract over 60m visitors each month. Like American tech giants, it is also expanding its offline logistical capabilities, signing recent deals with Uber, a ride-hailing firm, and with Sberbank, Russia’s largest bank, to build out its transportation and e-commerce…Continue reading

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ApprovedBusinessBusiness and finance

Who’s afraid of disruption?

LAST week Schumpeter met two tech tycoons who control businesses in total worth $600bn. In both cases the mayhem around them was what you would expect if Beyoncé hit town, minus the musical talent and looks. Hotel floors were locked down by the official secret service; the corridors were crammed with lines of petitioners and in one case a Wall Street boss gatecrashed the room in order to hug his idol.

The message from both titans—you ain’t seen nothing yet—was imperious. Over the next decade, they say, conventional industries will face an onslaught from tech competitors wielding vast financial resources, new technologies and massive reserves of data. It is a view that has swept through traditional firms’ boardrooms, too, where enthusing about virtual reality and singing the praises of Jeff Bezos, Amazon’s boss, is almost obligatory. The notion of disruption, with its promise to destroy the status quo and then renew it, is the most fashionable idea in global business since the…Continue reading

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Business and financeButtonwood’s notebook

Why a Labour government might mean a fall in sterling

THE British Labour Party is in buoyant mood at its annual conference, expecting to be in power very soon. And it has already started to think about the consequences, including a possible run on the pound if it takes office. But not everyone thinks this is likely; Simon Wren-Lewis, an economist, challenged people to think of “a serious economic reason why stering would fall on the election of a Labour government”. Well, this blogger can think of several. 

1. Labour plans to increase the rate of tax on corporate profits from (what will be) 17% to 26%. That means the profits available to overseas investors will be reduced accordingly. They will demand a lower price to compensate for this lower return—this will either come in the form of a fall in the stockmarket or in the pound, or probably a bit of both.

2. Labour plans to nationalise various utilities (railways, water, the Royal Mail and some energy) and to cancel some private finance initiatives…Continue reading

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Business and financeButtonwood’s notebook

Picking a fund manager? The odds aren’t great

WHO wants mediocrity? That is what a lot of people say when the subject of index-tracking, or passive fund management, comes up. They would rather choose a fund manager (an active manager in the jargon) who tries to beat the market by picking the best stocks. It does sound like a good idea.

The tricky bit is finding the right manager. The temptation is to look at past performance but fund managers rarely beat the market for long.

The average fund manager is always going to struggle to beat the market (this is a separate argument from whether markets are “efficient”). That is because the index reflects the performance of the average investor before costs. In a world dominated by professional fund managers, there aren’t enough amateurs for the professionals to beat. Even the hedge funds, those supposed “masters of the universe”, haven’t been able to do it; Warren Buffett looks…Continue reading

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Business and financeGulliver

Online auctions of Boeing 747s reflect shifts in the air-travel industry

FOR many aeroplane enthusiasts, buying a Boeing 747 is the stuff of dreams. The “Queen of the Skies” is an icon from the golden age of air travel, a period the 1960s and 1970s when the industry was at its most glamorous. And owning one would be like having a little piece of aviation history.

Last week that dream shifted slightly closer to reality, albeit only for well-heeled fans. Three Boeing 747s went up for auction on Taobao, China’s equivalent of eBay. The seller is a state court in Shenzhen, which seized the planes when Jade Cargo International, an airline, went bust in 2012. At first, state officials tried to flog the planes offline at private auctions. But after six failed attempts, they opened the sale up to public bids. Offers currently range from 122m yuan ($18.5m) to 135m yuan.

This is not the first time one of the planes has been auctioned online. Last year Concord Aerospace, a Florida-based firm which buys and sells plane parts,…Continue reading

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Business and financeGulliver

Sleep pods are becoming increasingly common at airports

IN THEORY, overnight air travel should be wonderfully convenient. Instead of booking a hotel for the night and losing a day, travellers simply sleep while they fly. In reality, sleeping on a plane is hard, and at an airport tougher still. The chairs in terminals, nobody’s idea of comfort to begin with, tend to have armrests that make splaying out unfeasible. Even in business-class lounges, travellers contort themselves into impossible shapes to pretend that workspace desks are actually beds.

But soon there may be less need for such acrobatics. Sleep pods are coming to more and more airports. Last month, Washington Dulles International put out a call for proposals for a company to provide “a quiet and comfortable place within the airport to sleep, relax, or work while waiting to board a flight”. Mexico City’s airport has just added sleep pods with a space-age design for $30 a night. YotelAir, which offers pods in…Continue reading

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Business and financeFree exchange

Bitcoin is fiat money, too

FINANCIERS with PhDs like to remind each other to “read your Kindleberger”. The rare academic who could speak fluently to bureaucrats and normal people, Charles Kindleberger designed the Marshall Plan and wrote vast economic histories worthy of Tolstoy. “Read your Kindleberger” is just a coded way of saying “don’t forget this has all happened before”. So to anyone invested in, mining or building applications for distributed ledger money such as bitcoin or ethereum: read your Kindleberger.

Start with A Financial History of Western Europe, in which Kindleberger documents how many times merchants in different centuries figured out clever ways of doing the exact same thing. They made transactions easier, and in the process created new deposits and bills that increased the supply of money. In most cases, the Bürgermeister or the king left these innovations in place, but decided to control the supply of money and credit themselves. It is good for the king to be in charge of his own creditors. But also, it has…Continue reading

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ApprovedBusinessBusiness and finance

Streaming has pushed Latin music into the mainstream

“MI GENTE” lures listeners with a mesmerising hook, a thumping beat and lyrics about breaking down barriers. A collaboration between J Balvin, a Colombian reggaeton star (pictured), and Willy William, a French producer, the latest product of this summer’s Latin craze is crooned almost entirely in Spanish. (The title means “My People”; reggaeton borrows from hip hop, reggae and rap.) The song topped the charts on Spotify, a streaming service, for weeks. “To be a crossover artist, you used to have to sing in English,” said John Reilly, Mr Balvin’s publicist. Now six of YouTube’s top ten music videos are predominantly in Spanish. In August the Billboard Hot 100, which tracks streams, sales and radio plays, sported seven Latin hits. Just five graced the chart in all of 2016.

Latin music is helping the music industry to arrest years of decline. Its growth is far outpacing that of other genres. Last year Latin America yielded just $598m out of total global recorded-music…Continue reading

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ApprovedBusinessBusiness and finance

Online matchmaking businesses in India have many ways to woo

“IT WAS 2012…I was number 37,” says Ashwini, referring to the badge that was pinned on her shirt pocket. Her task was to go onto the stage and introduce herself to around 70 eligible bachelors and their parents. Families then conferred and, provided caste and religious background proved no obstacle, would approach the event’s moderator asking to meet number 37. At midday girls would wait for prospects to swing by, again with parents on either side. A brief exchange might establish the potential bride’s cooking skills or her intention to work after marriage. If the two sides hit it off, they would exchange copies of their horoscopes. Nearly 50 men lined up to meet Ashwini that day, speed-dating style. No one made the cut. She later married a colleague.

Such gatherings form an important part of the wedding industry, worth around $50bn a year, in a country where arranged marriages continue to be the norm. India has 440m millennials—roughly, the generation born between…Continue reading

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ApprovedBusinessBusiness and finance

What if large tech firms were regulated like sewage companies?

THREE-QUARTERS of Americans admit that they search the web, send e-mails and check their social-media accounts in the bathroom. That is not the only connection between tech and plumbing. The water and sewage industry offers clues to the vexed question of how to regulate the Silicon Valley “platform” firms, such as Alphabet, Amazon and Facebook. The implications are mildly terrifying for the companies, so any tech tycoons reading this column might want to secure a spare pair of trousers.

In America and in Europe a consensus is emerging that big tech firms must be tamed. Their dominance of services such as search and social media gives them huge economic and political clout. The $3trn total market value of America’s five biggest tech firms (Apple and Microsoft are the other two) suggests that investors believe they are among the most powerful firms in history, up there with the East India Company and Standard Oil.

Trustbusters in need of instant gratification want to break…Continue reading

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ApprovedBusiness and financeFINANCEFinance and economics

Norway’s sovereign-wealth fund passes the $1trn mark

A year earlier than expected, Norway’s sovereign-wealth fund, the world’s largest, surpassed $1trn in assets on September 19th. It had gained over $100bn in the past year, thanks in large measure to the global stockmarket boom in 2017: around two-thirds of its assets are held as equities (over 1% of shares globally). It helps that Norwegians continue to earn fat revenues from pumping North Sea oil and gas, which go to the fund to be invested abroad. The fund is so big it is becoming a tool for 5m-odd Norwegians to shape values abroad. It is an increasingly activist shareholder, speaking out on executive pay, ethical behaviour, companies’ use of water, child labour and more. Both its size and influence are likely to keep on growing.

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