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European regulators delivered two helpings of bad news for US tech firms Wednesday (October 16). In the UK competition watchdogs have begun a probe into Amazon's investment in Deliveroo. Back in May, the online giant led a 575 million dollar fundraising round for the food delivery firm. Now the Competition and Markets Authority says it's looking into whether that will crimp competition. The deal was supposed to give Amazon a step up in its battle against Uber Eats. Deliveroo is one of Europe's fastest growing tech firms. It employs 60,000 riders in 13 countries to deliver takeaway food. Meanwhile chipmaker Broadcom - a major supplier to Apple - is in trouble with Brussels. Competition Commissioner Margrethe Vestager not pulling any punches Wednesday: (SOUNDBITE) (English) EU ANTITRUST COMMISSIONER, MARGRETHE VESTAGER, SAYING: "We consider that Broadcom is restricting competition by engaging in exclusive and quasi-exclusive dealing with key customers. Broadcom's behaviour would cause serious and irreparable harm to competition." As a result, she's ordered Broadcom to halt exclusive deals with six TV and modem makers for three years. She wants to investigate whether those agreements are intended to thwart rivals. Amazon and other tech giants may know how Broadcom feels. Vestager is infamous in Silicon Valley, after hitting U.S. tech giants with a series of multibillion dollar fines.
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The EU claims the chip maker is restricting competition for its chipsets using exclusivity and bundling contract terms. The company will appeal.
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The European Commission said Broadcom , the world's leading supplier of chipsets used for TV set-top boxes and modems, is engaging in anti-competitive practices and ordered it to halt the practices. Broadcom is using clauses containing exclusive or quasi-exclusive purchasing obligations and granting customers commercial advantages conditional on the customer buying systems-on-a-chip for cable modems exclusively or quasi-exclusively, the regulator alleged. The Commission's use of injunction power was the first in 18 years, The Wall Street Journal reported. In a statement, Broadcom said it will appeal the ruling and that the ruling won't have a material impact on the set-top box or broadband modem businesses. "As we previously disclosed in an 8-K filing on June 26, 2019, Broadcom's contracts with the customers that the European Commission characterizes as exclusivity-inducing remain in force, other than the provisions at issue, and we intend to continue to support these customers going forward," the company said. (Updates with Broadcom's response.)
U.S. chipmaker Broadcom said on Wednesday that an EU antitrust order to halt certain business deals with six TV and modem makers will not have a material impact on its business and it will challenge the EU move in court. The European Commission earlier on Wednesday issued the order, the first issued against a company in 18 years, saying certain provisions in the deals could cause serious and irreparable harm to competition. "The principal effect of the Commission's decision will be to disrupt the efficiencies that Broadcom and European OEMs have achieved through strategic alignment," the company said, referring to TV and modem makers.
(Bloomberg) -- Broadcom Inc. was ordered to drop allegedly unfair clauses that may compel set-top box makers to use its chips, as European Union antitrust chief Margrethe Vestager deployed a rarely used weapon meant to prevent victims from suffering while probes drag on for years.Broadcom must end "anti-competitive provisions" in contracts within 30 days while the EU continues an investigation into allegations that the U.S. supplier forces six of its main customers to buy its chipsets. While the order announced on Wednesday is set to remain in force for three years or until the EU finishes its probe, Broadcom says it will ask an EU court to overturn it."The evidence that we have gathered from Broadcom’s behavior is likely to have severe negative effects on competitors before we could reach a final decision,” Vestager told reporters in Brussels. She said the so-called interim measures tool is "now on the table" and "if we find cases where interim measures would actually be the thing to do to prevent irreparable harm to competition then obviously we stand willing to use it."The EU hasn’t used interim measures in nearly two decades. The Broadcom move comes after criticism that EU probes into Google and Intel Corp. -- where the tool wasn’t used -- took so long that victims of unfair practices were thwarted by the time fines were levied.Court Fight"We intend to appeal the commission’s decision to the European courts and in the meantime comply with the commission’s order,” Broadcom said, adding that it doesn’t believe the contested provisions “have a meaningful effect on whether the customers choose to purchase Broadcom products."Officials said swift action was necessary because Broadcom’s conduct was likely to affect several upcoming tenders by telecoms providers and the introduction of the WI-Fi 6 standard for models and TV set-top boxes.Broadcom, based in San Jose, California, has also been targeted by U.S. antitrust scrutiny of WI-Fi and switch-chip markets, a probe covering the vast majority of its chip business. Broadcom has described that investigation as immaterial.The EU’s order would be "a landmark moment" for antitrust enforcement, especially if it’s backed by the bloc’s courts, France’s antitrust chief Isabelle de Silva said at a Paris event last week. The EU’s last attempt to use interim measures was halted by a court order in 2001. The regulator had required IMS Health to license data-collecting tools in Germany. The company later partly won a legal challenge that allowed it restrict some licenses.Arris International Plc was among the Broadcom customers to receive a questionnaire from the EU on chips in hardware used by the cable and satellite industry to provide television and internet to consumers, Bloomberg reported in October.(Updates with Broadcom statement in fifth paragraph.)To contact the reporter on this story: Aoife White in Brussels at email@example.comTo contact the editors responsible for this story: Anthony Aarons at firstname.lastname@example.org, Peter Chapman, Amy ThomsonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
U.S. chipmaker Broadcom has been ordered to halt exclusivity deals with six TV and modem makers for up to three years while EU antitrust enforcers investigate whether these agreements are aimed at thwarting rivals. The move by European Competition Commissioner Margrethe Vestager suggests she may be more willing to take temporary but rapid action against tech giants deemed to be abusing their dominance rather than wait for investigations to be finalised. Google critics have for years urged Vestager to target the Alphabet Inc. subsidiary with such interim measures during its 10-year battle with EU antitrust regulators.
Broadcom was ordered Wednesday to stop its exclusivity deals with six TV and modem companies by European Union antitrust regulators who are investigating whether these deals hinder competition. The European Competition Commission has not made such a stopgap order in 18 years, according to Reuters. "It doesn't necessarily say that now we have all cases lined up where interim measures will be used but it means that the tool is on the table," European Competition Commissioner Margrethe Vestager said.
The EU has ordered US chipmaker Broadcom to suspend its exclusive deals with six television and modem manufacturers while it investigates whether they are anti-competitive. The move to apply so-called “interim measures”, which stop companies from engaging in suspected anti-competitive behaviour before the outcome of an investigation, is part of a new approach to tech regulation by Margrethe Vestager, the EU’s competition commissioner. The chipmaker must now pause its deals for three years, or until Brussels finishes its probe, a process which can also take years.
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Broadcom Inc. (AVGO) today announced the availability of its BCM65450 family of G.fast modem devices. As telecom operators drive toward gigabit broadband via fiber deployments, the existing twisted pair copper infrastructure often remains the fastest and most cost-effective method to complete the customer premise connection. The BCM65450, with the highest G.fast density available, is designed specifically to bridge this fiber-copper gap and get the operator to gigabit services revenue in the shortest possible time.
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Intel (NASDAQ:INTC) stock has had a tough time in 2019. While shares are up for the year, the stock has under performed its semiconductor peers. With the company losing CPU market share to Advanced Micro Devices (NASDAQ:AMD), it's no wonder investors have left INTC in the dust. In addition, the macroeconomic environment has not been friendly to INTC stock. Or to the chip space in general.Source: JHVEPhoto / Shutterstock.com While resumed trade talks have already resulted in "progress", investors remain skittish whether the U.S.-China trade fracas will lead to further headwinds for the chip space.But looking beyond these variables, Intel remains a solid stock to own. Selling at a low valuation, it offers value in a space dominated by speculative growth names. It pays a solid dividend, and has the cash flow to support it. While you may not see big gains from Intel, it may be a great blue chip opportunity. Let's take a closer look at Intel, and see why the stock may be a buy at today's price.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Intel vs. AMDI believe the CPU wars are the most important factor when assessing Intel stock. While the trade war is a big risk, long-term AMD's purported recriminating of CPU market share threatens INTC's economic moat. Intel's dominant market share has given it pricing power and other advantages to ensure the stock remains a cash cow. But with AMD eating more of Intel's lunch, it seems that this gravy train could soon be over. * 7 Semiconductor Stocks to Buy Now But what is the truth behind the hype?It's no joke that AMD's Ryzen processors have been a game-changer. The success of this chip line has helped AMD seize more of Intel's CPU market share since 2017. AMD now has a staggering 30% market share of the CPU market. If this trend continues, AMD could reach market share it hasn't seen since the mid-2000s, when it had over 40% CPU market share.However, could this be but a short-term blip? Intel's market share losses are the result of their chip shortage. Their inability to adapt to 14-nanometre sized processor lead to supply issues. End-users simply switched from Intel to AMD.Perhaps AMD's market-share grab will taper off in the next few quarters. InvestorPlace's Ian Bezek believes so. In his Oct. 9 article, he pointed out how while AMD's market share has grown materially, it cooled off in the last quarter. However, as an aside, Bezek pointed out how Microsoft (NASDAQ:MSFT) partnering with Qualcomm (NASDAQ:QCOM) for chips in their Surface tablets highlights market share risk. Mobile chips have not been successful in the past when used in tablets. But with improvements in technology, mobile chip makers like Qualcomm now offer a compelling alternative to Intel's x86 CPUs. Despite Headwinds, INTC Stock Is UndervaluedIntel stock trades at a low valuation relative to most of its peers. INTC trades at a forward price-to-earnings (P/E) ratio of 11.6. The stock's enterprise-value-to-EBITDA (EV/EBITDA) ratio is 7.7. Here are the respective valuations of INTC's key competitors:AMD: Forward P/E of 27.8, EV/EBITDA of 64.7Broadcom (NASDAQ:AVGO): Forward P/E of 12, EV/EBITDA of 14Qualcomm: Forward P/E of 18.3, EV/EBITDA of 8.4Nvidia (NASDAQ:NVDA): Forward P/E of 26, EV/EBITDA of 40Texas Instruments (NASDAQ:TXN): Forward P/E of 5.9, EV/EBITDA of 3.1One thing to keep in mind is Intel's lack of long-term revenue growth. Analyst consensus estimates revenue will only grow from $69.4 billion in 2019 to $70.9 billion in 2020. Clearly, INTC stock is no growth play. But Intel stock more than makes up for in terms of return of capital to shareholders.INTC stock currently pays a 2.42% yield. While not the highest yielding blue-chip, it is otherwise a solid dividend. With a payout ratio of just 35.92%, there's plenty of room to grow this in coming years. The average 5-year growth rate for the dividend has been 5.92%. * 10 Tech Stocks to Buy Now for 2025 Along with dividends, Intel has bought back a lot of stock. For the first half of 2019, they repurchased $5.6 billion worth of shares alone. These buybacks are accretive to Intel shareholders, as they improve earnings-per-share over the long-term. Bottom Line: Intel Is a Solid Long-Term InvestmentThere's not much of a "play" with INTC stock. The company's main appeal is their cash-generating status and relatively low valuation. Key risks like competition and China may already be priced into shares. But if both of these issues accelerate, it does threaten the bull case for Intel stock.So what's the call? Are you looking for a solid dividend payer? Consider Intel stock. Are you looking for a contrarian chip play? Perhaps look elsewhere. Whether or not INTC maintains its moat, it is unlikely the company will see monumental revenue growth. Other chip names may offer this proposition.As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Beverage Stocks to Buy Now * 10 Groundbreaking Technologies Created by Universities * 5 Semiconductor Stocks Worth Your Time The post Why Intel Stock Will Weather the Trade War Storm appeared first on InvestorPlace.
SAN JOSE, Calif., Oct. 14, 2019 -- Broadcom Inc. (NASDAQ: AVGO) today announced the availability of its BCM68650 family of optical line termination (OLT) PON MAC devices. With.
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Broadcom (AVGO) expands Wi-Fi 6 chip portfolio with latest BCM6710 chip that supports high-performance, low-latency and high-bandwidth applications.
Chip stock NVIDIA (NVDA) fell about 2% in after-hours trading on October 9. Micron (MU) and Broadcom (AVGO) also fell 2% and 1%, respectively.