|Day's Range||338.00 - 338.00|
Earlier this year, Google said it would transition all Hangouts users on GSuite to Hangouts Chat and Meet by October 2019 and then retire the classicversion of Hangouts
People love to share YouTube videos among their friends, which is why in mid-2017 YouTube launched a new in-app messaging feature that would allow YouTube users to private-send their friends videos and chat within a dedicated tab in the YouTube mobile app. After September 18, the ability to direct-message friends on YouTube itself will be removed. The change was first spotted by 9to5Google, which noted that YouTube Messages came to the web in May of last year.
Google has found a committed Android One partner in Xiaomi . The Chinese electronics giant today launched in India the Mi A3 (its third Android One smartphone in recent years) as the company looks to expand its handset offering in its most important market. The Mi A3 features mid to high-end hardware modules and follows Xiaomi's tradition of punching above its price class.
The DOJ's antitrust chief said he was working with several state attorneys general to investigate alleged anti-competitive behavior of big tech companies.
Hedge funds soured on technology stocks such as Alphabet in the second quarter, but increased their exposure to potentially politically sensitive health-care stocks.
(Bloomberg) -- The co-founder of DeepMind, the high-profile artificial intelligence lab owned by Google, has been placed on leave after controversy over some of the projects he led.Mustafa Suleyman runs DeepMind’s “applied” division, which seeks practical uses for the lab’s research in health, energy and other fields. Suleyman is also a key public face for DeepMind, speaking to officials and at events about the promise of AI and the ethical guardrails needed to limit malicious use of the technology.“Mustafa is taking time out right now after 10 hectic years,” a DeepMind spokeswoman said. She didn’t say why he was put on leave.Suleyman did not return multiple email requests for comment. He founded DeepMind in 2010 alongside current Chief Executive Officer Demis Hassabis. Four years later, Google bought DeepMind for 400 million pounds (currently $486 million), an ambitious bet on the potential of AI that set off an expensive race in Silicon Valley for specialists in the field.DeepMind soon began working on health-care research, eventually creating a division dedicated to the area. Suleyman, nicknamed “Moose” and whose mother was a nurse, led the development of the DeepMind Health team, building it into a 100-person unit.But DeepMind was heavily criticized for its work in the U.K. health sector. DeepMind Health’s first product was a mobile app called Streams that was originally designed to help doctors identify patients at risk of developing acute kidney injury. In July 2017, the U.K.’s data privacy watchdog said DeepMind’s partner in the project, London’s Royal Free Hospital, illegally gave DeepMind access to 1.6 million patient records. Suleyman apologized in a statement at the time.In late 2018, Alphabet Inc.’s Google said the team that created Streams would join a new Google division called Google Health. The DeepMind Health brand was shelved, and Suleyman was removed from the day-to-day running of the unit.Suleyman sat on an external panel of experts Google created to review thorny ethical issues related to AI. Bloomberg News also reported that he served on a smaller group within the company to vet particular projects, formed after an uproar over a Google AI contract with the Pentagon.To contact the reporters on this story: Giles Turner in London at firstname.lastname@example.org;Mark Bergen in San Francisco at email@example.comTo contact the editors responsible for this story: Tom Giles at firstname.lastname@example.org, Alistair BarrFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Three companies — Amazon.com Inc., Microsoft Corp. and Alphabet Inc. — quietly dominate the world of cloud computing.With more more than 100 giant data centers worldwide, they rent out computing power to all manner of customers, making billions of dollars along the way. In fact, cloud computing has done more to fuel Amazon’s earnings in recent years than its e-commerce business.But there’s a threat looming on the horizon, quite literally at the edge of the network. With so many mobile devices and sensors now connected to the internet — and relying on artificial intelligence — more people and companies need their computing power close to them. For everything from fast analysis of road conditions to streaming holographic concerts, remote data centers are just too far away.That’s going to hand a huge opportunity to wireless carriers, which are building fast 5G networks to handle the task. And create a threat for the dominant cloud-computing players, according to telecom analyst Chetan Sharma. “Over time, cloud will be primarily used for storage and running longer computational models, while most of the processing of data and AI inference will take place at the edge,” said Sharma, who just wrote a report on the topic sponsored by software provider AlefEdge Inc. He pegs the size of this so-called edge-computing market at more than $4 trillion by 2030.Wireless carriers and the owners of cell towers have a big advantage in the edge-computing race: Not only do they control access to high-speed telecommunications networks, they have valuable real estate, such as tens of thousands of cell sites all over the country.Cloud computing isn’t going away by any means. But there’s more pressure on the industry’s Big Three to team up with wireless carriers, so they’re not left out of the burgeoning edge market.“The big players realize that at a minimum they need to partner up with operators to get access to their real-estate property,” Sharma said.Already, AT&T Inc. — the second-largest U.S. wireless carrier — has joined forces with Microsoft Corp. and IBM Corp., two cloud providers.“Our goal is that our partners are wildly successful,” said Sam George, a cloud executive at Microsoft. “If our partners are wildly successful, we’ll be wildly successful. There’s a lot of money to be made for partners.”Amazon and Google declined to comment on their plans.AT&T has hundreds of workers focused on edge computing, and it’s “a core part of our 5G strategy,” said Mo Katibeh, chief marketing officer of AT&T’s business division.“This is one that takes a village.”IBM, meanwhile, is also working with carrier Vodafone Group Plc in Europe.“The networks are essentially themselves becoming a cloud,” said Steve Canepa, IBM’s global managing director for the telecom industry. “The telcos today have a point of presence at the edge, and that becomes a great place to have an extension of the platform.”Cloud providers in China — such as Alibaba Group Holdings Ltd. and Tencent Holdings Ltd. — invested in carrier China Unicom two years ago. And more such investments and partnerships could be coming, Sharma said.For other tech companies, including chipmakers like Intel Corp., the hope is the shift leads to a bigger opportunity for everyone.“We see a rapid convergence between the cloud providers and connectivity providers,” said Caroline Chan, a general manager at Intel. “In our view, it’s a bigger pie.”Other telecom players are angling to team up with both carriers and cloud providers. Crown Castle International Corp., which owns fiber lines as well as more than 40,000 cell towers in the U.S., is in talks with the two camps, said Paul Reddick, a vice president at the company.Crown Castle also is an investor in startup Vapor IO, which is deploying edge computing this year in six metro areas, including Chicago.“I would say this is one that takes a village,” Reddick said.Other projects are already well underway. At CenturyLink Inc., about 100 facilities that used to store telecom equipment are now outfitted with servers. And it’s making them available to corporate customers in sectors like retail and industrial robotics.“We’ve already sold these facilities to a number of customers that need to get that compute closer to the network edge,” said Paul Savill, a senior vice president at CenturyLink. “We’ve seen enough activity in this space that we can confidently build out this infrastructure.”To contact the author of this story: Olga Kharif in Portland at email@example.comTo contact the editor responsible for this story: Nick Turner at firstname.lastname@example.orgFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Google's (GOOGL) search dominance is about to increase. The Internet giant has made its much-awaited Google Go Search app available worldwide.
Google LLC plans to sublease Akamai Technologies Inc.’s current headquarters when the Cambridge-based internet giant moves into its newly constructed home across the street. Google (Nasdaq: GOOG) will occupy floors two through nine at 150 Broadway, and plans a fall 2020 move in. Akamai will keep the first floor, but plans to move into its new headquarters at 145 Broadway this November, a spokesperson said. “Google has finalized a deal to sublease office space from Akamai at 150 Broadway,” a Google spokesperson said in an email to the Business Journal. “This will serve as additional space to accommodate our continued short-term and long-term growth in Cambridge.” Office and lab vacancy in Cambridge's Kendall Square has been near zero for some time, as tech and biotechnology tenants flood the neighborhood in search of skilled talent and proximity to nearby institutions like MIT and Harvard University.
Roku (NASDAQ:ROKU) unquestionably has had an incredible 2019. Earnings continue to beat expectations. Growth has impressed. The ROKU stock price has soared, climbing 348% to this point. Among stocks with a market capitalization over $4 billion, not one has come close. Snap (NYSE:SNAP) is in second place, with a paltry-by-comparison 184% gain.Source: jejim / Shutterstock.com Even after those gains, ROKU stock looks reasonably cheap -- at least by the standards of this tech market. The midpoint of revenue guidance for 2019 suggests a roughly 14x enterprise value/revenue multiple. In a market where Shopify (NYSE:SHOP) is getting 25x+ and double-digit EV/sales multiples aren't uncommon, that figure isn't necessarily out of line.With Roku's pole position among cord-cutting and international possibilities, that type of multiple seems merited. But I'm no longer sure that's the case. The issue isn't necessarily the headline multiple. Investors mostly have done well by paying up for growth in this market. It's that, looking closer, Roku's current valuation for several reasons looks highly questionable -- even if, admittedly, I've made that argument before.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Player Revenue Shouldn't Count for the ROKU Stock PriceAgain, 14x revenue isn't that crazy in this market, even if that statement alone makes some investors wonder if the entire market has gone crazy at this point. But it's important to remember, as I've noted before, that not all of Roku's revenue is worth paying up for.The company's guidance, updated after this month's second-quarter earnings report, is for revenue of $1.1 billion at the midpoint. But roughly one-third of those sales are coming from Roku players -- which are actually unprofitable. * 10 Undervalued Stocks With Breakout Potential Player gross margin in the second quarter was just 5.5%. Gross profit dollars for players over the past four quarters total just $23 million -- suggesting 6.5% gross margins. Given that research and development spending alone has been over $200 million during that stretch, the player business obviously is a loss leader for the company's platform business.And that's fine. Platform revenue is growing at an exponential rate: 79% year-over-year in Q1 and 86% in Q2. But investors shouldn't be paying 14x revenue -- or really, anything, for the player revenue.Back out those hardware sales, and the ROKU stock price now sits above 20x this year's revenue. That is a multiple that, on its face, looks questionable. It's a multiple assigned to companies that have the potential for dominance of their market. Roku isn't necessarily one of those companies, at least not yet. The Market Share QuestionWhat's interesting about Roku is that it's driving growth while facing competition from absolute giants. This is a company going directly against Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) -- three of the four most valuable companies in the world. It has leading market share in terms of streaming devices in use.But it's still a relatively fragmented market. And in smart TVs, which is where Roku management itself believes streaming is going to go, its share in the first half of this year was "more than one in three," according to the shareholder letter.To be sure, Roku may be able to take share over time. More users means more data, which combined with the company's machine learning capabilities improves the experience. The Roku Channel increasingly looks like a gateway to streaming. It also looks like a business in which Roku can take dollars from streaming services, take dollars from advertisers and potentially take eyeballs (and maybe at some point dollars) through its own content.Still, Roku seems potentially unlikely to ever truly dominate the space. Competition is always going to be a factor -- and those larger rivals can find a way to undercut on pricing for streaming services and for advertisers. At 20x+ platform revenue, an investor should at least think she's buying the clear winner in an industry. That's not yet guaranteed to be the case. Where Does Streaming Go?The broader question is that this remains an industry still in the early stages -- which means Roku's long-term role in the ecosystem may change over time. Right now, there are dozens of streaming services of all sizes -- with more on the way. Disney (NYSE:DIS), Comcast (NASDAQ:CMCSA), and AT&T's (NYSE:T) unit WarnerMedia all are launching major efforts within the next 12 months.But many of the existing services -- and possibly one or two of the larger offerings out there -- are going to go by the wayside at some point. The glut of so-called virtual multi-channel video programming distributors like YouTube TV, Sling, DIRECTV NOW and others will ease.Roku's potential base of advertising customers, in particular, is likely to peak in the next 12-18 months. A less-fragmented streaming universe would give more power back to the winners -- and lower overall demand and pricing power for Roku.From a broad standpoint, there are simply a lot of questions here. Roku certainly is going to grow going forward. This is not the next TiVo (NASDAQ:TIVO). But, again, this is a stock selling at 20x its key revenue stream -- and something like 400x 2019 adjusted EBITDA.It's a valuation that leaves little room for questions. And it's a valuation that is likely to recede if, at some point, those questions are raised.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Marijuana Stocks to Ride High on the Farm Bill * 8 Biotech Stocks to Watch After the Q2 Earnings Season * 7 Unusual, Growth-Oriented REITs to Buy for Your Portfolio The post Why the Roku Stock Price Needs to Pull Back appeared first on InvestorPlace.
The 13F filing showed that George Soros bought almost 500,000 Slack (WORK) shares at an average price of $37.5 per share during the second quarter.
One open question after Judge Patricia Lucas' ruling: Whether non-disclosure agreements between government officials and Google are legal.
I'll admit it: I've gotten Snap (NYSE:SNAP) wrong. I've spent much of this year arguing that Snap (or, as some still refer to it, Snapchat) shares have moved too far and that the SNAP stock price was too high. So far, that cautiousness has proven foolish.Source: ArthurStock / Shutterstock.com Indeed, SNAP stock has nearly tripled so far this year. Among nearly 700 stocks with a market capitalization over $10 billion, only Roku (NASDAQ:ROKU) and Sea Limited (NYSE:SE) have done better.That performance, however, includes a bit of a pullback of late. Despite a blowout Q2 report last month, the SNAP stock price has fallen roughly 10% from post-earnings highs. There may be some profit-taking after the big gains. And with even analysts turning bullish, it could be that, at least in the near term, SNAP is running low on potential buyers.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAnd there are still valuation concerns. SNAP remains unprofitable. It's one of many high-flyers that could get dinged in another market swoon. There's still a lot of work for Snap to do to support even the current valuation. * 10 Undervalued Stocks With Breakout Potential All that said, first-half earnings show that there's a real path for Snapchat stock to keep its elevated levels. Also, it could potentially move higher. At this point, an investor's opinion on SNAP comes down to whether he or she believes it can move down that path. Incremental Margins and the SNAP Stock PriceOne of the concerns with SNAP stock is that its margins might not be quite as good as those of social media rivals like Twitter (NYSE:TWTR) or Facebook (NASDAQ:FB). Incremental usage on, say, Facebook costs the provider almost nothing. For Snapchat, a messaging app, the costs are higher, if still modest.Indeed, Snap's gross margins were negative as recently as 2016. But first-half results show real progress in moving toward profitability when looking at the company's incremental margins. Incremental margins are the profitability shown on each additional dollar in revenue. For Snap in 2019, they've been very strong.In fact, in the first quarter, they were over 100%. Revenue increased $89.8 million year-over-year; adjusted EBITDA increased by $94.4 million. That type of improvement probably is unsustainable, but even second quarter results were strong. Incremental margins (again, on an EBITDA basis) in Q2 were 72%. How Much Revenue Does Snap Inc Need?Over the past four quarters, Snap Inc has posted an adjusted EBITDA loss of $391 million. Assuming 70% incremental margins, it would need another roughly $560 million in revenue to break even on an EBITDA basis.That's still a lot of growth: revenue over the past year has been roughly $1.4 billion. That figure, then, probably needs to increase about 40% for Snap Inc simply to get back to zero. Of course, Snap posted revenue growth of 39% in Q1 and 48% in Q2, meaning the company should get to positive adjusted EBITDA by Q2 or Q3 of 2020.That said, near zero EBITDA doesn't support what remains a $22 billion market capitalization. To get to that point, Snap probably needs to get to at least $750 million in EBITDA, using Twitter's approximately 30-times multiple. That requires at least another $1 billion in revenue.Looked at another way, Snap's revenue needs to at least double just to get the company to the point where it can support a stock price of $16 on an EV/EBITDA basis. And so, anyone buying Snapchat stock here needs to believe that the top line can roughly triple in the next few years. That seems like a big ask. How Snapchat ImprovesThat said, it's certainly doable. 200% revenue growth in five years would require a roughly 25% annual growth rate. Snap has grown revenue 43% year-over-year for the past six quarters. And it has tools to keep that growth intact.Notably, Snap has tremendous room for improvement in monetizing its users. An analyst noted in April that its monetization was one-third that of Twitter and one-fifth that of Facebook.One way to do that is by getting more advertisers. Chief Business Officer Jeremi Gorman made exactly that point on the Q2 conference call:We believe the single biggest driver for our revenue in the short to medium term will be increasing the number of active advertisers using Snapchat. We have significant headroom in our business, given high levels of user engagement and ample supply of available impressions.In other words, Snapchat has plenty of inventory to sell to advertisers. The issue, at least per management, isn't necessarily user growth, which had flatlined before an impressive Q2 jump. Rather, Snap has to find those advertisers.And it's making progress doing so. ARPU (average revenue per user) has steadily increased at least 37% in each of the last four quarters. Yet Snap still has minimal monetization, particularly overseas. The company generates barely $1 in quarterly revenue per user outside of North America. That's almost 60% of its user base. The Case for SNAPIf Snap Inc can triple revenue in the next five years, Snapchat stock likely rises over that stretch. To get there, it needs to get more advertisers. To beat that mark, it needs user growth as well.And so, the case for SNAP stock comes down to largely those two aspects. Can the company better compete with Facebook, Twitter and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) for online advertising dollars? And can it drive user growth, particularly where it's struggled outside of the age 13 to 34 demographic?In December, investors largely thought the answer to both of those questions was "no." Now, they're more confident. But there's still more upside ahead if Snap Inc can deliver on both fronts.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Dividend Stocks to Load Up On * The 10 Biggest Losers from Q2 Earnings * 5 Dependable Dividend Stocks to Buy The post How Snap Stock Can Get Where It Needs to Go appeared first on InvestorPlace.
Alphabet Inc's Google, Apple Inc and Firefox browser maker Mozilla took steps on Wednesday to block the Kazakh government from creating an internet surveillance system using their browsers. Google Chrome and Mozilla Firefox will block a government encryption certificate that allows authorities to read anything a user types or posts using the browsers, including account information and passwords, the companies said in separate statements. Apple also said in a statement it would take similar measures to protect the users of its Safari browser.
Google Chrome and Mozilla Firefox will block a government encryption certificate that allows authorities to read anything a user types or posts using the browsers, including account information and passwords, the companies said in separate statements. Apple also said in a statement it would take similar measures to protect the users of its Safari browser.
(Bloomberg Opinion) -- In France, they call it taking mustard after dinner. In Germany, they talk about a child having already fallen in the well. In England, they speak of closing the stable door after the horse has bolted.They all are good ways of describing how regulators have tended to deal with the world’s biggest tech firms. But when it comes to Facebook Inc.'s digital coin, Europe's antitrust watchdog seems to be intent on breaking with this previous inaction.Bloomberg News reported on Tuesday that the European Commission is scrutinizing the two-month-old Libra project and the group backing it amid concern the currency will be detrimental to competition. This is a good sign the regulator will do something about it.That’s welcome because antitrust authorities have, over the years, repeatedly failed to prevent the sort of practices which have cemented the dominance of Silicon Valley firms in their target markets. Regulators then struggle to rebalance the market after the fact.Some past decisions look misguided in hindsight. The most obvious are Google’s $3.2 billion acquisition of DoubleClick in 2008, which cemented the search giant’s control over digital ads, and Facebook’s purchases of Instagram and WhatsApp – deals that made it the preeminent social network.Facebook’s plan should give regulators plenty of reasons for concern. The organization administering the digital currency, the Libra Association, comprises 28 members so far, but the extent of Facebook’s leading role warrants closer examination.QuicktakeWhy Everybody (Almost) Hates Facebook’s Digital CoinThe motivation for many of the members seems at this stage to be a fear of missing out. After all, Facebook’s 2.4 billion monthly active users give it unparalleled scale. But that could also be construed as the Menlo Park, California-based firm abusing a dominant position: Members of the association might feel they can’t risk being left out, so have little choice but to take part.The group includes most of the world’s biggest payments companies: Mastercard Inc., Visa Inc., Paypal Holdings Inc., Stripe Inc. and Vodafone Group Plc, whose M-Pesa mobile money transfer service is dominant in parts of Africa.That means it could be seen as a horizontal agreement, according to Bloomberg Intelligence analyst Aitor Ortiz. Those kind of arrangements may be acceptable in certain cases if they benefit the end user, but are normally anti-competitive if they consolidate the influence of a discrete group at the expense of consumers or rivals.Facebook has said that it won’t push ahead with Libra until it has secured all the necessary regulatory approvals. The European Commission’s message seems to be: Don’t push your luck. If the group fails to pay heed, it risks fines and punishments further down the line. That will make it harder to sign up new partners who are unwilling to expose themselves to such regulatory hazards.One has to wonder whether the growing regulatory scrutiny the currency is attracting will make the project worth the effort for Facebook. For sure, the social networking giant needs to find a way to diversify its revenue away from advertising. But I’m unconvinced that Libra does that.If anything, it will become another pillar of the advertising business by supplying valuable data on purchasing intent: every time you make a purchase using Facebook’s digital wallet, you give the company a better understanding of what you’re buying and why.All this highlights the contradiction at the heart of Libra: if it is truly independent, what’s in it for Facebook? Regulators are right to press for an answer.To contact the author of this story: Alex Webb at email@example.comTo contact the editor responsible for this story: Edward Evans at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Alex Webb is a Bloomberg Opinion columnist covering Europe's technology, media and communications industries. He previously covered Apple and other technology companies for Bloomberg News in San Francisco.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg Opinion) -- Investors in Argentina would seem to have no peers among global losers.After voters resoundingly rejected President Mauricio Macri and his free-market policies in primary elections earlier this month, the stock market, as measured by the S&P Merval Index, lost almost half its value in the biggest crash in at least six decades. The country’s currency, the peso, suffered its biggest decline since December 2015. The government’s benchmark-equivalent bond plummeted a record 26% to trade at 56 cents on the dollar, according to data compiled by Bloomberg.Argentina, whose economy is the third largest in Latin America, was already reeling from recession and inflation as high as 57.3% in May. The fear among investors now is the return to power of the Peronist party that traditionally stiffed creditors, defaulted on the nation’s bonds and rigged economic data so much that lenders had no incentive for a rescue.Amid the financial carnage, however, are two companies based in Argentina that highlight the country’s potential and showcase possible building blocks for its recovery. They are MercadoLibre Inc., Latin America’s largest online marketplace and biggest provider of online payment and digital financial services, and Globant SA, a software developer and technology services provider. Both are listed in the U.S., but if they were listed in their home country they would be 1.5 times the value of the local stock market, according to data compiled by Bloomberg. MercadoLibre and Globant increased their worldwide workforces 30% and 31%, respectively, to 7,239 and 8,384 in 2018 when most of the nation’s employers were either letting people go or not hiring during the recession.MercadoLibre is the most valuable publicly traded company based in Argentina, with a market value of $30 billion and revenue last year of $1.4 billion. Chief Executive Officer Marcos Eduardo Galperin, who is 47, started the company in his Buenos Aires garage in 1999 after studying at Stanford University. When he was a student, he successfully pitched the idea for the company to an investor while he was driving him to the airport. The company he has built now has operations in 18 countries and is referred to frequently as the Amazon.com of Latin America, with a healthy dose of PayPal thrown in because of its successful payments system.MercadoLibre, which went public in 2007, has gained 442% during the past five years and is still delivering a 109% total return this year. Its revenue is expected to increase 53% this year and 39% in 2020, according to analysts surveyed by Bloomberg. And while its 48% gross margin is down from previous years, it has been investing heavily in its businesses.Even with that success, Galperin sees a lot more room for growth. “Latin America has 600 million people and we have roughly 50 million people using our platform, up from 4 million” when the company went public, he said during an interview earlier this month at his Buenos Aires headquarters. MercadoLibre “can grow another 10 times from 50 million to 500 million” because “the number of transactions that are done per user in Latin America is still a 10th of what is happening in China.” The company derives only 21% of its revenue inside Argentina, so there’s plenty of room for expansion there.Martin Migoya, the 51-year-old chairman, CEO and co-founder of Globant, shared Galperin’s views about growth opportunities, calling the digital space “the largest single opportunity in the planet today.” His company, which was started in 2003, develops software and services for an array of mobile, social media, cloud-computing, gaming and big-data purposes, including artificial intelligence and machine learning. Its clients, 90% of which are in the U.S., have included such prominent companies as Google, Electronic Arts and Walt Disney.During an interview earlier this month at his Buenos Aires headquarters, Migoya said Globant, which generates only 5% of its sales in Argentina, is especially prepared to benefit from “a $5 trillion market in the next five years” made up of “digital transformation and cognitive transformation, which means applying artificial intelligence to pretty much everything.”Globant, which has a market value of $3.3 billion and generated $522 million in revenue last year, has gained 621% over the past five years and is returning 60% this year. Its sales are expected to increase 24% in 2019 and 21% next year, according to analysts surveyed by Bloomberg.The performances of MercadoLibre and Globant haven’t gone unnoticed. Toronto-based Dynamic Power Global Growth Fund, managed by Noah Blackstein, produced the largest total returns during the past 10, five and one years among more than 1,000 global mutual funds, according to data compiled by Bloomberg. MercadoLibre is the largest holding, accounting for more than 7% of the fund, according to the most recent filing. Globant makes up 5%.Blackstein looks for companies, not countries, when he invests. “My focus is finding the biggest opportunities for growth wherever they lie in the world, be they in technology, health care and retail,” he said in a July interview.By his measure, Argentina has some of the brightest prospects. As the country descends once again into political and economic instability, MercadoLibre and Globant can remind citizens and investors alike that a downward spiral doesn’t have to be the status quo.\--With assistance from Shin Pei.To contact the author of this story: Matthew A. Winkler at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Matthew A. Winkler is a Bloomberg Opinion columnist. He is the editor-in-chief emeritus of Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg) -- Twitter Inc. removed hundreds of accounts linked to the Chinese government this week meant to undermine the legitimacy of Hong Kong protests. It also said it would no longer allow state media to purchase ads on its platform.What Twitter didn’t mention in its series of blog posts this week was the increasing number of Chinese officials, diplomats, media, and government agencies using the social media service to push Beijing’s political agenda abroad. Twitter employees actually help some of these people get their messages across, a practice that hasn’t been previously reported. The company provides certain officials with support, like verifying their accounts and training them on how to amplify messages, including with the use of hashtags.This is despite a ban on Twitter in China, which means most people on the mainland can’t use the service or see opposing views from abroad. Still, in the last few days, an account belonging to the Chinese ambassador to Panama took to Twitter to share videos painting Hong Kong protesters as vigilantes. He also responded to Panamanian users’ tweets about the demonstrations, which began in opposition to a bill allowing extraditions to China.China’s ambassador to the U.S. tweeted that “radical protesters” were eroding the rule of law embraced by the silentmajority of Hong Kongers. The Chinese Mission to the United Nations’ Twitter account asked protesters to “stop the violence, for a better Hong Kong,” while social media accounts of Chinese embassies in Manila, India and the Maldives shared articles from China’s state media blaming Westerners for disrupting the city. “Separatists in Hong Kong kept in close contact with foreign elements,” one story says above a photo of U.S. Vice President Mike Pence."We know China is adept at controlling domestic information, but now they are trying to use Western platforms like Twitter to control the narrative on the international stage,” said Jacob Wallis, a senior analyst at the Australian Strategic Policy Institute’s International Cyber Policy Centre.It’s unclear if any of these diplomats were set up on the service by Twitter, but the state-backed attempt to discredit Hong Kong protesters continues to reach millions of global Twitter users. In many cases, the Chinese officials are promoting views similar to those in 936 accounts Twitter banned on Monday.The practice of supporting Chinese officials who use Twitter to spread the Communist Party agenda raises questions about the social media company’s commitment to rooting out disinformation and misinformation on the internet. It also raises concerns around why Twitter is helping Beijing make its case to a global audience when the service is banned in China, where dissenting voices are prohibited and officials sometimes detain users accessing the platform through virtual private networks.Twitter’s recent effort to curtail China’s government-directed misinformation campaigns, which provoked outrage from state media, seems at odds with continuing to welcome pro-Beijing accounts that attack Hong Kong protesters, said Wallis.“There’s a clear tension for Twitter here having seen that Beijing is willing to use the platform in deceptive and manipulative ways, whilst desiring to use the platform for state diplomacy,” Wallis said.The tweets are part of a broader campaign by China to reshape the narrative over Hong Kong, particularly in Western nations more sympathetic to the democratic aspirations of protesters. China this week also sent a 43-page letter to senior editors at foreign news outlets, including the Wall Street Journal, Reuters and Bloomberg.Twitter says it works with public officials and politicians around the world, not just in China, and that everyone deserves a voice in the public discourse, as long as they follow its rules and policies. The company has used the same argument to defend hosting tweets by U.S. President Donald Trump, which some users have questioned. Twitter has said it aims to “advance global, public conversation” and that public figures “play a critical role in that conversation because of their out-sized impact on our society,“ in a blog post last year.On Monday, Twitter said in a blog post that it would stop accepting advertising from state-controlled media: "Any affected accounts will be free to continue to use Twitter to engage in public conversation, just not our advertising products."Twitter’s embrace of Chinese officials on the platform also highlights how some American tech companies try to make inroads in the enormous market, despite government restrictions on their services. Facebook Inc. founder Mark Zuckerberg, for example, has repeatedly expressed a desire to enter China. Twitter oversees the China business from offices in Hong Kong and Singapore.Like Google, Facebook and other sites blocked in China, Twitter sells advertising to Chinese companies like Huawei Technologies Co. and Xiaomi Corp. that are trying to reach overseas users. Before Twitter’s policy change this week, it had also sold ad space to Chinese state media companies that used them to push the narrative that Hong Kong protests were orchestrated by foreign forces and angry mobs unrepresentative of the city’s majority. Facebook didn’t immediately respond to requests for comment.YouTube, part of Alphabet Inc., doesn’t have a specific policy that bars state-funded media, but the company’s ad policies require government-funded channels to be labeled as such. This week, state media including the Global Times published videos about the Hong Kong demonstrations, including an interview with a police officer who said he was “critically injured by violent protesters.” The company didn’t immediately respond to requests for comment on the matter.Both Twitter and Facebook have established programs to make sure public figures around the world sign up for their sites and understand how to use them effectively. The idea is that people who have a following — athletes, actors or singers — will create interest for their other users in the website. For years, the work has extended to politics, with the social networks signing up and training political figures. For example, Facebook has embedded staff with or trained Trump; Philippines President Rodrigo Duterte, known for encouraging extrajudicial killings; and Germany’s anti-immigrant Alternative for Germany party (AfD) in how to most effectively use the platform, Bloomberg News has reported.Twitter and Facebook have implemented terms of service that ban certain practices, including bot accounts that appear to be real people and promote misinformation. But government officials and state media still have wide latitude to say what they want.“If Trump is going to use Twitter to deliver his message to the Chinese government, then it makes perfect sense China should be using this medium to send signals back,” said Samm Sacks, cybersecurity policy and China digital economy fellow at think tank New America. “But then we get into this coordinated state misinformation domain and it raises problematic questions around what is propaganda and what is misinformation.”\--With assistance from Mark Bergen, Kurt Wagner and Daniel Ten Kate.To contact the reporters on this story: Shelly Banjo in Hong Kong at email@example.com;Sarah Frier in San Francisco at firstname.lastname@example.orgTo contact the editors responsible for this story: Peter Elstrom at email@example.com, Edwin ChanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Earlier this summer, the Federal Trade Commission began holding private talks with YouTube officials, part of a burgeoning investigation. The video service stands accused of breaking laws overseeing kids’ web habits, placing a massive library of media and accompanying revenue in jeopardy. Neither YouTube nor the regulators have discussed the talks publicly. Yet despite the secrecy, a small British marketing firm started emailing some marquee YouTube advertisers about the developments. Reports indicated that the FTC would hit YouTube with a record fine and force its operations to change -- something, the emails noted, that would "be of interest" to YouTube's sponsors. "Regardless of what size the fine actually is, it represents a shift in the world for children's digital privacy," read the message. "Look forward to seeing you soon.”The emails were from SuperAwesome Ltd. Toy makers, animators and other brands pay the company to place online ads or access tools like the startup’s “safe, moderated” system for internet comments. In July, SuperAwesome added another offering: a video service, called Rukkaz, that works much like YouTube. Amateur broadcasters upload videos, sponsors back them and kids watch. Only the startup pledged to work with only hand-picked broadcasters, and pitched the service as a way to abide by privacy laws and avoid the demented footage lurking on the open web. "This is something that Google and Facebook, and arguably Apple, should have been doing for the past five years," said Dylan Collins, SuperAwesome's chief executive officer. "And they haven't." Waves of new media darlings have tried to unseat YouTube, with no success. But Collins is one of several entrepreneurs trying to strike while YouTube is in turmoil. The video behemoth, owned by Alphabet Inc.'s Google, has earned a reputation as a Wild West of media, a place where young viewers have too readily stumbled on footage of crass humor or bloody violence. Lawmakers have asked about this, part of the scrutiny of the privacy practices and dominance of big tech. The FTC is probing whether Google violated the Children's Online Privacy Protection Act (COPPA), which prohibits tracking the personal information of minors under thirteen. YouTube's frequent tweaks to its all-powerful algorithms and ads policies have left video creators disgruntled. A handful of upstarts are hoping this momentum will help their cause. They've roped in venture financing, licensing deals and customers with the promise of creating kid-safe internet real estate.The FTC is inadvertently playing a role, too. Uncertainty over the case is producing panic in parts of the YouTube community, prompting some stars to hunt for alternatives. News reports surfaced that the FTC may force YouTube to move all children's videos to its Kids app or cut them off from ads. YouTube has offered no public statement on the issue and rumors have filled the vacuum."No one really has a sense of what is going to happen," said Michael, who runs KidCity and two other YouTube family channels. He is one of more than 150 YouTubers jumping to Rukkaz. He isn't moving off YouTube, but will cross-post select YouTube clips with the startup, which will share ad revenue. He asked that his last name not be revealed to protect the privacy of his two children.Kid's media online is booming as millions of children swap Saturday morning cartoons for streaming and smartphones. Most streaming services, like Netflix, run curated, slickly produced shows for kids, while YouTube relies on a mountain of unscripted, user-generated content. Multiple people who make these videos said that, in recent months, support representatives from YouTube have halted contact without explanation. A chief concern for many creators is that their videos will be restricted to YouTube Kids, a much less popular service, where Google runs fewer ads. “That would put everyone out of business. I mean, almost overnight,” said Michael.YouTube is unlikely to do that, or to cut off all its kids and family footage from ads. Instead, to comply with the FTC, YouTube is planning to end “targeted” ads on videos kids are likely to watch, Bloomberg News reported on Tuesday. That solution would make it harder for the creators behind those clips to earn more from ads, although it's a less draconian move than some other rumored options.A problem with this approach, though, is defining kids’ videos. COPPA applies to any web service “directed to children.” While most clips on YouTube Kids, such as nursery rhyme cartoons, clearly are, other huge swaths of YouTube, like footage of video game streaming, arguably aren’t. Yet it’s an open secret that younger viewers love watching people play video games. Roughly a quarter of the YouTube ads one major toy company buys run on Minecraft videos, according to a media buyer with knowledge of the matter who asked not to be identified discussing private data. “The difficulty here is determining what is ‘kid’s directed,’” said Ashkan Soltani, a privacy researcher who previously served as the Chief Technologist for the FTC. “It’s not a bright-line rule.” Once the line is drawn, YouTube creators do not want to fall on the wrong side. Many, like KidCity’s Michael, now describe their productions as “family-based play” or “co-play” – videos that feature adults and, the hope is, that adults watch. YouTube is not the only major player in an uncomfortable spot; other tech platforms are under similar pressure. The FTC fined Bytedance Inc., the owner of popular app TikTok, for violating federal guidelines on minors. Critics have complained that Facebook Inc. illegally tracks children’s online behavior. Many in children's media don't expect a viable solution to come from the household names. "It doesn't make sense that big internet companies can take something they designed for grown-ups and make that for kids," said Kevin Donahue, an early YouTube executive who now runs Epic, an e-book startup. "You have to create something new." (Donahue said has no interest in rivaling his old company, though. "We're not at all doing that," he said.)For most newcomers, that something looks like Netflix: A subscription service with a limited selection. The idea is that parents would pay for some parts of YouTube popular with kids: the toy unboxers and niche animators, without the pratfalls of an unlimited content library. Three years ago, Epic added video to its $7.99 a month e-books app. It offers a few thousand clips, all reviewed by staff members. Kidoodle.TV, a Canadian company, offers children’s videos on set-top box services like Roku. Another, JuniorTube, had a slate of curated amateur videos available on a subscription-based app. Earlier this week, Roku added a new curated kids and family section.Highbrow, a London-based startup, sells a $6.49 monthly service with a tagline “trusted by schools and parents worldwide.” Priyanka Raswant, a corporate lawyer, formed the company as she was preparing to have her first child. She found most videos available on YouTube Kids “nonsensical” and the app unhelpful for parents. “If you see something outrageous, you have to report it,” Raswant said. “They’ve put the onus on the parents. Most parents don’t even have time to brush their teeth.” Highbrow has partnered with telecoms in Latin America and India for distribution, but doesn’t share sales data. The service carries videos from Pinkfong, the studio behind mega-hit “Baby Shark,” as well as smaller shows like “Travel With Kids” from PBS.SuperAwesome is one of the few borrowing YouTube’s model of free, ad-supported programming. The startup is set to book $60 million in revenue this year. (YouTube doesn’t share sales, but estimates place the yearly sales from its kids’ content north of $700 million.) Collins said his company is profitable. Of course, the uncertainty surrounding kids’ online video could also threaten those profits. His ad business is competing against those at the twin giants of Google and Facebook. The benefits of SuperAwesome’s ad services might not be as apparent if YouTube passes through the FTC probe unscathed and grows its Kids’ app.That could mean that more is riding on Collins’ video service. For Rukkaz, Collins is targeting YouTube's blind spots. Most of YouTube Kids caters to preschoolers, so Collins is recruiting creators aiming for an older audience. He's also approaching creators with between 500 thousand and a million subscribers on YouTube -- enough to earn livings from the site, but not to be inculcated from its swings. "This entire community is really being orphaned by YouTube," Collins said.Michael, who runs the KidCity channel, is optimistic about Rukkaz. He’s planning to use SuperAwesome’s feature for hosting video comments, which he finds useful for getting audience feedback. YouTube shut off comments on videos with children earlier this year, but allowed a select group of channels to keep them with the condition they “actively moderate” the posts. Filtering those comments, though, requires using a manual system. “You have to go in there and spell the dirty words,” he said. His attempts to find footing beyond YouTube haven’t succeed in the past. On KidCity, the Texan father and his two children perform long skits dressed up as familiar cartoon characters – Marvel Comic’s Wolverine or Disney’s Queen Elsa. They tried to post one of these clips on Amazon’s self-publishing service, Prime Video Direct, but the company rejected the videos citing intellectual property concerns. A KidCity clip of his son donning a Spiderman costume and testing a Spiderman toy has over 85 million views on YouTube. YouTube’s laissez-faire approach to media has brought scathing critics, but it has also enabled countless careers online."That's the creator platform for kids," said Michael. "The only one, unfortunately." At least one would-be YouTube rival has already bit the dust. JuniorTube, a company based in Indiana, made a paid app and recruited a few established YouTubers. Like the others, it managed the costs of hosting video and other back-end services, splitting sales with video producers. In May, these producers received an email that JuniorTube had shut down "due to very poor business performance and audience interest." To contact the author of this story: Mark Bergen in San Francisco at firstname.lastname@example.orgTo contact the editor responsible for this story: Emily Biuso at email@example.com, Alistair BarrFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.