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Big boys to face congressional inquiry

The investigation will decide whether Facebook, Amazon and Google are damaging the competitive landscape for small businesses.
Read time 7min 20sec

The ongoing ‘big tech boys’ investigations continued to dominate the international ICT market last week.

At home, it was quiet.

Key local news

  • Mediocre year-end figures from Telemasters, with revenue down 11.9% and profit down 66.4%.
  • Positive trading updates from Cartrack Holdings and Datatec.
  • A negative trading update from Adapt IT.
  • African Zaibatsu Corporation acquired Jasco Trading’s Electrical Manufacturers Division for R65 million.
  • 4ORT has launched the world’s first “fraud free” dynamic QR (quick response) code. A globally patented algorithm ensures mobile users’ unique identities are securely stored within the code, making duplication by fraudsters virtually impossible.
  • The Films and Publications Act, which some dubbed the Internet censorship Bill, has been signed into law.
  • The appointment of Adrian Schofield as acting CEO of the ICT Council.

Key African news

  • Very good year-end figures from Airtel Uganda, with profit up 38%.
  • Full-year losses from Airtel Kenya, Airtel Rwanda and Airtel Tanzania.
  • The Ethiopian government has begun the process of privatising the country's only mobile phone operator Ethio Telecom, thus opening up the telecom sector to foreign investment.
  • Kenya’s Ethics and Anti-Corruption Commission has stalled the Telkom Kenya and Airtel Kenya merger on the grounds of investigating the former’s recapitalisation and misappropriation of funds.
  • MainOne has finally landed its submarine cable in Grand Bassam, Cote D’Ivoire, which is the final leg of the ongoing expansion to reach Senegal and Cote D’Ivoire.

Key international news

  • Accenture acquired Nytec, an award-winning product innovation and engineering company.
  • Alteryx bought Feature Labs, a data science software company launched out of MIT that automates feature engineering for machine learning and artificial intelligence applications.
  • Apple purchased UK-based iKinema, a visual effects company.
  • Atos acquired IDnomic, a European leader in digital identity management infrastructure.
  • Ciena bought privately held Centina, a provider of service assurance analytics and network performance management solutions.
  • EQT, a Swedish infrastructure investor, purchased Inexio, a German fibre-optic network operator for EUR1 billion.
  • Equinix acquired three data centres in Mexico from Axtel SAB for $175 million, as the data centre giant continues its global expansion into new markets.
  • FLIR Systems bought the intellectual property and certain operating assets of Aria Insights. Previously known as CyPhy Works, Aria pioneered the development of tethered small unmanned aerial systems.
  • Hazeltree, a provider of integrated treasury management and portfolio finance solutions, purchased ENSO Financial Analytics, a provider of portfolio analytics for hedge funds and prime brokers.
  • Oracle acquired CrowdTwist, a cloud-native customer loyalty solution to empower brands to offer personalised customer experiences.
  • PayPal bought 70% of China-based Gopay Information Technology, a domestic payments firm.
  • Sikich, a large professional services firm, purchased Salesforce partner, NexGen Consultants, as it looks to boost a CRM practice powered by advanced analytics and artificial intelligence.
  • Telus acquired ADT Security Services Canada for C$700 million.
  • Trimble bought privately held Azteca Systems, a provider of enterprise asset management software for utilities and local government.
  • Upland Software purchased InGenius, a computer telephony integration solution for enterprise contact centres.
  • Verizon Communications acquired all software and technology as well as other assets from augmented reality company Jaunt XR.
  • Taboola and Outbrain merged in an $850 million deal as they look to take on Google and Facebook. The merged company will be run by Adam Singolda, Taboola’s founder.
  • Huawei invested in Oxford Sciences Innovation, a company that commercialises research at Oxford University.
  • Tencent Holding has agreed to buy a 29% stake in Oslo-listed computer games developer Funcom.
  • A strategic partnership has been formed between Avaya Holdings and RingCentral, a provider of global enterprise cloud communications, collaboration and contact centre solutions.
  • Apple supplier TSMC has counter-sued smaller contract chipmaking rival GlobalFoundries in the US, Germany and Singapore, saying the US firm has infringed 25 of its patents.
  • Smartphone lens module maker Largan Precision has filed a charge against HP, Ability Opto-Electronics Technology and Newmax Technology, for allegedly infringing four of its US patents.
  • Anti-trust investigators are scrutinising plans by Google to use a new Internet protocol in a way that some say could make it harder for other companies to access consumer data.
  • US lawmakers have requested information from Spotify as part of the investigation into allegations that Apple engages in anti-competitive behaviour to support its own apps.
  • Facebook, Amazon.com and Alphabet's Google will face a congressional inquiry on how the big technology companies may be damaging the competitive landscape for small businesses.
  • Europe’s top court said Facebook can be ordered to police and remove illegal content worldwide, in a landmark ruling that rights advocates say could allow authoritarian regimes to silence critics.
  • KPN has ditched plans to name Belgian executive Dominique Leroy as its new CEO because she is under investigation for selling shares in her previous company, Proximus, while she was in talks to take the KPN job.
  • Turkish authorities have fined Facebook $282 000 for violation of data protection laws that affected nearly 300 000 people.
  • EU anti-trust regulators will order Broadcom to scrap its exclusivity clauses with TV and modem makers while they investigate whether this and other tactics hamper rivals.
  • The WeWork IPO has been withdrawn.
  • Satisfactory quarterly results from Paychex.
  • Satisfactory half-year numbers from Nasstar (back in the black).
  • Mediocre quarterly results from Smart Global Holdings.
  • Mixed half-year figures from Next Fifteen Communications Group, with revenue up but net income down.
  • Quarterly losses from Aehr Test Systems.
  • Half-year losses from Aeorema Communications, Altitude Group, ByteDance, Cloudcall Group and Youdoo.
  • The appointments of Bill Crager as interim CEO of Envestnet; Joost Farwerck as interim CEO of KPN; and Amur Lakshminarayanan as MD and group CEO designate of Tata Communications.
  • The death of Judson Bergman, chairman and CEO of Envestnet.
  • An IPO filing for Nasdaq from 36Kr Holdings, a Chinese e-business services company.
  • An IPO filing for the NYSE from Youdoo, a Chinese e-learning company.

Research results and predictions

EMEA/Africa:

  • Spending on AI systems in MEA is expected to reach $374.2 million next year, up from $261.8 million in 2018 and an anticipated $310.3 million in 2019, according to IDC.
  • The MEA wearable devices market saw tremendous year-on-year unit growth of 144.43% in Q219, with 1.96 million units worth $278.04 million shipped to the region, according to IDC.
  • The EMEA market for gaming desktops and notebooks declined in Q219, dipping 1.2% year-on-year and totalling 1.9 million units, according to IDC. Growth of 1.5% year-on-year is expected for the full year 2019, however, reaching 8.6 million units. By the end of 2023, the market is expected to increase to 11.1 million units, with a four-year CAGR of 6.8%.

Turkish authorities have fined Facebook $282 000 for violation of data protection laws.

Worldwide:
  • Global shipments of gaming desktops, notebooks and monitors reached 10.4 million units in Q219, up 16.5% year-over-year, according to IDC.
  • The worldwide market for PC monitors saw a year-over-year decline of 2.2% in 2Q19, with shipment volume totalling just over 30 million units, according to IDC.
  • Semiconductor sales for August were $34.2 billion, down 15.9% on year, but up 2.5% on month, according to the Semiconductor Industry Association.

Stock market changes

  • JSE All share index: Down 2.2%
  • FTSE100: Down 3.6%
  • DAX: Down 3%
  • NYSE (Dow): Down 0.9%
  • S&P 500: Down 0.3%
  • Nasdaq: Up 0.5%
  • Nikkei225: Down 2.1%
  • Hang Seng: Down 0.5%
  • Shanghai: Down 0.9%

Look out for

International:

  • A possible sale of FireEye and/or Fitbit to a private equity company.

South Africa:

  • Further developments regarding Cell C.

Final word

IDC recently published its 16th annual IDC FinTech Rankings, which categorise and evaluate technology providers based on calendar year revenue from financial institutions for hardware, software and/or services. Two sets of rankings emerge from this process: IDC FinTech Rankings Top 100 and Top 25 Enterprise.

The IDC FinTech Rankings Top 100 represents companies that derive more than a third of their revenue from financial institutions.

The IDC FinTech Rankings Top 25 Enterprise companies are enterprise/horizontal technology firms that provide products and services across multiple industries and have significant reported revenue in the financial services industry, but less than a third of revenue from financial institutions.

The 2019 IDC FinTech Rankings Top 10 are:

  • FIS
  • Tata Consultancy Services
  • NTT DATA
  • Fiserv
  • Cognizant Technology Solutions
  • Infosys
  • SS&C Technologies
  • Diebold Nixdorf
  • NCR Corporation
  • NRI (Nomura Research Institute)

The 2019 IDC FinTech Rankings Enterprise Top 5 are:

  • IBM
  • Dell
  • Accenture
  • Microsoft
  • Cisco Systems
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