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Germany’s business barons are finding it harder to keep a low profile

The Economist - Thu, 06/13/2019 - 16:26

IF THEY think their ranking on rich lists is too low, American tycoons fume. German ones kick up a fuss when theirs looks suspiciously high, explains Heinz Dürr. When a magazine called him a billionaire a few years ago, Mr Dürr rang the editor to remonstrate. The reporters had double-counted his ownership of Homag, a maker of wood-processing machines that Dürr, his family’s mechanical-engineering firm, bought in 2014. Plutocrats have reached the top of politics in America and Italy, while in Asia the super-rich often display their wealth in ostentatious style. Germany’s magnates love to shun the limelight.

The country is hardly short of super-rich people. It has the most of any country after America and China. In February Forbes, a magazine which tracks such things, counted 114 German dollar billionaires, more than double the number in Britain (see chart). This equates to one for every 727,000 Germans, not a world away from America’s tally of one for every 539,000 (though it has 607 in total). The German Institute for Economic Research, a think-tank, estimates that the combined assets of the richest 45 Germans are roughly the same as those of the entire poorer half of the country.

That such figures are a surprise to many is testament to the persistence of attitudes outlined by Mr Dürr. German...

Video gaming enters the cloud

The Economist - Thu, 06/13/2019 - 16:26

MORE THAN 70,000 gamers, developers and publishers descended on Los Angeles to goggle at each other’s wares and show off their own at the Electronic Entertainment Expo (E3), which began on June 11th. This year big publishers like Ubisoft and Square Enix used the annual video-game jamboree to show off previews of new games. Keanu Reeves, an actor, hyped up “Cyberpunk 2077”, a hotly anticipated title in which he plays a big role.

One of the most significant announcements at the show was also one of the briefest. Towards the end of a two-hour presentation, Phil Spencer, the head of Microsoft’s gaming division, offered a few more details about Project xCloud, Microsoft’s foray into cloud gaming. The service will be available in October, he said, before letting gamers loose to try a demo version in the conference centre.

Cloud gaming aims to do for video games what companies like Spotify and Netflix have done for music and films—make them available on any device with an internet connection. For the $140bn gaming industry, that would be a revolution. The consoles and beefy PCs required to run modern games cost several hundred dollars. Cloud gaming aims to shift the computational heavy lifting into data-centres and to pipe the results to users over the internet. That would allow gamers to play cutting-edge titles on nearly any...

The UTC-Raytheon deal highlights the changing nature of war

The Economist - Thu, 06/13/2019 - 16:26

WITH A DEEP voice and physique of a former American-football player, Greg Hayes, boss of United Technologies Corp (UTC), does not seem like the soft sort. But the ego is delicate. As he told Schumpeter in February while explaining his decision to carve UTC, a conglomerate dating back to the 1920s, into three parts, it was hard for him emotionally to accept that he may end up in charge of a smaller slice of the pie. Shed no tears, though. As he said those words, he was probably plotting a megamerger that could make him one of America’s biggest military-industrialists.

On June 9th UTC, which is big in jet engines, and Raytheon, a prominent missile-maker, said they would join together to create America’s second-largest aerospace and defence company after Boeing, with a combined market value of $166bn. UTC shareholders will get 57% of the combined company, to be called Raytheon Technologies. The merger reflects two trends sweeping America: the reshaping of defence because of fears about China and the streamlining of industry because of shareholder activism.

Neither firm’s share price reacted well to the news and feelings are mixed. Those who support the deal see it as a neat way of balancing UTC’s cyclical aerospace business, which mostly supplies Pratt & Whitney engines for passenger jets, with Raytheon’s more...

Tesla’s performance gives Elon Musk much to think about

The Economist - Thu, 06/13/2019 - 16:26

AT TESLA'S ANNUAL shareholders meeting on June 11th Elon Musk was as ebullient as ever. But its shares, which started the year above $300, have plunged close to $200 and its bonds recently traded at an all-time low of close to 80 cents on the dollar. Deliveries of the Model 3, the firm’s mass-market electric vehicle (EV), fell by over a fifth in the first quarter compared with the previous quarter, casting doubt on the firm’s annual sales target. Tesla raised $2.7bn in convertible debt and stock in May, but questions remain about how much cash it can generate—it burned through over $900m in the first quarter. Tesla may have outsold competitors last year, but faltering demand and a phase-out of EV subsidies in America are tough new challenges it has to face.◼

Trust-buster talk tough in America

The Economist - Thu, 06/13/2019 - 16:26

“IF WE WILL not endure a king as a political power, we should not endure a king over the production, transportation and sale of any of the necessaries of life.” Advocates of a muscular approach to antitrust often quote the words of John Sherman. In 1890 the senator urged Congress to pass the antitrust act that carries his name. On June 11th they were uttered by someone who many believed would be less keen on such action. Makan Delrahim, boss of the antitrust division of America’s Department of Justice (DOJ) used a speech in Tel Aviv to deliver the latest sign that America’s long-slumbering antitrust machine has woken up and is looking around threateningly, particularly at the country’s tech giants.

Signs of renewed vigour in antitrust enforcement are growing. Last week it emerged that the Federal Trade Commission, another antitrust agency, and the DOJ had agreed to divvy up the work, with the former looking into Facebook and Amazon and the latter Apple and Google (an investigation of the search firm is reportedly imminent). On June 11th, a Congressional committee opened an investigation into the impact of big tech firms on the news industry. And more than a dozen state attorneys-general are soon expected to do something similar. In another sign that big business is under antitrust scrutiny, on the same day a group of states sued to...

Drone deliveries are advancing in health care

The Economist - Thu, 06/13/2019 - 16:26

A FEW YEARS ago Jeff Bezos made a prediction. By 2018 his e-commerce empire, Amazon, would be delivering items by drone. Prime Air has yet to launch. But startups are making progress—mostly in health care, where they are vying to tap into a lucrative, $70bn global market in health-care logistics. As they deal with regulators and investors, these firms are charting the course for other aerial deliveries.

One of the best known is Zipline, based in San Francisco. It took off in Rwanda in 2016, where it is now a national on-demand medical drone network, delivering 150 medical products, mostly blood and vaccines, to hard-to-reach places. Maternal mortality rates are declining thanks to the delivery of blood. Other firms have used drones to supply medicines in Bhutan, Malawi and Papua New Guinea. Patients in many Swiss hospitals can receive results on the day a sample is taken. Zipline is expanding into Ghana and, later this year, into North Carolina, an American state with many out-of-the-way rural medical facilities. It wants to serve 700m people in the next three to four years.

For governments and regulators nervous about allowing drones to roam the skies, health-care deliveries offer a compelling reason to give it a go. Drones can fall out of the sky, collide with other air traffic, create perceived privacy concerns and...

Adani Australia receives final clearance for Carmichael coal mine

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 15:55
Adani Mining said that according to the approval, the mining plan of the company was in line with all the regulatory conditions set by the Australian and State governments

ITC CMD Sanjiv Puri's remuneration up by over 51% to Rs 6.16 cr in 2018-19

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 15:40
Total Remuneration of diversified group ITC Chairman & MD Sanjiv Puri has gone up by over 51 per cent to Rs 6.16 crore in 2018-19. Puri (56), who has been recently elevated as Chairman of the Kolkata-headquartered company after Y C Deveshwar passed away, took home Rs 4.06 crore in FY 2017-18. Moreover, the total number of employees getting a total salary of over Rs one crore in the company is now 91, ITC said in its Annual Report for FY 2018-19. Deveshwar, who died in May this year, had received a remuneration of Rs 16.62 crore for FY 2018-19. Puri was set to take over as the Chairman in 2021-22 and was being mentored by Deveshwar for the post. He was appointed as CEO of the company on February 5, 2017 and re-designated as the Managing Director of ITC from May 16, 2018. As per ITC's 'Report and Accounts 2019' filed at bourses, Puri's remuneration includes a basic salary of Rs 1.44 crore along with perks of Rs 40 lakh and performance bonus of Rs 4.32 crore. ITC Executive Director

Facebook to buy stake in e-commerce start-up Meesho, 'enable entrepreneurs'

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 15:15
Meesho is a digital platform on which re-sellers reach prospective customers via social media platforms.

RIL, HDFC among 57 Indian companies on Forbes magazine's Global 2000 list

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 14:45
China's Industrial and Commercial Bank of China (ICBC) tops the list for the seventh year in a row.

NCLT adjourns hearing on Jet Airways insolvency case to June 20

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 14:23
Jet Airways owes more than Rs 8,000 crore to a consortium of banks led by the State Bank of India, which now run the airline

Help to Buy: 'Most users did not need help report finds'

BBC News - Business - Thu, 06/13/2019 - 13:55
Most participants in the scheme could have got on the housing ladder without help, a report finds.

Philip Green: Topshop empire 'didn't come close to collapse'

BBC News - Business - Thu, 06/13/2019 - 13:04
Sir Philip Green thanks the landlords and suppliers who backed the restructuring deal that saved Arcadia.

Amazon starts offering part-time delivery jobs in Bengaluru, Mumbai, Delhi

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 13:00
Under the programme 'Amazon Flex', individuals can sign up, create their own schedule and earn Rs 120-140 per hour of delivering packages on behalf of Amazon, the company said

PwC fined £6.5m over 'lack of competence' in audit

BBC News - Business - Thu, 06/13/2019 - 11:50
The Financial Reporting Council reduced the fine to £4.6m after the accountancy admitted its mistakes.

PwC cites fraud-related section in its resignation letter

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 11:24
Reliance Capital says auditor's observations are completely baseless and unjustified

HCL to launch 'Tech Bee' programme to train, hire students after class 12

Admiral Quixote's Roundtable - Thu, 06/13/2019 - 10:45
Tech Bee, HCL's early career programme provides students an opportunity to start early, become financially independent and trendsetters

Adani mine: Australia approves controversial coal project

BBC News - Business - Thu, 06/13/2019 - 10:33
The huge project in Queensland has been subject to years of environmental hold-ups and protests.

Telegram boss links cyber attack during HK protests to China

BBC News - Business - Thu, 06/13/2019 - 10:20
The messaging service suffered a massive cyber attack during violent protests in Hong Kong on Wednesday.

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