- IEIC Welcomes Uber Technologies as New Founding Member
May 10, 2020
Dr. Jason Black to play key role in advocating global Internet resiliency, capacity diversity, risk mitigation and geo-economic equality
ASHBURN, Va. & SAN FRANCISCO, May 10, 2020 /PRNewswire/ -- The Internet Ecosystem Innovation Committee (IEIC), an independent committee that promotes internet diversity and resilience through the formation of new global internet nexus points, today announced that Uber (NYSE: UBER), has joined as a founding member. Internet Ecosystem Innovation Committee (PRNewsfoto/IEIC)
Dr. Jason Black, Head of Global Network Infrastructure at Uber Technologies, will be representing the company alongside the IEIC's other founding members. Black leads Uber's global network infrastructure team and has helped to build a multi-billion dollar web scale company and world-class network to sustain current traffic levels and support organic growth in conjunction with roadmap development, planning and execution.
The Internet requires networks to exchange traffic (peering points). Since the advent of the Internet, these peering points have largely been concentrated in a relatively small number of buildings where networks are concentrated. The reliance on a limited number of peering locations creates risk and limits opportunity for more communities to participate in the Internet's growth and economic potential.
"As new applications are developed and the demand for bandwidth continues to grow unabated, this concentration of Internet traffic exchange points may turn from an easy way to peer to a growing risk based on a lack of diversity," said Clint Heiden, Founder of the IEIC and Chief Revenue Officer of QTS Realty Trust. "Jason is a technology and business visionary with a background in engineering, mathematics, international business administration and computer information sciences and a welcome addition to the IEIC team with his ability of being able to sift through complex issues and ideas."
Large internet business models like Uber are acutely aware of the limitations and dependency on Internet exchange points which are critical to their success. The IEIC's mission is to collaborate with communities globally to create new internet nexus points through partnership with local municipalities, academia and businesses.
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"The IEIC is an organization assisting the digital economy globally and I firmly believe in the importance of their mission," Black said. "Now more than ever during these uncertain times we witnessed the congestion of service providers and capacity constraints. Now is the time to look ahead for cloud service or content providers to ensure that they are building ahead of the next pandemic or unforeseen event."
"The IEIC is a collaborative organization coming together at a time when we all must recognize the importance of Internet reliability in the new digital economy," said Dr. Vint Cerf, Google Chief Internet Evangelist and co-Founder of the Internet. "The malleability of the layered Internet continues to surprise and gratify me as many others look for new ways to apply this very general infrastructure."
The IEIC is preparing to announce an upcoming Virtual Summit Series beginning in late May 2020 featuring notable industry leaders including Dr. Vint Cerf and Dr. Ken Washington, CTO of Ford Motor Company. The online series will address key considerations for enterprise and government leaders in the wake of the Coronavirus pandemic that is reshaping our society into a global remote workforce. Each Virtual Series event will feature a live 20 minute keynote address from a recognized industry leader followed by 40 minute panel discussions with participating CEOs, CTOs, and COOs from industry giants, universities and municipalities such as Google, Ford Motor Company, Cigna, Uber, Hilton, Telia Carrier, CenturyLink, Ciena, Blade, Freddie Mac, Telxius, Virginia Commonwealth University, Henrico County and others.
About Uber Uber's mission is to create opportunity through movement. We started in 2010 to solve a simple problem: how do you get access to a ride at the touch of a button? More than 15 billion trips later, we're building products to get people closer to where they want to be. By changing how people, food, and things move through cities, Uber is a platform that opens up the world to new possibilities.
About the Internet Ecosystem Innovation Committee The IEIC is an independent committee that promotes Internet diversity forming new global Internet nexus points. The mission of IEIC is to partner with communities globally to create new Internet nexus points through public and private partnerships with local municipalities, academia and businesses. The Founding Members of IEIC are industry luminaries from many of the world's most respected companies and leaders including: Vint Cerf/Google (NASDAQ: GOOG), Clint Heiden/QTS (NYSE: QTS), Steve Alexander/Ciena (NYSE: CIEN), Rafael Arranz/Telxius, Jason Black/Uber (NYSE: UBER), Mark Boxer/Cigna, Barbara Boyan/Virginia Commonwealth University (VCU), Andrew Dugan/CenturyLink, Staffan Göjeryd/Telia Carrier (OMX: Telia1), Jon Greaves/QTS (NYSE: QTS), Anne Holton/Former Virginia Secretary of Education, Asher Kagan/Blade, Michael Leidinger/Hilton (NYSE: HLT), Josh Levi/Data Center Coalition, Vinay Nagpal/InterGlobix, Krishna Narayanaswamy/Netskope, Frank Nazzaro/FreddieMac, and Ken Washington/Ford (NYSE: F). For additional information visit: www.ieicco.com
IEIC Media Contact: Carter B. Cromley
(703) 861-7245
ccromley@cox.net
Uber Media Contact:
press@uber.com Cision
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SOURCE Internet Ecosystem Innovation Committee (IEIC)
- Nasdaq Stock Exchange president on IPO outlook amid COVID-19
May 7, 2020
Nasdaq Stock Exchange President Nelson Griggs joins Yahoo Finance’s Seana Smith to discuss market operations amid the coronavirus and the outlook on IPOs.
Video Transcript
SEANA SMITH: Welcome back to Yahoo Finance's live market coverage. Now, the coronavirus outbreak has upended US equities trading. The New York Stock Exchange has closed its trading floor, and the NASDAQ has closed its option floor in Philadelphia. Now, all of this happening, of course, as we've seen market volatility spikes.
So let's get more on this. And for that, we have Nelson Griggs, president of the NASDAQ stock exchange. And Nelson, thanks so much for taking the time to join the show this afternoon. We're excited to have you on. I guess let's start with-- give us a sense of what the last two months have been like with your entire operations working remotely.
NELSON GRIGGS: Sure, well thanks for having me. So historically, we are about a 4% work from home and very quickly went to a 98% work from home. If you think about the exchange's responsibility, though, we have been through shutdowns before over Sandy, et cetera. But most of the BCP planning, the backup planning, is thought about in terms of days and weeks, not globally for months. So we did very quickly put plans in place. We were pretty early on this because of what we saw happening with our operations in Hong Kong.
So we have been incredibly resilient, I think not just NASDAQ but the entire Street. I think we all feared the worst, in terms of what it would be like to work from home. And it has been really-- from a market operations, obviously there's a lot of volatility, but it's been really seamless.
SEANA SMITH: Nelson, can you talk about-- I mean, at a time when there's so much uncertainty and there's so much volatility in the markets, it's spooking a lot of investors out there. What kind of relief measures are you providing to listed companies at this point?
NELSON GRIGGS: Yeah, I think the one thing that comes up in times like this, and we saw this as well in the financial crisis, is companies that are on what we call more of the smaller cap end of the range, concerned about rules around having that minimum dollar bid price, minimum market values. And the SEC has been great to work with. Both ourselves as well as the competing exchanges have come up with plans that have been very-- the SEC has been very receptive to give temporary relief for those companies with the idea is that this is probably more of a temporary downturn and then we'll come back. And we saw that in the financial crisis.
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SEANA SMITH: Yeah, Nelson, you talk about the fact that it could be a temporary downturn. We have shifted our focus almost, or I guess the direction of our conversation recently, talking about people getting back to work, the return to work here, and the potential return to-- I don't know if we want to put it in quotes, but what normalcy will look like going forward. What do you think that could look like?
NELSON GRIGGS: Yeah, I think what's interesting to us is-- so we do operate in over 30 countries. So it is a very country by country, even-- and then you get to the US, it's state by state. There's a lot of local regulations and rules to figure out about what we actually can do with our employee base. So it's going to be gradual.
We are fortunate. Our business is very resilient, so we're not forced to go back early, by any means. But our hope is that we see gradual returning to work with a lot of precautionary measures around temperature testing, social distancing. The biggest thing to figure out early are transportation-- public transportation and how do you get a workforce to work?
So it's a daily call we have with our executive leadership team to talk about how that could look, but I think we all have to be understanding that it's going to take some time and it's going to be gradual and we should expect it to be-- you know, have a bit of a lumpy effect.
SEANA SMITH: Hey Nelson, so when we talk about returning to work, some of the questions I guess that have been raised I've been reading about is whether or not US exchange trading floors are still going to be relevant post-coronavirus. I know the NASDAQ in particular, it's mostly remote trading. You mostly do it all online. But what are your thoughts on that, just in terms of what we could expect going forward and what will be necessary going forward?
NELSON GRIGGS: Yeah, I think we'd separate the equities market from the options market. There's unique components of the options market. We still see value in a floor. But it's pretty clear during this time with the equities market, most of the volume today is happening away from a floor environment, as is we measure the quality of trading. And we do feel that NASDAQ does electronic trading the best in the world. But electronic trading better serves investors because there's not really that conflict of interests that we see in the floor-based models for equities.
So you know, we'll see how the floor-based markets-- there's really only one left, how it comes back. But I think at this time, investors are actually being served very well with tight spreads, liquidity, and we're seeing the markets operate very, very efficiently.
SEANA SMITH: Nelson, I want to hear your thoughts on the IPO market because it's come to nearly a standstill over the last several weeks. So how do you think-- or how has coronavirus reshaped the 2020 IPO timeline?
NELSON GRIGGS: Yeah, well, it certainly has reshaped it. It hasn't come to a complete stop. We have had six health care companies, biotechs go public, and we do believe we'll have more. And there actually is a small pipeline developing of companies that were on the cusp of going public in February and March that still have an active dialogue going about a June, July timeframe.
But clearly, the biggest challenge for a companies when you do go public is you need to forecast your-- you know, your financials for the remainder of the year, the coming year, and that's gotten very hard for many businesses. So we still think there can be an IPO market.
That's part of the reason why you see health care being successful is because the lack of need for forecasting. They're talking about, you know, two years, four years, five years down the road for developing drugs. But we do think we'll start seeing the IPO market open up a bit in June, July, August, but be fairly slow. And then we do think it'll pick up more robustly as the year progresses. There's a lot of companies would like to go.
SEANA SMITH: Yeah, Nelson, you mentioned the fact that you've had six companies go public. How are you facilitating those virtual IPOs. What exactly does that process look like at this point?
NELSON GRIGGS: Yeah, that's a great question. So as mentioned, we've been incredibly impressed with our partners, the trading firms, the banks that do trade through NASDAQ. So they can really operate as they do today. NASDAQ operates, as we always have-- we provide a very robust tools-- toolkit to companies, investors to go public-- or sorry, the trading desks. And we have our team that does that. So that that's been very, very fluid.
The challenge for companies is if you think about what a roadshow used to be, it used to be going for eight days to all these different cities on planes. And now it's usually been four days on video. But I would say the deals that have come out have all been received very, very well. They've traded well. And I think that companies were able to get their message across, you know, clearly enough to drive that investor demand, so different but also surprisingly successful.
SEANA SMITH: Nelson, real quick, in your line of work as the president of the NASDAQ stock exchange, you talk to a lot of executives because it's in your line of business. What are you hearing from these CEOs? What are you hearing from these executives, just about their outlook over the next couple of months?
NELSON GRIGGS: Yeah, and I think we look-see a little bit that's developing actually in the market in performance. It clearly has been a market where technology, health care have done very well. The averages there-- the NASDAQ 100, the NASDAQ composite, the biotech-- are actually positive now for the year. Clearly, value stocks in certain sectors have been hit very hard.
So I think you do need to look at the market, look at companies on a very individualist basis. What does their sector look like? But clearly, everyone says a lot of consistent themes. They think about their employees, their health, their safety and well-being.
And then depending on which side of the market they're on, it's either how do I accelerate through this and find new opportunities? For some, they're thinking about, OK, I need to really conserve cash, find cash, and prepare myself for, you know, a handful more quarters or even a year or so, what's going to be a slower market for their businesses.
SEANA SMITH: All right, Nelson Griggs, president of the NASDAQ stock exchange, thanks so much for joining me today.
NELSON GRIGGS: Thanks again. Thanks for having me.
- Stocks surge as more states move to reopen amid coronavirus
May 5, 2020
JP Morgan Private Bank Head of Cross-Asset Thematic Strategy Anastasia Amoroso joins Yahoo Finance’s Seana Smith to discuss the latest market action as more states move to reopen their economies in the wake of the coronavirus.
Video Transcript
SEANA SMITH: Let's get to more on today's moves, and for that we have Anastasia Amoroso at JP Morgan Private Bank, Head of Cross-Asset Thematic Strategy.
Anastasia, thanks so much for taking the time to rejoin the show. I want to start with what we talked about the last time you were on. It was just about a month ago you were on. You were talking about that there is no doubt that we would see this drop in Q2 GDP and that we were at least going to have some sort of a technical recession.
So the question now is, how deep and how long of a recession we could see? What are you thinking at this point?
ANASTASIA AMOROSO: That's right. So the view that we're going to have a very deep recession is certainly playing out, as some of the data that we're getting suggests that the drops are really significant.
But what I would submit to you is that although, obviously, things like initial jobless claims and unemployment rate and manufacturing numbers are very important to see what's happening on the ground right now, if we look into the future, and if we look at how quickly can we see a rebound, what becomes more important is real-time, real-world data. Because some of the data that we're now getting is the backwards-looking view of what happened over the last month. And you and I know that what's going to happen in the next month, hopefully, is going to be pretty vastly different.
So we're looking to things like the mobility reports that tell us, is the traffic to the physical grocery stores, to retail, is it starting to pick up? We're looking at things like TSA lines, are they starting to get a little bit longer, just a little bit? And I do want to say that there's definitely parts of the economy where we're seeing no pickup in activity whatsoever, such as restaurants and movie theaters. Not a surprise. But we're seeing very minuscule, I will say, but nevertheless pickups in economic activity, just judging from some of the mobility reports.
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So this is going to be the story to watch for the next, really, couple of months as more and more states open up, and we'll get this sense of how many of them are resuming economic activity and how quickly.
SEANA SMITH: And Anastasia, going off of that mobility report, it's really interesting, because we talk about the fact that these states are reopening, but take a look at what we've seen just in Texas over the last couple of days. And there was reports, I think there was one in the Wall Street Journal today, talking about the fact that so many of their retail shops are still not seeing the uptick in traffic that many economists, many analysts, were hoping that we would see over the first coming days, as we begin to see states reopening.
So when we take that into account and what exactly that could mean for a potential rebound, and how long it could take until we see a significant rebound, how are you reading that?
ANASTASIA AMOROSO: Yeah, it's going to take a while. You can appreciate psychologically, after the last six weeks or two months of lockdowns, it's going to take a little bit of nudging and a little bit of confidence, which comes with time, before people really turn up at the stores and the restaurants. But if we think about it, not only what's going to happen over the next one week, but what's going to happen over the next six weeks or even over the next two months, I think that's really the most material thing.
I suspect that over the next two months, May and June, we're going to see a recovery in the level of activity. Not back to 100%, maybe not even back to 90%, but maybe somewhere around the 80% range. So as that happens, that's what's really key for the markets, is to make sure that the economy comes back largely online by June, because that's what's currently being reflected in consensus expectations.
SEANA SMITH: Anastasia, it's interesting. I was reading your latest note, and in there, you were talking about how AI and big data, how they're helping to fight the spread of COVID-19. What are some of the trends you're seeing there, and then from an investor's perspective, how can you act on some of those trends?
ANASTASIA AMOROSO: Yeah, absolutely. AI and big data are absolutely front and center, and frankly, this is why you see such a massive leadership of big tech companies. Because a lot of them capitalize on really critical trends at the moment, which is the shift to the cloud, so that's why some of the tech names are leading.
But with this shift to the cloud, more and more companies are also implementing AI capabilities with it. So with the cloud comes AI, and with all of that comes the focus on cloud security. So that's why we see names in the tech sector lead the way here.
The other trend that is absolutely top of mind for us here is AI and how it relates to health care, and more so, the innovation that is happening in the biotech space. Biotech, as you know, has period of performance where it does really well, but if you look at in the last five years, it has actually not done well at all. It's been sideways.
But what I think we're on the cusp of right now is seen as significant payoff. And all this money that went into R&D, that's actually starting to materialize in new treatment approvals, and that's going to ramp up significantly over the next several years. That, I think, is not fully reflected in the valuations of some of these biotech names, and that's where I would be looking to put those extra dollars to work.
SEANA SMITH: Anastasia, what about some of the big tech names? I know it doesn't exactly fit into what you were just talking about, but some of the big names like Apple, for example, Google. They're coming up with ways to assist in the contact tracing and trying to help other ways, just in terms of mitigating the spread of coronavirus. Are you seeing any investment opportunities in some of those bigger tech names?
ANASTASIA AMOROSO: Absolutely. It is actually stunning what they're doing in order to help with the contact tracing and perhaps predicting the future spread of the virus like that. So we would definitely look to those names, because as you know, it's definitely very difficult to open up the economy without having some of those tools in place.
And by the way, one of the reasons why countries like China, like South Korea, like Taiwan, why they were able to in certain cases contain this a whole lot quicker is because they did implement a whole lot of technology to solve this problem. So that's why you see the resiliency in some of those names.
And then the other reason is a lot of this is playing out in the cloud. As enterprises and consumers look to boost our digital resiliency, we now have enterprises accelerate how much money they're going to be spending on transition to the cloud. And that was a big trend that was already in place. Now, I think we'll pull that forward, and once again it adds to the resiliency of those names.
SEANA SMITH: Anastasia, real quick, I just want to get your take on earnings, what we've seen so far. So while we have seen a huge drop-off from what we were initially expecting going back to the beginning of the year, in a lot of instances, the earnings report have not been as bad as what we initially expected.
How are you reading what we're seeing so far, and what we could expect here over the next couple of weeks?
ANASTASIA AMOROSO: Yeah, it's been a very lackluster earnings season to say the least. And what we're seeing now is fewer companies at typical earnings. That's understandable, of course. But also, while the average surprise is usually a positive one, we're not seeing that this time around. So this is why, going into the earnings season, we were expecting to see a bit of a downside or at least sideways markets, because earnings were not going to move the needle for companies.
But the exception to that, of course, is the companies that have managed to beat estimates should be rewarded. I will say they're not being rewarded to the same extent as we would expect them to in this sort of environment, but nevertheless tech and health care, as you've mentioned, are outperforming here.
The other thing that really is largely offsetting some of the lackluster earnings season, which I think we're going to continue to see here, is obviously the hopes about the reopening of the economy. So those are the two factors that the markets are balancing right now.
SEANA SMITH: All right. Anastasia Amoroso, JP Morgan Private Bank, thanks so much for taking the time to join us again.
ANASTASIA AMOROSO: Thank you, Seana.
- Here is Why You Should Sell Alphabet Inc. (GOOGL) Now
May 5, 2020
We have been telling our readers not to invest in the S&P 500 ETFs and instead invest in the top 5, top 10, or top 20 hedge fund stocks because these large-cap stocks historically outperformed index funds. Warren Buffett doesn't like hedge funds because of their high fees and recommends index funds. However, investors don't have to pay hedge funds anything to invest in their top 10 stock picks. Check out the numbers.
In 2019, the top 10 hedge fund stocks returned 41.4% and beat the S&P 500 Index funds by 10.1 percentage points. You could have been 10% richer if you had followed our recommendation in 2019. Things didn't change much in 2020 either. The top 10 hedge fund stocks returned 1% in 2020 (through May 1st) and beat the S&P 500 Index funds by an additional 12.9 percentage points. If you had been listening to our advice, you wouldn't have noticed the effects of the coronavirus crash in your portfolio at all. Also, you would have been 12.9% richer.
[caption id="attachment_88925" align="aligncenter" width="450"] Bill Miller
Bill Miller of Miller Value Partners[/caption]
Alphabet Inc. (NASDAQ:GOOGL) is one of the top 10 stocks among hedge funds. So, we really like Alphabet Inc. However, when we read legendary value investor Bill Miller's 2020 Q1 investor letter, his reasoning made perfect sense. In the following video you can watch why Bill Miller thinks it doesn't make sense today to invest in Alphabet Inc. (NASDAQ:GOOGL) and 6 other recession stocks that performed well so far.
Bill Miller is no ordinary investor. His hedge fund returned 120% in 2019. Bill Miller came to fame for beating the S&P 500 Index for 15 straight years when he was at Legg Mason.
Disclosure: No positions in Alphabet Inc. (NASDAQ:GOOGL). This article is originally published at Insider Monkey.
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- Tesla turns negative after David Einhorn questions billing practices
Apr 30, 2020
Yahoo Finance’s Emily McCormick joins Seana Smith to break down why short-seller David Einhorn is questioning Tesla's billing practices.
Video Transcript
SEANA SMITH: Tesla shares reversing and are now down more than 4%. Now this comes despite the fact that the company revealed a surprise profit in the first quarter.
For more on this, we have Emily McCormick in. Emily, it's a little bit interesting when you take a look at the stock performance today. We were up over 4%, now down in the red, off over 4%. Why are we seeing a reversal so far today?
EMILY MCCORMICK: Well, Seana, we did have some news come out partway through today's session. We had David Einhorn, the president of hedge fund Greenlight Capital, challenging Tesla's billing practices in an open letter to Elon Musk posted on Twitter earlier today. He specifically took issue with Tesla's accounts receivable, particularly since Tesla still posted solid results even though the company likely saw sales lower at the end of the quarter due to the coronavirus pandemic, and that's usually the part of the quarter that Tesla relies on to really see a bump for quarterly results overall.
So that call-- getting that called into question is something that really sparked the reversal that we're seeing. The stock had been up more than 8% during the overnight session and earlier on around market open, and that was because of these much better results that we saw for the first quarter. So that was a first-quarter profit that had been unexpected as well as an about 30% rise in sales to nearly $6 billion.
We did see free cash flow about negative $895 million. But for at least the overnight session, that was something that the Street wasn't as focused on. Really, there had been a lot of optimism around the ramp of the Model Y, the fact that we had automotive gross margins improving to 25 and 1/2% in the first quarter, which was an improvement versus just about 23% over last year. And still a pretty good margin at 20% even when you exclude those regulatory credits.
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So an interesting story that we've seen play out between the earnings, the David Einhorn challenge this afternoon, and then now seeing the stock down about 4%.
SEANA SMITH: Yeah, Emily, I want to ask about the coronavirus impact that that's going to have on Tesla. Do you have any more information about that? Because it was interesting just in terms of what Elon Musk was saying about-- when he was asked about a potential slowdown. He said it was still pedal to the metal on new products and also plans for expanding the company.
EMILY MCCORMICK: Right. Well, Elon Musk did give a rather colorful earnings call yesterday after market close. He called the coronavirus social-distancing measures akin to, quote, "forcibly imprisoning people in their homes against all their constitutional rights." He later conflated it with fascism. So he definitely didn't have a lot of positive things to say about the coronavirus pandemic and the social-distancing measures that have emerged because of it.
Now, Tesla did have to shut down its Fremont factory, its flagship Fremont auto facility, at the end of the day starting March 23. So that's been a weeks-long closure that is really threatening Tesla when it comes to those delivery goals that it had at the beginning of the year. In January, Tesla said it had hoped to-- or it believed it would comfortably exceed 500,000 vehicle deliveries this year, although analysts are now saying that that's much more unlikely given the nature of the pandemic and the way that it's impacted both the supply chain and demand for autos overall.
SEANA SMITH: All right, Emily McCormick, thanks so much.
- Google parent co. Alphabet reports earnings tomorrow
Apr 27, 2020
Yahoo Finance’s Dan Howley joins Seana Smith to break down what investors should expect from Alphabet's upcoming earnings report on Tuesday after the market close.
Video Transcript
SEANA SMITH: Hey, Dan, I want to switch gears here a little bit and talk about another tech giant that we watch very closely, and that's Alphabet. Now the company's set to report results tomorrow, earnings tomorrow. And the stock has held up relatively well when you compare it to broader market performance since the start of the year. What do you think investors should be prepared for tomorrow?
DAN HOWLEY: I think the main thing to look for is how badly the company was hit as a result of the outbreaks towards the end of March. That's really what we're hearing from different analysts or reading from different analysts that the company was tracking to do double-digit teens improvements year over year as far as revenue and that that was then just slammed into at the end of March there when lockdowns went into place.
And the big thing, obviously Alphabet, you know, for all of its different businesses-- Waymo and Verily and what have you-- it's still fundamentally an advertising-run company, and that's really what we're going to be looking is how badly was advertising hit towards the end of March and then going forward? So it'll be really Q2 when we get the biggest impact from the COVID slowdowns. And obviously we also heard Google itself looking to cut back on marketing as well as hires as a result of the slowdown. So it's going to be kind of a double whammy for them.
But then on the flip side, we'll look for increases in the amount of people using G Suite, it's Meet video-chatting platform, as well as YouTube because everyone's stuck inside, and you can just go down a YouTube whole for hours at a time and just waste a day away.
SEANA SMITH: All right, Howley. Well, you certainly will be watching. Those results are going to be after the bell tomorrow. Thanks so much for breaking that down for us.
- Amazon tests video calls to verify third-party sellers
Apr 27, 2020
Amazon is taking new steps to verify third-party sellers; e-commerce giant is testing the use of video calls to validate the sellers’ identity. Yahoo Finance’s Tech Editor Dan Howley breaks down the details. Howley also discusses Apple's potential plans to delay production on its newest iPhone.
Video Transcript
BRIAN SOZZI: Switching gears, Amazon is taking new steps to verify third party sellers. The e-commerce giant is testing the use of video calls to validate the seller's identity. Yahoo Finance tech editor Dan Howley joins us now to break it down. Dan, why wasn't Amazon doing this before?
DAN HOWLEY: I think they really just wanted kind of face-to-face interactions rather than a video interaction, but now that COVID has, obviously, everyone homebound, or at least preventing people from being able to meet in person, they're doing this video style. They had been piloting this before. They were using it in months prior, so this is something that they're continuing to use, and it's basically a way for them to vet sellers that are using the platform-- third-party sellers-- to ensure that what they're actually offering are legitimate products.
Now we've seen, obviously, investigations by various outlets showing-- I think particularly "The Wall Street Journal"-- showed that they were offering some unsafe items, particularly children's toys with lead-based paint. There's obviously been an issue as well with the likes of Apple and Nike taking issue with the fact that there are fraudulent products sold through Amazon bearing their name. So now Nike doesn't even sell through Amazon as result. So this is a way for them to try to make sure that this is all kind of borne out, that they vet the people that are selling through their platform, and they can avoid any unfortunate issues with other companies disputing the fact that they may have fraudulent items or, more importantly, that items themselves are safe.
ALEXIS CHRISTOFOROUS: Hey, I want to switch gears for a minute here, Dan, and talk about Apple. I'm sure you saw this story in "The Wall Street Journal" this morning saying that the company is going to have to push back mass production of its flagship iPhone this year because of the pandemic. How much should investors be worried about that, given the fact that the iPhone makes up such a huge chunk of Apple's revenue?
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DAN HOWLEY: It's interesting, because, you know, we've seen reports saying that this was likely to happen for some time now. Most analysts I've spoken to-- particularly Dan Ives at Wedbush basically saying, look. It's more likely than not going to be delayed. We haven't heard anything, though, about the actual launch-- the launch event that they usually have in September. But if there's still lockdowns going on in September, that's not going to happen. And if there's still military hospitals set up in the country, that's probably not going to happen either. They would push it out a little longer.
I think for analysts and investors, this is something, as I said, was expected. The going thought now is, OK. So we push it forward a little bit or back a little bit. That's still gives people enough time to purchase these devices for the important holiday season. And as you go through the iPhone cell cycle, you'll have Q1-- you have the tail end of Q4, and Q2 where a lot of sales really happen. It's really just the end of Q4 there, though, when the new iPhones come out.
So the older phones start to phase out around Q3 and the bulk of Q4, and then we go back into the cycle. So it seems like they would still have the devices on store shelves for the tail-- the very tail end of Q4, Q1, Q2, and then into Q3.
HEIDI CHUNG: Hey, Dan, it's Heidi here. So a pretty busy week for you. We have a lot of those large cap tech names reporting. We just talked about Apple, but I want to get what The Wall Street analysts here are expecting when it comes to Microsoft, Amazon, a couple of those other names that you closely follow.
DAN HOWLEY: Yeah, I think for the likes of Microsoft and Amazon, Google, a lot of what we're going to be talking about is obviously cloud usage. We talked about how AWS had seen a surge. Azure from Microsoft likely saw a surge as well as Google's cloud platform. Any of these cloud companies are really taking a lot of traffic and as a result of so many people working from home and so many operations now having to be done remotely.
So I think we'll hear a lot about that. And don't forget, you know, these companies don't just provide services for businesses as far as B2B work. They also host platforms like Netflix, so they are going to see a ton of increased traffic, and that will probably bode very well for them. But then you have to think, OK, if the economy starts to slow down, Capex spending from companies will start to slow down, and that may translate into these companies saying, look. Down the line, we might not have the kinds of profits that we were expecting as a result of our cloud platforms simply because other companies aren't signing up for new contracts because they just don't have the bandwidth for it right now.
But I think for the coming quarters, we're going to see gangbusters stuff from them. Microsoft, on the other hand, with their hardware side, probably not. And Google as well. I think it's going to be harder for product side at this point.
BRIAN SOZZI: All right, Dan Howley, thanks so much.
